Preece Coal Co.

PREECE COAL CO. Preece Coal Company and District 30, United Mine Workers of America. Case 9-CA-24228 June 30, 1988 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND CRACRAFT On March 21, 1988, Administrative Law Judge Richard H. Beddow Jr. issued the attached deci- sion. The Respondent filed exceptions and a sup- porting 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 brief and has decided to affirm the judge's rulings, findings, and conclusions' and to adopt the recommended Order as modified.2 ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, Preece Coal Company, Turkey Creek, Kentucky, its officers, agents, successors, and as- signs, shall take the action set forth in the Order as modified. 1. Substitute the following for paragraph 2(a). "(a) Offer James David Smith immediate and full reinstatement to his former job or, if that job no longer exists, to a substantially equivalent position, without prejudice to his seniority or any other rights or privileges previously enjoyed, and make him whole for any loss of earnings and other bene- fits suffered as a result of the discrimination against him, in the manner set forth in the remedy section of this decision." 2. Substitute the following for paragraph 2(e). "(e) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply." 3. Substitute the attached notice for that of the administrative law judge. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government 731 The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. WE WILL NOT bargain directly with any employ- ees in the bargaining unit. WE WILL NOT discharge or lay off any employ- ees for engaging in activities protected by Section 7 of the Act. 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 offer James David Smith immediate and full reinstatement to his former job or, if that job no longer exists, to a substantially equivalent position, without prejudice to his seniority or any other rights or privileges previously enjoyed and WE WILL make him whole for any loss of earnings and other benefits resulting from his discharge, less any net interim earnings, plus interest. WE WILL remove from our files any reference to the layoff of James David Smith on April 31, 1987, and notify him in writing that this has been done and that evidence of this unlawful layoff will not be used against him in any way. PREECE COAL COMPANY ' In affirming the judge's conclusion that Smith's termination violated the Act, we do not rely on the judge's finding that the Respondent al- lowed Preece, a truckdnver who had been convicted of vehicular homi- cide, to continue working for the Company as a contract hauler was evi- dence of disparate treatment One of the Respondent 's contentions was that its insurance company would not insure Smith because of his DWI conviction As the record fails to show that contract haulers are covered under the Company's insurance policy, we cannot find that Respondent's treatment of Preece is relevant to the inquiry of how Smith 's situation was handled 2 We shall modify par 2(a) of the judge's recommended Order to con- form his reinstatement language to that customarily used by the Board We shall also modify par 2(e) to correct an inadvertent error Linda B. Finch, Esq., for the General Counsel. Ray Blankenship and Gary Wang, of Greenwood, Indi- ana, for the Respondent. DECISION STATEMENT OF THE CASE RICHARD H. BEDDOW JR., Administrative Law Judge. This matter was heard in Williamson, West Virginia, on 20 October 1987. Briefs subsequently were filed by both parties. The proceeding is based on a charge filed 24 289 NLRB No. 93 732 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD April 1987,1 by District 30 United Mine Workers of America. The Regional Director's complaint, dated 12 June, alleges that Respondent Preece Coal Company of Turkey Creek, Kentucky, violated Section 8(a)(1), (3), and (5) of the National Labor Relations Act by discharg- ing employee James David Smith, by bypassing the Union, and by dealing directly with its employees con- cerning wage and benefit reductions. On a review of the entire record in this case and from my observation of the witnesses and their demeanor, I make the following FINDINGS OF FACT I. JURISDICTION Respondent is a Kentucky corporation engaged in the mining and sale of coal under contract with Island Creek Coal Company. During the past 12 months Respondent provided services valued in excess of $50,000 for Island Creek, an Illinois corporation that annually sells and ships coal valued in excess of $50,000 directly to points outside Kentucky. Respondent admits that at all times material it has been an employer engaged in operations affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act, and that the Union is a labor or- ganization within the meaning of Section 2(5) of the Act. II. THE ALLEGED UNFAIR LABOR PRACTICE Island Creek holds a lease on coal located in Hatfield, Kentucky. Respondent has a contract to mines and deliv- ers this coal for Island Creek, and to conduct no other operations. Since June 1975, Respondent has recognized District 30 United Mine Workers of America as the col- lective-bargaining representative of all of its employees working at the Hatfield mine location. Under its January 1985 contract with Island Creek, Respondent was paid $23 per ton of clean coal, however, effective November 1985 Respondent's payment was re- duced to $22 per ton, effective August 1986 to $20 per ton, and effective December 1986 to $19.50 per ton. Its latest contractual arrangement, effective in March 1987, provides $18.50 per ton of clean coal for the first 5000 tons monthly, and a 50-cent reduction for each 5000 tons produced thereafter. James David Smith began working for Respondent in October 1978 and worked at varying times as either a truckdriver or loader operator . Since 1979, Smith has been the union mine committeeman at Respondent's fa- cility. He also has been the president of Local 1532 since June 1984. In 1986 Smith was employed as a truckdriver but was discharged in November 1986. Pursuant to an arbitration award dated 8 December 1986 , Smith was re- instated as a truckdriver. Thereafter, in mid-January 1987, Respondent assigned Smith to operate the loader. Smith continued as a loader operator until he was dis- charged in April (he previously had performed the loader operator job for approximately 6 months in 1984 and 1985). I All following dates will be in 1987 unless otherwise indicated In late March, Paul Lawson, Respondent's accountant, came to the mine, met with the day-shift employees, and told them that Respondent was having financial prob- lems and they needed to try to find a solution. Lawson explained that the problem was not a pressing one at the time, but Island Creek Coal Company was reducing the amount it paid per ton of coal and he suggested that the employees consider purchasing Respondent's stock. Lawson did not discuss the financial problems or his sug- gested stock purchase plan with any authorized union of- ficial prior to meeting with the employees. Between 27 and 30 March, Mine Superintendent Jimmy Webb called Smith to the office and told him he wanted a meeting with the employees to discuss their taking a pay cut. Smith replied that it was a contract vio- lation and he could not and would not discuss it. Webb then told Smith he had an insurance company letter saying he could not be a truckdriver. Smith replied he was not a truckdriver but a loader operator and walked away. On Friday, 3 April, Webb met with the employees at the end of the day shift and told eight or nine day-shift and four second-shift employees that Respondent had been having financial problems and could not afford to buy supplies. He said that Respondent would close its mine if the employees did not reduce their daily wage rate to $100 per day and freeze all of their sick and per- sonal days (daily wage rates were all more than $100 prior to this time). The discussion between Webb and the employees was underway when Smith, who had not been at work that day, joined the meeting. Smith told the other employees that Webb was violating the con- tract by making such a proposal, and it was a violation for Respondent to negotiate outside of the contract. Some employees suggested accepting Webb's proposal for a 30-day period , under certain conditions . This was conveyed to Webb, who refused this offer. The employ- ees told Webb that they would not agree to a wage re- duction and he responded by saying that there would be no more work. Smith instructed the men to report to work as usual on Monday, 6 April, to cover themselves, and to verify whether Respondent was going to close its operations. On Sunday evening, Respondent notified some employees to report to work the next day. On Monday, Webb also telephoned roof bolt operator Roger Stepp and told him to return to work the following day. Smith was not called to report back to work, but report- ed to the mine on 6 April on his own. When he went to his loader he was told to wait, and that Webb wanted to talk to him. Smith testified that Webb said, "David, I told you in the meeting the other day, if you'd stay out of this meeting and kept quiet that you'd be working. The other men are working and you're not." Smith again reported to work the following day, but was not allowed to work. Later that day Smith filed two grievances. A third grievance was filed on Friday, 10 April. Webb dis- agreed with each grievance on behalf of the Employer. Smith asked Webb why he would not let him work, and Webb grinned, and said that there was just no work for him and walked out. PREECE COAL CO. On 15 April, Union Field Representative Vernon Adkins held a third-step grievance meeting with Webb. Smith and Lawson also were present. Adkins and Smith both testified that Adkins asked if there could be a settle- ment to get Smith back to work. Adkins testified that Webb said "There's no way. David would have been working, if he had kept quiet." Smith recalled that Webb replied "No, if he would have kept his mouth shut, this all could have been avoided," and that Adkins looked at him a little bewildered and asked what he had said, and Webb again said, "If they would have kept quiet, this all could have been avoided and we'd all be working now." Adkins said Webb made a similar statement three times during this discussion. One time saying "David would have been okay if he had kept quiet," and "If he would have kept his mouth shut, he would have been okay." During this meeting, Webb commented that Respondent had received a letter from its insurance company stating that they could no longer insure Smith as a truckdriver because he had been arrested for driving under the influ- ence of alcohol and, therefore, he could not be returned to work. Adkins argued that Smith was not a truckdriver but a loader operator. Webb responded, "That makes no difference." Smith testified that he was convicted of driving his own vehicle under the influence of alcohol on 10 Febru- ary 1986. The subject was published in the local paper and the Company was aware of it. He attended school, had the points removed, and did not lose his license. He continued driving a truck for Respondent under a lease- purchase arrangement, in which he reimbursed Respond- ent for insurance cost for a policy through Respondent's insurer, Justice and Stamper Insurance Agency, until 15 November 1986. When the lease- purchase arrangement was ended, he apparently was laid off but after an arbi- tration proceeding in November he was returned to work on 8 December 1986. He was employed as a driver of one of Respondent's trucks until his January assign- ment as a loader operator. On 11 March, the insurance agency notified Respond- ent that it would not reinsure Respondent unless Smith was deleted from the policy. Respondent promptly signed a waiver to that effect. Respondent asserts that because of lower production under the sales contract, which became effective in March, it no longer required a full-time loader operator, and it resumed the practice of having truckdrivers load their own vehicles. Mackey Preece is a truckdnver for the Company and continues to work as a contract hauler (along with one other driver with a similar arrangement), even though he was convicted of vehicular homicide in 1985. Preece Coal currently owns 4 trucks but owned as many as 17 in 1983 and 1984. It currently considers Smith to be on layoff status. III. DISCUSSION The issues in this case arose after the Respondent sought wage and benefit concessions from its employees, and thereafter laid off the union mine committeeman who opposed this action. 733 First, it is undisputed that both the mine superintend- ent and Respondent's accountant met directly with em- ployees, discussed the Company's financial problems, and promoted changes (reductions in pay and leave benefits and a proposal for a new stock purchase program) in terms and conditions of employment. It appears that Su- perintendent Webb mentioned Respondent's plan to meet directly with the men to Smith, who promptly informed him that it would be contrary to the contract. Otherwise, it is shown that Smith had no authority to negotiate a change in the existing collective-bargaining agreement on behalf of the Union and, accordingly, I find that it is ir- relevant that Smith was aware of or present during Re- spondent's meeting with the employees. The clear purpose and effect of the meetings were to obtain changes in wages and benefits directly from the employees, regardless of the contract and bargaining agreement with the Union. It is well established that direct dealings with employees tend to undermine a union's status as exclusive representative and to inhibit parties from reaching agreement. See Tralas Meat Co., 239 NLRB 1400 (1979). Although the Respondent asserts that its conduct was mandated by severe economic con- ditions, this factor does not allow an employer to repudi- ate or modify an existing collective-bargaining agree- ment, and bypass the process of negotiation with the des- ignated bargaining representative. Under these circumstances, I find that Respondent met and bargained directly with the employees concerning changes in terms and conditions of employment at a time when it was bound by an existing union contract and bargaining agreement and, accordingly, I conclude that Respondent is shown to have violated Section 8(a)(1) and (5) of the Act, as alleged. At the end of Webb's meeting the employees made a counteroffer; however, Webb refused to accept their conditions and told them there would be no more work, thereby effectively laying off all the employees on Friday, 3 April. The following Sunday and Monday Re- spondent called most employees back to work. However, when Smith made repeated attempts to report to his usual job, he was specifically told by Webb that there was no work for him because he had interjected himself into the meeting on Friday. In a discharge or layoff case of this nature, applicable law requires that the General Counsel meet an initial burden of presenting sufficient evidence to support an in- ference that the employee's union or other protected concerted activities were the motivating factor in the employer's decision to lay off and not recall the employ- ee. Here, the record shows that Smith was the minesite union committeeman, that he objected to the Company's direct negotiations with the employees, and that he was told by the mine superintendent that he would be work- ing if he would have kept quiet and stayed out of the meeting with employees. Under these circumstances, I find that the General Counsel has met his initial burden by presenting a prima facie showing sufficient to support an inference that Smith's union activities were the moti- vating factor in Respondent's decision to terminate him. Accordingly, the testimony will be discussed and the 734 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD record evaluated in keeping with the criteria set forth in Wright Line, 251 NLRB 1083 (1980), see NLRB v. Trans- portation Management Corp., 462 U.S. 393 (1983), to con- sider Respondent's defense, and to consider whether the General Counsel has carried her overall burden. Respondent rests its defense on a claim that a reduc- tion in its work force was required because of a decline in both the price it was paid for its coal and in its appar- ent level of production. It further asserts that Smith's job as a loader operator was not a regular job, and that be- cause of the decreased volume of production, truckdriv- ers could do their own loading without the help of a full-time loader operator. Although it is apparent that the Respondent did have financial difficulties, and subsequently experienced a de- cline in production, it is equally apparent that these con- cerns were not the primary reason for its decision on 6 April and thereafter to keep Smith from coming back to work. The unrebutted,2 credible testimony of both Smith and Union Field Representative Adkins shows that during the course of a grievance proceeding on 15 April Super- intendent Webb repeatedly said that if Smith had "kept quiet" and had "kept his mouth shut" he would have been okay and would be working. Although Respondent asserts that Smith was laid off because there was no need for a loader operator, and because he could not be used as a truckdriver because of an insurance problem, there is no indication that Smith was ever given any formal notification of his layoff or that he was notified of this rationale for his layoff until the close of the grievance proceeding when his DWI conviction was mentioned. The facts surrounding the conviction show that it had occurred over a year earlier and that Smith had been employed as a truckdriver of Respondent's equipment during December 1986 and January 1987, and that Smith had cleared his record by attending traffic school. No effort was made by Respondent to investigate whether Smith's insurance status could be reconsidered, and no attempt was made to discuss the possibility of offering Smith other work or the opportunity to drive a truck as a contract hauler, as he previously did and as driver Macky Preece continued to do, despite a conviction for vehicular homicide. Moreover, an employee with 14 years' experience testified that immediately after Smith's layoff there continued to be enough coal being run to keep a full-time loader operator busy, as the operator also usually performs other maintenance type tasks around the minesite. Under these circumstances, I find that the reasons offered as justification for Smith's layoff, especially its opportunistic reliance on the action of its insurance company, clearly are inconsistent with the un- refuted reasons stated by its mine superintendent, and I conclude that Respondent's reasons are pretextual. Respondent clearly knew of Smith's union position as mine committeeman, and his opposition to its attempt to bargain directly with the employees. It is well settled that an employee who invokes the provisions of a collec- 8 Webb did not testify However, accountant Lawson, who also was present during the grievance proceeding, did testify but did not address or rebut the testimony of Smith and Adkins on this subject tive-bargaining agreement or otherwise engages in activi- ties on behalf of a labor organization is engaged in pro- tected concerted activity. The Company responded to the employees' refusal to accept concessions by announc- ing that there would be no more work but it then re- called all employees except Smith.3 As discussed above, it is clear that the motivating factor behind Respondent's action was Smith's affrontary in opposing the Company's attempt to bypass the Union and obtain concessions di- rectly from the employees. Under all these circumstances, I conclude that Re- spondent has not met its burden of showing that Smith would have been laid off and not recalled, absent his union and protected concerted activity. The General Counsel otherwise has met its overall burden of proof, see Chestnut Ridge Mining Corp., 268 NLRB 374 (1983), and I further conclude that Respondent is shown to have violated Section 8(a)(1) and (3) of the Act, as alleged. CONCLUSIONS OF LAW 1. Respondent is an employer engaged in commerce within the meaning of Section 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. By bargaining directly and unilaterally with employ- ees in regard to wages and benefits, Respondent violated Section 8(a)(1) and (5) of the Act. 4. By laying off employee James David Smith on 3 April 1987, the Respondent engaged in unfair labor prac- tices in violation of Section 8(a)(1) and (3) of the Act. THE REMEDY Having found that Respondent has engaged in an unfair labor practice, I recommend that Respondent be ordered to cease and desist therefrom and to take the af- firmative action described below, which is designed to effectuate the policies of the Act. With respect to the necessary affirmative action, I rec- ommend that Respondent be ordered to reinstate James David Smith to his former job or to a substantially equivalent position, without prejudice to his seniority or other rights and privileges previously enjoyed, and make him whole for any loss of earnings he may have suffered because of the discrimination practiced against him by payment to him of a sum of money equal to that which he normally would have earned from the date of the dis- crimination to the date of reinstatement, in accordance with the method set forth in F. W Woolworth Co., 90 NLRB 289 (1950), with interest as computed in New Ho- rizons for the Retarded, 283 NLRB 1173 (1987),4 and that s Contrary to Respondent's assertion, the Company did make a threat of reprisal when Webb told the employees there would be no more work if they did not agree to a wage reduction and that this threat in fact was carried out against Smith when he was singled out to be omitted from the general recall back to work * Under New Horizons, interest is computed at the "short-term Federal rate" for the underpayment of taxes as set out in the 1986 amendment to 26 U S.C § 6621 Interest accrued before 1 January 1987 (the effective date of the amendment) shall be computed as in Florida Steel Corp, 231 NLRB 651 (1977) PREECE COAL CO. Respondent remove from its files any reference to the layoff and notify him in writing that this has been done and that evidence of this unlawful layoff will not be used as a basis for future personnel action against him. Otherwise, it is not considered to be necessary that a broad order be issued. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed ORDER The Respondent, Preece Coal Company, Hatfield, Kentucky, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Bargaining directly with any employee in the bar- gaining unit. (b) Discharging or laying off any employee for activi- ty protected by Section 7 of the Act. (c) In any like or related manner interfering with, re- straining, or coercing its employees in the exercise of rights guaranteed to them by Section 7 of the Act. 2. Take the following affirmative action neccessary to effectuate the policies of the Act. (a) Offer James David Smith immediate and full rein- statement and make him whole for the losses he incurred 5 If no exceptions are filed as provided by Sec. 102 .46 of the Board's Rules and Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec 102 48 of the Rules , be adopted by the Board and all objections to them shall be deemed waived for all pur- poses 735 as a result of the discrimination against him in the manner specified in the remedy section of this decision (b) Remove from its files any reference to the layoff or discharge of James David Smith on 3 April 1987, and notify him in writing that this has been done and that evidence of this unlawful layoff will not be used as a basis for future personnel actions against him. (c) Preserve and, on request, make available to the Board or its agents for examination and copying, all records, reports, and other documents necessary to ana- lyze the amount of backpay due under the terms of this decision. (d) Post at its Hatfield, Kentucky facility, copies of the attached notice marked "Appendix."a Copies of the notice, on forms provided by the Regional Director for Region 9, after being signed by Respondent's authorized representative, shall be posted by Respondent immediate- ly on receipt and maintained for 60 consecutive days in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent 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 Re- spondent has taken to comply. 6 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."