Haley & Haley, Inc. And Oceanway Transport, Inc.

HALEY & HALEY, INC. Haley & Haley, Inc. and Oceanway Transport, Inc. and International Woodworkers of America, Local 3-140, AFL-CIO. Case 36-CA-4967 June 30, 1988 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND BABSON On December 13, 1985, Administrative Law Judge Gerald A. Wacknov issued the attached de- cision. The General Counsel filed exceptions and a supporting brief. 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. 1. The complaint alleges that Respondent Haley & Haley, Inc., and Respondent Oceanway Trans- port, Inc., are alter egos and that they violated Section 8(a)(5) and (1) by transferring employees and equipment from Haley & Haley to Oceanway in order to perform log-hauling work. The judge recommended that the complaint be dismissed, but for the reasons given below we conclude that the Respondents' conduct violated Section 8(a)(5) and (1). The central facts are not in dispute and are largely established by uncontradicted testimony. Haley & Haley is a family corporation engaged ex- clusively in the business of hauling logs. The Union has represented Haley & Haley's employees for many years, and the parties' most recent collective- bargaining agreement was effective from June 1, 1983, until June 1, 1986. Loren Haley (Loren) is Haley & Haley's president, his son Larry Haley (Larry) is its vice president, Duane Vergeer is its secretary, and Charles Ritchey is its treasurer. The parties stipulated that Loren owns 276 shares of Haley & Haley's stock, that Larry owns 191 shares, that Larry's wife Lucretia Haley (Lucretia) owns 4 shares, that Larry's sons Lee Haley (Lee) and Paul Haley (Paul) each own 2 shares, that family mem- bers Larry L. Haley and Jean L. Haley each own 2 The General Counsel has excepted to some of the judge's credibility findings The Board's established policy is not to overrule an administra- tive law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect Standard Dry Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cit. 1951) We have carefully examined the record and find no basis for re- versing the findings 649 shares, and that Duane Vergeer owns 1 share.2 Until Haley & Haley ceased hauling logs on May 7, 1985,3 Larry served as its manager and operated the Company on a day-to-day basis. In his absence, Supervisor Gary Sichting was responsible for daily operations. Loren is "semiretired," according to both Larry and Loren. Oceanway is a wholly owned subsidiary of Haley & Haley and at the time of the hearing Oceanway operated both a log-hauling department and a "lowboy" department, which hauled general commodities, including heavy equipment.4 Larry is the president of Oceanway, Loren is its secretary- treasurer, and Lucretia is a director. Larry and Loren are also the officers of L & L Repair Incorporated, a corporation which performs repair work almost exclusively for Haley & Haley and Oceanway.5 Until some time in 1985, Haley & Haley, Oceanway, and L & L Repair all operated on the same premises in Mapleton, Oregon. At the time of the hearing all three companies had relo- cated to Reedsport, Oregon.6 In 1984 and 1985, the logging industry in Oregon was experiencing serious economic difficulties, and in response to these difficulties Haley & Haley pur- chased Oceanway on March 30, 1984. Larry Loren and Lucretia negotiated the purchase. Larry testi- fied that the purchase was necessary "[b]ecause I could see down the road by reading papers, and talking to people and watching TV, that the log- ging industry was going downhill." Oceanway was dormant at the time, and Larry testified that Haley & Haley purchased Oceanway in order to acquire its permit to haul general commodities other than logs. In June 1984 Oceanway acquired one lowboy truck from another company and began hauling such general commodities. In August 1984 Larry applied for and obtained a log-hauling permit for Oceanway, and he testified that he did so "for the future, I thought we might need it." Oceanway did not begin hauling logs until February 17. Haley & Haley operated 21 log-hauling trucks, and until early in 1985 it had derived approximate- ly 97 percent of its business from Champion Paper Company (Champion) and International Paper Company (International). Its remaining business was divided among several smaller companies. In 2 Vergeer is the only shareholder who is not a member of the Haley family. The parties also stipulated that since July 24, 1985, there may have been some small stock transfers to the children of some of the shareholders. 8 Unless otherwise specified, all dates refer to 1985. 4 A lowboy truck hauls items other than logs At the time of the hear- ing, Oceanway operated three lowboy trucks. L & L Repair is not a respondent in this proceeding Larry testified that L & L Repair also has a facility in Oakndge, Oregon. 289 NLRB No. 87 650 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD late 1984 or early 1985, Champion announced that it intended to terminate its operations, and Interna- tional curtailed its operations and announced its in- tention to reduce the rates that it paid for log-haul- ing services.7 On April 12 Champion did terminate its operations, and on May 21 International's lower rates went into effect. The financial difficulties of Champion and Inter- national had a serious impact on Haley & Haley. Larry testified that before April 12 Haley & Haley engaged in "very little" log hauling for Internation- al, and that after April 12 it no longer hauled for Champion. During this time, according to Larry, "we worked a few trucks" for small independent logging companies, or "gypos." Larry testified, however, that Haley & Haley was unable to "come out" with a profit because of its high contractual wage rates and the low rates paid by the gypos for log-hauling services.8 In these circumstances, Larry recognized that Oceanway could "get more business" than Haley & Haley and that "we would sell our trucks to Oceanway." On February 17 Haley & Haley sold 5 of its 21 log-hauling trucks to Oceanway,9 and Oceanway immediately activated its log-hauling operation. Employees of L & L Repair removed Haley & Haley's name from the trucks and repainted Ocean- way's name in its place. Larry testified, in refer- ence to Oceanway, that "we" subsequently pur- chased two log-hauling trucks from Haley & Haley in March, one in April, eight in May, and the four remaining trucks on August 8.10 When the first trucks were sold on February 17, several of Haley & Haley's drivers withdrew from Haley & Haley's labor relations consultant, Gossard, testified that it was "common knowledge" that Champion was terminating its operations and that international's operations had been curtailed Gossard indicated that prior to April 1985 , he had discussed "several times" with the Haleys the financial situation of Champion and International The Union's business representative, Letts, testified that in late 1984 there were "feel- ings out in the industry" that the large wood operators would either go out of business or seek to modify their contract. a According to Larry , the gypos paid only $23 to $24 an hour for log- hauling services By contrast, International formerly had paid approxi- mately $39.60 an hour for such services Haley & Haley's contractual wage and benefit rates totaled approximately $18 an hour and according to Larry, Haley & Haley was using approximately 100 gallons of diesel fuel a day 9 A sixth log-hauling truck was sold to Oceanway at the same time, but was converted to a lowboy truck. 1 0 The Respondent's accountant, Charles Ritchy, testified that the trucks were sold on notes written from Oceanway to Haley & Haley, with an interest rate of 10 5 percent. According to Ritchey each note was written with a 1-year due date. Oceanway does not make individual monthly payments on each note, and the method of payment has changed over time At first Oceanway made payments on the notes to Haley & Haley, apparently from an "intercompany account," which each compa- ny maintained to pay its debts to the other On 8 August, when the final four trucks were sold, Oceanway instead began to assume some of Haley & Haley's obligations when the latter was no longer able to make pay- ments on its own notes to its bank Ritchey testified that this procedure constituted "automatic payment from Oceanway to Haley & Haley " the Union and went to work for Oceanway.11 Larry testified that "Oceanway wasn't supposed to be hiring Haley & Haley drivers. They belonged to the Union." However, he also testified that those Haley & Haley drivers who did go to work for Oceanway "were supposed to get a withdrawal from the Union." The Respondent's attorney, Duane Vergeer, stated at the hearing that some Haley & Haley drivers went to work for Ocean- way, "but not until after they withdrew from the Union." Vergeer also stated that unless Haley & Haley's drivers "withdrew from the Union, they wouldn't have been working for Oceanway, be- cause Oceanway is a non-Union concern." 12 Eleven of Haley & Haley's drivers eventually went to work for Oceanway, and eight were still em- ployed by Oceanway at the time of the hearing. Larry testified that he is not involved in the daily operation of Oceanway, although there is evi- dence that he is engaged to some extent in per- forming dispatching duties.13 According to Larry's testimony, Lee and Paul operate Oceanway's log- hauling department, are responsible for hiring deci- sions in that department, and in fact "hired them- selves" when Oceanway began hauling logs.14 Larry also testified that an individual named Charles Carlow operates Oceanway's lowboy de- partment and is responsible for its hiring decisions. Larry further stated that he initially hired Carlow in June 1984, that neither Lee nor Paul had had any previous management experience before going to work for Oceanway, and that Lee, Paul, and Carlow are all truckdrivers who regularly drive for Oceanway when work is available.15 According to Larry, "that's all Oceanway has, is truck drivers," and he also asserted that Oceanway "[can't] afford to have people sitting in the office." Larry further testified that Lee, Paul, and Carlow ask him ques- " Larry testified that Leland Gronnel, Lee, and Paul had been union members while driving for Haley & Haley Those three, and two other individuals who apparently had not previously worked for Haley & Haley, were the first five log-hauling drivers hired by Oceanway 18 The complaint does not contain an 8(a)(3) allegation regarding with the hiring of these employees, or regarding any of the Respondent's other conduct 's Robert Hensley, a driver for Haley & Haley, testified that Haley & Haley and Oceanway used the same radio frequency , and that he heard Larry engaging in radio dispatches of Oceanway drivers in approximate- ly March 1985 and on and off over a period of months Although Hens- ley indicated that anyone in the office could answer the radio , he also testified that he heard Larry relay messages and tell Oceanway drivers which log-hauling assignments to perform, where to pick up fuel, where to have a flat tire fixed , and where other trucks were located. Hensley further testified that "if you listened to the conversation, you could pretty well figure out who was in command " Larry testified that he did relay messages over the radio. 14 Larry testified that Oceanway 's log-hauling department was initially operated by Leland Gronnel and Paul, but that Lee replaced Gronnel when the latter quit 15 Lee, Paul, and Charles Carlow did not testify at the hearing HALEY & HALEY, INC. tions about operating the business, but do not necessariy follow his advice. As noted above, Oceanway activated its log- hauling operation when the first five trucks were sold on February 17, and Larry testified that Oceanway's business grew "gradually." According to Larry, Oceanway began to haul logs for em- ployers "in different parts of the state that Haley & Haley ha[d] never been in." In addition, Oceanway began to engage in substantial log hauling for International at some point during 1985, although the record does not disclose the precise date. Larry testified that as of the day of the hearing, Ocean- way operated five trucks out of International's fa- cility at Gardiner, Oregon, and four trucks out of another International facility at Vaughn, Oregon. There is no evidence that the Respondents noti- fied the Union or requested bargaining prior to the events of February 17. However, as more fully ex- plained in the judge's decision, the parties did engage in bargaining at a later point. Briefly, the Union's business representative, Letts, sent Haley & Haley a letter on March 13 that asserted that the removal of the trucks violated their contract. Haley & Haley's first approach to the Union came in April, when its labor relations consultant, Gos- sard, told Letts that wage reductions were neces- sary. On April 20 Larry sent the Union a letter as- serting that "substantial changes" would be needed to enable Haley & Haley to compete for Interna- tional's business. The letter further asserted that "[u]nless something happens soon, we will be forced to sell off more of our trucks or even con- sider going out of business." On May 7, Haley & Haley ceased hauling logs, although its operations were not completely termi- nated. Rather, according to Larry, Haley & Haley simply parked its four remaining trucks while trying to find jobs that would permit it to pay its contractual wage rates. After May 7, the parties bargained on several occasions, but were unable to agree on a wage-reduction package. On May 28, the Union made a written request for certain infor- mation, but at a meeting on May 30, according to the credited testimony, Letts told Larry and Loren that the information need not be furnished until a meeting could be arranged with the Union's re- gional representative, Hubble. At the same meeting Letts also told Loren "not to worry" about the in- formation request. For reasons not disclosed by the record, a meeting with Hubble was never arranged, and Haley & Haley did not provide the requested information. Following additional unsuccessful bar- gaining, as stated by Larry, "we just went ahead and sold" Haley & Haley's four remaining trucks 651 to Oceanway on August 8, after concluding that "we couldn't get . . . anything out of Mr. Letts." The judge found that Haley & Haley did not es- tablish Oceanway as a "disguised corporation." He also found that no unit work was transfered outside the bargaining unit because the work that Ocean- way obtained as a nonunion entity could not have been obtained by Haley & Haley because of the Tat- ter's contractual obligation to pay a higher wage rate. He then found that Haley & Haley had bar- gained in good faith to impasse with the Union. Relying on Milwaukee Spring Division, 268 NLRB 601 (1984), affd. 765 F.2d 175 (D.C. Cir. 1985), the judge concluded that Haley & Haley did not vio- late the Act by causing Oceanway to engage in log hauling. 16 We find it appropriate to analyze this case under alter ego principles and not, as the judge essentially did, under the principles established in Milwaukee Spring and Otis Elevator Co., 269 NLRB 891 (1984). 17 In Milwaukee Spring, the Board found that an economically motivated relocation of unit work is not a midterm contractual modification in the absence of a specific contractual provision re- stricting such a relocation. In Otis Elevator the Board considered management decisions having "a substantial impact on the continued availability of employment," as described by the Supreme Court in First National Maintenance Corp. v. NLRB, 452 U.S. 666 (1981). The Respondents' conduct here is not the type of conduct that the Board considered in Otis Eleva- tor and Milwaukee Spring. In those cases the man- agement decisions at issue were based on economic considerations and were not the result of a pro- scribed motive.18 Indeed, the Board plurality in Otis Elevator was careful to distinguish economical- ly motivated decisions from situations in which an employer utilizes "alter ego or other sham devices . .. to disguise a unilateral reduction in labor costs in an operation over which the employer maintain[s] surreptitious control."19 In light of all is The complaint also alleges that the Respondents violated Sec 8(a)(5) and (1) by failing to comply with the Union's written information request, discussed above. The judge concluded that the Respondents' fail- ure to furnish the information did not violate the Act We agree with the judge in view of the credited testimony that Letts told Loren "not to worry" about the information, and that Letts stated that the information need not be provided until a meeting was held with the Union 's regional representative, Hubble As noted above, that meeting never took place for reasons that the record does not disclose 17 The judge did not cite Otis Elevator, but that decision is relevant to the manner in which he analyzed the case 18 We also note that in First National Maintenance Corp v. NLRB, the Supreme Court "illustrate(d) the limits" of its holding by observing, inter alia, that the union did not claim that the employer 's decision had been motivated by union animus 452 U S at 687 19 269 NLRB at 893 The Board made this statement in explaining why it would have reached a different result in Adams Dairy, 137 NLRB Continued 652 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the evidence analyzed below, including evidence establishing a proscribed motive, we conclude that Haley & Haley and Oceanway are alter egos and that it is not appropriate to analyze their conduct under the principles set forth in Otis Elevator, Mil- waukee Spring, and First National Maintenance Corp. v. NLRB. 20 In Otis Elevator cases, the issue is whether there is a duty to bargain over the deci- sion to transfer work out of a unit; in alter ego cases, the issue is whether the work is effectively still in the unit because the allegedly new employer is the same as the former employer. In Advance Electric, 268 NLRB 1001, 1002 (1984), the Board stated that it will find alter ego status where two employers have "`substantially identical' management, business purpose, operation, equipment, customers, and supervision, as well as ownership." The Board also stated that among the other factors that must be considered is "whether the purpose behind the creation of the alleged alter ego was legitimate or whether, instead, its purpose was to evade responsibilities under the Act."21 At the outset we find that Haley & Haley and Oceanway share substantially identical ownership. Loren and Larry together own 467 of the approxi- mately 480 outstanding shares of Haley & Haley, and 12 of the remaining 13 outstanding shares are owned by members of the Haley family. Haley & Haley purchased the stock of Oceanway and is its only stockholder. Where, as here, the stock of two companies is concentrated in members of the same family, the Board has found ownership to be "sub- stantially identical," for purposes of determining alter ego status.22 We also fmd that Haley & Haley and Oceanway share substantially identical management. Loren is the president of Haley & Haley and the secretary- treasurer of Oceanway. Larry is the vice president of Haley & Haley and the president of Oceanway. Charles Ritchey is the treasurer of Haley & Haley and the accountant for both companies. Lucretia owns four shares of Haley & Haley and is a direc- tor of Oceanway. In finding that Haley & Haley and Oceanway have substantially identical management, we par- ticularly note that Larry was the dominant force in establishing the direction of both companies. In this connection, we fmd that Larry was the central figure in the decision-making process, which culmi- nated in the sale of the trucks, the single decision 815 (1962), enf. denied in relevant part 350 F 2d 108 (9th Cit. 1965), cert. denied 382 US 1011 (1966) 20 We agree that the situation here is distinguishable from that in Otis under any of the views expressed in that case 81 268 NLRB at 1002 , quoting Fugazy Continental Corp , 265 NLRB 1301, 1302 (1982) 22 See Advance Electric, supra at 1004, and cases cited therein. that most affected the direction of the two compa- nies. In support of this finding, we note the absence of evidence that any other management official from either company played a significant role in the decision to sell the trucks, and we also note that Larry's own testimony demonstrates his con- trol over the decision-making process. Thus, Larry testified that in August 1984 he applied for and ob- tained Oceanway's log-hauling permit "for the future [because] I thought we might need it." When the financial difficulties of Champion and International became severe, Haley & Haley "worked a few trucks" for the gypos, the small in- dependent companies. However, "we couldn't come out" with a profit because of Haley & Haley's high contractual wages and the low rates that it received from the gypos. Faced with these difficulties, Larry recognized that Oceanway could "get more business" than Haley & Haley, and that "we could sell our trucks to Oceanway." The first five trucks were sold on February 17 and, in refer- ence to Oceanway, Larry testified that "we" added two trucks in March, one in April, and eight in May.23 Oceanway's business grew "gradually" after its log-hauling operation was activated, and after May 7 "we just parked" the remaining four Haley & Haley trucks until profitable work could be found. On August 8, "we just went ahead-and sold them to Oceanway" after concluding that "we couldn't get . . . anything out of Mr. Letts." Larry's extensive testimony, when coupled with the lack of evidence that other management offi- cials participated in the decision-making process, clearly establishes that Larry was the central figure for both companies in the decision to transfer the trucks. Larry also played a major role in Haley & Haley's purchase of Oceanway, another decision that greatly affected the direction of both compa- nies. Oceanway was a dormant corporation in March 1984 when Larry, in conjunction with Loren and Lucretia, negotiated the purchase of Oceanway's stock. The purpose of the acquisition, according to Larry, was to obtain Oceanway's permit to haul general commodities, "[b]ecause I could see the road . . . that the logging industry was going downhill . . . ." In June 1984 Ocean- way began hauling general commodities, including heavy equipment, with one driver hired by Larry. Larry's own testimony therefore establishes that he as Larry's testimony illustrates the close connection between the two companies and his role as the central figure in the decision . He first testi- fied, in reference to Haley & Haley, that "we" sold "our" trucks to Oceanway He then testified, in reference to Oceanway, that "we" added a number of trucks over a period of months HALEY & HALEY, INC. played a major role in the acquisition of Ocean- way.24 We accord little weight to Larry's general testi- mony that he is not involved in Oceanway's daily operation,25 that Lee and Paul operate its log-haul- ing department, and that Charles Carlow operates its lowboy department. The evidence discloses that Larry spends a significant amount of time engaging in dispatching duties for Oceanway. Further, Lee and Paul, who purportedly are two of Oceanway's managers, did not even begin working for Ocean- way until it began hauling logs on February 17; before that they had driven trucks for Haley & Haley. Besides their late involvement in the man- agement of Oceanway and their lack of manage- ment experience, Lee and Paul, along with Carlow, continued to perform as truckdrivers, regularly driving for Oceanway when work was available. Indeed, Larry testified that "that's all Oceanway has, is truck drivers," and he also noted that Oceanway "[can't] afford to have people sitting in the office." Consequently, we find that Lee, Paul, and Carlow spend most of their time performing "hands-on" work.26 In Advance Electric, supra at 1003, the Board was not persuaded that an individ- ual played a significant managerial or supervisory role in light of the fact that he was primarily en- gaged in "hands-on" work. Similarly, we see little reason to give weight to Larry's conclusional testi- mony that Lee, Paul, and Carlow operate Ocean- way, in view of his concession that they regularly perform "hands-on" work. Nor is our finding that the two companies share substantially identical management affected by Larry's general testimony that he does not partici- pate in Oceanway's hiring process; that Lee and Paul make the hiring decisions for Oceanway's log- 24 The role of other officials in the decision to purchase Oceanway is not clear Larry testified that he negotiated the purchase with Loren and Lucretia, and Charles Ritchey testified that Larry and Loren had dis- cussed with him "in broad terms" the possibility of "branching out from log trucking." However, Lucretia did not testify at all, Loren did not tes- tify concerning the purchase of Oceanway, and Ritchey did not indicate the extent of his participation in the discussions leading to the decision 25 There is no question concerning his status as Haley & Haley's man- ager and operating head 26 The Union introduced into evidence a document prepared by Lu- cretia and Larry pursuant to a subpoena by the Union. The document lists the individuals who perform various duties for Oceanway and Haley & Haley. It indicates that Lee, Paul, Carlow and, until he quit, Gronnel, have been responsible for handling discipline and employee complaints at Oceanway. However, the record does not establish the number of em- ployees, if any, who have been disciplined or who have registered com- plaints, and it does not establish whether these responsibilities consume any significant amount of these individuals' time The same document also states that these individuals perform dispatching duties for Ocean- way, but the record also does not establish what percentage of their time is occupied by these duties. Moreover, as noted above, the record dem- onstrates that Larry performs dispatching duties for Oceanway. Conse- quently, we find that the conclusional statements contained in the docu- ment do not tend to establish that Oceanway's management is different from Haley & Haley's 653 hauling department; and that Carlow makes such decision for its lowboy department. First, it was Larry who hired Carlow in June 1984 to drive what was then Oceanway's only lowboy truck. Further, Larry's testimony that Lee, Paul, and Gronnel "hired themselves" when Oceanway began hauling logs in February 1984, falls of its own weight. Larry did not explain the process by which they "hired themselves," or how that could have occurred without his participation, as it was he who made the decision to activate Oceanway's log-hauling operation. It also is clear that, regard- less of the hiring role played by Lee and Paul, Larry apparently set one of the conditions-no union members-by which the hiring of drivers in Oceanway's log-hauling department would be gov- erned.27 Thus, he testified in reference to the driv- ers in the log-hauling department: "Oceanway wasn't supposed to be hiring Haley & Haley driv- ers. They belonged to the Union." Regarding those Haley & Haley drivers who were hired by Ocean- way, Larry testified that, "they were supposed to get a withdrawal from the Union." Even if Larry had less influence in the daily op- eration and hiring process of Oceanway than he did regardingthat of Haley & Haley, we are con- vinced that that weight of the evidence supports a finding that Haley & Haley and Oceanway have substantially identical management.28 First, the evi- dence establishes that he does maintain some role in Oceanway's daily operation and hiring process. More importantly, the record firmly establishes that Larry was a major force behind Haley & Haley's acquisition of Oceanway, and that he was the central force behind the decision to activate Oceanway's log-hauling operation and to phase out Haley & Haley's operation. We also find that Haley & Haley and Oceanway share a substantially identical business purpose and mode of operation. Both companies have been en- gaged in the hauling of logs, and by August 1984 each had obtained a permit to haul logs throughout the State of Oregon. Both companies operated out of the same location in Mapleton, and sometime in 27 Regarding the lowboy department, Larry testified that Carlow hires the drivers, but the record establishes that the lowboy department oper- ates only three trucks 211 We find that the record does not permit a conclusion whether the two companies share substantially identical immediate supervision, or even whether they draw a distinction between high level management and immediate supervision. Thus, Larry was Haley & Haley's vice presi- dent and was responsible for its daily operation . With the exception of Gary Sichting, who operated the Company in Larry's absence, Haley & Haley had no other supervisors In addition , it is not entirely clear who exercises managerial and supervisory authority for Oceanway Lee, Paul, and Carlow assertedly are responsible for daily operations, but they spend most of their time driving trucks However, we note that supervi- sion is merely one factor among many to be considered 654 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1985 both relocated to Reedsport. The repair work for both companies has been performed by L & L Repair, which is owned by the Haleys and which also relocated from Mapleton to Reedsport .29 Our finding that the two companies share a sub- stantially identical business purpose is not affected by the fact that Haley & Haley was engaged exclu- sively in the business of hauling logs, while Ocean- way hauled both logs and general commodities such as heavy equipment. Oceanway operated only one lowboy truck for hauling heavy equipment from June 1984 until February. In February it pur- chased a second truck for that purpose and subse- quently it purchased a third. However, between February 17 and August 8 it acquired 20 log-haul- ing trucks from Haley & Haley. Consequently, we think it clear that after February 17, Oceanway was engaged predominantly in the hauling of logs. In similar circumstances in Advance Electric, supra at 1002, the Board concluded that two enterprises had a substantially identical business purpose, and we reach the same conclusion here. The record also establishes that Haley & Haley and Oceanway share a substantially identical cus- tomer base. As noted above, International had been one of Haley & Haley's major customers for sever- al years. Although the record does not disclose the precise date, Oceanway also began to engage in substantial log hauling for International at some point during 1985. As of the day of the hearing, ac- cording to Larry, Oceanway operated five trucks out of one of International's facilities and four trucks out of another of its facilities. Haley & Haley's other major customer, Champi- on, had experienced serious financial difficulties over an extended period of time and finally termi- nated its operations on April 12. In our view, a finding that Haley & Haley and Oceanway shared a substantially identical customer base is not pre- cluded by the circumstance that Champion termi- nated its operations before Oceanway had any real- istic opportunity to seek its business. It is true that Haley & Haley performed much less work for gypos, the small independent busi- nesses that paid a lower rate than the large compa- nies for log-hauling services, than did Oceanway.30 Noting this fact, the judge found that Oceanway was able to obtain this work because, as a non- union company, its costs were less than Haley & Haley's, and for that reason, the work obtained by Oceanway was not work that Haley & Haley oth- 29 As noted above, L & L Repair also operates a facility in Oakndge, Oregon 30 Forrest Egli, a driver for Haley & Haley, testified that Oceanway hauled for gypos when it commenced operations, and Larry testified that Oceanway hauled for companies "in different parts of the state that Haley & Haley ha[d] never been in " erwise would have obtained. We, however, do not view this circumstance as precluding a finding that the two companies share a substantially identical customer base. As discussed infra, we find that Haley & Haley sold its equipment and transferred its employees to Oceanway for the proscribed pur- pose of evading its responsibility under the Act to adhere to its collective-bargaining agreement with the Union. Therefore, Oceanway obtained this work only after Haley & Haley chose to evade its collective-bargaining agreement rather than seek the concessions that might have enabled it to com- pete for the work. We shall not alter our conclu- sion that the two companies share a substantially identical customer base merely because Haley & Haley succeeded in achieving the outcome that its unlawfully motivated conduct was designed to achieve. The record also clearly establishes that Haley & Haley and Oceanway have used substantially iden- tical equipment. Haley & Haley sold all its trucks to Oceanway, and the trucks were merely re- painted with Oceanway's name.31 To operate this equipment, Oceanway employed 11 of Haley & Haley's drivers, 8 of whom it still employs. Also relevant to the alter ego issue is the motive underlying the sale of the trucks and the activation of Oceanway's log-hauling operation. The record establishes that since at least March 1984 Larry had been aware that the logging industry was "going downhill." In August 1984 he obtained a log-haul- ing permit for Oceanway "for the [future] because I thought we might need it." Subsequently he learned that one of Haley & Haley's two primary customers intended to terminate its operations, and that the other intended substantially to lower the rate it would pay for log-hauling services. Haley & Haley's attempt to haul logs for the gypos proved unprofitable because of its contractual wage obliga- tions and the low rate paid by the gypos. Confronted with these circumstances, Larry chose to ignore Haley & Haley's obligations under the collective-bargaining agreement. Having previ- ously laid the groundwork by obtaining Ocean- way's log-hauling permit, he decided simply to sell 31 A similar circumstance existed in Advance Electric, supra at 1003 In Advance Electric the Board also noted that the transfer of equipment from one enterprise to another was not marked by such business formali- ties as contracts or bills of sale In this proceeding Haley & Haley and Oceanway did execute bills of We, but we see no significance to this dis- tinction because we still would not characterize the We as an arm's- length transaction Larry, as the president of Oceanway and the primary manager of Haley & Haley, was the dominant figure in the decision to sell the trucks There is no evidence that any negotiations over puce took place, and the extent to which cash changed hands is unclear Ritchey testified that some payments were made, but that on August 8 Oceanway simply assumed Haley & Haley's obligations when the latter could no longer make payments on its own debts HALEY & HALEY, INC. Haley & Haley's trucks to Oceanway and operate the latter without the burden of a union contract. The record leaves no doubt that Larry intended to operate Oceanway as a nonunion enterprise. Larry testified that "Oceanway wasn't supposed to be hiring Haley & Haley drivers. They belonged to the Union." According to Larry, those Haley & Haley drivers who did go to work for Oceanway "were supposed to get a withdrawal from the Union." In addition, the Respondent's attorney stated at the hearing that some Haley & Haley drivers went to work for Oceanway, "but not until after they withdrew from the Union . . . . Unless they withdrew from the Union, they wouldn't have been working for Oceanway, because Oceanway is a non-union concern." We find in these circumstances that Larry acti- vated Oceanway's log-hauling operation for the purpose of enabling Haley & Haley to evade its re- sponsibility under the Act to honor its collective- bargaining agreement with the Union. As we found in Advance Electric, supra at 1004, such a motive supports an alter ego finding.32 Because of the above analysis, we find that Re- spondent Oceanway is the alter ego of Respondent Haley & Haley. We also find that the Respondents violated Section 8(a)(5) and (1) by transferring equipment and employees from Haley & Haley to Oceanway to perform log-hauling work, for the purpose of avoiding their statutory responsibility to adhere to their collective-bargaining agreement with the Union.33 We further find that Respondent Oceanway and Respondent Haley & Haley are bound to the collective-bargaining agreement be- tween Respondent Haley & Haley and the Union, and that the Respondents violated Section 8(a)(5) and (1) by refusing to honor and apply that collec- tive-bargaining agreement.34 32 We are not persuaded that Haley & Haley's belated offer to bargain precludes a finding that it acted with a proscribed motive Even if Haley & Haley had engaged in timely bargaining to impasse for concessions, it still would not have been privileged to create an alter ego for the pur- pose of evading its collective-bargaining agreement The creation of an alter ego is not the type of management decision analyzed in Otis Eleva- tor, where, for example, an employer may implement a decision to relo- cate unit work after it has bargained in good faith to impasse if the con- tract does not restrict the relocation Moreover, we note that Haley & Haley did not engage in timely bar- gaining. It began to implement its decision on February 17 without noti- fying or bargaining with the Union, and it did not contact the Union for several weeks following the Union 's March 13 protest of the sale of the trucks It was not until April that Haley & Haley expressed any willing- ness to bargain, when Gossard advised Letts that wage reductions were necessary At that time , Haley & Haley's decision already had been sub- stantially implemented . In addition, Haley & Haley's April 28 bargaining request was coupled with a reminder that some trucks already had been sold and a threat that more would be sold unless concessions were forth- coming Only 9 days later Haley & Haley ceased hauling logs s s See G & M Lath & Plaster Co, 252 NLRB 969, 979-980 (1980). As noted above, we have found it appropriate to analyze this case under alter ego principles and not under the principles set forth in Otis Elevator, supra, and Milwaukee Spring, supra We emphasize again that 655 CONCLUSIONS OF LAW 1. Respondent Haley & Haley, Inc. and Re- spondent Oceanway Transport, Inc. are employers engaged in commerce within the meaning of Sec- tion 2(2), (6), and (7) of the Act. 2. International Woodworkers of America, Local 3-140, AFL-CIO is a labor organization within the meaning of Section 2(5) of the Act. 3. Respondent Oceanway Transport, Inc. is, for the purpose of this proceeding, the alter ego of Re- spondent Haley & Haley, Inc. 4. All employees of Haley & Haley, Inc., and of its alter ego Oceanway Transport, Inc., excluding office clerical employees, professional employees, guards, and supervisors as defined in the Act, con- stitute a unit appropriate for collective bargaining within the meaning of Section 9(b) of the Act. 5. At all times material, the Union has been the exclusive collective-bargaining representative of the employees in the appropriate unit within the meaning of Section 9(a) of the Act. 6. By transferring equipment and employees from Respondent Haley & Haley, Inc. to Respond- ent Oceanway Transport, Inc., to perform log-haul- ing work to avoid their statutory responsibility to adhere to their collective-bargaining agreement with the Union; and by refusing to honor and apply that collective-bargaining agreement, the Re- spondents have violated Section 8(a)(5) and (1) of the Act. 7. The unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. 8. The Respondents otherwise have not violated the Act as alleged in the complaint. THE REMEDY Having found that the Respondents have violat- ed Section 8(a)(5) and (1), we shall order them to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. We have found that the Respondent Oceanway Transport, Inc. and the Respondent Haley & Haley, Inc. are alter egos. We have also found that they transferred equipment and employees from Respondent Haley & Haley, Inc. to Respondent one factor that distinguishes this case from Otis Elevator is the Respond- ents' unlawful motive The Board in Otis Elevator expressly noted that there was no allegation that the employer had acted for antiunion rea- sons. 269 NLRB at 892 fn 4 In addition, as indicated above, the Su- preme Court in First National Maintenance noted the absence of any claim that the employer's decision had been motivated by union animus 452 U.S at 687 Similarly, in Milwaukee Spring the Board noted the par- ties' stipulation that the employer 's decision was not the result of union animus 268 NLRB at 601 656 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Oceanway Transport, Inc., to perform log-hauling work to avoid their statutory responsibility to adhere to their collective-bargaining agreement. We have also found that they refused to abide by that collective-bargaining agreement. Having made these findings, we shall order the Respondents to honor the collective-bargaining agreement and apply it to their employees, and to make their em- ployees whole, with interest,35 for any losses they may have suffered because of the Respondents' fail- ure to honor and apply the collective-bargaining agreement. In addition, we shall order the Re- spondents to make whole their employees by making payments to the various trust funds estab- lished by the collective-bargaining agreement,36 and by reimbursing employees for any expenses en- suing from the Respondents' unlawful failure to make such required payments, as provided in Kraft Plumbing & Heating, 252 NLRB 891 fn. 1 (1980), enfd. 661 F.2d 940 (9th Cir. 1981).$' ORDER The National Labor Relations Board orders that Respondents Haley & Haley, Inc. and Oceanway Transport, Inc., Reedsport, Oregon, their officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Transferring equipment and employees from Respondent Haley & Haley, Inc. to Respondent Oceanway Transport, Inc., to perform log-hauling work to avoid their statutory responsibility to adhere to their collective-bargaining agreement with International Woodworkers of America, Local 3-140, AFL-CIO. (b) Refusing to honor and apply their collective- bargaining agreement with the Union described above. The unit is: All employees of Haley & Haley, Inc., and of its alter ego Oceanway Transport, Inc., ex- cluding office clerical employees, professional employees, guards, and supervisors as defined in the Act. (c) In any like or related manner interfering with, restraining, or coercing employees in the ex- "" See Ogle Protection Service, 183 NLRB 682 (1970). 96 Because the provisions of employee benefit fund agreements are variable and complex, the Board does not provide for interest at a fixed rate on fund payments due as part of a "make -whole" remedy. We there- fore leave to further proceedings the question of how much interest the Respondents must pay into the benefit fund to satisfy our "make-whole" remedy These additional amounts may be determined , depending on the circumstances of each case, by reference to provisions in the documents governing the fund at issue and, when there are no governing provisions, to evidence of any loss directly attributable to the unlawful action, which might include the loss of return on investment of the portion of funds and withheld additional administrative costs, but not collateral losses. See Merryweather Optical Co, 240 NLRB 1213, 1216 fn 7 (1979) 37 See also Advance Electric, supra at 1005 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) Honor and apply the collective-bargaining agreement with the Union described above. (b) Make whole the bargaining unit employees and reimburse the funds established by the collec- tive-bargaining agreement, with interest, for any losses suffered as a result of the Respondents' fail- ure to honor and apply the collective-bargaining agreement, in the manner described in the remedy section of this decision. (c) 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 amount of backpay due under the terms of this Order. (d) Post at their facility in Reedsport, Oregon, copies of the attached notice marked "Appen- dix."38 Copies of the notice, on forms provided by the Regional Director for Region 19, after being signed by the Respondent's authorized representa- tive, shall be posted by the Respondents immedi- ately upon receipt and maintained for 60 consecu- tive days in conspicuous places including all places where notices to Respondents are customarily posted. Reasonable steps shall be taken by the Re- spondents to ensure that the notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply. s" 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 transfer equipment from Haley & Haley, Inc. to Oceanway Transport, Inc., to per- form log-hauling work to avoid our statutory re- sponsibility to adhere to our collective-bargaining HALEY & HALEY, INC. agreement with International Woodworkers of America, Local 3-140, AFL-CIO. WE WILL NOT refuse to honor and apply our collective-bargaining agreement with the Union de- scribed above. 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 honor and apply our collective-bar- gaining agreement with the Union described above. The unit consists of all employees of Haley & Haley, Inc., and its alter ego Oceanway Trans- port, Inc., excluding office clerical employees, guards, and supervisors as defined in the Act. WE WILL, in the manner prescribed by the Na- tional Labor Relations Board, make whole our bar- gaining unit employees and reimburse the funds es- tablished by the collective-bargaining agreement, with interest, for any losses suffered as a result of our failure to honor and apply our collective-bar- gaining agreement. HALEY & HALEY, INC. OCEANWAY TRANSPORT, INC. Richard V. Stratton, Esq., for the General Counsel. Duane Vergeer, Esq., and Charles Huber, Esq., Portland, Oregon, for the Respondent. Rick Roll, Esq., Tillamook, Oregon, for the Charging Party. DECISION STATEMENT OF THE CASE GERALD A. WACKNov, Administrative Law Judge. Pursuant to notice, a hearing with respect to this matter was held before me in Eugene, Oregon, on 1 October 1985. The initial charge was filed on 13 June 1985 by International Woodworkers of America, Local 3-140, AFL-CIO (the Union). An amended charge was filed by the Union on 31 July 1985. Thereafter, on 31 July 1985 , the Regional Director for Region 19 of the National Labor Relations Board (the Board) issued a complaint and notice of hearing alleging a violation by Haley & Haley, Inc. and Oceanway Trans- port, Inc. (Respondents) of Section 8(a)(1) and (5) of the National Labor Relations Act (the Act). The parties were afforded a full opportunity to be heard, to call, examine and cross-examine witnesses, and to introduce relevant evidence. Since the close of the hearing, briefs have been received from the General Counsel, counsel for the Respondent, and counsel for the Union. 657 On the entire record,' and based on my observation of the witnesses and consideration of the briefs submitted, I make the following FINDINGS OF FACT I. JURISDICTION Respondent Haley & Haley, Inc. is an Oregon corpo- ration with an office and place of business located in Ma- pleton, Oregon, where it is engaged in the business of contract log hauling. In the course and conduct of its business operations, Haley & Haley, Inc. has provided services valued in excess of $50,000 annually to custom- ers, including International Paper Company and Champi- on Paper Company, which enterprises were directly en- gaged in interstate commerce. On the basis of the foregoing, I find that Haley & Haley, Inc. is, and has been at all times material, an em- ployer engaged in commerce within the meaning of Sec- tion 2(2), (6), and (7) of the Act. It is admitted that the Union is, and has been at all times material, a labor organization within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES A. The Issues The principal issue raised by the pleadings is whether Haley & Haley, Inc. and Oceanway Transport, Inc., a corporation wholly owned by Haley & Haley, have vio- lated Section 8(a)(1) and (5) of the Act by unilaterally transferring equipment and employees outside the bar- gaining unit, and by failing and refusing to abide by the provisions of a current collective-bargaining agreement. B. The Facts Haley & Haley, Inc. (Haley), a family corporation en- gaged in the log-hauling business, has maintained a col- lective-bargaining relationship with the Union for many years. The current collective-bargaining agreement ex- tends from 1 June 1983 to 1 June 1986. Haley had two principal customers that accounted for approximately 97 percent of its business, each customer providing nearly half of Haley's business over the years. One of these cus- tomers was Champion Paper Company, which terminat- ed its operations in January or February 1985. About the same time the other customer, International Paper Com- pany, changed its method of compensating log-hauling contractors and announced that it intended to significant- ly reduce the fees it was willing to pay for this service.2 Haley was economically unable to haul logs at the new rate. Moreover, because of the established contractual wage rate, Haley was unable to haul for "gypos," small independent nonunion companies, at a profit. As a result, Haley ceased hauling operations on 7 May 1985. 1 Errors in the transcript have been noted and corrected 2 Prior to this time, the Union's contract with International Paper pro- vided that log-hauling work be contracted to union haulers, thus ensuring that Haley would retain the work 658 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Haley purchased Oceanway Transport, Inc. (Ocean- way) on 30 March 1984. In June 1984 Oceanway com- menced operations as a hauler of heavy equipment. It had no log-hauling permit until August 1984, and did not commence hauling logs until about 17 February 1985, when it purchased four log-hauling trucks from Haley. The names on these trucks were changed at Haley's premises to reflect that they were being operated by Oceanway. Thereafter the trucks were driven by the same drivers who had previously driven them for Haley. The drivers withdrew from the Union prior to their em- ployment with Oceanway. On 13 March 1985 the Union sent the following letter to Haley: It has come to the attention of this Local Union, I.W.A. 3-140, that you have moved several logging trucks out of the bargaining unit. This is in violation of our joint working agree- ment. Any truck drivers within the bargaining unit hauling for any company, or gypo, are to remain in Local 3-140's jurisdiction. In April 1985 Jack Gossard, a labor relations consult- ant, spoke with Charles Letts, union business representa- tive, concerning Haley's economic circumstances. Gos- sard advised Letts that contractual wage reductions were necessary. Letts indicated that discussions on this subject would be fruitless until the International Paper negotia- tions, which were then being conducted, had been final- ized. Larry Haley, vice president of Haley & Haley, Inc., sent a letter to the Union, dated 28 April 1985, as fol- lows: We want to confirm and repeat recent requests to you from Jack Gossard and myself, for further dis- cussions on how Haley & Haley can continue in business and compete for I-P's trucking business. If what we hear indirectly from I-P is true, then we are going to have to have substantial changes in order to compete for the I-P hauling. As I told you the last time I saw you, Haley & Haley cannot come close to competing for the hauling for other companies anywhere in this area. Unless something happens soon, we will be forced to sell off more of our trucks or even consid- er going out of business. We will appreciate hearing from you as soon as possible. Thereafter, apparently being advised during a phone conversation between Gossard and Letts that the request for a meeting should be sent to the Union's regional council, Haley sent the following letter to the counsel on 6 May 1985: We are attaching a copy of a letter sent to IWA Local 3-140. We have been advised that our request for a meeting should be addressed to the Regional Council. We are requesting a meeting to discuss Haley & Haley's competitive position now that Champion International at Mapleton is closed and we believe that international Paper at Gardiner is putting its log trucking up for competitive bidding to nonunion truckers who are paying their drivers $7.00 an hour with few if any fringes. We will expect to hear from you soon. On 18 May 1985, Larry Haley advised Union Repre- sentative Letts that Haley had been given a deadline by International Paper and would have to advise that Com- pany by 21 May 1985 whether it would provide hauling at the newly established rate, which was significantly lower than the then-prevailing contract rate. Haley told Letts that the contract wage and benefit package would need to be reduced, and proposed a $10.50-an-hour pack- age. Letts said he would get back to him over the week- end after holding a union meeting among the drivers for the purpose of voting on Haley's proposal. The union meeting was held, apparently on 18 May 1985, and the drivers refused to accept the package offered by Haley. A meeting between the parties was held on 21 May 1985. The Union was advised that Haley, in order to sur- vive, was going to need a reduced wage and fringe bene- fit package of around $10.50 an hour due to the new rates that International Paper was willing to pay for hauling. Letts, according to Gossard, stated that he had been negotiating with International Paper and knew what it would take to make Haley competitive. Letts' position was that the Union remained either unable or unwilling to grant any wage concessions. On 22 May 1985 Letts wrote the Company the follow- ing letter: It has come to the attention of Local 3-140 that Haley & Haley Trucking has transferred logging trucks to a company under the name of Ocean Way [sic] of Mapleton, Oregon. We strongly believe this is a move to circumvent our joint working agree- ment and deprive the I.W.A. crew of wages and benefits due under the agreement. I.W.A. Local 3-140 requests a meeting on this issue. We suggest the date of May 28, 1985 at 4:00 pm at the I.W.A. Hall at 364 N. 4th Street in Reed- sport, Oregon. Please advise as to your availability of time and place. A meeting was held on 28 May. Larry Haley pressed the Union for a response to its wage concession propos- al, and advised that Haley was in danger of going out of business. Gossard testified that he gave the Union a breakdown on the hourly costs of what it would take to operate profitably, and the Union was told there was no way Haley could continue in business under the current contract labor costs. Loren Haley, Respondent's presi- dent, said the Company was absolutely firm on its pro- posal. During the course of the meeting the Union's at- torney asked for certain specific information , including the names of the stockholders of Haley and Oceanway; how many trucks Haley retained; how many trucks Oceanway operated; and Haley's projected costs. Haley's representatives answered these questions, and there is no HALEY & HALEY, INC. contention that Haley refused to divulge whatever infor- mation the Union requested about either corporation. Letts said he was aware of much of the information, and recognized that Haley was probably in a loss position. The Union made no request for Haley's books and records to verify its economic position. During the meeting, Letts stated that Haley's proposed wage package was not sufficient. However, he made no counteroffer or indicated that the Union would be recep- tive to another offer. The Union's attorney said the Union would not discuss the problem further until those trucks that had been sold to Oceanway were transferred back to Haley. At the end of the meeting a written re- quest for information was handed the Company. The three-page request is extensive, listing some 20 separate items of information, some of which call for detailed re- ports on the operation of each log truck. The informa- tion was to be produced by 10 June 1985. Larry Haley testified that there was not a total shut- down on 7 May 1985, the day Haley ceased its hauling operations. Rather, the Company parked the trucks while attempting to find hauling jobs at a rate that would enable it to pay the contractual wage rate to the drivers. Four trucks were kept until 8 August 1985 when Haley concluded that there would be no concessions from the Union. Loren and Larry Haley met with Letts on 30 May 1985. The Union was unwilling to grant any wage con- cessions and made no counterproposals. Rather, Letts said he had no authority to grant any wage concessions. Letts said, according to Larry Haley, that the informa- tion requested at the earlier meeting did not need to be furnished until a subsequent meeting attended by another union representative, Hubble, could be held. Loren Haley testified that he advised Letts that it would prob- ably take about 2 weeks to put the information together, and Letts, according to Loren Haley, said not to worry about it Letts testified that he did not remember anyone mentioning the request for information at the 30 May meeting, but acknowledges that the Union was in no hurry for the information, and would have utilized it for bargaining purposes until such time as Union Representa- tive Hubble was available to negotiate. The meeting with Hubble, however, was never held. Another meeting occurred on 11 June. No progress was made, as the parties continued to maintain their prior positions. C. Analysis and Conclusions Oceanway is wholly owned by Haley and there is no dispute that the Haley family owns and controls both corporations. Clearly, if Haley has violated the Act as al- leged, by unlawfully transferring unit work to Ocean- way, both corporations would be jointly liable for par- ticipating in such unlawful activity. It is clear that 97 percent of Haley's business has been with only two customers, each of which did about an equal amount of business with Haley. One of these cus- tomers, Champion Paper Company, totally discontinued its business operations. The other, International Paper Company, which was having severe financial difficulties and had been negotiating with the Union for concessions, 659 had sharply curtailed its operations. This further reduced Haley's log-hauling work and resulted in a substantial number of idle vehicles and employees. Moreover, Inter- national Paper advised Haley that as of 21 May 1985, it would sharply reduce the hourly fees it would pay for log hauling and would contract out the work to the lowest bidders. Further, the record indicates that prior to 21 May there was not much hauling work contracted out by International Paper, and that Haley obtained what- ever work was available and economically feasible during this period. There is no dispute as to the economic hardship on the business operations of Haley due to the foregoing cir- cumstances. That Haley needed midterm concessions from the Union is beyond dispute, and no evidence was presented that its wage and benefit proposal to the Union, although substantially less than the then-current contract rate, was unrealistic, advanced in bad faith, or was designed to ensure that it would be unacceptable to the Union. Indeed, it is significant that although union representatives were clearly and repeatedly advised of Haley's financial condition, no request was made to see the books or records of that corporation to verify Haley's representations in this regard. The parties engaged in substantial negotiations during which Haley, which had been given a deadline by Inter- national Paper, desperately attempted to negotiate re- duced contract wage rate, which would enable it to con- tinue hauling logs for that customer. The Union, howev- er, although it did not refuse to discuss the matter, simply had no authority to modify the contractual wage and fringe benefit terms. Counsel for the General Counsel and the Union main- tain that no impasse in negotiations could have been reached since certain unit work was transferred to Oceanway in February, prior to any negotiations and, moreover, because Haley failed to provide certain re- quested information. I do not agree. I find, as credibly testified to by Gossard, that Haley's representatives an- swered all questions asked regarding Haley's financial sit- uation and its relationship with Oceanway. Nor does the record show that Haley's officers or representatives at- tempted to establish a disguised corporation to evade Haley's bargaining obligation. Indeed, the name of Oceanway Transport, Inc. was placed on many former Haley trucks at Haley's premises, and the same drivers were employed by Oceanway to drive them . Business Agent Letts' testimony that he was unaware of the rela- tionship between the two entities is not persuasive. Moreover, I credit the Respondent's witnesses who testi- fied that Letts told them the information need not be provided until a later event, namely, negotiations with Business Representative Hubble, which negotiations never took place. And, even if Letts had been given the information, the Union would admittedly not have been in a position to agree to contract modifications. Oceanway, being operated as a nonunion entity, could simply obtain work at the prevailing "gypo" rate for log hauling, and Haley, under the current contractual wage and benefit constraints, could not. There is no showing that there would have been any additional work for 660 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Haley drivers subsequent to the time Haley commenced selling its trucks to Oceanway, other than the work Haley actually performed. Therefore, the work per- formed by Oceanway was not work that Haley's em- ployees would otherwise have performed. Under these circumstances, it has not been shown that unit work was unlawfully transferred outside the bargaining unit, as al- leged. On the basis of the foregoing, I find that Haley en- gaged in good-faith negotiations for contract conces- sions, and that an impasse was reached . Further, under the precedent established in Milwaukee Spring Division, 268 NLRB 601 (1984), I find that Haley did not violate the Act as alleged by causing Oceanway, its wholly owned entity, to engage in log hauling . Indeed, such work under the prevailing contract rates would not have been performed by Haley. Moreover, Haley did not vio- late the Act, as alleged, by failing to furnish requested information, as the information had either been furnished to the Union or, under the circumstances, would have served no useful purpose. CONCLUSIONS OF LAW 1. Haley & Haley, Inc. is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. Haley & Haley, Inc. has not engaged in conduct violative of the Act as alleged. On these findings of fact and conclusions of law and on the entire record in this case , I issue the following recommendeds ORDER It is recommended that the complaint be dismissed in its entirety. s If no exceptions are filed as provided by Sec. 102 .46 of the Board's Rules and Regulations, and 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.