Kenmore Contracting Co., Inc. And Sloan Steel Erectors And Equipment Rental, Inc.

336 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Kenmore Contracting Co., Inc. and Sloan Steel Erec- tors and Equipment Rental, Inc. and Interna- tional Association of Bridge, Structural and Or- namental Iron Workers, Local No. 6, AFL- CIO. Case 3-CA-11787 June 24, 1988 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND BABSON On September 12, 1984, Administrative Law Judge Winifred D. Morio issued the attached deci- sion. The General Counsel filed exceptions and a supporting brief, and the Respondents filed cross- exceptions and supporting briefs. 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, I and conclusions only to the extent consistent with this Decision and Order.2 The judge found that Kenmore and Sloan are not alter ego corporations and do not constitute a single employer. She concluded, therefore, that they did not violate Section 8(a)(5) and (1) of the Act by failing to apply the terms of the collective- bargaining agreement between Kenmore and the Union to Sloan's employees. For the reasons set forth below, we disagree with the judge's determi- nation, and we find that Sloan is the alter ego of Kenmore and that they have violated the Act as al- leged.3 The facts, which are largely undisputed, are de- tailed in the judge's decision. Kenmore is a steel erection company that performs construction work using its own cranes and equipment. It also leases cranes and related tools, such as welders, to other construction contractors. Kenmore has been owned since 1966 by Jacqueline Hanley and her husband, Hugh Hanley Jr. They are the Company's only of- ficers. Kenmore is a member of the Construction Industry Employers Association, Inc. (CIEA) and, through CIEA, has been party to a series of collec- ' The General Counsel has excepted to the judge's failure to resolve a conflict in the testimony of Fitzpatrick and Hugh Hanley Jr concerning whether the latter said he was paying Sloan employees $7 an hour In view of the decision we have reached, we find it unnecessary to resolve this question of credibility 2 We affirm the judge's finding that the Charging Party Union first ac- quired specific knowledge of the existence of Respondent Sloan approxi- mately I month prior to the filing of the charge We further affirm her conclusion that the charge was timely filed. 3 In view of our finding that the Respondents are alter egos , we find it unnecessary to pass on the General Counsel's alternative allegation that the corporations constitute a single employer tive-bargaining agreements with the Union, the most recent of which was effective from June 1, 1981, through May 31, 1984. The Building Trades Council (BTC), of which the Union is a member, prohibits union employers such as Kenmore from performing construction work at sites where non- union contractors perform work, and the CIEA- union agreement prohibits ironworkers from work- ing for nonunion contractors. On November 4, 1981, two of the Hanley's chil- dren, Cherub and Patrick, then 27 and 21 years old, respectively, formed Sloan, a nonunion steel erection and crane rental company. Cherub is Sloan's president and Patrick is its vice president; they are Sloan's only officers and shareholders. Sloan performs steel erection work in western New York State, the same geographic area that Ken- more services. Sloan rents all the construction equipment it uses from Kenmore, and but for a pickup truck purchased on credit through a friend of the Hanley family, Sloan owns no field equip- ment. Sloan subleases cranes and other tools it rents from Kenmore to third parties. No other Kenmore customers are permitted to engage in third-party rentals. Additionally, unlike other Ken- more customers, Sloan is not required to lease the services of Kenmore crane operators when it uses Kenmore cranes4 and, accordingly, is able to sub- lease Kenmore equipment to third parties using Sloan operators. Sloan's employees-who num- bered 14 on its largest job-are paid approximately one-third of the union wage rate and do not re- ceive fringe benefits. The parties stipulated that both companies share many of the same custom- ers. 5 Sloan's office is an 8- by 10-foot area located within the Kenmore office. Pursuant to an unwrit- ten agreement, it rents this space from Kenmore for $100 a month, a figure unilaterally set by Ken- more. Although Sloan has been as much as 6 months late in rent payments, Kenmore has never required that it pay interest or penalties. Sloan owns no office equipment and uses without addi- tional charge Kenmore's adding machine, typewrit- er, and office supplies. It maintains its own payroll, bank account, books, and records. At the time of the formation of Sloan and con- tinuing through the date of the hearing in these proceedings, Cherub and Patrick Hanley were fi- 4 Hugh Hanley Jr testified that Kenmore once leased a crane without a crane operator to a contractor named Stimm 5 Pursuant to the stipulation, G C Exh 8 indicates that Sloan's only customer in 1981 was also a Kenmore customer , and that in 1982 five of eight Sloan customers were Kenmore customers In 1983 and 1984, re- spectively, 8 of 12 Sloan customers and 12 of 18 Sloan customers were or had been Kenmore customers 289 NLRB No. 56 KENMORE CONTRACTING CO nancially dependent on their parents. Cherub and her son live in a condominium apartment owned by her parents, for which half the mortgage, fees, and utilities are paid by her parents. Her parents also pay her son's school tuition and approximately half the cost of his clothing. Patrick lives with his par- ents when not residing on campus at the Rochester Institute of Technology, and his parents pay his tuition and expenses. Additionally, both Cherub and Patrick were employees of Kenmore at the time of Sloan's formation. Cherub worked as a re- ceptionist for Kenmore until July 1983 at a salary of $150 a week. Patrick was employed as a yard- man. He testified that his employment with Ken- more ceased when Sloan was formed. Although neither Cherub nor Patrick has any previous expe- rience in the industry, Cherub is Sloan's office manager and bookkeeper, and Patrick, whose title is field superintendent, estimates and bids Sloan jobs and supervises work at Sloan construction sites. 6 Cherub used the proceeds ($1400) from the sale of a car her parents had given her to capitalize Sloan. 7 Patrick testified that he contributed $1200 to capitalization, money from a student loan he se- cured for college but did not use for that purpose because his parents financed his education. The judge correctly stated that in determining alter ego status, the Board considers whether the companies have substantially identical ownership, management, business purpose, operations, custom- ers, equipment, and supervision.8 As she pointed out, no one factor is controlling. The judge found, and the record establishes, that Kenmore and Sloan exist for the same business purpose, use some of the same equipment, 9 and share the same premises.10 She also found, however, that this evidence is in- sufficient to outweigh what she deemed to be a lack of common ownership, management, and con- trol over labor relations policy. Contrary to the judge, we find that the evidence establishes that Kenmore and Sloan are commonly owned, operat- ed, and managed and that the record as a whole 6 As a yardman for Kenmore, Patrick helped to load trucks, did odd jobs, and generally kept the yard clean Patrick never operated a crane His only experience estimating a job was for a school project ' Immediately after selling her car, Cherub , through Sloan, rented a car from Kenmore for $ 150 a month As with the office rental, the figure was unilaterally set by Kenmore and although the rent payment was as much as 9 months in arrears, no interest or penalty was charged 8 See Leslie Oldsmobile, 276 NLRB 1314 (1985), Advance Electric, 268 NLRB 1001 (1984), and Crawford Door Sales Co, 226 NLRB 1144 (1976), cited with approval in Goodman Piping Products v NLRB, 741 F 2d 10, 11 (2d Cir 1984) As explained below, the Board has also considered em- ployer motivation in assessing alter ego status 9 As explained , infra, we find that the Respondents use substantially more than "some" of the same equipment 10 We agree with the judge that Hugh's instructing Sloan employees in the proper use of a crane and proper hand signals on August 1, 1983, at the National Fire Adjuster jobsite was too isolated an incident on which to base a finding of common supervision 337 warrants a finding that, the two corporations are alter egos. First, we note that a finding of common owner- ship may be made where, although the same indi- viduals are not shown to be owners of each corpo- ration, the corporations are solely owned by mem- bers of the same family. Watt Electric Co., 273 NLRB 655, 658 fn. 17 (1984); E. G. Sprinkler Corp., 268 NLRB 1241, 1244 (1984), enfd. sub nom. Goodman Piping Products v. NLRB, 741 F.2d 10 (2d Cir. 1984). Granting that the existence of a close family relationship between owners of two compa- nies will not always establish the common owner- ship element in an alter ego inquiry, we see no im- pediment to such a finding here, given the record evidence of Cherub's and Patrick's financial de- pendence on their parents and the less than arm's- length dealings between Kenmore and Sloan in the course of the latter's founding. i i Patrick and Cherub were able to provide the minimal capitalization of Sloan ($2600) only by virtue of aid from their parents. Specifically, Jac- queline's and Hugh's payment of Patrick's tuition enabled him to divert his student loan to the capi- talization of Sloan; and Cherub's initial investment was made possible by the opportunity, immediately on the sale of her car, to lease a car from Ken- more, at a rate set by Kenmore with sporadic rental payments made through Sloan. Concerning Sloan's operations, Kenmore and Sloan share the same premises, office equipment, and supplies and have open access to telephones and workspace. As the record establishes that Sloan owns no equipment except a pickup truck, uses Kenmore cranes for its own erection work, and subleases Kenmore property to third parties, it " We find the instant case distinguishable from cases in which the Board found that alter ego status was not established between corpora- tions in which the owners were members of the same family In Best Me- chanical Contractors, 273 NLRB 83 (1984), in which the closing of the business of M H Best was followed by the opening of a business by his son and son-in-law, the new business did not engage in the same kinds of projects as the old one and its purchases of equipment and other transac- tions with the old corporation were all at arm's length These same cir- cumstances-different markets and arm's- length dealings between the two family-owned corporations-were also present in United Construc- tors, 233 NLRB 904 (1977) In Hillsamer Painting Contractors, 272 NLRB 1366 (1984), the assistance of the lather (who owned Hillsamer) to the son (who owned Commercial Decorating ) was minimal (use of a tele- phone and some clerical assistance for a brief period ) The evidence of financial dependence and subsidizing of the formation of the new enter- prise did not approach what was shown in the present case Likewise, the instant case differs from Victor Valley Heating & Air Con- ditioning, 267 NLRB 1292 (1983), in that in Victor Valley, although the father gave advice and training at the start of the business formed by the son and the son's friend , the son contributed the entirety of the capital (from his own funds and a gift from a grandmother who had no demon- strated connection with the other corporation), and the new corporation paid cash for equipment it received from the father's business Id at 1293, 1297 Victor Valley is distinguishable also for reasons discussed infra at fn 18 338 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD is clear that Kenmore and Sloan share substantially the same equipment. Further, although the Hanleys describe the two corporations as competitors, Sloan's ability to provide equipment to third parties is dependent on its having access to Kenmore equipment without operators . In this regard, Sloan subleases Kenmore equipment to third parties at the same cost it is charged by Kenmore , but de- rives its profits from the amount it charges for also providing an operator. Moreover, Sloan is the only Kenmore customer permitted to engage in third- party rentals.' 2 On two occasions Sloan was awarded jobs it could not perform , and it subcon- tracted both to Kenmore without seeking or invit- ing other bids . On one of those jobs, the Walden job in August 1983 , Kenmore earned $800 or more as the subcontractor while Sloan received only $100. On the Iroquois Central School project that was subcontracted to Kenmore, Sloan made no profit at all. In addition to this evidence concerning Sloan's manner and method of doing business , the record reveals that Jacqueline and Hugh Hanley and Ken- more employee Tina Kasinski are integrally in- volved in Sloan's everyday affairs, including an- swering telephones, noting records, bookkeeping, and preparing job estimates and specifications, tool lists, and payroll. In this regard , we note that Ka- sinski completed substantial portions of Sloan's in- dividual payroll records , including those pertaining to Cherub's and Patrick's earnings, for the 23-week period from July through December 1983.13 Her entries and calculations, as well as those made by Jacqueline, also appear frequently in Sloan's cash disbursement/payroll journal for the months of March through December 1983. A review of Sloan invoices for that year reveals that Jacqueline took a customer order (invoice 8438) and twice wrote in notations instructing that no tax should be charged Sloan customers (invoices 8427 and 8431 ).14 At- 12 Sloan is also the only Kenmore customer permitted to select the actual cranes and tools it desires , and frequently rents them without exe- cuting the customary Kenmore paperwork 13 Kasinski's weekly entries account for nearly all the entries for all employees for August 14 Notwithstanding Cherub's explanation that Sloan was "new in the business" and uncertain about some tax matters, we note that the invoices noted "no tax" are dated November 1983 and involve equipment rentals, a service that Sloan had provided for 2 months and that Kenmore had provided Sloan for 2 years Regarding invoice 8416, which bears Jacque- line's instruction to "continue billing Spancrete," Patrick testified that al- though he could not actually explain the notation , he believed he may have asked his mother to mark the invoice on an occasion when he tele- phoned the office while Cherub was out We also note that Patnck was away at school during the fall of 1983 and that Cherub attended office courses during the summer and fall of that year Although Sloan hired Linda Longobardi on September 29 to help around the office , she was laid off on November 8 and worked only 56 hours in the 7 weeks she was employed , usually 3 .5 hours on Monday and Tuesday of each week In light of these facts, it appears that there tachments to Sloan invoices 8432, 8410, 8411, and 8412 are price specifications drawn up by Hugh. Invoices 8432 and 8411 also have attachments in Patrick's handwriting. It is noteworthy that while Patrick and Hugh's figures for invoice 8432 are the same, the price actually billed on invoice 8411 is the one calculated by Hugh. Significantly, those in- voices that reflect Jacqueline's, Hugh's, and in one instance Hugh III's' 5 input account for more than half of Sloan's income from erections and rentals for 1983. Also relevant to our analysis is Cherub's salary as a Kenmore receptionist, which was nearly three times that of her Sloan salary between November 1981 and August 1983, even though, she testified, she divided her workday equally between the two companies. She earned $150 a week from Kenmore and $55 a week from Sloan until the pay period ending July 31, 1983, when she purportedly ceased working for Kenmore and began earning $150 a week from Sloan. 16 What is most salient about Cherub's salary is that Sloan records show that Cherub's first paycheck at the higher salary was written on August 3, 1983, 2 days after Union Rep- resentative Fitzpatrick encountered Hugh at a Sloan jobsite. Patrick's salary likewise increased, from $55 to $140, on August 3. We find it relevant, too, under the circum- stances, that Patrick painted the exterior of the Kenmore building at a time when he was no longer a Kenmore employee. Patrick testified variously that he received only his regular Sloan salary for this work, that he "imagine[d]" Kenmore paid Sloan but "to be perfectly honest" he did not know, and that Sloan was compensated but the price was left "to the owner of the building."' 7 In our view the foregoing evidence, particularly Sloan's unique and total reliance on Kenmore for equipment rentals and the day-to-day input of Ken- more personnel in Sloan's affairs, establishes that the operations of Kenmore and Sloan are so inter- were frequent and substantial periods of time when no Sloan personnel were present in the office at all 15 Hugh Hanley III is another of Jacqueline and Hugh Jr 's children He is an ironworker and has been employed by Kenmore 16 Cherub did not articulate any reason for her ceasing to work for Kenmore, nor did she indicate that her termination resulted in her ceas- ing, for example, to answer Kenmore phone calls or to perform other re- ceptionist's duties 17 We note, but find no need to base our finding of common oper- ations on the fact that Patrick painted a 35-ton Kenmore crane Cherub denied knowing that any equipment was painted but stated that the equipment needed it and surmised that the improvement would make for a better impression Kenmore employee R Barry Miller, who is Jacque- line and Hugh's nephew, testified that Patrick often selected equipment that did not bear the Kenmore name and acknowledged that his cousin painted a crane Patrick admitted painting over Kenmore 's name on the crane, but stated that he did so to avoid the equipment's being vandalized by persons unhappy with a nonunion company's presence at construction sites KENMORE CONTRACTING CO. related and symbiotic as to be substantially identi- cal.18 Even apart from its bearing on the substantial identity of operations between the two companies, Jacqueline and Hugh's involvement in Sloan affairs, as described above, evidences that they were vested with decision-making authority. Thus, Jac- queline and Hugh quoted prices to Sloan custom- ers, Jacqueline resolved a Sloan customer's com- plaint and a dispute a Sloan employee had with his paycheck, and Hugh estimated Sloan jobs and pre- pared tool lists while Patrick was away at school. Moreover, Cherub testified that she was not aware of her father's price quoting or whether he was au- thorized to do so and that in an instance in which her mother made a notation in Sloan's records about a problem with a customer, Cherub did not know what the discussion between her mother and the Sloan customer related to or what the notation meant.19 The extent of this authority, we find, is a manifestation of common management in the two corporations. Finally, Patrick testified that although he never discussed the matter with his father, he knew from working with Kenmore and from reading articles about a decline in unionism in the United States that former Kenmore customers which were previ- ously union shops had become nonunion and that they would seek nonunion companies such as Sloan to perform steel erection.20 It thus is evident from Patrick's testimony that Sloan was created at least in part to do business with nonunion customers and to perform work at sites at which Kenmore was prohibited by the BTC from working. The intent to operate a nonunion company and to build a cus- tomer base of nonunion companies does not, with- out more, manifest an unlawful purpose or indicate antiunion animus. However, where the nonunion corporation's operations are so interrelated with its union counterpart as to be substantially identical, and the corporations share a common business pur- pose, customers, management, and owners, such a 18 Sloan's near total dependence on Kenmore further distinguishes this case from Victor Valley Heating, supra From its formation , Concord, the nonunion business established by the son, had its own offices, equipment, and tools The trucks that it leased from Victor Valley were essentially surplus since Victor Valley had gone into a different kind of business, and there was no evidence that the monthly lease payments by Concord (which included a 10-percent profit for Victor Valley) represented less than the market rate 267 NLRB at 1293, 1297 19 Cherub's testimony in this regard strains credibility , given the office arrangement and the fact that she is Sloan 's highest-ranking officer and the custodian of its records The judge did not discredit the testimony, however Assuming its veracity, Cherub's ignorance about such matters gives rise to an inference that her parents held considerable decision- making authority in Sloan 20 Hugh testified that Kenmore had lost a lot of jobs because of BTC restrictions on union contractors 339 stated intent is further evidence of alter ego status.21 In view of all the foregoing, we find that Ken- more and Sloan are alter egos. As the record estab- lishes that Sloan failed to apply the terms of the union contract to its ironworker employees, we find further that Kenmore and Sloan have violated Section 8(a)(5) and (1) of the Act by their failure to do so. REMEDY Having found that Sloan and Kenmore unlawful- ly failed to apply the terms of the collective-bar- gaining agreement between Kenmore and the Union to Sloan's ironworker employees, we shall order that they cease and desist and that they maintain and give full force and effect to the 1981- 1984 CIEA-union contract retroactive to February 26, 1983,22 and amendments and subsequent agree- ments covering the unit employees, 2 3 to which Kenmore is a party. Kenmore and Sloan will be re- quired to take the actions necessary to fulfill their contractual obligations, including but not limited to: (1) reimbursing their former and current em- ployees for any loss of wages and benefits they may have incurred since February 26, 1983, be- cause of the Respondents' failure to apply the es- tablished terms and conditions of the agreement, with interest;24 (2) making all required payments to the various trust funds established by the collec- tive-bargaining agreements;25 and (3) reimbursing their employees for actual costs they incurred (such as payments to health care providers and to third-party insurers) by reason of the Respondents' failure to make required contributions to agreed-on health care and insurance plans, with interest.26 Additionally, in view of the nature of employment in the construction industry, we find that posting notices at the Respondents' place of business is in- adequate to inform the Respondents' present and 21 See Advance Electric, 268 NLRB at 1004 22 The normal remedy for violations of this nature is limited to the 10(b) period, in this case 6 months pnor to the filing of the charge on August 26, 1983, and no basis has been shown in the present case for a departure from this rule See Al Bryant, Inc, 260 NLRB 128 In 3 (1982). 23 The appropriate unit is ironworkers and ironworker apprentices em- ployed by Kenmore Equipment Contracting Co, Inc and Sloan Steel Erection and Rental Equipment, Inc 24 In accordance with our decision in New Horizons for the Retarded, 283 NLRB 1173 (1987), interest on and after January 1, 1987, shall be computed at the "short-term Federal rate" for the underpayment of taxes as set out in the 1986 amendment to 26 US C § 6621 Interest on amounts accrued prior to January 1, 1987 (the effective date of the 1986 amendment to 26 US C § 6621), shall be computed in accordance with Florida Steel Corp, 231 NLRB 651 (1977) 25 Interest, if any, on trust fund contributions, shall be determined at the compliance stage of this proceeding in the manner set forth in Merryweather Optical Co, 240 NLRB 1213 (1979) 26 Interest on these sums shall be computed in the manner set forth in fn 24, supra 340 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD former employees of their rights under this Deci- sion and Order. Therefore, we shall order that in addition to posting the attached notice at their place of business, the Respondents will post copies of the notice at their jobsites, and furnish signed copies of the notice to the Union for posting at the Union's office and meeting places.27 ORDER The National Labor Relations Board orders that the Respondents, Kenmore Contracting Co., Inc. and Sloan Steel Erectors and Equipment Rental, Inc., Cheektowaga, New York, their officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Failing or refusing to recognize and bargain collectively in good faith with International Asso- ciation of Bridge, Structural and Ornamental Iron Workers, Local No. 6, AFL-CIO as the exclusive bargaining representative of their employees in the appropriate unit, and failing or refusing to honor collective-bargaining agreements applicable to those employees. (b) In any like or related manner interfering with, restraining, or coercing employees in the ex- ercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action neces- sary to effectuate the policies of the Act. (a) Maintain and give full effect to the 1981-1984 collective-bargaining agreement between Iron Workers Local No. 6 and the Construction Indus- try Employers Association, Inc. retroactive to Feb- ruary 26, 1983, and any amendments and subse- quent agreements covering the unit employees, ret- roactive to February 26, 1983, including but not limited to: (1) making whole all unit employees for any loss of wages and benefits they may have in- curred since February 26, 1983, because of the Re- spondents' failure to apply or maintain the estab- lished terms and conditions of such agreements; (2) making required payments to the various trust funds established by the collective-bargaining agreements; and (3) reimbursing their employees for any actual expenses they incurred which ensue from the Respondents' failure to make such contri- butions; all as set forth in the remedy section of the decision. (b) Preserve and, on request, make available to the Board or its agents for examination and copy- ing, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the 27 See generally Apex Decorating Co, 275 NLRB 1459 (1985) amount of backpay due under the terms of this Order. (c) Post at their place of business and at each of their jobsites copies of the attached notice marked "Appendix."28 Copies of the notice, on forms pro- vided by the Regional Director for Region 3, after being signed by the Respondents' authorized repre- sentative, shall be posted by the Respondents im- mediately upon receipt and maintained by them for 60 consecutive days in conspicuous places includ- ing all places where notices to employees are cus- tomarily posted. Reasonable steps shall be taken by the Respondents to ensure that the notices are not altered, defaced, or covered by any other material. (d) Sign and return to the Regional Director suf- ficient copies of the notice for posting by the Union, if it is willing, at its office and meeting halls, including all places where notices to mem- bers are customarily posted. (e) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondents have taken to comply. 28 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 " APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. WE WILL NOT fail or refuse to recognize and bargain collectively and in good faith with Interna- tional Association of Bridge, Structural and Orna- mental Iron Workers, Local No. 6, AFL-CIO as the exclusive representative of our employees in the appropriate unit, or fail or refuse to honor col- lective-bargaining agreements applicable to those employees. The appropriate unit is: All ironworker and ironworker apprentice em- ployees employed by Kenmore Contracting Co., Inc. and its alter ego, Sloan Steel Erec- tors and Equipment Rental, Inc., excluding all other employees, professional employees, guards and supervisors as defined in the Act. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer- KENMORE CONTRACTING CO. cise of the rights guaranteed you by Section 7 of the Act. WE WILL maintain and give full effect to the col- lective-bargaining agreement between Local 6 and the CEIA and its employer-members which was ef- fective by its terms from June 1981 through May 1984, and any amendments and subsequent agree- ments covering the unit employees , retroactive to 26 February 1983, and including but not limited to (1) Making whole all unit employees for any loss of wages and benefits they incurred be- cause of our failure to apply or maintain the established terms and conditions of such agree- ments, with interest, (2) Making required payments to the various trust funds established by the collective-bar- gaining agreements, (3) Reimbursing our employees for any actual costs they have incurred which ensued from our failure to make required contribu- tions to contractually established trust funds, with interest. KENMORE CONTRACTING CO., INC. AND SLOAN STEEL ERECTORS AND EQUIPMENT RENTAL, INC., ALTER EGOS Doren G. Goldstone, Esq., for the General Counsel. Joseph L. Randazzo, Esq. (Flaherty, Cohen, Grande, Ran- dazzo & Doren, P.C.), of Buffalo , New York, for Re- spondent Kenmore. Marto J. Rossetti, Esq., of Buffalo, New York, for Re- spondent Sloan. DECISION STATEMENT OF THE CASE WINIFRED D. MORIO, Administrative Law Judge. This case was tried before me from January 16-18, 1984, in Buffalo, New York. The complaint, which was issued by the Regional Director for Region 3, on October 7, 1983, alleged, in substance, that Kenmore Contracting Co., Inc. (Respondent Kenmore) and Sloan Steel Erector and Equipment Rental, Inc. (Respondent Sloan) are either alter ego corporations or constitute a single employer within the meaning of the Act and that Respondent Sloan, since on or about January 1983, has failed to apply the terms and conditions of employment , contained in the collective-bargaining agreement in existence be- tween Respondent Kenmore and International Associa- tion of Bridge, Structural and Ornamental Iron Workers, Local No. 6, AFL-CIO (the Union), to its employees and has failed to recognize and bargain with the Union as the exclusive bargaining representative of the employ- ees of both Respondents in a combined unit . The answers filed by Respondent Kenmore and Respondent Sloan deny that the corporation are alter egos or constitute a single employer within the meaning of the Act and also 341 deny that the combined employees of Respondent Ken- more and Respondent Sloan constitute an appropriate unit as defined in Section 9(b) of the Act . The answer filed by both Respondents also claim that the Union has not demanded that Respondent Kenmore or Respondent Sloan apply the collective-bargaining agreement in exist- ence between Respondent Kenmore and the Union to the employees of Respondent Sloan . Finally, the answer filed by both Respondents allege that the complaint is time barred by Section 10(b) of the Act. All parties were given a full opportunity to participate in the proceedings, to cross-examine witnesses , to argue orally, and to file briefs. Briefs were filed by all parties. On the entire record in the case and my observation of the witnesses and after careful consideration, I make the following FINDINGS OF FACT 1. JURISDICTION At all times material, the principal place of business of Respondent Kenmore has been located at 1560 Harlem Road, Cheektowaga, New York, where it is and has been engaged in the steel erection and equipment rental business. During the past year Respondent Kenmore, in the course and conduct of its business operations , provid- ed services valued in excess of $50 ,000 for Morton Salt Co., an enterprise directly engaged in interstate com- merce. The parties admit, and I find, that Respondent Kenmore is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. The record fails to disclose jurisdictional facts with respect to Respondent Sloan. It is the position of counsel for the General Counsel that the jurisdiction over Respondent Sloan is based on "whether the Respondents are alter egos or in the alternative single employers." II. THE LABOR ORGANIZATION The parties admit , and I find, that the Union is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES Respondent Kenmore was established in 1919, and in 1966 its outstanding stock was purchased by Hugh Hanley Jr. and Jacqueline Hanley, who are presently, re- spectively, vice president and president 1 Respondent Kenmore is and has been a member of the Construction Industry Employers Association , Inc. (CIEA), and as such, has been a party to collective-bargaining agree- ments with several labor organizations, including the Union. The most recent agreement between Respondent Kenmore and the Union was effective between June 1981 and May 1984. Hugh Hanley Jr. has been a member of the negotiating committee for CIEA for over 12 years and is a trustee for the Iron Workers Health Care and Pension Fund . According to Hanley , Respondent Ken- more and other members of CIEA have been advised by the Building Trades Council , of which the Union is a ' These are the only officers of the corporation 342 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD member, that union contractors cannot bid on a job if there is a nonunion contractor on the job. Hanley testi- fied that Respondent Kenmore lost "quite a few jobs" as a result of that directive. In November 1981, Cherub and Patrick Hanley, who are the children of Jacqueline and Hugh Hanley Jr. formed the corporation, Respondent Sloan, with Cherub as president and Patrick as vice president.2 The corpora- tion was formed to perform essentially the same type of work performed by Respondent Kenmore, in basically the same geographic area, in the western part of New York State. At the time they formed the corporation Cherub and Patrick were, respectively, 27 and 21 years of age and both were receiving financial assistance from their parents. Thus, Cherub Hanley, although living with her son in her own residence, received approximately one-half of her expenses for rent, utilities, and her son's clothes and education needs from her parents.3 Patrick Hanley, both at the time of the formation of the corpora- tion and at the time of the hearing, resided with his par- ents when not attending school and received financial as- sistance from them for his education and living expenses. Both individuals claim that they formed Respondent Sloan to gain financial independence and because they saw a limited future if they continued with their employ- ment with Repsondent Kenmore. Cherub Hanley was employed in November 1981 as a receptionist for Re- spondent Kenmore and Patrick Hanley was employed as a yardworker. Although both individuals contend that they had considerable knowledge about the steel erection and equipment rental business by virtue of their relation- ship with their parents, the record fails to reveal that these individuals had performed the type of work in- volved in the steel erection industry, or had supervised the performance of such work. There is also no evidence that either Cherub or Patrick Hanley had submitted bids for steel erection jobs or estimated such jobs prior to the formation of Respondent Sloan. It also appears that both Cherub and Patrick Hanley had limited education back- grounds in the business area. Cherub Hanley, at the time of the formation of Respondent Sloan, had some book- keeping courses while in high school and Patrick Hanley had received an associate degree in construction technol- ogy from Erie Community College (ECC) and had com- menced his freshman year at Rochester Institute of Tech- nology (RIT).4 According to the testimony of Cherub and Patrick Hanley, the formation of Respondent Sloan was funded by $1400 from Cherub and $1200 from Patnck. These moneys, apparently, were used for incorporation fees, for letterheads, and for the salaries of Cherub and Patrick. Cherub Hanley testified that she secured her moneys from the sale of her car, which had been a gift from her parents. Patrick Hanley testified that he secured the money he put into the corporation from a loan he had 2 Cherub and Patnck are the only officers of this corporation 9 She was receiving the same type of assistance at the time of the hear- ing 4 It appears that sometime after the formation of the corporation, Cherub Hanley took an adult education class in bookkeeping and an ac- counting course at ECC Patrick was scheduled to receive his degree from RIT in May 1984 secured for school purposes, but which he did not apply to that purpose because his school tuition was paid by his parents. Cherub Hanley testified that when she sold her car in November 1981 Respondent Sloan leased a car, which she began to use in November 1981, from Re- spondent Kenmore. The car was leased for the sum of $150 per month, a figure that was determined by Re- spondent Kenmore. However, it does not appear that Respondent Sloan began to make the payments for leas- ing the car until some months after November 1981.5 Commencing in November 1981, Respondent Sloan rented office space from Respondent Kenmore. The space rented was in a building owned by Respondent Kenmore and was on the same floor where the office of Respondent Kenmore was located and where other ten- ants, who rented desk space from Respondent Kenmore, also were located. The area rented by Respondent Sloan, approximately 8 by 10 feet, was separated by a partition from the area used by Respondent Kenmore and the other tenants and it contained a desk and phone, both of which were used by Cherub and Patrick Hanley. There was no written lease for the use of office space between the two Respondents or, apparently, between Respond- ent Kenmore and other tenants. Initially, according to C. Hanley, Respondent Sloan had planned to use the 25 Gratton Street entrance as the address for the new cor- poration rather than 1560 Harlem Road address used by Respondent Kenmore. However, that plan was not fol- lowed because the space near the Gratton entrance was leased to another tenant. Respondent Sloan agreed to pay the sum of $100 a month to Respondent Kenmore as a rental fee.6 However, Respondent Sloan was frequent- ly late in making these monthly payments, sometimes for periods as long as 6 months, and it was not required to pay either interest or late payment penalties. C. Hanley testified that this same courtesy was extended to other tenants by Respondent Kenmore due to the difficult fi- nancial conditions in the area. The younger Hanleys did not purchase office equipment when they formed Re- spondent Sloan but used Respondent Kenmore's office equipment and they had free access to the entire area outside the space occupied by Respondent Sloan. It also appears that C. Hanley used office supplies of Respond- ent Kenmore, including timesheets and scratch pads, without reimbursing Respondent Kenmore for the use of the material.7 C. Hanley testified that she received per- mission to use the office equipment and supplies and she "assumed" that the use of these supplies was included in the monthly rental fee, although the matter was not dis- cussed when the fee for the office space was negotiated. After the formation of Respondent Sloan, C. Hanley continued her employment with Respondent Kenmore as a receptionist. She was paid $150 a week by Respondent Kenmore for that work, which included typing duties 5 Cherub Hanley testified that she knew "some time went by" before Respondent Sloan began to make payments for the lease of the car, al- though she was uncertain as to the length of time She also testified that at the time of the hearing she was "caught up" with the car payments 6 Hanley testified that, initially, rent was paid to Jacqueline C Hanley and then it was paid to Respondent Kenmore 7 Respondent Sloan, however, did have its own forms, including in- voices KENMORE CONTRACTING CO. and answering phones. She was also paid $50 a week by Respondent Sloan and her duties included preparing pay- checks, distributing them at the jobsites,8 paying taxes and other bills and in general maintaining the financial records for Respondent Sloan. On at least one occasion she authorized a Respondent Kenmore employee to pur- chase equipment, however, it is unclear when this oc- curred. The record reveals that during the period be- tween November 1981 and July 1983, C. Hanley divided her hours of work equally between the corporations, al- though there was a substantial difference in the moneys she received from the corporations. It does not appear that C. Hanley was required to or did work specific hours for either corporation. In July 1983, C. Hanley ceased working for Respondent Kenmore and about the same time her salary for Respondent Sloan was increased to $150 a week. As noted, part of the duties C. Hanley performed for Respondent Sloan included maintaining the books of that corporation. It is conceded that prior to her employment with Respondent Sloan, C. Hanley had limited actual ex- perience in bookkeeping duties. The record reveals that C. Hanley received assistance with respect to these duties from Tina Kazinski, an employee of Respondent Kenmore. This assistance was not limited to the time when Respondent Sloan began its operations but contin- ued through 1983. In fact, in many instances it was Ka- zinski who actually prepared the records for Respondent Sloan. Thus, C. Hanley testified that Kazinski wrote the names and addresses of Respondent Sloan employees on compensation forms and entered the number of exemp- tions for each employee on these forms. An examination of Respondent Sloan's payroll and timesheet records9 for 1983 discloses that, although C. Hanley made entries on these records, numerous entries were made also by Ka- zinski and to a lesser degree by Jacqueline Hanley. 10 The parties stipulated that in the instances where Kazins- ki's handwriting appeared it was she who computed the figures that appeared in the record. C. Hanley testified that she requested Kazinski to prepare the payroll when she was not available1' and "she does it as part of the rents which I pay Kenmore, the hundred dollars a month." At another point, C. Hanley testified that she did not pay wages to any Respondent Kenmore employ- ee for work done in connection with Respondent Sloan's s She had on occasion brought paychecks to a jobsite for Respondent Kenmore's employees 9 G C Exhs 3 and 4 The parties agreed that with respect to these exhibits and also G C Exh. 7, a red marking pen was used to identify Kazinski's handwriting , a black marking pen was used to identify Jacque- line Hanley's handwriting, a blue ball pen was used to identify C Han- ley's handwriting, entries made by Hugh Hanley Jr are identified by the words "Hugh Jr ", Patrick Hanley's handwriting is identified by the word "Pat", the handwriting of Respondent Sloan employee Linda Lon- gobardi is identified by the word "Linda", the handwriting of Respond- ent Kenmore's employee Hugh Hanley III is identified by the word "Hugh III " 1° An entry made by Jacqueline Hanley indicated that an employee was owed moneys C Hanley testified that neither she nor her brother was in the office when the employee called and her mother took the mes- sage, noted it on the payroll record , and subsequently the employee was paid 11 C Hanley attended school after July 1983 during the day Howev- er, C Hanley had hired another employee in October 1983 , Linda Lon- gobardi, to assist in the office work 343 payroll. C. Hanley did not know if she asked her parents whether she could use the services of Kazinski to assist her in preparing Respondent Sloan's records. 12 In addition to these records, an examination of the in- voices of Respondent Sloan reveals that entries were made on these documents by Jacqueline Hanley, Hugh Hanley Jr., and Hugh Hanley III, who is a son of the senior Hanleys and an employee of Respondent Ken- more. On an invoice for a project for a company, Na- tional Fire Adjusters, 13 the words, "Pat call Ober- sheimer if you disagree" appear and they were written by Jacqueline Hanley. C. Hanley testified that it was her mother who received the call from the customer because neither she nor her brother Patrick was in the office. She did not know what, if any, discussion her mother had with the customer, and she did not know what the nota- tion meant. There was also a document bearing a Re- spondent Kenmore's letterhead attached to an invoice for a company, G. A. Dyce, dated November 30, 1983.14 On the document, bearing Respondent Kenmore's letter- head, there is a notation, about a customer's order, in the handwriting of Jacqueline Hanley. C. Hanley explained that her mother also took this order because she and her brother were not in the office. The record reveals that several documents attached to an invoice for another company, Norcan Steel Corp., dated November 7, 1983,15 are in the handwriting of Hugh Hanley Jr. and Hugh Hanley III and these documents described both the type of work to be performed and the price to be charged for this work. 16 C. Hanley was unable to ex- plain the involvement of her father and brother in this project, which was a Respondent Sloan job, and she was unable to state whether they were paid by Respondent Sloan for their services. An invoice for a company, Spancrete Northeast, dated November 19, 1983,17 con- tains a notation in Jacqueline Hanley's handwriting, "contract price, no tax." C. Hanley testified that it was her brother who received the call about this order but her mother reviewed the order because it involved a question about whether tax should be paid. According to C. Hanley, she did seek her mother's advice about tax questions because she was new in the business and unfa- miliar with tax matters.18 Another invoice for Norcon Steel Corp., dated November 30, 1983,19 also has at- tached to it, in the handwriting of Hugh Hanley Jr., the work to be performed and the price to be charged for the job. C. Hanley could not explain why her father was involved in making this estimation of the job but she did note that in another document attached to this invoice, 13 C Hanley testified that employees of Respondent Kenmore assisted other tenants with the maintenance of records In fact, Respondent Ken- more's secretary, Shelly Schintsius, prepared the payroll for one of Re- spondent Kenmore's other tenants 13 G C Exh 7, invoice 8313 14 G C Exh 7, invoice 8438 15 G.C Exh 7, invoice 8412 16 C Hanley claimed that the paper with Respondent Kenmore's let- terhead was borrowed from that company and she assumed that it was paid for by the moneys paid for the rent 17 G C Exh 7, invoice 8431 18 C Hanley was unable to explain why her mother did not respond verbally to her inquiries. 19 G C Exh 7, invoice 8432 344 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD her brother Patrick also quoted the same price for the job. Finally, an invoice for a company, CJS Sign, dated November 7, 1983, has a document attached to it, in the handwriting of Hugh Hanley Jr., which describes the work to be performed and the price to be charged. C. Hanley admitted that the job was performed at the price quoted by her father to the customer. However, she tes- tified that she did not know whether her father had the authority, generally, to quote prices to customers for work to be performed by Respondent Sloan. The record establishes that after Respondent Sloan commenced its operations it had 1 job in 1981, 7 jobs in 1982, and 13 jobs in 1983, and during this period it em- ployed as few as 3 employees20 in 1981 and as many as 12 to 14 employees in the summer of 1983. Respondent Sloan was engaged in basically the same type of business as Respondent Kenmore, i.e., construction work and the rental of crane equipment. However, Respondent Sloan did not own the crane equipment it rented to third cor- porations but, rather, it rented this equipment from Re- spondent Kenmore.21 There was no verbal or written agreement between the two Respondents that permitted Respondent Sloan to rent Respondent Kenmore's equip- ment to third corporations, and it does not appear that Respondent Kenmore had permitted corporations, other than Respondent Sloan, to rent its equipment to third parties. Respondent Sloan charged these third corpora- tions the same rental fee it had been charged by Re- spondent Kenmore and, thus, did not make a profit on the rental of the equipment. The profit, according to C. Hanley, was made from the moneys that were charged for the services of Respondent Sloan's employees who operated the equipment. Respondent Sloan's employees were nonunion. Respondent Kenmore, prior to this time, had not rented its equipment to other companies without an operator, who was a member of the Union. The record fails to establish that the extra moneys derived by Respondent Sloan from the rental of Respondent Ken- more's equipment was shared with Respondent Ken- more.22 C. Hanley testified that representatives of Re- spondent Kenmore were aware that their equipment was being rented by Respondent Sloan to other corporations. In addition to the crane equipment, which it rented, Respondent Sloan also rented toolboxes from Respond- ent Kenmore. These toolboxes contained the smaller tools needed on a job. Patrick Hanley testified that the type of job determined the type of tools needed and, generally, he was able to prepare the tool list for the job for his company, although on occasion he sought his fa- ther's assistance, and his father gave him advice without charging him for the services. However, another witness, R. Barry Miller, who was Hanley's cousin and an em- ployee of Respondent Kenmore, testified that he had ob- 20 This number did not include Cherub and Patrick Hanley 21 Patrick Hanley testified that it was usual for a company renting Re- spondent Kenmore equipment to sign for the equipment , although some did not, including Respondent Sloan He also testified that when he rented the equipment he preferred to take equipment that did not have the Kenmore name, because he did not want to worry "about people trying to destroy the Kenmore equipment because they are upset renting to a non-union company " 22 At least one-half of Respondent Sloan 's income was secured from the rental of equipment served Hanley Jr.'s handwriting on Respondent Sloan tool lists when Patrick was at school. He did not know, however, if Patrick had called in the list of tools he needed for a job to his father. Miller, further, testified that when Patrick Hanley rented equipment he would specify which particular equipment he wanted and, usu- ally, he preferred the equipment that did not have the Respondent Kenmore's name on it.23 According to Miller, Patrick Hanley told him he wanted the unmarked equipment because he did not want other people to know that he used Respondent Kenmore's equipment on the jobs his company was doing.24 As noted, Patrick Hanley was 21 years old when he formed Respondent Sloan with his sister . During the period of time from November 1981 until about June 1983, Hanley worked for Respondent Sloan on weekends and during school recess. Hanley testified that he was fa- miliar with the steel erection industry at the time of the formation of his company due to his family background. However, the record establishes that his actual knowl- edge about construction work was limited to some courses he had when he attended school. His pnor work experience, as a Respondent Kenmore employee, did not involve actual construction work but involved the duties of cleaning the yard and fixing tools. Hanley admitted that he was not "a very good mechanic" and that he had been at jobsites only when he drove to work with his father and his father stopped to check the site. Notwith- standing this lack of experience in the field, Patrick Hanley claimed that he secured and estimated jobs for Respondent Sloan,25 performed actual construction work, and supervised the other employees of Respondent Sloan, who performed steel structure work. According to Hanley, in order to secure customers he checked phone books for companies in the steel sales business and he spoke to employers with whom his father had done business and he tried to convince them to do business with his company. The first job he secured was from a prior customer of Respondent Kenmore who he knew "was getting more into an open shop area."26 Hanley ex- plained that he was aware that employers in the area were interested in doing business with a nonunion or open-shop employer and he had observed that companies who had agreements with unions "switched" and became nonunion and were unable to get more work. Hanley claimed that he did not discuss this issue with his father but he was aware of these changes from his observation and from what he heard at school or read in magazines. He testified, "I could give you all kinds of references on magazines, articles, such as that show the decline of un- ionism in the United States, thus pushing, making the open shop the better way to go." 23 Miller stated that Patnck took whatever equipment he wanted and was not required to sign a rental form, although other companies were required to do so 24 The only equipment owned by Respondent Sloan was a pickup truck that was used for jobs and as a mode of transportation for Patrick This truck was purchased from a friend of the Hanley family and was financed by a bank loan 26 Hanley's only prior experience in estimating a job involved work he did for school projects. 26 The job involved the erection of steel joists and a metal deck KENMORE CONTRACTING CO. Patrick Hanley testified that he was able to secure sup- plies for jobs for his company without paying money, signing a purchase order, without collateral, and without a credit rating. In one instance Hanley was able to pur- chase a fire escape, which cost $2800, in such a manner, he attributed his ability to make such purchases without advancing money or signing a loan for them to "an honest face or trusting or whatever." There is no evi- dence that his parents or their corporation vouched for his honesty or guaranteed that these supplies would be paid. Patrick Hanley claimed that his first priority was to secure jobs for Respondent Sloan. However, he admitted that when he went to a company to bid on a job and he secured their drawings to prepare a bid, he allowed his father to examine the drawings he had borrowed, and at times his father made a bid on the same job. According to Hanley, he also subcontracted two jobs, on which he had been the successful bidder, to Respondent Kenmore. Prior to subcontracting to Respondent Kenmore, Hanley did not seek bids from other companies, although on one of the jobs Respondent Sloan did not gain any financial benefit.27 Respondent Kenmore also extended courtesies to Respondent Sloan that it did not extend to other com- panies. Thus, Patrick Hanley was permitted to store his scrap material at Respondent Kenmore's yard without any charge, and he was assisted by Respondent Kenmore employees in loading his truck or the equipment he rented.28 When Patrick Hanley began to work for his company his salary was $50 per week, but it was increased to $140 per week in late July or early August 1983. It is unclear from this record whether Hanley continued to receive a salary from Respondent Kenmore after November 1981, but he did continue to work for that company as a yard- man, he helped to load and unload trucks, and on one occasion he painted the Respondent Kenmore building. Patrick Hanley's testimony about whether he was paid for this work is contradictory: at one point he could not recall if he was paid, and at another point he testified that he "must" have been paid. Patrick and Hugh Hanley Jr. both testified that Patrick sought advice on several occasions from his father and other Respondent Kenmore employees about how to es- timate a job and about other problems that arose on Re- spondent Sloan jobs.29 The record does not reflect whether Patrick always followed this advice, although it does appear from Miller's testimony that the two Han- leys did not always agree about a problem. Respondent Sloan did not pay for this assistance. Hugh Hanley Jr. admitted that a bid based on an incorrect estimation could cause serious problems for a company and that, usually, the individual who did the estimation work had to have experience in such a job, although it was not 27 It does not appear that any representative of Respondent Sloan went to the jobsite to examine the work that had been subcontracted 2e Miller testified that he assisted Hanley, and the representatives of other companies, to load material on equipment rented for Respondent Kenmore 29 There is no evidence of employee interchange, nor does it appear that employees of one corporation were transferred to the payroll of the other corporation 345 necessary for the experience to be gained from doing actual construction work. In fact, the employee who did the estimations for Respondent Kenmore did not have prior field experience, although he did have experience as an estimator in the fabrication field, which is not field- work. The record reveals that Respondent Sloan is a member of the National Association of Women in Construction and the Construction exchange. It is not a member of CIEA. The record also establishes that the two corpora- tions maintain separate payroll records, have separate telephone numbers, are listed separately in the telephone book, and maintain separate financial records. It fails to reveal any direct payment of moneys from Respondent Sloan to Respondent Kenmore. The employees of Re- spondent Kenmore are paid according to the Union's collective-bargaining agreement and they receive fringe benefits. The employees of Respondent Sloan are paid at a lower wage level and do not receive fringe benefits. There is no evidence that Patrick Hanley or Cherub Hanley hired, disciplined, or discharged any Respondent Kenmore employee. Nor does the record reflect that Hugh Hanley Jr. or Jacqueline Hanley hired, disciplined, or discharged any Respondent Sloan employee. There is, however, one instance that counsel for the General Counsel contends establishes that Hugh Hanley Jr. super- vises and directs the work of Respondent Sloan employ- ees. In late July or early August 1983 Respondent Sloan commenced work at the National Fire Adjuster jobsite. The income for this job was the largest received by Re- spondent Sloan to that date. It is significant, the General Counsel asserts, that at the start of this job, Patrick paint- ed over the name of Respondent Kenmore on the crane rented by his company, the name of Cherub Hanley was removed from Respondent Kenmore's payroll, and Pat- rick Hanley received a substantial pay increase.30 In early August 1983, Michael Fitzpatrick, the Union's busi- ness agent, went to the jobsite and observed Hugh Hanley Jr giving hand signals to the crane operator, which the operator followed. Hugh Hanley Jr testified that he did give signals to the operator but denied that he was supervising the job. He testified that as he passed the jobsite he observed a dangerous condition because the "choker" that was hauling the steel was twisted. He directed the operator to lower the steel to correct the condition. Hanley Jr. maintained that it was obvious he was not working on the job because he was not dressed in work clothes. Fitzpatrick did not dispute this testimo- ny about the clothes. Fitzpatrick claimed that he spoke to Hanley Jr. at the time and during the course of the conversation Hanley Jr. said he was paying the employ- ees $7 an hour. Hanley Jr. denied that he said that he was paying the employees $7 an hour but he admitted that he told Fitzpatrick that the employees were receiv- ing one-third of the union rate of pay, which at that time was about $22 an hour.3 i 30 It appears to be counsel 's position that the increase in Patrick's salary was to compensate Cherub for her loss of salary as a Respondent Kenmore employee a' Fitzpatrick testified that he had heard rumors about the new corpo- ration in April or May 1983, but the first actual knowledge he had about Continued 346 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD The parties stipulated that the two corporations had similar customers. In 1981 Respondent Sloan had 1 cus- tomer who was also a Respondent Kenmore customer, in 1982 Respondent Sloan had 4 customers who were or had been Respondent Kenmore customers, in 1983 there were 8 such customers, and in 1984 there were 11 such customers. Discussion The determination of whether one company is the alter ego of the other is difficult to make under any set of circumstances. It becomes more difficult when the in- dividuals involved in the two companies are related. That relationship creates appearances that are suspicious. However, the courts and the Board have outlined certain criteria to be considered in making a determination whether companies are alter egos. These criteria include whether the companies have substantially identical own- ership, business purposes, management, operations, equip- ment, customers, and supervision.32 It does not appear that any one of these factors is controlling.33 Counsel for the General Counsel cited several cases in support of his position that the Respondents meet the criteria outlined and, therefore, Respondent Sloan should be considered the alter ego of Respondent Kenmore. In Hageman Underground Construction, 253 NLRB 60 (1980), cited by counsel for the General Counsel, the facts were substantially different from those existing in this case. That case involved four enterprises in which one individual, George Hageman, was involved. The first enterprise, Hageman Backhoe Service or (Backhoe), was established to rent and did rent equipment to other companies for several years until it went out of business in 1975. In that year George Hageman formed a second company, Hageman Underground (Underground), to in- stall underground utility lines, and Backhoe transferred all its equipment to Underground. Underground installed lines for Pacific Telephone & Telegraph Company (PT&T) and rented the equipment, which had been transferred from Backhoe, to other companies. Under- ground had a collective-bargaining agreement with a union. In 1978 George Hageman formed a third compa- ny, Hageman Construction (Construction), to construct underground utility lines for PT&T, and he testified that he formed Construction to operate as a nonunion compa- ny. Construction leased equipment from Underground and hired all the construction workers who had been em- ployed by Underground. After the formation of Con- struction, Hageman received a visit from union repre- sentatives during which they demanded that he apply the terms of the Underground contract to the Construction employees. Hageman decided after this visit to set up a forth company, Hageman Engineering (Engineering), also to install underground utility lines for PT&T and to operate under nonunion conditions. Engineering com- menced performing the type of work that had been per- Respondent Sloan was when he saw Hugh Hanley at this jobsite in August 1983 32 Ski Craft Corp, 237 NLRB 122 (1978), Crawford Door Sales Co, 226 NLRB 1144 (1976) as Blake Construction Co, 245 NLRB 630, 634 (1979), enf. denied in part on other grounds 663 F 2d 272 (D C Cir 1981) formed by Construction, and Hageman transferred Con- struction's employees to Engineering's payroll. Thus, the record in that case established that Underground, Con- struction, and Engineering had the same officers, the same employees, and that the labor relations policies for all three companies were set up by one person, George Hageman. It is significant that George Hageman testified that he established Engineering to operate as a nonunion entity because of the efforts by the union to have the terms of Underground's collective-bargaining agreement applied to Construction's employees. In J. M Tanaka Construction, 249 NLRB 1238 (1980), also cited by counsel, in which the Board found alter ego status, the two corporations had similar officers, similar supervision, and similar control of labor relations poli- cies. Thus, in that case Raymond Tanka was president of both corporations; the supervision of all jobs, including the supervision of manpower, equipment, and supplies for both corporations was vested in the same person, Takeo Wakido, who was an uncle of Raymond Tanka; Raymond Tanka formulated the labor relations policy for the original corporation while he shared the responsi- bility for that policy for the newly formed corporation with his uncle, Takeo Wakido. In addition, after the for- mation of the new corporation, the original corporation phased out its operation and laid off its employees be- cause it could not continue to pay fringe benefits re- quired by the collective-bargaining agreement. These laid-off employees, subsequently, were hired by Ray- mond Tanka and Takeo Wakido, as employees for the new corporation. In McDonald's Ready Mix Concrete, 246 NLRB 152 (1979), at least one member of the same family was an officer in both corporations. Thus, in that case the evi- dence established that McDonald's Ready Mix was owned and operated by Bill McDonald, his wife, and son. The son, Jim, effectively, controlled the operations of this corporation for about a year before a new corpo- ration, Jim's Ready Mix, was established. The new cor- poration purchased the ready mix portion of the McDon- ald's business and the son, Jim, became president of the new corporation. The record in that case established that both corporations used the same premises, had the same customers and suppliers, and interchanged employees. It is apparent from an examination of these three cases that, although, there are some similarities to the present case, there are crucial differences. In all three cases, at least one individual was an officer in both corporations, a situation not present in the instant case. Thus, in this case the record establishes that Hugh and Jacqueline Hanley are the sole stockholders and officers of Respondent Kenmore. The stockholders and officers of Respondent Sloan are Cherub and Patrick Hanley. Although they are members of the same family, Cherub and Patrick are not the same individuals as their parents and, thus, the two corporations do not share common ownership or control. Further, in the three cases cited by counsel, the same in- dividual exercised control over the day-to-day operations of the two corporations and the labor relations policy for the two corporations was formulated by the same indi- vidual. The record fails to reveal that Hugh Hanley or KENMORE CONTRACTING CO. Jacqueline Hanley controls the operations of Respondent Sloan or is involved in the formation of its labor rela- tions policy, nor does it appear that Cherub and Patrick control the operations of Respondent Kenmore or are in- volved in the formation of its labor policy. Finally, there is no evidence in this case that two corporations inter- changed employees, transferred employees, or have hired similar employees. Counsel has cited one case, Ramos Iron Works, 234 NLRB 896 (1978), where an alter ego status was found and where there are some similarities to the instant case. In that case, as in the present one, a young son of the president of the original corporation formed a new cor- poration, allegedly to develop a solar-heating structure. The record revealed that the son, in that case, also had limited construction or business experience. However, the differences between the present case and the Ramos case are greater than the similarities. In Ramos the ad- ministrative law judge found that Ramos Sr., the father, and Ramos Jr., a brother, were involved in the original corporation, which had a collective-bargaining agree- ment with a union. Prior to the formation of the new corporation, Ramos Sr. openly stated his opposition to the union, and after the new corporation was formed the employees of the original corporation worked for the new corporation. These employees continued to work on projects for the new corporation that they had worked on for the original corporation. In addition, Ramos Sr. worked "intensively" on projects of the new corpora- tion, and a vice president of the original corporation spent a considerable amount of time at the project of the new corporation. As noted, the employees of Respond- ent Kenmore and Respondent Sloan are not the same, and the only evidence of Hugh Hanley's presence at any jobsite of Respondent Sloan was on one occasion, at the National Fire Adjusters jobsite. A close family relationship will not establish the alter ego status.34 Counsel for the General Counsel contends, however, that factors other than the family relationship exist in the instant case. He asserts that but for the indi- rect financial assistance from their parents, Cherub and Patrick Hanley could not have funded Respondent Sloan. However, financial assistance from one corpora- tion to another will not establish the alter ego status. In Shellmaker, Inc., 265 NLRB 749 (1982), the record re- vealed that William Boland was president of a company, Shellmaker, which had a collective-bargaining agreement with the Union. This agreement provided that new dredges had to have a four-man crew. Boland planned to operate a new dredge with a two-man crew. A second corporation, Bayside, was formed by Boland, his wife, and his nephew, who had worked for Shellmaker, to op- erate as a nonunion shop. The initial capital for Bayside came from personal loans made by Mrs. Boland and Bo- land's nephew. The loans were repaid when Bayside bor- rowed $50,000 from Shellmaker's profit-sharing plan. This loan by Shellmaker to Bayside was unsecured. The direct financial assistance did not cease but continued when Bayside renegotiated its loan. Notwithstanding the suspicion surrounding the formation of the new corpora- 34 Contra Packing Co, 268 NLRB 193 (1983) 347 tion and the extensive financial assistance given to it with unsecured loans, the Board did not find the companies to be alter egos. In the instant case, as noted, the officers are not the same, and there is no evidence of any direct financial assistance given by Respondent Kenmore to fund the formation of Respondent Sloan. A further factor relied on by the counsel for the Gen- eral Counsel to support his assertion that the corpora- tions are alter egos is the assistance that Hugh Hanley gave to Patrick Hanley in estimating jobs. Counsel, to some degree, relied on the testimony of Miller to estab- lish this fact. An examination of Miller's testimony estab- lishes that Miller basically "assumed" that Patrick was receiving such assistance, not only about estimating jobs but about how to perform the work. However, I am con- vinced from the testimony of the Hanleys that Patrick did discuss, with his father, both how work was to be performed and how to estimate a job. The Board has failed to find corporations to be alter egos because of this type of assistance. In Victor Valley Heating & Air Condi- tioning, 267 NLRB 1292 (1983), the record established that the president of Victor Valley, the original compa- ny, taught an employee of the new corporation formed by his son, how to estimate and bid jobs and for the first few months the father came to the new corporation's workshop approximately once a week to assist the em- ployee to learn these functions. In addition, the father signed bids for the new corporation, gave advice about jobs, and referred suppliers and customers to the new corporation. In that case there was evidence, also, that the bookkeeper of the original corporation maintained the books and records of the new corporation and did so without being reimbursed. Notwithstanding this type of assistance, the Board did not find one corporation to be the alter ego of the other corporation. It is obvious that representatives of Respondent Ken- more did show favoritism to the representatives of Re- spondent Sloan Thus, they allowed rent bills and car bills to go unpaid for months, they permitted their office supplies to be used without reimbursement, and they rented equipment to Repondent Sloan at low fees. How- ever, even blatant favoritism in the day-to-day oper- ations, standing alone, does not necessarily make one corporation the alter ego of the other.35 As was true in Victor Valley the favoritism exhibited to Cherub and Pat- rick showed the concern of the parents that their chil- dren should be given the opportunity to succeed. This record fails to establish that the two corporations have common ownership, common management, common control over labor relations policies, the same employees, or the same supervisors. There is evidence that the two corporations are engaged in the same type of business, use some of the same equipment, and share the same premises. However, these factors are insuffi- cient to outweigh the lack of common ownership, common management, and common control over labor relation policies. Accordingly, I find that Respondent Kenmore and Respondent Sloan are not alter egos.36 35 Victor Valley Heating & Air Conditioning, supra 36 Shellmaker, supra 348 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Counsel for the General Counsel argues, in the alterna- tive, that the two corporations constitute a single em- ployer within the meaning of the Act. The criteria for determining that status was set forth in Radio Union Local 1264 v. Broadcast Service, 380 U.S. 255, 256 (1965), and includes the interrelation of operations, common management, centralized control of labor relations, and common ownership. Although no one factor appears controlling, the Board stresses the first three criteria, with particular emphasis on centralized labor relations.37 This record fails to establish that the operations of the two corporations are interrelated. There is no evidence that either Cherub or Patrick Hanley was involved in the operations of Respondent Kenmore except in their ca- pacity, respectively, as receptionist and yardman. They were not involved in making decisions of formulating policies for that corporation and the evidence is insuffi- cient to establish, affirmatively, that their parents made decisions of formulated policies for Respondent Sloan. Based on my discussion set forth above with respect to the other criteria, I find that Respondent Kenmore and Respondent Sloan do not constitute a single employer within the meaning of the Act.38 Accordingly, I find that the General Counsel has failed to sustain the burden of proof as required.39 Respondents assert that the Union had knowledge of Respondent Sloan in April or May 1983, but at no time did it make a request that the collective-bargaining agreement of Respondent Kenmore be applied to the em- 37 NLRB v. Al Bryant, Inc, 711 F.2d 543, 551 (3d Cir 1983), cert denied 104 S Ct. 699 (1984). 38 Victor Valley Heating & Air Conditioning, supra 99 In view of my finding that the two corporations are not alter egos and do not constitute a single employer , I do not find that a unit consist- ing of both groups of employees constitutes an appropriate unit for pur- poses of collective bargaining ployees of Respondent Sloan. Therefore, they contend that the complaint is time barred by Section 10(b) of the Act. Although I have recommended dismissal of the complaint, I do not agree with the contention that the complaint is time barred. The record does not support the assertion that the Union had knowledge of Respond- ent Sloan in April or May 1983. Rather, the record es- tablishes that in that time period the union representa- tives had heard rumors about the existence of Respond- ent Sloan but they did not gain specific information until Fitzpatrick saw Hugh Hanley at the National Fire Ad- justers jobsite. It is obvious, in view of the position of the Respondents about their separate status, that none of the Hanleys informed the Union about the existence of Respondent Sloan. Further, in view of that position it is also obvious that any demand by the Union that the col- lective-bargaining agreement of Respondent Kenmore be applied to Respondent Sloan's employees would have been rejected. CONCLUSIONS OF LAW 1. Kenmore Contracting Co., Inc. is an employer en- gaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. International Association of Bridge, Structural and Ornamental Iron Workers, Local No. 6, AFL-CIO is a labor organization within the meaning of Section 2(5) of the Act. 3. The General Counsel has failed to establish by a preponderance of the evidence that Respondent Ken- more and Respondent Sloan, as alleged in the complaint, are alter egos and/or constitute a single employer within the meaning of the Act and violated Section 8(a)(5) of the Act. [Recommended Order for dismissal omitted from pub- lication.]