Francis J. Fisher, Inc.

FRANCIS J. FISHER, INC. Francis J. Fisher, Inc. and Local 13, International Brotherhood of Teamsters, Chauffeurs, Ware- housemen & Helpers of America, AFL-CIO. Case 27-CA-10021 July 13, 1987 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND BABSON On February 3, 1988, Administrative Law Judge William L. Schmidt issued the attached decision. The Respondent filed exceptions and a supporting brief. The General Counsel filed an answering 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, and conclusions, as modified, ' and to adopt the recom- mended Order. ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, Francis J. Fisher, Inc., Denver, Colorado, its officers, agents, successors, and assigns, shall take the action set forth in the Order. i We agree with the judge that the Respondent violated Sec 8(a)(1) of the Act when, at an employee meeting in November 1986, its owner and president told employees that there would be no union after March 1987 and its vice president concluded the meeting by telling employees to decide what they wanted and come to him In agreeing with the judge's conclusion, however, we do not rely on his fording that such remarks by the Respondent tend to cause employees to be "apprehensive and fearful" in exercising their Sec 7 rights, rather, we find that such remarks reason- ably tended to interfere with, restrain, or coerce employees in the exer- cise of their Sec 7 rights The judge relied on the court's opinion in Teamsters Local 175 v NLRB, 788 F.2d 27 (D.C Cir 1986), denying enf of Bell Transit Co., 271 NLRB 1272 (1984), for the general proposition that an employer is re- quired to maintain the status quo established by an expired collective-bar- gaining agreement until the parties reach a new agreement or bargain to impasse The General Counsel, in her answering brief, contends that Bell Transit, in which a valid impasse was found after only three bargaining exchanges, is distinguishable on its facts . Whether or not Bell Transit is distinguishable from the instant case, we overrule it to the extent it holds that impasse can be found on the basis of subsequent events-e .g , a fail- ure to ratify a contract proposal or an ultimate failure to reach an agree- ment-rather than on the state of negotiations at the time of the unilateral action. We additionally overrule the Board 's analysis in that case to the effect that an impasse and tentative agreement may exist simultaneously Michael J. Belo, Esq., for the General Counsel. Gus Achey, Esq., of Denver, Colorado, for the Respond- ent. DECISION STATEMENT OF THE CASE 815 WILLIAM L. SCHMIDT, Administrative Law Judge. I heard this matter on 9 July 19871 at Denver, Colorado. The proceeding is based on a charge filed 10 March by International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, AFL-C102 Local 13 (Charging Party or Union) alleging that Fran- cis J. Fisher, Inc. (Respondent or Employer) violated Section 8(a)(1) and (5) of the National Labor Relations Act (the Act). Pursuant to that charge the Regional Di- rector for Region 27 of the National Labor Relations Board (NLRB or Board) Region 27 issued a complaint on 23 April alleging that Respondent violated Section 8(a)(5) of the Act when it: (1) bypassed the Union and dealt directly with employees the Union represents on 24 November 1986; (2) refused to bargain in good faith with the Union since 15 January; and (3) unilaterally altered wages and working conditions on 9 March. The com- plaint also alleges Respondent independently violated Section 8(a)(1) of the Act when its owner and president Jean Sharkey told employees on 24 November 1986 that as of March there would be no more union and its vice president Don Klaversma solicited employees for infor- mation concerning the working conditions they desired in March. On 30 April Respondent filed a timely answer wherein it admitted certain allegations of the complaint and denied others, including the unfair labor practices al- leged. Having carefully considered the record, the demeanor of the witnesses as they testified and the parties' post- hearing briefs, I now make the following FINDINGS OF FACT 1. THE EVIDENCE A. Relevant Background Respondent is an old Denver firm established in 1889 that sells construction materials.3 In 1935 ownership of Respondent passed from the heirs of its founders to the Goody family and the Union, a labor organization within the meaning of Section 2(5) of the Act, and became the representative of Respondent's drivers and warehouse- men. The collective-bargaining relationship between Re- spondent and Union proceeded peacefully for the next 50 years. The most recent agreement, having a term from 1 March 1984 to 1 March 1987, was concluded following five bargaining sessions in 1984.4 i If not specified all further dates refer to the 1987 calendar year 2 On 1 November 1987 the Teamsters International Union was read- mitted to the AFL-CIO Accordingly, the name of the Union has been amended to reflect that change 3 Respondent sells to the retail and nonretail trade Annually its sales have exceeded $500,000 and its direct inflow exceeded $50,000 Accord- ingly, Respondent meets the Board's announced standard for exercising jurisdiction over the labor dispute involved here 4 Throughout this decision are references to an agreement expiring 8 March It is the same agreement As found below, the parties orally ex- tended the agreement from its I March expiration through 8 March 289 NLRB No. 104 816 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD For about 20 years prior to 1982 Jean Sharkey and her husband, Walter M. Goody, Jr., successfully operated the business. In large measure this success was due to a personal arrangement permitting Goody the exclusive right to distribute a waterproofing product manufactured by Thoro Systems, a firm ultimately consumed in a merger with the Beatrice Company. With the resultant boom this arrangement produced, Respondent expanded beyond its historical roots in Denver by adding a branch outlet in Casper, Wyoming. Good times and humans are not eternal. In 1982 Goody died. The exclusive arrangement for the lucrative waterproofing product ended with his life. In addition to her personal loss, Sharkey was left to deal with the busi- ness ramifications of Goody's death. The effects were not immediate but in 1984, Respond- ent was confronted with competitors for its principal product. By 1985 Respondent's income statement reflect- ed a loss exceeding $81,000.5 The following year's income statement reflected a $36,000 loss on net sales, which were $258,000 lower than those of 1985.6 The January 1987 statement reflected a $6100 loss. According to Sharkey the loss had risen to approximately $30,000 by May 1987. Certain efforts to retrench Respondent's operations were taken in response to these losses. They included: 1. The Casper branch was closed and its capital equip- ment was relocated to Denver or sold. 2. The number of bargaining unit employees in Denver was reduced from five to three between 1984 and the end of 1986. In January 1987 one additional bargaining unit employee was laid off. 3. By April 1987 Respondent relocated its Denver op- eration from quarters requiring a lease payment in excess of $9000 per month to a location where the lease pay- ment is $1600 per month. 7 4. In mid-January 1987 the pay of the five salaried office employees, including Klaversma and Sales Manag- er Clarence Robert, was reduced.8 This was accom- plished by a variety of methods. The elimination of Rob- ert's commission earnings resulted in a $600 per month pay reduction. Bookkeeper Marcie Bishop's salary was reduced by $400 per month. Klaversma's and Tenice Goodman's pay were not reduced but their hours of work were extended. Sharkey relinquished her salary al- together in favor of her son who was hired for sales 5 More precisely the loss was $81 ,487 24 Nearly 43 percent of this loss could be attributed to a bad debt wnteoff in the amount of $35,016 85 for the month of December 1985, the final month of Respondent's fiscal year. By contrast, the bad debt writeoff for December 1986 was $2913 05 The total bad debt wnteoff for 1985 was $46,413 83 The 1986 income state- ment does not indicate the total of that writeoff for that year 6 Respondent's net sales (gross sales plus returns and allowances minus trade discounts) in 1985 were $1,371,250 77 The net sales in 1986 were $1,112,674 33 7 This finding is based on Mrs. Sharkey's testimony However, the 1985 and 1986 income statements reflect rent payments of $62,716 72 and $68,988.40, respectively, or considerably less per month than Sharkey stated at the hearing. 8 The General Counsel attempted to establish-without success-that Robert was a supervisor. Robert, who is essentially an outside salesman, possesses and exercises only routine authority Although Sharkey would expect Robert to exercise common sense in Klaversma's absence by send- ing an intoxicated driver home, such situations have never arisen. work. Finally, Respondent's profit-sharing plan for non- unit employees was eliminated . Following these salary actions, the two remaining unit employees were Re- spondent's highest paid employees by a significant margin. 5. Several vehicles were sold in 1986 and early 1987. Those sold in January 1987 produced income in the amount of $4800 and thereby reduced the loss for that month from $10,900 to $6100. During this retrenchment period , Sharkey made no moves that affected the unit employees' contractual ben- efits. After participating in the 1984 labor negotiations, Sharkey's perception was that on the conclusion of the 1984-1987 agreement she would be free to legally adjust the unit labor costs promptly as she was of the view even as late as the hearing that she would not be obliged to adhere to the agreement in any manner once it ex- pired. In the meantime, Sharkey remarried and relocated her personal residence to Indiana. However, she returns to Denver for approximately 1 week per month to oversee Respondent's operations. In her absence, Klaversma is the principal executive in charge of the operation. There is little or no evidence that he is authorized to conduct Respondent's business with the Union. B. The Alleged Unfair Labor Practices 1. The 8(a)(1) allegations On 11 November 1986 Sharkey met with the unit em- ployees primarily to reassure them that Respondent was not going to close its doors or declare bankruptcy as widely rumored. In addition to Sharkey, Klaversma and the three unit employees, Richard Einertson, Paul Le- Gault, and Paul Vestal, were present. According to LeGault, Sharkey reassured the employ- ees that "the company was not for sale and stuff like that." However, Sharkey did inform the employees that the company was "hurting financially" and that the non- unit employees "hadn't had raises in a certain period of time." Sharkey appealed to the employees to pull togeth- er so they could "make a go out of the company."9 LeGault testified that after Sharkey spoke, Einertson asked her if "we were going to go without the union." Sharkey responded to Einertson saying "for us to get to- gether and figure out what we wanted . . . and let [Kla- versma] know . . . that we'd work something out to go without the union." Einertson then asked if the unit em- ployees "would get a chance to vote on this or any- thing." In response, Sharkey said the employees would not have a chance to vote as, apparently, "there would be no union contract after March 1st." Because the pension plan was of concern to LeGault, he asked Sharkey about that matter. Sharkey responded that "something would be done about a profit-sharing plan." 9 All five individuals who testified concerning this meeting are in sub- stantial accord concerning this aspect of the meeting FRANCIS J. FISHER, INC. 817 LeGault also recalled Klaversma requested that the unit employees let him know what the drivers wanted after they had an opportunity to get together. Like LeGault, Einertson testified that Sharkey spent the first part of the meeting reassuring employees that she intended to keep the business going . Following a dis- cussion concerning holidays, Einertson asked "about ne- gotiations come March 1st ...." Sharkey replied "that come March 1st . . . we would be going non-union- there would be no union as of March 1st." None of the employees responded but Klaversma said that the em- ployees should "come to me and tell me what you want." As for the pertinent part of the meeting concerning the Union, Vestal testified that Einertson asked "What about the union?" Purportedly Sharkey replied that "come March there will be no union." Later, at the end of the meeting, Klaversma told the employees "to let .. . the Company know what [the unit employees] wanted." Sharkey testified that she was "not real sure" if there was any discussion about the Union at this meeting. She said she "just [did not] really know." Klaversma recalled that following Sharkey's introduc- tory remarks one (unspecified) driver asked: "What about the union?" Klaversma testified that he "really did not remember what [Sharkey's] reply was at the time" but "[t]hey went on discussing that, and I really didn't get that much involved in that one." When asked direct- ly if Sharkey had said that when the contract ended in March there would be no union, Klaversma responded: "I don't recall her saying that, specifically, no." As for remarks the drivers attributed to Klaversma suggesting that he solicited proposals about working conditions after the contract ended, Klaversma testified that he only asked the employees to tell him about their complaints so he would not have any morale problems. 2. The 8(a)(5) allegations For a number of years Respondent has retained the Mountain States Employers' Council (MSEC) to conduct its labor negotiations. In mid-December 1986 Gus Achey-an MSEC representative who normally handled Respondent's labor negotiations-sent a written notice to the Union's president terminating the existing agreement effective 1 March, its expiration date. The document is a typical "opening letter" in which Achey also invited the Union to arrange "a meeting to discuss a new Agree- ment." By mid-January 1987 the Union met with Respond- ent's employees and drafted a list of proposals for a new agreement which were hand-delivered to Achey at MESC. In late January 1987 Union Representative George Del Monte wrote to inform Achey that the Union "is prepared to meet for the purpose of negotiat- ing an agreement with [Respondent]." About the same time Del Monte reached Achey on the telephone and was informed Respondent would be unable to meet until 27 February, the date of Sharkey's next scheduled return to Denver. Because Sharkey was unavailable until that late date, Achey agreed to extend the agreement to 6 March and tentatively agreed to meet with the Union on 2 and 5 March. 10 In late February, Sharkey arrived back in Denver as planned. On 1 March she met with MSEC representative Joe Downing to review Respondent's financial predica- ment and formulate its proposals."' By the conclusion of this meeting, Respondent planned to propose the follow- ing: 1. Reduce the hourly pay of unit employees from $9.30 to $6.50 per hour. 2. Delete pension contributions by Respondent. 3. Delete the maintenance-of-standards clause (contract article 5). 4. Change the time and one-half premium pay for overtime work from all hours after 8 per day to 40 per week. 5. Switch unit employees from the Union's health and welfare plan to the Respondent's plan estab- lished for non-unit employees. 6. Establish a vacation moritorium until the end of the year, Respondent's slow season. 7. Limit the contract term to 7 months (or 1 Oc- tober). The Union's proposals delivered to Respondent in mid-January were dramatically different. They provided 1. Increase hourly pay by 40 cents in each year of a three-year agreement. 2. Increase the Respondent's pension contribution by 14 cents per hour each year of the agreement. 3. Require Respondent to maintain health and welfare coverage at no less than the current level. 4. Maintain all other contract provisions. The following day, 2 March, the Respondent and union negotiators met for the first bargaining session. Downing was Respondent's primary spokesman, aided by Sharkey and Marcie Bishop, the Respondent's book- keeper. Del Monte spoke for the Union. He was assisted by fellow business agent Ray Tefrey. During the first portion of the meeting Downing ex- plained the Respondent's financial position at some length, providing the union agents with copies of its income statements for the 1985 and 1986 calendar years as well as its January 1987 income statement, the last available. Although Del Monte could not specifically recall the extent of the losses suffered by Respondent for that period, he clearly remembered Respondent's claim that it was losing money and that the office employees' salaries had been reduced by one means or another. After stressing that any increases in wages and benefits were out of the question and the need for immediate fi- nancial relief,' 2 Downing slowly set forth Respondent's 10 There is evidence that Sharkey was somewhat upset at Achey's action of extending the agreement. 11 Achey enlisted his colleague Downing as a substitute because of the press of other business. 12 Del Monte recalled that Downing said something had to be done by Monday, 9 March. 818 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD proposals, enabling the union agents to write them down. Discussions of the Respondent's proposals focused pri- marily on the relative merits of the health and welfare plans for unit and nonunit employees. During this ex- change the union agents were informed that the purpose of this proposal was to realize savings that might accrue under the company plan by enlarging its group coverage. After approximately an hour and a half, the session was adjourned until 5 March. Between the two bargaining sessions, the union repre- sentatives met with the unit employees to review the Re- spondent's proposals with them.13 As explained by Del Monte, the union agents "wanted to know from [the em- ployees], and get some direction from them, on what was the bottom line, what was the least they felt that they could work for and what conditions they wanted us to insist would be maintained. As a result of this meeting, the union agents were instructed to first seek a wage freeze and if that was not possible then they could work for a "little less than they were making at the time." However, the employees "didn't feel that they could .. . survive on what the company had offered." In addi- tion, the employees indicated that they could "reluctant- ly agree to the overtime-after-forty proposal." The second bargaining session was held on 5 March at the Union's offices. At the outset of this session the Union proposed a wage freeze, which was promptly re- jected. The Union then proposed to reduce the wage rate to $8.90 per hour and agreed with the overtime- after-forty proposal. Downing responded that substantial- ly more relief was required. A discussion ensued con- cerning the Union's willingness to assist Sharkey in filing applications with the city of Denver and the State of Colorado for certification as a minority contractor, a status that presumably would accord Respondent some type of preferential treatment in doing business with those governmental entities. Sharkey, however, had al- ready sought such certification in the past 2 years. The union agents then questioned Respondent's agents closely about the nonunit health plan. That discussion disclosed that Respondent was uncertain of the savings that would be realized from adding the unit employees to the non- unit group coverage. For this reason the union negotia- tor14 asked Respondent to extend the agreement while this information was obtained from Respondent's insur- ance carrier. At some point in this 1-1/2- to 2-hour meeting Re- spondent asked for a caucus from which they emerged with a counterproposal. This counterproposal differed from the Respondent's earlier proposal in that (1) the demand to include unit employees in the nonunit health plan was dropped; (2) the vacation moratorium was dropped; and (3) the contract term was shortened from 1 October to 15 September. Downing stressed that the reason for the switch in the health plan proposal was that time was of the essence in obtaining relief. Downing further stated that the Respondent's audit reports show- 13 Presumably this session was attended by at least Vestal and Einert- son Whether LeGault-who had been laid off approximately 45 days earlier-attended is unknown 14 The Union's principal spokesperson at this portion of the meeting appears to have been Ray Tefrey who did not testify ing business conditions for the busier summer months would probably be available by 12 September in time for review by the Union for negotiation of a new agreement. Downing stated that this proposal was the Respondent's final proposal which it intended to implement on 9 March. The Union responded by suggesting that the unit em- ployees could probably earn more on unemployment compensation than by working at the Respondent's pro- posed wage rate. Downing told the Union that if the em- ployees chose to leave, the Respondent would not con- test their claim for unemployment compensation and that this offer would remain open while the employees were given an opportunity to see how well they could survive on the lower wage rate. Del Monte also recalled that the Union asked if Respondent would consider making the employee pension contributions. Downing responded that employees would have to pay that cost them- selves. 115 The Union also proposed extending the existing agree- ment until there was an opportunity to have its account- ants audit the Respondent's books. Although Respondent agreed to make its books available for audit at any time, Downing told the Union that the Respondent was not in a position to await an audit before it made changes in its wage rates. The Respondent also agreed to make its books available for an audit in September but declined to commit itself to increase wages in September if it was making money because of its tax deficiencies and debt situation. 16 Del Monte recalled that the union agents (he did not specify which ones) expressed the view that further ne- gotiations were needed-that there had not been suffi- cient time to consider Respondent's proposals-and that they did not believe an impasse existed. Nevertheless, the 5 March meeeting concluded with the Respondent's re- quest that the Union seek ratification of the Respondent's final proposal. The union agents told Respondent's nego- tiators that they would take Respondent's proposals to the employees to be voted on but that they could not recommend such an agreement. Nevertheless, Downing provided them with his home number and asked the Union to notify him if the Respondent's proposal was ratified. Downing told the Union agents that if the Re- spondent's proposals were not ratified, they would be implemented the following Monday anyway. Downing extended the existing agreement through 8 March. Downing recalled that after the 5 March meeting there were two relatively brief telephone exchanges between Del Monte and himself, one on 5 March and one on 6 March. During one of these exchanges, he agreed that the Respondent would pay prorated vacation pay to the unit employees if they chose to leave and draw unem- 15 Del Monte said Respondent's stand on the pension contributions was a major matter with the two employees involved as neither had worked the 10 years necessary in covered employment to have a vested interest in the Union's pension plan. At the time of the hearing Vestal and Einertson had worked for Respondent over 7 years. 16 While the income statements in evidence reflect a variety of tax payments as operating expenses, they do not indicate if such payments were sufficient to meet Respondent's tax liabilities The statements reflect no obvious loan or interest payments FRANCIS J. FISHER, INC. ployment insurance against the Respondent 's account. He also recalled that Del Monte again expressed the view that the negotiators were not at an impasse . In effect, Downing felt that in light of the Union's reluctance to agree to its proposals and the limited wage reduction ratified by the employees at the Threewit-Cooper Com- pany,17 one of Respondent's principal competitors, the Union would not agree to a contract that put Respond- ent in a significantly better position than this competitor. Del Monte recalled that the first telephone conversa- tion occurred during the afternoon of 5 March. He said that he told Downing that the Union had a counterpro- posal and that further negotiations were needed as the parties were not at impasse.18 Downing apparently dis- agreed as he told Del Monte that Respondent had made its final proposal. On the morning of 6 March, Del Monte again tele- phoned Downing to request that negotiations continue. Del Monte proposed a meeting for 19 March but apart from the fact that no such meeting was ever agreed on, Downing's response is unknown. Del Monte reported that Downing again stressed that Respondent had made its final proposal. Del Monte wrote to Downing on 6 March (with a copy to Sharkey and the unit employees.) In the letter, Del Monte repeated his belief that negotiations were not at an impasse. The letter continues: "Due to the limited time allowed by the company for negotiations this Local Union requests further meetings as soon as possible as there are still many issues to discuss and contract articles to address." Del Monte's letter also states that the Union has a counterproposal that it desired to present, suggests a 19 March meeting and requests a response to arrange a time and date for a meeting. Del Monte received no response to his 6 March letter until approximately 17 or 18 March when Downing called his office and requested to meet at 8:30 a.m. on 19 March. When Del Monte learned of this call he tele- phoned Downing's office and spoke with a secretary in an effort to arrange a 9:30 or 10 a.m. alternative meeting time on 19 March as he had, in the meantime , made an- other commitment at 8:30. The alternative times proved unsatisfactory for Downing's schedule so a further meet- ing between the parties never occurred. Meanwhile, on 9 March Respondent reduced the unit employees' hourly rate from $9.30 to $6.50, discontinued pension contributions, and began paying overtime premi- um pay after 40 hours of work per week instead of 8 hours per day. On 10 March, the Union filed the instant charge. C. Further Findings and Conclusions 1. The independent 8(a)(1) allegations Section 8(a)(1) of the Act provides that it is an unfair labor practice for an employer to "interfere with, re- 17 According to Downmg, the Threewit-Cooper employees ratified an agreement providing for a 30-cent-per hour wage reduction and overtime premium pay after 40 hours on 5 March 18 The terms of the counterproposal are not known Nor does it appear that Del Monte attempted to report the counterproposal terms to Downing dung this conversation or at any later time 819 strain, or coerce employees" in the exercise of their Sec- tion 7 rights. 29 U.S.C. § 158(a)(1). In essence, Section 7 provides that employees have the right to engage in union or concerted activity for the purpose of collective bargaining or other mutual aid or protection, or to re- frain from such activities. I find that the account of the employee-witnesses about Sharkey's remark at the November 1986 meeting that there would be no more union after March and Kla- versma's followup remarks that the employees should decide what they wanted and come to him are credible. Neither Sharkey nor Klaversma provided a clear-cut denial concerning the reported remarks. Read together, the two remarks convey the message that the Respond- ent was proceeding to unilaterally dismantle the collec- tive-bargaining system by which employee wages, hours, and working conditions were determined. Announce- ments of this nature reasonably tend to cause employees to be apprehensive and fearful of persisting against their employer's will in exercising the right they have under Section 7 to bargain collectively. Accordingly, I find the remarks by Sharkey and Klaversma on this occasion to be coercive within the meaning of Section 8(a)(1) of the Act, as alleged in the complaint. 2. The 8(a)(5) allegations Section 8(a)(5) of the Act provides that it is an unfair labor practice for an employer "to refuse to bargain col- lectively with the representative of his employees." (29 U.S.C. § 1158(a)(5).) Section 8(d) of the Act defines the duty to bargain collectively as "the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement or any question arising thereunder." (29 U.S.C. § 158(d).) Justice Felix Frankfurter, dissenting in NLRB v. Truitt Mfg. Co., 351 U.S. 149, 154-155 (1956), observed that: These sections 8(a)(5) and 8(d) obligate the parties to make an honest effort to come to terms; they are required to try to reach an agreement in good faith. "Good faith" means more than merely going through the motions of negotiating; it is inconsistent with the predetermined resolve not to budge from an initial position. But it is not necessarily incompat- ible with stubbornness or even with what to an out- sider may seem unreasonableness . A determination of good faith or of want of good faith normally can rest only on an inference based upon more or less persuasive manifestations of another's state of mind. The previous relations of the parties, antecedent events explaining behavior at the bargaining table, and the course of negotiations constitute the raw facts for reaching such a determination. Over the years certain more specific principles have evolved that provide flesh for the statutory skeleton set forth above. Among other things, an employer is re- quired to maintain the status quo established by an ex- pired collective-bargaining agreement until the parties 820 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD reach a new agreement or bargain to an impasse. Team- sters Local 175 (Bell Transit) v. NLRB, 788 F.2d 27 (D.C. Cir. 1986). If an employer unilaterally institutes changes in wages, hours, or working conditions absent an impasse in the negotiations for a new agreement, the duty to bar- gain in good faith is violated . NLRB v. Katz, 369 U.S. 736 (1962); Stone Boat Yard v. NLRB, 715 F.2d 441, 444 (9th Cir. 1983). In addition to foregoing basic ground rules establishing the starting point for negotiations, it has been observed that the duty to bargain in good faith contemplates "co- operation in the give and take of personal conferences with willingness to let [the] ultimate decision follow a fair opportunity for the presentation of pertinent facts and arguments." NLRB v. Jacobs Mfg. Co., 19 F.2d 680, 683 (2d Cir. 1952). Good-faith bargaining precludes laying plans for comprehensive changes and timing their announcement or implementation so as to preclude any meaningful negotiation . J. P. Stevens, 240 NLRB 579 (1979). To these ends the courts long ago established the requirement that an employer pleading an inability to pay furnish the bargaining representative with informa- tion sufficient to substantiate such claims. NLRB v. Truitt Mfg. Co., supra; NLRB v. Jacobs Mfg. Co., supra. Here the 9 March unilateral changes in wages and benefits are undisputed. The sole question concerns the presence or absence of a bargaining impasse when these changes occurred. The existence of an impasse is a fact question. In Hi-Way Billboards, 206 NLRB 22, 23 (1973), the Board stated: A genuine impasse in negotiations is synonymous with a deadlock; the parties have discussed a sub- ject or subjects in good faith , and despite their best efforts to achieve agreement with respect to such, neither party is willing to move from its respective position. [footnotes omitted]. In Taft Broadcasting, 163 NLRB 475, 478 (1967), the Board identified numerous factors that serve to aid in de- termining the existence of an impasse: Whether a bargaining impasse exists is a matter of judgment . The bargaining history, the good faith of the parties in negotiations, the length of the negotia- tions, the importance of the issue or issues as to which there is disagreement, [and] the contempora- neous understanding of the parties as to the state of negotiations are all relevant factors to be considered in deciding whether an impasse in bargaining exist- ed. Regardless, an employer may not "parlay an impasse re- sulting from its own misconduct into a license to make unilateral changes." Wayne's Olive Knoll Farms, 223 NLRB 260, 265 (1976). Overall, certain circumstances here suggest the negoti- ations may have been practically doomed before they began. First, there were several signals that a significant upheaval was likely especially where, as here, the unit employees enjoyed the highest pay rates. Over the period of the recently expired agreement, the size and scope of Respondent's business operation was steadily shrinking. The Casper branch was closed, capital equip- ment was sold, the unit employment was shrinking, and rumors were afloat that the enterprise was going under. In January as the Union and the unit employees were formulating proposals for wage and benefit increases, one additional unit employee was laid off, salary cuts ranging from $400 to $600 per month were imposed on two of the four unrepresented employees, the hours of the other two were extended without added compensation, and the owner relinquished her own salary in favor of another full-time salesperson albeit that person was her son. Added capital equipment was sold to reduce January losses and Respondent was in search of other lower cost quarters. These factors signaled the probability of con- cession bargaining. Second, when negotiations did commence, the Re- spondent's dire financial circumstances were detailed for the Union's negotiators and the urgency of Respondent's need for immediate relief was emphasized. The salient feature of Respondent's proposal, which lends credence to the urgency of the situation, is, the fact that Respond- ent was proposing a short-term agreement of 6 or 7 months' duration rather than a long-term commitment. Third, although some modifications in position were made by both Respondent and the Union at the second session, progress toward a wage and benefit adjustment of the magnitude sought by the Respondent was much slower. Del Monte conceded in his testimony the Union's unwillingness to consider a cut in wages of the magnitude sought by the Respondent. Del Monte's report of the unit employee attitude as reflected in the direction given the Union agents between the two bar- gaining sessions to seek a pay freeze or a concession in the range of 20 or 30 cents per hour strongly indicates that they too were unwilling to readily accept Respond- ent's proposed pay. The General Counsel attempts to de- flect attention away from this central fact by arguing that Respondent's wage proposal was arbitrary and ca- pricious based on Sharkey's testimony that it was within the range of wage rates at nonunion firms in the area. That argument misses one central point, to wit, the wage reduction Respondent sought to impose on the unit em- ployees was also within the range of cuts already im- posed on nonunit employees about 2 months earlier. Fourth, at the conclusion of the second bargaining ses- sion the Union specifically stated its unwillingness to rec- ommend the Respondent's final proposal. This fact, cou- pled with the concession made that employees could quit to draw unemployment without a contest from Respond- ent and the limited nature of concessions in the about-to- be-ratified agreement with one of Respondent's competi- tors, lends some credence to Downing's assessment that the parties were at an impasse. Despite the high probability that attempts to negotiate a new agreement here would produce an impasse, I am unable to conclude that an impasse-as the term has pre- viously been used by the Board and the courts-oc- curred so quickly. The question for me to decide is not whether an impasse would occur but rather whether an impasse did occur and, if so, when. Although the number and extent of the bargaining sessions are not controlling FRANCIS J. FISHER, INC. considerations, 19 they are factors which, as the Taft Broadcasting case suggests, are significant. When those factors are coupled with the magnitude of the conces- sions sought by Respondent, the bargaining here simply does not reflect the type of fixed resolve on both sides normally found in impasse situations. Instead, the facts here show that the Union ap- proached negotiations with a compromising attitude. In the 3 or 4 hours of face-to-face negotiations, the Union abandoned nearly all of its original proposals, accepted the Respondent's position on overtime premium pay, dis- cussed a potential pay reduction albeit not of the magni- tude Respondent sought, achieved agreement for an al- ternate course of action if employees were unable to "live" on the pay scale Respondent proposed, and achieved concessions from Respondent concerning the health and welfare plan and the vacation moritorium. In addition the Union sought an additional meeting to present another proposal. Objectively viewed, these cir- cumstances strongly suggest that the parties were not yet completely deadlocked. Rather, they suggest that at least the Union's position remained fluid while the parties en- gaged in face-to-face negotiations. Other atmospheric factors also detract from a conclu- sion that the parties arrived at a deadlock after "exhaus- tive" negotiations. Thus, because of Sharkey's unavail- ability, the parties did not commence negotiations until 2-1/2 months after Respondent sent its termination notice and 1-1/2 months after the Union made its initial propos- al. When negotiations did commence, Respondent artifi- cally compressed the time available for negotiations into a 1-week period. Moreover, Respondent insisted on the Union's acceptance of huge concessions without provid- ing the Union with an opportunity to have Respondent's financial records evaluated by independent experts. This was at the very time when the Union was in the process of concluding an agreement with one of Respondent's competitors which involved concessions of a much smaller magnitude.20 Although Respondent did provide the union agents with the financial statements for the previous 2 years plus the month of January, it is reasona- ble to infer in light of the Union's request for a broader independent analysis that its negotiators were not compe- tent business analysts. In this circumstance, it would be 19 For example, in Betlem Service Corp., 268 NLRB 354 (1983), the Board adopted Judge Ricci's conclusion that the parties there were at im- passe following two formal negotiating sessions However , in that case, the union adamantly refused to consider any agreement other than a new agreement negotiated with another employer There the Board stated: Generally, (we] will not find that an impasse has occurred unless the negotiations between the parties have been exhaustive. Here, the par- ties had engaged in only two formal bargaining sessions with subse- quent contact through two telephone conversations . We agree with the judge, however, that the Union's refusal to consider any agree- ment other than the new local agreement caused impasse early in the negotiations But cf NLRB v Jacobs Mfg supra; Servir Equipment Co, 198 NLRB 266, 269 (1972) 20 The Respondent's most recent agreement with the Union contains no "most favored nations" clause Whether the Threewit-Cooper agree- ment contained such a clause is not known Regardless, the Union could not have been expected realistically to agree on a $2.80 per hour wage reduction on the very day it sought employee ratification to an agree- ment with Respondent's competitor calling for only a 40-cent-per-hour wage reduction 821 unreasonable to conclude that the Union requested fur- ther substantiation of Respondent's financial position merely to prolong negotiations. Rather, an expert analy- sis could have provided the union agents with a more persuasive basis to educate unit employees for the need to be more realistic about their expectations concerning an agreement or to provide them with more convincing arguments in further negotiations with Respondent. Moreover, certain aspects of Respondent's financial records in evidence indicate that an expert analysis would be appropriate on the Union's part. Finally, Shar- key's misapprehension that the terms of a collective-bar- gaining agreement could be abrogated at the end of its term like any ordinary contract suggests that the Re- spondent's limitation on the bargaining process resulted from a predetermined plan and not from an objective as- sessment of the Union's bargaining flexibility. For the foregoing reasons, I find that although obtain- ing an agreement as circumstances existed here would have been quite difficult, the parties had not yet reached a complete deadlock when Respondent implemented the new wage rates and abolished the pension contributions of 9 March. Accordingly, by doing so, Respondent vio- lated its duty to bargain in good faith as defined in Sec- tion 8(a)(5) and (d) of the Act. II. THE EFFECT OF THE UNFAIR LABOR PRACTICES ON COMMERCE The activities of the Respondent set forth above, oc- curring in connection with the Respondent's business op- erations, have a close, intimate, and substantial relation- ship to trade, traffic, and commerce among the several states and tend to lend to labor disputes burdening and obstructing commerce and the free flow of commerce. CONCLUSIONS OF LAW 1. Respondent 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. The following employees of Respondent constitute a unit appropriate for purposes of collective bargaining within the meaning of Section 9(b) of the Act: All truck drivers and warehousemen, excluding office and clerical employees, salesmen, executives, foremen, and all supervisory employees with the au- thority to hire, discharge, promote, discipline, or otherwise effect changes in the status of employees. 4. By telling employees that there would be no union after March 1987 and requesting that they inform Re- spondent of the working conditions they desired after March 1987, Respondent engaged in an unfair labor practice within the meaning of Section 8(a)(1) of the Act. 5. By unilaterally changing the wages and benefits of employees on 9 March without agreement of the Union or without reaching an impasse in negotiations concern- ing such changes, Respondent engaged in an unfair labor 822 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD practice within the meaning of Section 8(a)(1) and (5) of the Act. 6. The unfair labor practices specified in paragraphs 4 and 5, above, affect commerce within the meaning of Section 2(7) of the Act. REMEDY To remedy the unfair labor practices found above, Re- spondent must cease and desist its unlawful conduct and take the affirmative action specified below to effectuate the purposes of the Act. Affirmatively, Respondent must bargain in good faith with the Union if requested to do so. Additionally, Re- spondent must restore and maintain the terms and condi- tions of employment of the unit employees to those spec- ified in the collective-bargaining agreement , which ex- pired 8 March 1987 until a new agreement is concluded or a valid impasse in bargaining occurs. The Respondent must also make unit employees whole for the loss of pay they incurred as a consequence of the unlawful change in their wage rate on 9 March 1987, with interest. The amount of backpay due each employee shall equal the difference between their pay as calculated using the wage rate in the expired agreement and the amount they actually received for the period beginning on 9 March 1987 and ending on the date Respondent re- stores the appropriate wage rate. The appropriate method of determining backpay is specified in Ogle Pro- tection Services, 189 NLRB 682, 683 (1970). The appro- priate method of determining the interest on the backpay due is specified in New Horizons for the Retarded, 283 NLRB 1173 (1987). Respondent must also make pension plan contributions on behalf of the unit employees retro- actively to 9 March 1987. The method of determining the amount of those contributions and any interest there- on is specified in Merryweather Optical Co., 240 NLRB 1213 (1979). Finally, Respondent must post the attached notice to inform employees of their rights and the outcome of this matter. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed21 ORDER The Respondent, Francis J. Fisher, Inc., Denver, Col- orado, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Refusing, on request, to bargain in good faith with Local 13, International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, AFL-CIO as the exclusive collective-bargaining repre- sentative of its employees in the following appropriate unit: 21 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- All truck drivers and warehousemen, excluding office and clerical employees, salesmen, executives, foremen and all supervisory employees with the au- thority to hire, discharge, promote, discipline, or otherwise effect changes in the status of employees. (b) Changing the terms and conditions of employment of the unit employees from those specified in the collec- tive-bargaining agreement with Teamsters Local 13, which expired on 8 March 1987 without reaching an agreement with Teamsters Local 13 concerning such changes or a valid impasse in bargaining. (c) Telling employees there would be no union when its collective-bargaining agreement expires and request- ing that they formulate their own terms and conditions of employment for submission directly to Respondent. (d) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action designed to ef- fectuate the policies of the Act (a) On request, bargain with the Union as the exclusive representative of the employees in the following appro- priate unit concerning terms and conditions of employ- ment and, if an understanding is reached, embody the un- derstanding in a signed agreement: (b) Restore and maintain the wages, benefits, and other terms and conditions of employment of the unit employ- ees to those specified in the collective-bargaining agree- ment, which expired on 8 March 1987, until a new agree- ment is bargained or a valid impasse in bargaining occurs. (c) Make employees whole, with interest, for the dif- ference in pay that they would have received under the collective-bargaining agreement that expired on 8 March 1987 and the amount of pay they actually received for the period following 9 March 1987 in the manner speci- fied in the remedy section of the decision. (d) Make all contributions required under the pension plan established in the collective-bargaining agreement that expired on 8 March 1987, with interest if any is re- quired, in the manner specified in the remedy section of the decision. (e) Preserve and, on request, make available to the Board or its agents for examination and copying, all pay- roll records, social security payment records, timecards, personnel records and reports, and all other records nec- essary to analyze the amount of backpay due under the terms of this Order. (f) Post at its Denver, Colorado, facility copies of the attached notice marked "Appendix."22 Copies of the notice, on forms provided by the Regional Director for Region 27, after being signed by the Respondent's au- thorized representative, shall be posted by the Respond- ent immediately upon receipt and maintained for 60 con- secutive days in conspicuous places including all places 22 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 " FRANCIS J. FISHER, INC. 823 where notices to employees are customarily posted. Rea- sonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (g) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a hearing before an administrative law judge at which we were provided with the opportunity to present evidence and argument, the National Labor Relations Board concluded that we violated the National Labor Relations Act. To remedy this matter the National Labor Relations Board has ordered us to post this notice and comply with its terms. The National Labor Relations Act gives employees the right to organize themselves, to join or assist unions, to engage in collective bargaining with their employers through representatives freely chosen by a majority of employees in an appropriate bargaining unit, to engage in other group activities for the mutual aid and protection on the job, and to refrain from any or all of the above activities. WE WILL NOT refuse to bargain in good faith with Local 13, International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, AFL-CIO as the exclusive bargaining representative of our employees in the following appropriate unit: All truck drivers and warehousemen, excluding office and clerical employees, salesmen, executives, foremen and all supervisory employees with the au- thority to hire, discharge, promote, discipline, or otherwise effect changes in the status of employees. WE WILL NOT change the terms and conditions of em- ployment established in our agreement with Teamsters Local 13 which expired on 8 March 1987 until a new agreement or a valid impasse in bargaining is reached. WE WILL NOT tell employees there would be no union when our collective-bargaining agreement with Team- sters Local 13 expires and request that employees tell us directly about the terms and conditions of employment they want. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act. WE WILL, on request by Teamsters Local 13, bargain in good faith concerning rates of pay, wages , hours, and other terms and conditions of employment for our em- ployees represented by that union and, if an understand- ing is reached, embody such understanding in a signed agreement. WE WILL restore and maintain the terms and condi- tions of employment contained in our expired agreement with Teamsters Local 13, including the wage rates and pension benefits, until a new agreement or a valid im- passe in bargaining is reached. WE WILL make unit employees whole, with interest, for the loss of pay they incurred because we unilaterally established new wage rates on 9 March 1987 before an agreement or impasse in bargaining with Teamsters Local 13 was reached. WE WILL make appropriate pension plan contributions on behalf of the unit employees retroactively to 9 March 1987, with interest if required , because we unilaterally discontinued pension contributions on that date before an agreement or impasse in bargaining with Teamsters Local 13 was reached. FRANCIS J. FISHER, INC.