Storer Cable Tv Of Texas, Inc, The Meca Corp., And Houston Community Cablevision, Inc

140 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Storer Cable TV of Texas, Inc, The Meca Corpora- tion, and Houston Community Cablevision, Inc and Communications Workers of America, AFL-CIO Cases 23-CA-10357 and 23-CA- 10391 December 30, 1988 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND CRACRAFT On May 14, 1987, Administrative Law Judge Steven M Charno issued the attached decision The Respondent filed exceptions and a supporting brief, the Charging Party filed a response to the Respondent's exceptions, and the General Counsel and the Charging Party filed briefs in support of the judge's decision Thereafter, the Charging Party filed a motion to sever and the Respondent filed a brief in opposition The National Labor Relations Board has delegat ed its authority in this proceeding to a three member panel In its motion to sever, the Charging Party re quests that Case 23-CA-10357, which involves the Respondent's technical refusal to bargain on the grounds that the Board's certification of the Union is invalid, be severed from Case 23-CA-10391, which involves the Respondent's refusal to bargain over a subcontracting decision and an analysis of that decision under Otis Elevator Co, 269 NLRB 891 (1984) Regarding the former, the Charging Party contends that the issues on which the Re spondent bases its refusal to bargain were fully liti- gated in the underlying representation proceeding, and the Respondent has offered no newly discov ered evidence or special circumstances warranting relitigation of this issue The Charging Party there fore requests severance in order to expedite the processing of Case 23-CA-10357, while providing the Board additional time to consider the more complex factual and legal issues raised in Case 23- CA-10391 In its opposition to the motion, the Respondent contends that severance of the cases will constitute a waste of resources The Respondent further con- tends that the Charging Party has presented no good reasons to justify severance, and has failed to demonstrate that severance will expedite the relief sought Having duly considered the matter, and because it appears that granting severance will result in no prejudice to any of the parties, we grant the Charging Party's motion to sever the cases See generally Adair Standish Corp, 283 NLRB 668, JD at Appendix A (1987) We shall order that Case 23-CA-10391 be continued separately before the Board The Board has considered the attached judge's decision and the record in light of the exceptions and briefs as they relate to Case 23-CA-10357, and has decided to adopt the judge's rulings, findings, and conclusions with respect to Case 23-CA- 10357 ORDER The National Labor Relations Board orders that the Respondent, Storer Cable TV of Texas, Inc, The Meca Corporation, and Houston Community Cablevision, Inc, Houston, Texas, its officers, agents, successors, and assigns, shall 1 Cease and desist from (a) Refusing to bargain with Communications Workers of America, AFL-CIO as the exclusive bargaining representative of the employees in the bargaining unit (b) In any like or related manner interfering with, restraining, or coercing employees in the ex ercise of the rights guaranteed them by Section 7 of the Act 2 Take the following affirmative action neces sary to effectuate the policies of the Act (a) On request, bargain with the Union as the ex clusive representative of the employees in the fol lowing appropriate unit on terms and conditions of employment and, if an understanding is reached, embody the understanding in a signed agreement All dispatchers, technicians, warehousemen, installers, linemen and groundmen converter repair technician and field service coordina tors employed at the Employers six facilities located in the Houston, Texas metropolitan area (Bisbee Street, Airport Boulevard, Law rence Road, FM 1765, Munson Road, and Mayard Road), but excluding all other em- ployees, customer service representatives, cus- tomer sales representatives, local originations operator, receptionist, draftsperson (drafter), office clericals, guards, watchmen and supervi sors as defined in the Act (b) Post at each of its facilities in Houston, Texas, copies of the attached notice marked 'Ap pendix I Copies of the notice, on forms provided by the Regional Director for Region 16, after being signed by the Respondent's authorized repre- sentative, shall be posted by the Respondent imme- ' 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 292 NLRB No 29 STORER CABLE TV OF TEXAS diately upon receipt and maintained for 60 consec utive days in conspicuous places including all places where notices to employees are customarily posted Reasonable steps shall be taken by the Re- spondent to ensure that the notices are not altered, defaced, or covered by any other material (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply 2 IT IS FURTHER ORDERED that Case 23-CA-10357 is severed from Case 23-CA- 10391, and that the issues raised with respect to Case 23 -CA-10391 are continued before the Board 2 The judge included in his recommended Order a visitatorial clause In the circumstances of this case we find it unnecessary to include such a clause at this time See Cherokee Marine Terminal 287 NLRB 1080 (1988) APPENDIX NOTICE To MEMBERS 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 refuse to bargain with Communi- cations Workers of America, AFL-CIO as the ex- clusive representative of the employees in the bar gaining unit WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer cise of the rights guaranteed you by Section 7 of the Act WE WILL, on request, bargain with the Union and put in writing and sign any agreement reached on terms and conditions of employment for our employees in the following bargaining unit All dispatchers, technicians, warehousemen, installers, linemen and groundmen, converter repair technician, and field service coordina- tors employed at the Employer's six facilities located in the Houston, Texas metropolitan area (Bisbee Street, Airport Boulevard, Law- rence Road, FM 1765, Munson Road, and Mayard Road), but excluding all other em- ployees, customer service representatives, cus- tomer sales representatives, local originations operator, receptionist, draftsperson (drafter), 141 office clericals, guards, watchmen and supervi sors as defined in the Act STORER CABLE TV OF TEXAS, INC, THE MECA CORPORATION, AND HOUSTON COMMUNITY CABLEVISION, INC Robert G Levy II Esq for the General Counsel Nancy Noall and Michael T McMenamin Esqs (Walter Haverfield Buescher & Chockley), of Cleveland Ohio, for the Respondent Sharon Groth Esq (Fickman Van Os Waterman Dean & Moore) of Austin, Texas, for the Charging Party DECISION STEVEN M CHARNO Administrative Law Judge In response to a charge timely filed by the Communications Workers of America AFL-CIO (Union), a complaint was issued on 15 May 1986, alleging that Storer Cable TV of Texas, Inc The Meca Corporation and Houston Community Cablevision Inc (Respondent) violated Sec tion 8(a)(1) and (5) of the National Labor Relations Act, by refusing to bargain with the Union concerning the unilateral decision to lay off five unit employees the of fects of that decision, and the terms and conditions of employment of bargaining unit employees Respondent s answer denied the commission of any unfair labor prac tice and asserted that the Board's certification of the Union in a prior representation proceeding was invalid due to an allegedly inappropriate definition of the rele vant bargaining unit A hearing was held before me in Houston Texas on 18 November 1986 t At the hearing it was stipulated that the unit employees named in the complaint were ter minated rather than laid off and the complaint and answer were accordingly amended Briefs were filed by the General Counsel Union, and Respondent under ex tended due date of 5 January 1987 2 FINDINGS OF FACT I JURISDICTION Respondent is a single employer engaged in providing cable television service to residential subscribers in the metropolitan area of Houston Texas During the 12 months preceding issuance of the complaint Respondent in the conduct of its business in Texas purchased and re ceived goods valued in excess of $50,000 from points outside the State and derived gross revenues in excess of $100,000 It is admitted, and I find, that Respondent is an employer engaged in commerce within the meaning of the Act ' Certain errors in the transcript have been noted and corrected 2 General Counsels motion that the parties posthearing briefs be made part of the record will be granted Accordingly Memorandum of Gener al Counsel to the Administrative Law Judge is identified as G C Exh 5 Petitioners Postheanng Brief as C P Exh I and Respondent s Brief to the Administrative Law Judge as R Exh 5 142 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD The Union is stipulated to be and I find is, a labor or ganization within the meaning of the Act 11 ALLEGED UNFAIR LABOR PRACTICES A Certification and the Request to Bargain On 18 November 1985, the Union filed a representa tion petition, which initiated Case 23-RC-5286 A hear ing on the petition was held on 11 and 12 December On 30 December, the Regional Director issued a Decision and Direction of Election, which found the following unit to be appropriate All dispatchers, technicians warehousemen, in stallers, linemen and groundmen, converter repair technician and field service coordinators employed at the Employers six facilities located in the Hous ton Texas metropolitan area (Bisbee Street, Airport Boulevard, Lawrence Road, FM 1765, Munson Road and Mayard Road), but excluding all other employees, customer service representatives, cus tomer sales representatives, local originations opera tor, receptionist, draftsperson (drafter), office cleri cals, guards, watchmen and supervisors as defined in the Act In an election held on 30 January 1986, a majority of Re spondent s employees in the designated unit voted to be represented by the Union The following day, the Board rejected Respondents request to review the Regional Di rector s 30 December decision On 6 February Respond ent filed objections to the election By supplemental deci sion of 18 March the Regional Director overruled Re spondent s objections and certified the Union as the col lective bargaining representative of Respondents em ployees in the designated unit On 31 March 1986 the Union wrote Respondent re questing bargaining By letter of 7 April Respondent de clined to bargain asserting invalidity of the Board s cer tification based on an allegedly inappropriate bargaining unit and on the Boards failure either to set aside the election or to hold a hearing on Respondents objections The letter stated Accordingly, we have no choice but to decline to bargain with you until the NLRB in Wash ington and/or the US Court of Appeals has ruled on the validity of objections On 16 June 1986 the Board denied Respondents re quest for review of the Regional Director's Supplemental Decision B The Discharges At all times relevant, Respondents operations in the Houston region were divided into three separately man aged and budgeted operating areas Northwest Harris, South Houston and the Bay Area Among the functions performed by Respondent's installers in the Houston region were the installation and reconnection of cable service to residential dwelling units In mid 1984, 85 to 90 percent of the installation work in each of the three operating areas was done by outside contractors and the remainder, by Respondents service personnel, including installers At that time, Northwest Harris had no em ployees with the title installer while South Houston and the Bay Area each had five to six Beginning in 1985, Respondent increased the number of employees called installers in the Bay Area from 6 to 14, with the stated intention of performing all installation and reconnection work in house This intention was clearly abandoned no later than the beginning of 1986, since only 8 of the 14 installers in the Bay Area at that time were performing any duties relating to the installa tion or reconnection of service to residential dwelling units 3 Throughout 1985 and the first 3 months of 1986, installers in the Bay Area handled between 10 and 50 percent of the installation and reconnection work in that area, the remainder was done by an outside contractor In January 1986, Respondents regional vice president, William Langendorf, decided to initiate a new marketing program in the Bay Area in April of that year, the inter vening 3 months being required to hire and train sales personnel Purportedly concerned over the increased volume of installation work the new marketing effort would generate,4 Langendorf immediately asked Re spondent s vice president for engineering, Ricky Luke, to prepare a study as soon as possible concerning the ability of the Bay Area's installers to handle the new work Langendorf never checked on the status of Luke s work, and Luke ultimately reported back around the beginning of April 5 A summary of Luke s study was placed in evidence, but no underlying documentation was made available In preparing the study Luke first selected the month of February 1986 as a test period and determined the in stallation and restart activity that was done by our in house personnel during that month, which amounted to 354 jobs Although eight Bay Area installers did some in stallation or reconnection work during February, Luke confined his study to five specific individuals His choice was admittedly based solely on the criterion that these five employees would be terminated if the installer job title was eliminated 6 Luke then purported to derive an in house cost of installation based on an attribution of labor, operating and capital costs to the five employees which he compared with a figure alleged to be the cost of having the 354 jobs done by an outside contractor The study is seriously flawed in a number of crucial respects First the labor costs that Luke attributed to the five employees are directly controverted by Respond ent s salary histories for those employees 7 Second, no a Respondent s vice president of engineering so testified concerning the penod from January through March 1986 * Langendorf testified that the Bay Area had 200 to 400 installations per month before the sales effort and that the campaign was expected to raise this figure to between 800 and 1200 installations per month Luke testified that the Bay Areas average of 1100 installations per month in creased to 1200 as a result of the marketing campaign S Given Luke s admission that he initially surveyed all the Bay Area s installation work during the first 3 months of the year for his study he could not have begun the study before the end of March 6 How Luke could have formulated an initial selection criterion based on the outcome of his study was unexplained and appears inexplicable unless the study s outcome was a foregone conclusion ° The study employs an average monthly cost per employee for labor and associated benefits of $1333 31 Using one twelfth of the employees Continued STORER CABLE TV OF TEXAS attempt was made to relate or compare the number of hours required to perform the 354 installation jobs with the number of hours worked by the five installers Indeed, if one uses Luke s estimates of how long each of the jobs should have taken 8 all 354 jobs could have been finished in 158 man hours and could therefore have been accomplished by a single installer, rather than five 9 Third, the study posits significant capital savings that are not substantiated in or otherwise supported by the record Luke correctly asserts that the termination of five installers will allow Respondent to utilize the dis charged installers' trucks and equipment at other points within its system He then assumes that the value of repositioning this capital equipment may appropriately be measured by the equipments undepreciated replacement cost new An accurate valuation could have been ob tained by using the value of the equipment reflected in Respondents books of account or by using a value that took into account the age and future useful life of the equipment in question Under any theory of valuation however, the number of dollars saved by repositioning capital equipment would obviously be reduced if fewer than five installers were discharged The final flaw in the study involves calculation of the cost of having an outside contractor perform the 354 jobs Luke admittedly used cost figures that were be tween $1 and $4 per job lower than the actual charges of Respondent s contractor during February 1968 10 Given the study s conceptual and methodological defects as well as the absence of any evidentiary support for its conclusions, I find it to be without probative value After receiving the study, Langendorf purportedly de cided to eliminate the position of installer in the Bay Area and to subcontract all the area's installation and re connection work to an outside contractor for the follow mg reasons the anticipated increase in installation work in the Bay Area resulting from the new marketing effort, the need to achieve sufficient flexibility to accommodate peaks and valleys in the demand for installations, the desire to cut operating costs, including labor costs the need to reposition capital i i and a desire to conform the actual annual salaries as reflected in Respondents records one derives an average monthly cost per employee of $1248 for labor and benefits This discrepancy is troubling in view of Langendorfs testimony that Respond ent s employees work 8 hours a day 5 days a week with no overtime fi These appear as Luke s annotations on R Exh 4 9 Even if one assumes an ample increase-say 50 percent-in the number of hours necessary to do the jobs in order to allow for travel time (an assumption by no means required by R Exh 4) the total labor and benefit cost for the in house performance of all the work in the study would be $1872 rather than Luke s figure of $6666 53 10 Also troubling is Luke s testimony that Respondent paid its outside contractor only $1500 a month for installations and reconnections in the Bay Area after installers were eliminated If as Luke also testified $2759 50 represents the outside contractors charges for doing 10 percent of the installation and reconnection work in the Bay Area during Febru ary 1986 the total monthly cost for such work should approximate $27 000 The latter figure is supported by Respondent s purchase orders which budget a minimum of $10500 monthly for reconnections by the outside contractor The monthly amount Respondent budgets for installs tions by the contractor is not of record i i This reason was given in response to a leading question posed by Respondent s counsel 143 Bay Area s practices to those of Northwest Harris and South Houston, where installation and reconnection work was allegedly no longer performed in house As a result of increased subcontracting of installation work in the Bay Area Respondents payments to its outside con tractor increased from $182 000 in 1985 to a projected $196,000 in 1986 Langendorfs decision directly resulted in the assign ment of a new job title to or the termination of each of the installers in the Bay Area Without notification to or bargaining with the Union, Respondent discharged the following installers on 17 April 1986 Stephen H Spears, John T Rose, Tomas Rios, M J Butler Jr and David M Boudreaux Jr It was stipulated that the Union never requested bargaining concerning the effects of Respond ent's decision to terminate the five employees and that Respondent never bargained with the Union concerning those effects At the time of the discharge and in June 1986, Re spondent employed nine installers in the South Houston area Between 20 September and 22 October 1986, the service employees in South Houston installed cable serv ice in over 600 residential dwelling units 12 C Discussion Respondent contends that its 7 April 1986 and later failures to bargain with the Union were not unlawful be cause the Board s certification of the Union was invalid This matter was fully litigated in Case 23-RC-5286 and, absent any showing of special circumstances or newly discovered evidence Respondents contention cannot be relitigated in this proceeding See Pittsburgh Plate Glass Co v NLRB, 313 U S 146, 162 (1941), Sections 102 67(f) and 102 69(c) of the Rules and Regulations of the Nation al Labor Relations Board Accordingly, this defense is rejected, and I find that Respondents 7 April refusal to bargain with the Union was an unfair labor practice vio lative of Section 8(a)(5) of the Act Respondent also argues that its decision to terminate five employees on 17 April 1986 was a `decision con cerning the commitment of investment capital and the basic scope of the enterprise and was therefore not a mandatory subject of bargaining within the holding of Otis Elevator Co 269 NLRB 891 (1984) The record does not support this argument in a number of respects First it is clear that Respondents purported decision to subcontract all installation work and discharge five in stallers was not made for the reasons advanced by Re spondent s witnesses Langendorf's asserted need for flexibility to handle varying levels of demand for installa tion service including any increase occasioned by a new marketing effort is spurious Because Respondent's in house service personnel in the Bay Area never handled more than 50% of available installation work and the re mainder was always given to an outside contractor, there 12 The more than 600 overhead installations set forth in R Exh 4 for this period were clearly distinguished by Luke s lengthy explanation from the type of service required for multiple dwelling units Accordingly I reject Langendorfs testimony that 100 percent of the installations in the three Houston operating areas were made by an outside contractor after June 1986 144 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD was no possibility of Respondent either being unable to meet peaks in demand or of its in house personnel re maining idle during valleys in demand Since Respondent never entertained the idea of altogether eliminating the subcontracting of installation in the Bay Area,13 one must conclude that Respondent already enjoyed com plete flexibility with respect to the demand for installa tions Maintenance of this flexibility did not require the termination of five employees Similarly, Langendorf's assertions that his decision to terminate employees would result in significant operating and capital savings are wholly unsupported, and at least partially contradicted, by the record Finally, Langen dorf's supposititious assertion of a desire to establish a uniform installation policy throughout the three Houston areas is gainsaid by the fact that the South Houston area did not cease to employ installers or cease to perform in stallations with its own personnel after 17 April 1986 Indeed, this fact raises a serious question whether Re spondent actually decided to eliminate the in house per formance of installation work 14 Also persuasive of the pretextual nature of Respond ent s rationale are the indications in the record that Lan gendorf's decision was made before he received Luke s study If any possibility had actually existed of hiring training, and equipping additional installers to begin work at the time the new marketing effort began in April 1986, it would have been prudent for Langendorf to have been anxious about the progress of Luke s study and for Luke to have begun the study before the begin ning of April Neither occurred Even stronger evidence of the fact that decision preceded rationale is Luke s ad mission that he began his study with the assumption that five named installers would be terminated For the foregoing reasons I find that Respondents de cision, which resulted in the termination of five employ ees on 17 April 1986 was not made for any legitimate business reason that might cause that decision to fall within the holding of Otis Elevator Co supra Accord ingly, I find that Respondents failures to give notice to or bargain with the Union concerning that decision are unfair labor practices in violation of Section 8(a)(5) of the Act The final issue in this case is raised by Respondent s argument that it had no legal obligation to engage in bar gaining over the affects of its decision since such bar gaining was never requested by the Union By letter of 7 April 1986 Respondent stated that it would not bargain with the Union while certification litigation was pending For the Union again to request bargaining only 10 days 13 In response to a question from the Bench Luke testified that the portion of his study that purportedly focused on increasing the number of Bay Area installers was based on the assumption that some installations would continue to be performed by an outside contractor 14 In this context it is troubling that Respondent allegedly increased its subcontracting in the Bay Area by at least 100 percent while experienc mg an increase in billing from its subcontractor of less than 8 percent Using the assumption in Respondents study that 10 percent of the Bay Area s installation work could be done by a subcontractor for $2757 Re spondent should have experienced a monthly increase in subcontracting costs for the last 7 months of 1986 (during which in house installations had allegedly been abandoned) of $13 785 or 90 89 percent over its aver age monthly costs in 1985 later would have been a totally futile gesture See Lauren Mfg Co, 270 NLRB 1307, 1309 (1984) The Union s failure to make a second request under the cir cumstances of this case did not release Respondent from its legal obligation to engage in bargaining I therefore find that Respondents failure to bargain over the effects of its decision to terminate five employees is an unfair labor practice violative of Section 8(a)(5) of the Act 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 All dispatchers, technicians, warehousemen install ers linemen and groundmen converter repair technician, and field service coordinators employed at Respondent s six facilities located in the Houston Texas metropolitan area (Bisbee Street Airport Boulevard, Lawrence Road, FM 1765, Munson Road and Mayard Road), but exclud ing all other employees, customer service representatives, customer sales representatives, local originations opera tor, receptionist, draftsperson (drafter) office clericals, guards watchmen and supervisors as defined in the Act constitute a unit appropriate for the purpose of collective bargaining within the meaning of Section 9(b) of the Act 4 The Union is now and all times material has been the exclusive representative for the purpose of collective bargaining of the employees in the aforesaid unit within the meaning of Section 9(a) of the Act 5 By refusing on 7 April 1986 to bargain with the Union as the exclusive collective bargaining representa tive of employees in the aforesaid unit Respondent has engaged and is engaging in an unfair labor practice in violation of Section 8(a)(1) and (5) of the Act 6 By failing and refusing to give notice to and bargain with the Union concerning the termination of five em ployees on 17 April 1986 Respondent has engaged and is engaging in unfair labor practices in violation of Section 8(a)(1) and (5) of the Act 7 By failing to bargain with the Union concerning the effects of a decision to terminate five employees on 17 April 1986 Respondent has engaged and is engaging in an unfair labor practice in violation of Section 8(a)(1) and (5) of the Act 8 The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act REMEDY Inasmuch as Respondent has engaged in unfair labor practices I shall order it to cease such practices and to take affirmative action designed to effectuate the pur poses of the Act In order to remedy its unlawful refusal and failure to bargain Respondent shall be ordered to bargain with the Union To ensure that the unit employ ees are accorded the services of their selected agent for the period provided by law the initial period of the cer tification shall be construed to begin on the date the Re spondent begins to bargain in good faith with the Union See Great Western Produce, 282 NLRB 17 (1986) Mar STORER CABLE TV OF TEXAS 145 Jac Poultry Co 136 NLRB 785 (1962) In addition Re spondent shall be required to make whole those employ ees it unlawfully terminated by paying them their normal wages from the date of their termination until the earliest of the following conditions is met (1) Respondent and the Union reach an agreement, (2) a bona fide impasse is reached through good faith bargaining, (3) the Union fails to request bargaining within five days of receipt of Respondents notice of its desire to bargain or (4) the Union fails to bargain in good faith See Gulf States Mfrs, 261 NLRB 852, 853 (1982) Backpay shall be cal culated in accordance with the formula set forth in F W Woolworth Co 90 NLRB 289 (1950) with interest thereon computed in the manner set forth in Florida Steel Corp, 231 NLRB 615 (1977) 15 [Recommended Order omitted from publication ] 15 See generally Isis Plumbing Co 138 NLRB 716 (1962)