Paragon Systems, Inc.

373 NLRB No. 108 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. Paragon Systems, Inc. and United States Court Secu- rity Officers. Case 06–CA–282943 September 20, 2024 DECISION AND ORDER BY CHAIRMAN MCFERRAN AND MEMBERS KAPLAN AND WILCOX The General Counsel seeks a default judgment in this case pursuant to the terms of an informal settlement agree- ment. Upon a charge and amended charges filed by United States Court Security Officers (Charging Party), on September 14, 2021, October 22, 2021, and May 12, 2022, respectively, the Regional Director for Region 6 issued a complaint on February 3, 2023, alleging that Paragon Sys- tems, Inc. (the Respondent) violated Section 8(a)(5) and (1) of the Act by refusing to bargain in good faith with the Charging Party over an October 1, 2021 wage reopener in the parties’ collective-bargaining agreement. On Febru- ary 17, 2023, the Respondent filed an answer to the com- plaint. The Respondent and the Charging Party subsequently entered into a bilateral informal settlement agreement, which the Regional Director approved on March 7, 2024.1 The settlement agreement required the Respondent to, among other things (1) sign and mail, at its own expense, a copy of the Notice to Employees to all members of the bargaining units described in the attached Notice who have performed work for the Respondent at any time since March 14, 2021; (2) make whole the employees named in Appendices A and B of the settlement by payment to each listed employee of the amount opposite each name for lost wages, benefits, and all direct or foreseeable pecuniary harms they suffered because the Respondent failed to im- plement a wage increase effective October 1, 2021; (3) file with the Regional Director for Region 6 a report allocating the backpay and payments to the appropriate calendar year and copies of the employees’ corresponding W-2 forms reflecting the awards; and (4) notify the Regional Director in writing what steps the Respondent has taken to comply with the agreement. The settlement agreement also contained the following provision: The Charged Party agrees that in case of non-compli- ance with any of the terms of this Settlement Agreement by the Charged Party, and after 14 days’ notice from the 1 All subsequent dates are 2024 unless otherwise indicated. Regional Director of the National Labor Relations Board of such non-compliance without remedy by the Charged Party, the Regional Director will reissue the complaint previously issued on February 3, 2023, in the instant case. Thereafter, the General Counsel may file a motion for default judgment with the Board on the alle- gations of the complaint. The Charged Party under- stands and agrees that the allegations of the aforemen- tioned complaint will be deemed admitted and the An- swer to such complaint will be considered withdrawn. The only issue that may be raised before the Board is whether the Charged Party defaulted on the terms of this Settlement Agreement. The Board may then, without necessity of trial or any other proceeding, find all allega- tions of the complaint to be true and make findings of fact and conclusions of law consistent with those allega- tions adverse to the Charged Party on all issues raised by the pleadings. The Charged Party agrees that the Board may then issue an order providing, as elected by the Re- gional Director, a full remedy for the violations found as is appropriate to remedy such violations and/or an order requiring the Charged Party to perform terms of this Set- tlement Agreement as specified by the Regional Direc- tor. The parties further agree that a U.S. Court of Ap- peals Judgment may be entered enforcing the Board or- der ex parte, after service or attempted service upon Charged Party/Respondent at the last address provided to the General Counsel. By email dated March 21, the Region’s compliance of- ficer contacted the Respondent to inquire about the status of its affirmative obligations under the agreement. That same day, the Respondent replied that compliance with the monetary provisions would take “a little while longer” and that a status update would be provided the following day. On March 22, the compliance officer asked the Re- spondent to provide a date by which they would submit the payments, as well as a status update on the related af- firmative provisions. On March 25, having received no response, the compliance officer once again emailed re- questing a status update. On March 26, the Respondent replied that the notice mailing would go out by March 28 and that it anticipated the payments would issue the fol- lowing week. Throughout April and May, the compliance officer and Regional Director attempted to contact the Respondent, warning that continued noncompliance would result in the reissuance of the complaint and a motion for default judg- ment. The Respondent failed to respond. Accordingly, on May 17, the Regional Director, by letter sent via certified mail, notified the Respondent of its noncompliance with DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 2 the terms of the settlement agreement. The letter also in- formed the Respondent that, unless it complied with its obligations under the agreement by May 30,2 the Regional Director would reissue the complaint that included the al- legations settled by the agreement. On June 4, pursuant to the uncontroverted terms of the agreement’s noncompli- ance provisions, the Acting Regional Director issued a complaint based on breach of affirmative provisions of settlement agreement seeking the same remedies as the in- itial complaint and noting that the Respondent had waived the right to contest the unfair labor practice allegations through its noncompliance with the settlement. On June 28, the General Counsel filed a Motion for De- fault Judgment with the Board requesting that the Board issue a Decision and Order against the Respondent con- taining findings of fact and conclusions of law based on the allegations in the complaint. On July 3, the Board is- sued 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 allega- tions 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 According to the uncontroverted allegations in the mo- tion for default judgment, the Respondent has failed to comply with the terms of the settlement agreement. Con- sequently, pursuant to the noncompliance provision of the settlement agreement set forth above, we find that the Re- spondent’s answer to the original complaint has been withdrawn and all of the allegations of the reissued com- plaint are true.3 Accordingly, we grant the General Coun- sel’s Motion for Default Judgment. On the entire record the Board makes the following FINDINGS OF FACT I. JURISDICTION At all material times, the Respondent has been a corpo- ration with an office and place of business in Herndon, Virginia, and has been engaged in providing security ser- vices for governmental and commercial entities, including the United States Government. Annually, in conducting its operations described above, the Respondent has per- formed services valued in excess of $50,000 in states other than the Commonwealth of Virginia. We find that at all material times the Respondent has been an employer engaged in commerce within the mean- ing of Section 2(2), (6), and (7) of the Act, and the 2 The Motion inadvertently states that the Regional Director’s letter demanded compliance by May 30, 2023. A copy of the letter submitted Charging Party has been a labor organization within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES At all material times, the following individuals held the positions set forth opposite their respective names and have been supervisors of the Respondent within the mean- ing of Section 2(11) of the Act and agents of the Respond- ent within the meaning of Section 2(13) of the Act: Jean Dober VP of Labor Relations-Corpo- rate Counsel Leslie Kaciban Jr. President The following employees of the Respondent constitute units appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act: All full-time and share-time federal Court Security Of- ficers (CSOs), Lead Court Security Officers (LCSOs), Senior Lead Court Security Officers (SLCSOs), Special Security Officers (SSOs), Lead Special Security Offic- ers (LSSOs), and Senior Lead Special Security Officers (SLSSOs) employed by the Company in the District of Delaware, but excluding all other employees, confiden- tial employees, guards, managers, professional employ- ees, and supervisors as defined by the Act. All full-time and share-time federal Court Security Of- ficers (CSOs), Lead Court Security Officers (LCSOs), Senior Lead Court Security Officers (SLCSOs), Special Security Officers (SSOs), Lead Special Security Offic- ers (LSSOs), and Senior Lead Special Security Officers (SLSSOs) employed by the Company at the following location(s) in the 4th Circuit: Baltimore and Greenbelt in Maryland; Alexandria, Manassas, Norfolk, Newport News and Richmond in E/Virginia; Durham, Greens- boro and Winston Salem in M/North Carolina; Colum- bia, Florence, Charleston and Greenville in South Caro- lina; Clarksburg, Elkins, Martinsburg and Wheeling in N/West Virginia; Asheville, Charlotte and Statesville in W/North Carolina; Abingdon, Big Stone Gap, Char- lottesville, Danville, Harrisonburg, Lynchburg and Roa- noke in W/Virginia, but excluding all other employees, confidential employees, guards, managers, professional employees, and supervisors as defined by the Act. Since about August 25, 2020, until April 1, 2022, the date the Respondent lost the government contract cover- ing the above units, and at all material times, the as an attachment to the motion, however, shows that the compliance let- ter used the correct date of May 30, 2024. 3 See U-Bee, Ltd., 315 NLRB 667 (1994). PARAGON SYSTEMS, INC. 3 Respondent has recognized the Charging Party as the ex- clusive collective-bargaining representative of the units. This recognition has been embodied in a series of collec- tive-bargaining agreements, the most recent of which were effective by their terms from August 25, 2020, through September 30, 2023. At all material times, based on Section 9(a) of the Act, the Charging Party has been the exclusive collective-bar- gaining representative of the units. At various times from May 18, 2021, through Novem- ber 24, 2021, the Respondent and the Charging Party met for the purposes of negotiating October 1, 2021 wage reo- peners denoted in the collective-bargaining agreements described above. During this period the Respondent bar- gained with no intention of reaching agreement by with- drawing its proposal for a 1 percent wage increase and prematurely halting bargaining over the October 1, 2021 wage reopener. CONCLUSION OF LAW By its overall conduct, including the conduct described immediately above, the Respondent has failed and refused to bargain in good faith with the Charging Party as the ex- clusive collective-bargaining representative of the units in violation of Section 8(a)(5) and (1) of the Act. The unfair labor practices of the Respondent described above affect commerce within the meaning of 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 actions designed to effectuate the policies of the Act. Specifically, we shall order the Respondent to comply with the unmet terms of the settlement agreement approved by the Regional Direc- tor for Region 6 on March 7, 2024. In this regard, the Respondent agreed in the settlement agreement to make whole the employees named in Appen- dices A and B of the settlement agreement by payment to each listed employee of the amount opposite each name for lost wages, benefits, and all direct or foreseeable pecu- niary harms they suffered because the Respondent failed to implement a wage increase effective October 1, 2021. Accordingly, we order the Respondent to make such pay- ments in the manner prescribed in the settlement agree- ment, plus interest accrued to the date of payment at the rate prescribed in New Horizons, 283 NLRB 1173 (1987), compounded daily as prescribed in Kentucky River Medi- cal Center, 356 NLRB 6 (2010). In addition, the 4 Perkins Management Services Co., 365 NLRB 831, 834 fn. 3 (2017) (construing the General Counsel’s motion for default judgment to seek enforcement of unmet settlement terms when he specifically requested Respondent shall file a report with the Regional Director allocating the payments to the appropriate calendar year and copies of the employees’ corresponding W-2 forms reflecting the awards. We shall also order the Respondent to mail copies of the Notice to Employees incorporated into the settlement agreement to all employees in the bargaining units de- scribed above who performed work for the Respondent at any time since March 14, 2021. In limiting our affirmative remedies to those enumer- ated herein, we are mindful that the General Counsel is empowered under the default provision of the settlement agreement to seek a “full remedy for the violations found as is appropriate to remedy such violations and/or an order requiring the Charged Party to perform terms of this Set- tlement Agreement as specified by the Regional Director.” Here, we construe the General Counsel’s Motion for De- fault Judgment as requesting the latter, as she specifically requests that the Board order the Respondent to “fulfill all of its obligations under the March 7, 2024, Settlement Agreement.” Accordingly, we will not, sua sponte, in- clude other remedies in the affirmative relief ordered herein.4 ORDER The National Labor Relations Board orders that the Re- spondent, Paragon Systems, Inc., Herndon, Virginia, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Failing and refusing to bargain in good faith with United States Court Security Officers over wages, hours, and working conditions by engaging in dilatory tactics de- signed to frustrate the bargaining process. (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) Within 14 days from the date of this Order, make whole all bargaining unit employees named in Appendices A and B of the settlement agreement by payment to each listed employee of the amount opposite each name, in the manner prescribed by the settlement agreement, with in- terest accrued to the date of payment. (b) Within 21 days from the date of this order, file a report with the Regional Director for Region 6 allocating the payments to the appropriate calendar year and copies of the employees’ corresponding W-2 forms reflecting the awards. an order requiring the respondent to fulfill its undertakings in that agree- ment); Benchmark Mechanical, Inc., 348 NLRB 576, 578 (2006). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 4 (c) 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 Charging Party and to all unit employees who were employed by the Respondent at any time since March 14, 2021 as provided for in the settlement agreement. (d) Within 5 days after service by the Region, and again within 60 days after service, file with the Regional Direc- tor for Region 6 a sworn certification of a responsible of- ficial on a form provided by the Region attesting to the steps that the Respondent has taken to comply with this Order. Dated, Washington, D.C. September 20, 2024 ______________________________________ Lauren McFerran, Chairman ______________________________________ Marvin E. Kaplan Member ______________________________________ Gwynne A. Wilcox, 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 FEDERAL LAW, GIVES YOU THE RIGHT TO Form, join, or assist a union Choose a representative 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 ac- tivities. WE WILL NOT interfere with, restrain, or coerce you in the exercise of the above rights. United States Court Security Officers (USCSO) is the employees’ representative in dealing with us regarding 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 National Labor Relations Board” shall read “Mailed Pursuant to a Judgment of the wages, hours and other working conditions of the employ- ees in the following units: All full-time and share-time federal Court Security Of- ficers (CSOs), Lead Court Security Officers (LCSOs), Senior Lead Court Security Officers (SLCSOs), Special Security Officers (SSOs), Lead Special Security Offic- ers (LSSOs), and Senior Lead Special Security Officers (SLSSOs) employed by the Company in the District of Delaware. All full-time and share-time federal Court Security Of- ficers (CSOs), Lead Court Security Officers (LCSOs), Senior Lead Court Security Officers (SLCSOs), Special Security Officers (SSOs), Lead Special Security Offic- ers (LSSOs), and Senior Lead Special Security Officers (SLSSOs) employed by the Company at the following location(s) in the 4th Circuit: Baltimore and Greenbelt in Maryland; Alexandria, Manassas, Norfolk, Newport News and Richmond in E/Virginia; Durham, Greens- boro and Winston Salem in M/North Carolina; Colum- bia, Florence, Charleston and Greenville in South Caro- lina; Clarksburg, Elkins, Martinsburg and Wheeling in N/West Virginia; Asheville, Charlotte and Statesville in W/North Carolina; Abingdon, Big Stone Gap, Char- lottesville, Danville, Harrisonburg, Lynchburg and Roa- noke in W/Virginia. WE WILL NOT, upon request, refuse to bargain in good faith with United States Court Security Officers (USCSO), over your wages, hours, and working conditions by engag- ing in dilatory tactics designed to frustrate the bargaining process. WE WILL NOT in any like or related manner interfere with your rights under Section 7 of the Act. WE WILL pay the employees who were employed in the units described above for the wages, benefits, and all di- rect or foreseeable pecuniary harms that resulted from our failure to implement a wage increase effective October 1, 2021. WE WILL provide the Regional Director with a Backpay report allocating the payments to the appropriate calendar year and a copy of the IRS form W-2 for wages earned in the current calendar year within 21 days from issuance of the Board’s order. PARAGON SYSTEMS, INC. The Board’s decision can be found at www.nlrb.gov/case/06-CA-282943 or by using the QR United States Court of Appeals Enforcing an Order of the National Labor Relations Board.” PARAGON SYSTEMS, INC. 5 code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National Labor Relations Board, 1015 Half Street, S.E., Washington, D.C. 20570, or by calling (202) 273-1940.