Fraser Shipyards, Inc

496 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Fraser Shipyards, Inc and District No 133, Interna- tional Association of Machinists and Aerospace Workers, AFL-CIO. Case 18-CA-7842 28 September 1984 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS ZIMMERMAN AND HUNTER On 16 September 1983 Administrative Law Judge James J O'Meara Jr issued the attached de- cision The General Counsel and the Union each filed exceptions and a supporting brief The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel The Board has considered the decision and the record in light of the exceptions and brief and has decided to affirm the judge's rulings, findings, and conclusions as modified and to adopt the recom- mended Order The judge concluded that the Respondent did not violate Section 8(a)(5) and (1) of the Act by failing or refusing to bargain with the Union about its decision to close its machine shop We agree with the judge's conclusions, but for the following reasons The Board recently held in Otis Elevator Co that management decisions which affect the scope, direction, or nature of the enterprise are excluded from the limited mandatory bargaining obligation of Section 8(d) of the Act The Board stated that the critical factor in determining whether a man- agement decision is subject to mandatory bargain- ing is "the essence of the decision itself, i e , wheth- er it turns upon a change in the nature or direction of the business, or turns upon labor costs, not its effect on employees nor a union's ability to offer alternatives "2 Applying that analysis to the facts of the instant case, we find that the Respondent's decision to close its machine shop and to subcon- tract 3 existing machine work to employees of Northern Engineering Works 4 turned not on labor ' 269 NLRB 891 (1984) 2 Id at 892 3 The General Counsel and the Union both contend in their exceptions that the Respondent s action was not a partial closing and subcontracting, but a reassignment of unit work As we noted in Otis Elevator, the appel lation of the decision is not important, particularly where, as here, the decision involves elements of several types of actions 4 Northern Engineering Works is a wholly owned division of Fraser Shipyards, Inc It is located within three blocks of the Fraser yards and employs machinists and other craft personnel in the manufacture, installa non, and maintenance of ship winches and other general industrial ma chine work Northern Engineering machinists are also represented by the Union costs but on a significant change in the nature and direction of the business and therefore was not sub- ject to mandatory bargaining The Respondent is engaged in the repair, mainte- nance, construction, and conversion of marine ves- sels in Superior, Wisconsin It maintains drydock and onshore facilities and, until mid-August 1982,5 maintained a shipyard machine shop The Respondent had been a party to a collec- tive-bargaining agreement with the Union since 1966 In the spring of 1982 the parties notified each other of their intent to terminate the existing con- tract effective 31 July and of their desire to negoti- ate a new contract On 20 July the parties met and exchanged contract proposals, and agreed to resume negotiations on 4 August At the opening of the 4 August meeting, the Respondent's repre- sentatives advised the Union that it planned to close the shipyard machine shop by 1 September and to subcontract the machine work to Northern Engineering employees The Respondent's repre- sentatives stated that the closure had been consid- ered for a year and was motivated by the recession, lack of business, and the substantial amount of cap- ital necessary to modernize the machine shop However, they indicated they were willing to dis- cuss the reasons for the closure and the effects on the employees This was the first indication the Union had of the Respondent's plans to close the shop The meeting then adjourned with neither party discussing the closing further The parties met on two subsequent dates, 12 October 1982 and 13 January 1983 At both meetings the union repre- sentatives asked if the Respondent had reconsid- ered its decision to close the machine shop 6 Both times the Respondent's representatives responded that, although it was open to discussing with the Union any recommendations, new facts, or alterna- tives to closing, the Union had not proposed any- thing regarding the decision to close or its effects on the employees The parties have had no further meetings It is clear that, under Otis Elevator, the essence of the Respondent's decision to close its machine shop did not turn on labor costs Although the Re- spondent's president testified that the employees' wages and benefits placed it at an economic disad- 5 All dates refer to 1982 unless otherwise indicated 6 The machine shop closed about 15 August and most of the machin ery was moved to Northern Engineering, with the exception of one hon zontal mill too large to be moved After the closing, Northern Engineer ing employees performed the work previously done by the Respondent's employees either at its own facilities or at the Respondent's shipyard The machine shop was used only four times in the 6 months after It was closed in order to use the honzontal mill The record also discloses that, prior to the closing, the Respondent had subcontracted some work to other companies 272 NLRB No 80 FRASER SHIPYARDS 497 vantage, this factor did not prompt the Respond- ent's action Rather, the record indicates that, in closing the machine shop, the Respondent was re- acting to the general decline in shipping on the Great Lakes, the reduction in the number of ships its facilities could service, a slim schedule of work through the winter, 7 and the projected cost—over $130,000—of modernizing the shop and repairing or replacing machinery By closing the machine shop and subcontracting the work, which was spo- radic, to Northern Engineering employees, the Re- spondent could continue both onshore and vessel work without maintaining separate facilities and work forces and could achieve an efficient utiliza- tion of its resources These facts establish that the decision at issue here, no matter what it is labeled, clearly turned on a fundamental change in the nature and direction of the Respondent's business See Columbia City Freight Lines, 271 NLRB 12 (1984) Accordingly, since we conclude that under Otis Elevator the Respondent had no duty to bar- gain about its decision to close its machine shop, we affirm the judge's dismissal of this portion of the complaint We also agree, for the reason stated by the judge, that the Respondent met its obligation of no- tifying the Union of its intention to close the ma- chine shop and offering the Union an opportunity to bargain regarding the effects of that decision on the Respondent's employees Accordingly, we affirm the judge's dismissal of the complaint in its entirety ORDER The recommended Order of the administrative law judge is adopted and the complaint is dis- missed MEMBER ZIMMERMAN, concurring I agree with my colleagues that the management decision in issue here was not a mandatory subject of bargaining Several factors influenced the Re- spondent's decision, including a decline in shipping on the Great Lakes in general, the number of ships its facilities could service, the paucity of work scheduled through the winter, the projected cost of repairing and replacing machinery and modernizing the machine shop, duplication of work, and the poor utilization of personnel These were factors over which the Union had little or no control To the extent that labor costs were a factor, it is evi- 7 The record indicates that at the time the decision was made the Re spondent had one ship scheduled for work in October and, because it only had tentative commitments for two others it would have to lay off the employees Further, although the Respondent performed some ma chinery work for area industries, it was not in a competitive position to solicit such work because its facilities and machinery were outdated dent from the record that those costs were an in- significant consideration in the Respondent's deci- sion I therefore conclude that the Respondent's decision to alter its operation was not amenable to resolution through collective bargaining and agree that this portion of the complaint should be dis- missed See my dissent in Milwaukee Spring, 268 NLRB 601, 605-612 (1984), and my concurrence in Otis Elevator Co, 269 NLRB 891 (1984) I also agree with my colleagues, for the reasons stated by the judge, that the Respondent satisfied its obliga- tion to bargain about the effects of its decision, and that the complaint should be dismissed in its entire- ty DECISION STATEMENT OF THE CASE JAMES J O'MEARA, JR , Administrative Law Judge The complaint in this case was issued on October 29, 1982, and is based on a charge filed by District No 133, International Association of Machinists and Aerospace Workers, AFL-CIO on August 30, 1982, and alleges that on August 4, 1982, during a negotiation session designed to accomplish a succeeding collective-bargaining agree- ment, the Respondent announced that it had decided to close its machine shop and to subcontract any future bar- gaining unit work without previously affording the Union an opportunity to negotiate and bargain regarding such decision and its effect on Respondent's employees comprising the subject bargaining unit, thereby violating Section 8(a)(1) and (5) of the Act The Respondent denies that it has violated the Act The case was heard in Duluth, Minnesota, on March 8 and 9, 1983, where and when the parties were given full opportunity to submit evidence in support of their re- spective positions On the conclusion of the hearing, the parties waived oral argument and filed briefs which have been received and considered FINDINGS AND CONCLUSIONS Based upon the evidence of record, including the testi- mony and demeanor of the witnesses and in consider- ation of the briefs filed by the parties I find the follow- ing I JURISDICTION The Respondent, Fraser Shipyards, Inc, is now, and has been at all times material, a Wisconsin corporation with offices and place of business located in the city of Superior, Wisconsin, and has been engaged in the con- struction, maintenance, and remodeling of large ships and vessels During the 12-month period ending December 31, 1981, Respondent, in the course and conduct of its busi- ness operations, sold and shipped from Respondent's fa- cilities products, goods, and materials valued in excess of $50,000 directly to points outside the State of Wisconsin and also during that period purchased and received at 498 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent's facilities in Superior, Wisconsin, products, goods, and materials valued in excess of $50,000 directly from points outside the State of Wisconsin Accordingly, I find that the Respondent is, and at all times material herein was, an employer engaged in com- merce within the meaning of Section 2(2), (6), and (7) of the Act I further find that it will effectuate the policies of the Act to assert jurisdiction in this case II THE CHARGING PARTY District No 133, International Association of Machin- ists and Aerospace Workers, AFL-CIO (the Union), is now, and has been at all times material, a labor organiza- tion within the meaning of Section 2(5) of the Act III THE FACTS Fraser Shipyards, Inc (Respondent) is engaged in the repair, maintenance, construction, and conversion of marine vessels at its location on Lake Superior in the city of Superior, Wisconsin Its employee complement has ranged from as high as 400 persons to none, depend- ing on workload considerations Respondent has been a party to a collective-bargaining agreement with the Union for the operation of the ship- yard machine shop and mechanical work aboard the sev- eral vessels The personnel comprising the bargaining unit defined in the collective-bargaining agreement be- tween Respondent and the Union has comprised as many as 20 machinists and as few as none, again depending on current workload In addition to employing a complement of machinists comprising the bargaining unit above described, Re- spondent also employs machinists and other craft person- nel in a division known as "Northern Engineering Works" This division is not a separate entity and is a part of Respondent's operations in Superior, Wisconsin, although physically separated from the waterfront ship- yard facility Respondent is a party to and currently maintains a collective-bargaining agreement between the Union and several of its employees including machinists, physically located at the Northern Engineering Works facility The bargaining unit defined in that collective- bargaining agreement includes tool-and-die makers, ma- chinists, pattern makers, machinists maintenance men, welders, boilermakers, their helpers, and apprentices Al- though each of the aforedescribed collective-bargaining agreements have been negotiated and executed by the Union, the named employer in the former is Fraser Ship- yards, Inc and in the latter is Northern Engineering Works, A Division of Fraser Shipyards, Inc The agree- ment to which the named employer is Fraser Shipyards, Inc expired on July 31, 1982, while the agreement with named employer Northern Engineering Works has not expired and continues in force and effect by its terms until December 31, 1984 Prior to August 19, 1982, the employees assigned to the Northern Engineering Works Division were princi- pally engaged in the manufacturing, installation, and maintenance of shipboard winches The accounting system employed by Respondent separates the functions of Northern Engineering Works from that of the other operations of Respondent A The Termination of the Contract The collective-bargaining agreement between the Re- spondent and the Union which related to the employees in the machine shop located on the shore facilities of Re- spondent was effective July 1, 1978, and by its terms continued in force and effect to and including June 30, 1981 On February 24, 1981, Respondent and the Union entered into an agreement extending that contract for 1 year and 1 month and provided that it shall expire on July 31, 1982 The termination clause provided for in that contract required a 60-day notice prior to the expi- ration date of the contract notifying that the party giving such notice desires to terminate or to modify the agree- ment In the event the notice recited a desire to terminate the agreement, the agreement would terminate on the date embodied in the agreement itself or any extension thereto In the event the party or parties notified the other that it desired to modify the agreement, then the terms of the agreement remain in force and effect, pend- ing the outcome of negotiations on the desired modifica- tions The parties each notified the other that it was their intent to terminate the collective-bargaining agreement on July 31, 1982, in conformance with the February 24, 1981 extension of the original collective-bargaining agreement The notice of intent to terminate the contract served by each party on the other anticipated negotia- tions for a new contract, and invited each other to ar- range to meet and initiate negotiations for a new con- tract B The Negotiations The parties met on July 20, 1982, and commenced ne- gotiations for the new collective-barganing agreement At this meeting the Union presented an agenda of mat- ters to be resolved by the negotiations The Company also provided a draft of an agreement containing its pro- posals for the new contract The parties subsequently agreed to resume negotiations on August 4, 1982 At the opening of the August 4 negotiating meeting the Re- spondent's representatives advised the Union's represent- atives that it plans to permantently close its machine shop where the bargaining unit members were employed They advised that the closure would take place by Sep- tember 1, 1982 The Respondent stated that it was its in- tention to subcontract the bargaining unit work This was the first indiction the Union had that Respondent had intended to close its machine shop The meeting ad- journed and a subsequent meeting was arranged for and held on October 12, 1982 At that meeting the union rep- resentatives asked the Company if it had reconsidered its decision to close the shop The issue of the machinists work being performed by Northern Engineers Work per- sonnel was also discussed The Respondent's representa- tives stated that they had to close the machine shop be- cause it needed to be winterized and modernized and that a crane located in the machine shop would require expensive alterations or replacement The continued FRASER SHIPYARDS 499 maintenance of the shore side machine shop was consid- ered not to be economically feasible The next meeting was on January 13, 1983 Subsequent to the October 12, 1982 meeting, the Respondent's repre- sentative, in a letter dated October 27, 1982, advised the Union that the Company would reconsider its decision to subcontract machinist work The letter further advised that the Company had not "been presented and is not aware of any new facts which alter the economic reason- ing which indicated the advisability of subcontracting" The letter further expressed that the Company was in a position to remain open to any proposals, suggestions, new facts, or otherwise that the Union cared to present and that it is willing to negotiate concerning the decision and the effects of the subcontracting ' On January 13, 1983, at a negotiating meeting the union representatives asked Respondent's representatives whether or not it had changed its position on the closing of the machine shop Respondent's representatives advised that it had not, and that it continued to feel that for economic reasons It was going to maintain its position of closure They stated that it could not continue to keep the machine shop in its present form and be competitive and that it was going to close it down No further meetings have been held On August 30, 1982, 30 days after the expiration of the collective-bargaining agreement, the Union filed a charge with the Board against the Employer, in effect, charging that Respondent unlawfully elected to close the subject machine shop without prior negotiations with the Union C The Alleged Union An. imus In 1982, one of the union members incurred a substan- tial hospital bill during May of that year He assumed he had insurance through his employment and later learned that he did not have such coverage It was the opinion of the Union and the union steward that the provisions of the contract provided for such coverage As a result, a grievance was drawn and submitted to the Company About the same time, Respondent had requested certain of the machinists to work overtime in order to expedi- tiously complete its work on a certain vessel then in the harbor It was the Company's position that the grievance was not well founded and that the employee who had in- curred the hospital obligations did not have coverage The Union, at that time, conveyed to the Company that its personnel would not work overtime unless the griev- ance regarding the hospital obligations was granted In a conversation regarding these circumstances, Phillip Mill- roy, the president of Respondent, stated that "You're not entitled to the insurance under the agreement You're not going to get the insurance If this is the way things are going to go we're not going to end up with a machine shop We're not going to end up with a shipyard if the Union doesn't start cooperating" 1 Subsequent to the expiration of the collective bargaining agreement, pursuant to option of the parties, the Union presented several grievances under the provisions of the expired contract Respondent contending that the contract was terminated and that no gnevance under the terms of the old contract was proper, refused to consider the gnevance as such D Postcon tract Work Assignments Subsequent to the August 4 notification to the Union that Respondent planned to close the machine shop, the work previously performed in that machine shop, to the extent the operations the Company required, were per- formed by employees, some of which were machinists, of the Northern Engineering Works Division of the Com- pany Other work which could more effectively have been accomplished by third parties was subcontracted, such as the turning of excessively heavy drive shafts and propellers During this period the Union filed several grievances against the Company based on the prior con- tract and alleging that workers other than those of the bargaining unit were being given work previously done by members of that bargain unit IV DISCUSSION AND CONCLUSIONS Duty of Respondent to Bargain The uncontroverted economic circumstances existing in the summer of 1982 prompted Respondent to opt to close its machine shop located on the shoreline premises on Respondent's Superior, Wisconsin facility In order for the Company to continue its operations as in the past and maintain the machine shop on its shoreline premises, it would be necessary to spend $47,500 in order to strengthen the support beams carrying the cranes used in that machine shop It would further be necessary to modernize the shop with a new boiler at a cost of about $15,000 and to insulate the roof and walls of the struc- ture for a cost of about $67,500 The expenditure of such amounts in order to maintain the facilities and operations as they had been in the past was deemed imprudent by the Company and it opted to close that machine shop, move certain of its equipment to the Northern Engineer- ing Works, and continue both shore work and vessel work with the personnel of Northern Engineering Works The Union contends that Respondent violated the Act in that it decided to close the physical machine shop facilities without first negotiating this matter with the Union This act of Respondent can be considered as a "partial closing" which has been defined as a situation where the employer closes one of its plants but maintains the same operation in other locations Ozark Trailers, 161 NLRB 561, 564 (1966) Respondent here closed its shipyard ma- chine shop, terminated the employees of that bargaining unit, and assigned the work to other of its employees then operating in the Northern Engineering Works Divi- sion of the Company This division of Respondent was staffed by a different bargaining unit which had a sepa- rate collective-bargaining agreement with the Union An employer's decision to implement a partial closing is not a mandatory subject of bargaining under Section 8(d) and Section 8(a)(5) of the Act if the decision is based on economic considerations Weather Tamer Inc , 253 NLRB 293 (1980), enfd in part and denied in part 670 F 2d 483, 490-491 (11th Cir 1982) The Supreme Court recently held in First National Maintenance Corp v NLRB, 452 U S 666, 686 (1981), that 500 DECISIONS OF NATIONAL LABOR RELATIONS BOARD We conclude that the harm likely to be done to an employer's need to operate freely in deciding whether to shut down part of its business purely for economic reasons outweighs the incremental benefit that might be gained through the union's participa- tion in making the decision, and we hold that the decision itself is not part of Section 8(d)'s "terms and conditions over which Congress has man- dated bargaining" Where an employer is faced with the necessity of either moving or consolidating the operations of its busi- ness it has no duty with the union respecting its decision to shut down NLRB v Royal Plating & Polishing Co, 350 F 2d 191, 196 (3d Cir 1965) An economic decision to close part of an operation clearly involves the basic scope of the enterprise and, although it indirectly in- volves "conditions of employment" requiring bargaining under Sections 8(d) and 8(a)(5), it imposes too heavy a burden on the employer's ability to run its business Ibid In light of these principles, Respondent's decision clearly falls within the category of economically prompted par- tial closings that are exempt from bargaining The eco- nomic considerations of Respondent were a lack of present and future work, a duplication of expense and manpower, and old equipment in need of extensive repair To require bargaining over this aspect of employ- er discretion would be contrary to the purposes of the Act In Weather Tamer Inc , supra, the employer closed one of three plants shortly after a unionization campaign without bargaining with the Union The Board found this to be a violation of Section 8(a)(1), (3), and (5) based on union animus (Id at 486) The appellate court re- versed, finding that a badly deteriorating economic situa- tion (decline in demand, poor economic outlook, and the opening of a more cost-efficient plant elsewhere) sup- ported the partial closing (Id at 491 ) Accordingly, there could be no finding that the lack of bargaining was an 8(a)(5) violation (Id at 493) The situation in First National Maintenance, supra, is also similar to the instant case The employer chose to terminate an unprofitable contract to do maintenance and housekeeping and discharged the affected employees The Board and appellate court required bargaining over the decision to terminate the contract The Supreme Court reversed, finding this to be an economically moti- vated partial closing where the employer continued to provide the same services with a lesser number of em- ployees (Id)) Although the employer chose to use an in- dependent contractor, this is not unlike the situation here where Respondent transferred the work to a separate bargaining unit covered by a different collective-bargain- ing agreement In the instant case, just as in First Nation- al Maintenance, the impact of the decision necessarily terminated employment, but the economic considerations of the decision hinged on the basic scope of the enter- prise and removed the necessity to bargain over the deci- sion from the scope of Sections 8(d) and 8(a)(5) (Id)) Also noteworthy is NLRB v Adams Dairy, 350 F 2d 108 (8th Or 1965), where an employer made an eco- nomic decision to liquidate the distribution portion of its operations and procure the services of an independent contractor The court held the decision to be outside the scope of mandatory bargaining based on a number of considerations a basic operational change had taken place, no union animus was involved, and it was a com- plete transfer of work to a separate operation rather than a substitution of a set of employees for another (Id at 113-115) These considerations parallel those in the in- stant case The unilateral transfer of work to the North- ern Engineering Shop was a basic operational change not predicated on union animus, under which an entirely sepa- rate unit of employees took control of the work Although an employer is under no duty to bargain over a partial closing decision, there is a duty to notify the union of is intentions so that bargaining can occur over the effects of the closing NLRB v Royal Plating & Polishing, supra See also Textile Workers Union (Darling- ton Mfg Co), 380 F 2d 263 (1965) (The union must be given the opportunity to bargain on the effects of a deci- sion that will alter unit members' employment status ) Bargainable issues in this respect include such things as seniority, layoff and rehire provisions, pensions, and sev- erance pay NLRB v Royal Plating & Polishing Co, supra The duty to bargain, however, does not include a duty to agree and so long as a good-faith effort has been made to entertain union proposals and questions, the em- ployer's obligation has been met Ozark Trailers, 161 NLRB 568 (1966) The record establishes that Respondent did notify the Union of its intention to close and was available to enter- tain issues which the Union wished to discuss The Union was notified on August 4 of the September 1 clos- ing date During the interim period and for approximate- ly 1 month thereafter, the Union failed to present any proposals or suggestions in spite of management requests The fact that no mention of the closing was made to the Union prior to the August 4 negotiation meeting is not sufficient to sustain a finding of bad-faith bargaining The Union had almost 1 month's notice and as little as 9 days' notice has been held to be adequate (See Cumberland Shoe Corp, 156 NLRB 1130 (1966), 20-day notice of clo- sure adequate, American Oil Co, 164 NLRB 36 (1967), 9- day notice of closure adequate ) The Union's failure to initiate negotiations in response to Fraser's invitation weighs heavily against the finding of an 8(a)(5) violation Respondent's decision to implement the partial closing for economic reasons is not a mandatory subject of bar- gaining The record is clear that Respondent has met its duty of notifying the Union of its intention such that bar- gaining over the effects of the closing could occur The Union chose not to take advantage of the opportunity to bargain over the effects, and the record is devoid of any excuse for this lack of action The General Counsel has attempted to show union animus by the actions of Employer in its treatment of grievances brought by the Union and its members and in a statement made by the president of Respondent, Phillip Milroy The grievances were filed pursuant to the provi- sions of the most recent collective-bargaining agreement with the Company However, the option of the Union and the Company to "terminate" as opposed to FRASER SHIPYARDS 501 "modify," that contract provided for its termination as of July 31, 1982 Therefore there was no contract, after that date, under which any grievances were required to be processed by the parties Notwithstanding this, Respond- ent, in its invitation to the Union to discuss the closure and its effect upon the employees, included the issue of the subject matter of the grievance in its offer to negoti- ate On December 17, 1982, Respondent wrote to the union representative advising that it was unwilling to process a contractual grievance but that it was willing to negotiate concerning the decision to close the machine shop and its effect upon its employees and those negotia- tions in the matter of the grievance would be considered Respondent's position in this regard is well taken The decision of the Union to notify the Company at the ter- mination period of the collective-bargaining agreement that it desired to terminate the contract and negotiate for a new contract, had the effect of disposing as of July 31, 1982, all of the conditions and obligations under that col- lective-bargaining agreement They were not, therefore, required to formally treat the subject matter of the griev- ance under the terms of that contract Respondent did, however, agree to consider the subject matter of those grievances in subsequent negotiations regarding the clo- sure of Respondent's machine shop The incident involving the claim of an employee for insurance benefits and the attempt by the Union to obtain favorable resolutions of this claim in exchange for volun- tary overtime work prompted Respondent's president to state that there would not be a machine shop unless the Union cooperated This statement cannot be interpreted as an antiunion statement It was clear that the economic situation of the Company was precarious In an attempt to satisfy a customer, the Company requested its employ- ees to work overtime in order to return a vessel to the trade In the event overtime was not worked by Re- spondent's employees, the Company's reputation for effi- cient service would have been tainted A refusal to work overtime unless the Company acceded to a claim which it thought unjustified, certainly can be characterized as, at least uncooperative, and such lack of cooperation could further damage the economic posture of the Com- pany to the extent that a closure of not only the machine shop, but the entire shipyard, was possible This is not deemed to comprise union animus which affected the de- cision of Respondent to close its shipyard machine shop V CONCLUSIONS Accordingly, Respondent had no legal obligation to negotiate with the Union on the question of whether or not it should close its physical facilities known as the shipyard machine shop It did have a duty to notify the Union in order that the Union may discuss and negotiate the resolution of several circumstances arising as a result of such closure as it affects the tenure of the union em- ployees Respondent, on August 4, notified the Union of its intent to close the machine shop and it invited the Union to provide alternatives to such closure and to ne- gotiate the effects of the closure on the bargaining unit employees The Union clearly did not pursue this invita- tion of the Respondent Instead, 26 days later, it filed a charge with the Board alleging the Respondent's failure to negotiate the decision and the effects of the decision For the reasons above stated, I find that Respondent had no duty or legal obligation to negotiate the decision to close the machine shop with the Union It did notify the Union as it was required to do and invited negotia- tions The Union, for reasons not evident in the record, failed to request, engage in and pursue negotiations re- garding these matters I, therefore, find that Respondent did not violate the Act by closing its machine shop nor did it fail to offer to the Union an opportunity to negoti- ate and bargain regarding the effects of such decision upon Respondent's employees comprising the subject bargaining unit CONCLUSIONS OF LAW 1 The Respondent, Fraser Shipyards, Inc , is an em- ployer engaged in commerce within the meaning of Sec- tion 2(2), (6), and (7) of the Act 2 District No 133, International Association of Ma- chinists and Aerospace Workers, AFL-CIO is a labor organization within the meaning of Section 2(5) of the Act 3 Fraser Shipyards, Inc has not violated the Act in any manner alleged in the complaint On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed 2 ORDER It is ordered that the complaint in this proceeding be dismissed in its entirety 2 If no exceptions are filed as provided in 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 '