Delaware Valley Designers & Mfrs.

355 NLRB No. 52 NOTICE: This opinion is subject to formal revision before publication in the bound volumes of NLRB decisions. Readers are requested to notify the Ex- ecutive Secretary, National Labor Relations Board, Washington, D.C. 20570, of any typographical or other formal errors so that corrections can be included in the bound volumes. Delaware Valley Designers and Manufacturers, Inc. and New Jersey Regional Council of Carpenters. Case 4–CA–37307 July 16, 2010 DECISION AND ORDER BY CHAIRMAN LIEBMAN AND MEMBERS BECKER AND PEARCE The Acting General Counsel seeks a default judgment in this case on the ground that the Respondent has failed to file an answer to the complaint. Upon a charge filed by the New Jersey Regional Council of Carpenters (the Council) on February 1, 2010, the General Counsel is- sued the complaint and notice of hearing on March 23, 2010, against Delaware Valley Designers and Manufac- turers, Inc. (the Respondent), alleging that it has violated Section 8(a)(5) and (1) of the Act. The Respondent failed to file an answer. On May 7, 2010, the General Counsel filed a Motion for Default Judgment with the Board. Thereafter, on May 12, 2010, the Board issued an order transferring the proceeding to the Board and a Notice to Show Cause why the motion should not be granted. The Respondent filed no response. The allegations in the motion are therefore undisputed. The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. Ruling on Motion for Default Judgment Section 102.20 of the Board’s Rules and Regulations provides that the allegations in the complaint shall be deemed admitted if an answer is not filed within 14 days from service of the complaint, unless good cause is shown. In addition, the complaint affirmatively states that unless an answer is received by the Regional Office on or before April 6, 2010, the Board may find, pursuant to a motion for default judgment, that the allegations in the complaint are true. Further, the undisputed allega- tions in the Acting General Counsel’s motion disclose that the Region, by letter dated May 3, 2010, notified the Respondent that unless an answer were received by May 10, 2010, a motion for default judgment would be filed.1 1 By letter dated May 5, 2010, the Respondent’s attorney advised the Regional Attorney for Region 4 that the Respondent’s company has ceased operations, and turned over its assets for liquidation. The letter further states that there are no funds available to pay unsecured credi- tors and that the Respondent would not be defending any action before the Board. The Board has long held that the liquidation of assets does not shield a respondent from the obligation to file a timely answer. See In the absence of good cause being shown for the fail- ure to file a timely answer, we grant the Acting General Counsel’s Motion for Default Judgment. On the entire record, the Board makes the following FINDINGS OF FACT I. JURISDICTION At all material times, until about January 25, 2010, the Respondent, a New Jersey corporation with a facility in Pennsauken, New Jersey (the Pennsauken facility), was engaged in the manufacture of nonwooden partitions, shelving, counters, counter displays and lockers for stores and offices and the manufacture and installation of wooden millwork and trim. During the 12-month period preceding the issuance of the complaint, the Respondent, in conducting its business operations described above, sold and shipped goods valued in excess of $50,000 di- rectly to points outside the State of New Jersey. We find that the Respondent is an employer engaged in com- merce within the meaning of Section 2(2), (6), and (7) of the Act and that New Jersey Regional Council of Car- penters is a labor organization within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES At all material times, Local 2098, New Jersey Re- gional Council of Carpenters, United Brotherhood of Carpenters and Joiners of America (Local 2098) has been a labor organization within the meaning of Section 2(5) of the Act. At all material times, the following individuals have held the positions set forth opposite their respective names and have been supervisors within the meaning of Section 2(11) of the Act, and agents within the meaning of Section 2(13) of the Act, acting on behalf of the Re- spondent: Samuel LaCroce Chief Executive Officer and President Joseph Berman Manager The Respondent’s production and maintenance em- ployees at the Pennsauken facility have constituted a unit Valiant Metal Products, 244 NLRB 1049 (1979). Similarly, the Board has held that cessation of operations or bankruptcy does not relieve respondents of the obligation to file an answer. OK Toilet & Towel Supply, 339 NLRB 1100, 1101 (2003); Miami Rivet of Puerto Rico, 307 NLRB 1390, 1391 fn. 2 (1992); see also Holt Plastering, Inc., 317 NLRB 451, 451 (1995) (respondent was not excused from filing an answer to compliance specification, even though the respondent noti- fied the Board it had “ceased operations and liquidated the plant facili- ties”). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 2 (the unit), appropriate for the purposes of collective bar- gaining within the meaning of Section 9(b) of the Act. At all material times, the Council and Local 2098 (col- lectively, the Union) have been the designated exclusive collective-bargaining representatives of the unit and the Council and Local 2098 have been recognized as the representatives by the Respondent. This recognition has been embodied in successive collective-bargaining agreements, the most recent of which is effective by its terms from July 1, 2008 through June 30, 2011. At all material times, since at least July 1, 2008, based on Section 9(a) of the Act, the Council and Local 2098, collectively the Union, have been the exclusive collec- tive-bargaining representatives of the unit. On about January 25, 2010, the Respondent ceased op- erations at the Pennsauken facility.2 The Respondent engaged in the conduct described above without prior notice to the Union and without af- fording the Union an opportunity to bargain with the Respondent with respect to the effects of this conduct. CONCLUSION OF LAW By the acts and conduct described above, the Respon- dent has been failing and refusing to bargain collectively with the exclusive collective-bargaining representatives of its employees, and has thereby engaged in unfair labor practices affecting commerce within the meaning of Sec- tion 8(a)(5) and (1) and Section 2(6) and (7) of the Act. REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, we shall order it to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. Specifically, to remedy the Respondent’s unlawful failure and refusal to bargain with the Union about the effects of the Respondent’s decision to cease its operations at the Pennsauken facil- ity, we shall order the Respondent to bargain with the Union, on request, about the effects of its decision. As a result of the Respondent’s unlawful conduct, however, the unit employees have been denied an opportunity to bargain through their collective-bargaining representative 2 Although the complaint alleges that the Respondent’s cessation of operations is a mandatory subject of bargaining, we need not address that allegation because there is no allegation that the failure to bargain about the decision to close violates the Act. Instead, the complaint specifically alleges only that the Respondent violated the Act by failing to give notice and afford the Union an opportunity to bargain about the effects of that conduct. The Board has repeatedly found that the effect of such decisions on unit employees is a mandatory bargaining subject. See Shasta Regional Medical Center, LLC, 354 NLRB No. 65, slip op. at 2 fn. 2 (2009); Nick & Bob Partners, 340 NLRB 1196, 1198 (2003). Accordingly, we find that the complaint supports a cause of action as to the failure to bargain over the effects of the Respondent’s decision to cease its operations and to lay off its unit employees. at a time when the Respondent might still have been in need of their services and a measure of balanced bargain- ing power existed. Meaningful bargaining cannot be assured until some measure of economic strength is re- stored to the Union. A bargaining order alone, therefore, cannot serve as an adequate remedy for the unfair labor practices committed. Accordingly, we deem it necessary, in order to ensure that meaningful bargaining occurs and to effectuate the policies of the Act, to accompany our bargaining order with a limited backpay requirement designed both to make whole the employees for losses suffered as a result of the violation and to re-create in some practicable man- ner a situation in which the parties’ bargaining position is not entirely devoid of economic consequences for the Respondent. We shall do so by ordering the Respondent to pay backpay to the unit employees in a manner similar to that required in Transmarine Navigation Corp., 170 NLRB 389 (1968), as clarified by Melody Toyota, 325 NLRB 846 (1998).3 Thus, the Respondent shall pay its unit employees backpay at the rate of their normal wages when last in the Respondent’s employ from 5 days after the date of this Decision and Order until occurrence of the earliest of the following conditions: (1) the date the Respondent bar- gains to agreement with the Union on those subjects per- taining to the effects of its decision to cease operations at its Pennsauken facility on the unit employees; (2) a bona fide impasse in bargaining; (3) the Union’s failure to request bargaining within 5 business days after receipt of this Decision and Order, or to commence negotiations within 5 business days after receipt of the Respondent’s notice of its desire to bargain with the Union; or (4) the Union’s subsequent failure to bargain in good faith. In no event shall the sum paid to these employees exceed the amount they would have earned as wages from the date on which the Respondent ceased operations of the facility to the time they secured equivalent employment elsewhere, or the date on which the Respondent shall have offered to bargain in good faith, whichever occurs sooner. However, in no event shall this sum be less than the employees would have earned for a 2-week period at the rate of their normal wages when last in the Respon- dent’s employ. Backpay shall be based on earnings 3 See also Live Oak Skilled Care & Manor, 300 NLRB 1040 (1990). Neither the complaint nor the motion specify the impact, if any, on the unit employees of the Respondent’s decision to close. Thus, we do not know whether, or to what extent, the refusal to bargain about the effects of this decision had an impact on the unit employees. In these circum- stances, we shall permit the Respondent to contest the appropriateness of a Transmarine backpay remedy at the compliance stage. See, e.g., Buffalo Weaving & Belting, 340 NLRB 684, 685 fn. 3 (2003); and ACS Acquisition Corp., 339 NLRB 736, 737 fn. 2 (2003). DELAWARE VALLEY DESIGNERS & MFRS. 3 which the unit employees would normally have received during the applicable period, less any net interim earn- ings, and shall be computed in accordance with F. W. Woolworth Co., 90 NLRB 289 (1950), with interest as prescribed in New Horizons for the Retarded, 283 NLRB 1173 (1987).4 Finally, in view of the fact that the Respondent has closed its Pennsauken facility, we shall order the Re- spondent to mail a copy of the attached notice to the Un- ion and to the last known addresses of its former unit employees in order to inform them of the outcome of this proceeding. ORDER The National Labor Relations Board orders that the Respondent, Delaware Valley Designers and Manufac- turers, Inc., Pennsauken, New Jersey, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Failing and refusing to bargain collectively and in good faith with New Jersey Regional Council of Carpen- ters and Local 2098, New Jersey Regional Council of Carpenters, United Brotherhood of Carpenters and Join- ers of America, collectively the Union, as the exclusive collective-bargaining representatives of the Respondent’s production and maintenance employees (the unit) over the effects of the Respondent’s decision to cease opera- tions at its Pennsauken, New Jersey facility. (b) 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 necessary to effectuate the policies of the Act. (a) On request, bargain with the Union concerning the effects on the unit employees of the Respondent’s deci- sion to cease operations at its Pennsauken, New Jersey facility, and reduce to writing any agreement reached as a result of such bargaining. (b) Pay to the unit employees their normal wages for the period set forth in the remedy section of this decision, with interest. (c) Preserve and, within 14 days of a request, or such additional time as the Regional Director may allow for good cause shown, provide at a reasonable place desig- nated by the Board or its agents, all payroll records, so- cial security payment records, timecards, personnel re- cords and reports, and all other records including an elec- 4 In the complaint, the General Counsel seeks compound interest computed on a quarterly basis for any backpay or other monetary awards. Having duly considered the matter, we are not prepared at this time to deviate from our current practice of assessing simple interest. See, e.g., Glen Rock Ham, 352 NLRB 516, 516 fn. 1 (2008), citing Rogers Corp., 344 NLRB 504 (2005). tronic copy of such records if stored in electronic form, necessary to analyze the amount of backpay due under the terms of this Order. (d) Within 14 days after service by the Region, dupli- cate and mail, at its own expense and after being signed by the Respondent’s authorized representative, copies of the attached notice marked “Appendix”5 to the Union and to all unit employees who were employed by the Respondent on January 25, 2010. (e) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a re- sponsible official on a form provided by the Region at- testing to the steps that the Respondent has taken to comply. Dated, Washington, D.C. July 16, 2010 Wilma B. Liebman, Chairman Craig Becker, Member Mark Gaston Pearce, Member (SEAL) NATIONAL LABOR RELATIONS BOARD APPENDIX NOTICE TO EMPLOYEES MAILED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we vio- lated Federal labor law and has ordered us to mail and obey this notice. FEDERAL LAW GIVES YOU THE RIGHT TO Form, join, or assist a union Choose representatives to bargain with us on your behalf Act together with other employees for your bene- fit and protection Choose not to engage in any of these protected activities. 5 If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading “Mailed By Order of the Na- tional Labor Relations Board” shall read “Mailed Pursuant to a Judg- ment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board.” DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 4 WE WILL NOT fail and refuse to bargain collectively and in good faith with New Jersey Regional Council of Car- penters and Local 2098, New Jersey Regional Council of Carpenters, United Brotherhood of Carpenters and Join- ers of America, collectively the Union, as the exclusive collective-bargaining representatives of our production and maintenance employees (the unit) over the effects of our decision to cease operations at our Pennsauken, New Jersey facility. 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, bargain collectively and in good faith with the Union concerning the effects of our deci- sion to cease operations at our Pennsauken, New Jersey facility, and WE WILL reduce to writing and sign any agreement reached as a result of such bargaining. WE WILL pay the unit employees their normal wages for the period set forth in the Decision and Order of the National Labor Relations Board, with interest. DELAWARE VALLEY DESIGNERS AND MANUFACTURERS, INC.