Kohler & Sons, Inc.

National Labor Relations Board - Board Decisions

May 24, 2010

355 N.L.R.B. 221 (N.L.R.B. 2010)

KOHLER & SONS, INC.
355 NLRB No. 34
221
Kohler & Sons, Inc. and Local 6-505M, Graphic
Communications Conference of the Interna-
tional Brotherhood of Teamsters. Case 14–CA–
29932
May 24, 2010
DECISION AND ORDER
BY CHAIRMAN LIEBMAN AND MEMBERS SCHAUMBER
AND BECKER
The General Counsel seeks a default judgment in this
case on the ground that the Respondent has withdrawn its
answer to the complaint. Upon a charge and an amended
charge filed by the Union on October 23 and December
22, 2009, respectively, the General Counsel issued the
complaint on December 31, 2009, against Kohler &
Sons, Inc., the Respondent, alleging that it has violated
Section 8(a)(5) and (1) of the Act. The Respondent filed
an answer to the complaint. However, by letter dated
February 18, 2010, the Respondent withdrew its answer.
On March 11, 2010, the General Counsel filed a Mo-
tion for Default Judgment with the Board. Thereafter, on
March 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 a 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 the answer must be received by the Regional Office
on or before January 14, 2010. Although the Respondent
filed an answer to the complaint on January 14, 2010, it
subsequently withdrew its answer by letter dated Febru-
ary 18, 2010. The withdrawal of an answer has the same
effect as a failure to file an answer, i.e., the allegations in
the complaint must be considered to be true.1 Accord-
ingly, we grant the 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, the Respondent, a Missouri cor-
poration, with an office and place of business in St.

1 See Maislin Transport, 274 NLRB 529 (1985).
Louis, Missouri, has been engaged in the commercial
printing business. During the 12-month period ending
November 30, 2009, the Respondent, in conducting its
business operations described above, purchased and re-
ceived at its St. Louis, Missouri facility goods valued in
excess of $50,000 directly from points outside the State
of Missouri.
We find that the Respondent is an employer engaged
in commerce within the meaning of Section 2(2), (6), and
(7) of the Act and that Local 6-505M, Graphic Commu-
nications Conference of the International Brotherhood of
Teamsters, the Union, is 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
meaning of Section 2(11) of the Act and agents of the
Respondent within the meaning of Section 2(13) of the
Act:

Kevin C. Kohler — President
Kent J. Kohler — Vice President and Secretary
Keith G. Kohler — Member, Board of Directors

The employees of the Respondent in the unit covered
by the collective-bargaining agreement described below
(the unit) constitute a unit appropriate for the purposes of
collective bargaining within the meaning of Section 9(b)
of the Act.2
Since about 1970, and at all material times, the Union
has been the designated exclusive collective-bargaining
representative of the unit and since then the Union has
been recognized as the representative by the Respondent.
This recognition has been embodied in successive collec-
tive-bargaining agreements, the most recent of which is
effective from July 1, 2007, through June 30, 2011.
At all material times since about 1970, based on Sec-
tion 9(a) of the Act, the Union has been the exclusive
collective-bargaining representative of the unit.
Since about October 9, 2009, the Respondent has
failed to continue in effect all the terms and conditions of
the 2007–2011 agreement, by failing and refusing to pay
unit employees accrued vacation pay, and failing to make
pension fund and retirement fund contributions on behalf
of the unit employees for September and October 2009.

2 There is no specific unit description set forth in the complaint.
However, in light of the Respondent’s withdrawal of its answer, there is
no dispute that the unit described in the parties’ collective-bargaining
agreements is appropriate.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD

222
The subjects set forth above relate to wages, hours, and
other terms and conditions of employment of the unit and
are mandatory subjects for the purpose of collective bar-
gaining. The Respondent engaged in the conduct de-
scribed above without the Union’s consent and without
affording the Union an opportunity to bargain with the
Respondent with respect to this conduct.
About October 9, 2009, the Respondent ceased opera-
tions and laid off all the employees in the unit. The Re-
spondent engaged in this conduct without prior notice to
the Union and without affording the Union an opportu-
nity to bargain with the Respondent with respect to the
effects on the unit of its decision to cease operations and
the resulting layoffs.3
CONCLUSION OF LAW
By the acts and conduct described above, the Respon-
dent has been failing and refusing to bargain collectively
and in good faith with the exclusive collective-
bargaining representative of its employees, and has
thereby engaged in unfair labor practices affecting com-
merce within the meaning of Section 8(a)(5) and (1) and
Section 2(6) and (7) of the Act.4
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 operations at its St. Louis, Missouri
facility and lay off all the employees in the unit, we shall
order the Respondent to bargain with the Union, on re-

3 Although the complaint alleges that the Respondent’s cessation of
operations and laying off of all unit employees are mandatory subjects
of bargaining, we need not address those allegations 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 Re-
spondent 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 Cen-
ter, 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.
4 In its letter to the Region withdrawing its answer, the Respondent
stated that because it is “out of business with virtually no remaining
assets, no office, no staff and depleted records, . . . it is simply not
prudent . . . to proceed further in this matter given those economic
circumstances.” It is well settled that an employer’s adverse business
circumstances do not constitute an adequate defense to the complaint
allegations here. See, e.g., Coal Rush Mining, Inc., 341 NLRB 32, 33
fn. 2 (2004), and Nick Robilotto, Inc., 292 NLRB 1279 (1989).
quest, about the effects of its decision. As a result of the
Respondent’s unlawful conduct, however, the unit em-
ployees have been denied an opportunity to bargain
through their collective-bargaining representative at a
time when the Respondent might still have been in need
of their services and a measure of balanced bargaining
power existed. Meaningful bargaining cannot be assured
until some measure of economic strength is restored 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 recreate 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).5
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 of
its facility on the unit employees; (2) a bona fide impasse
in bargaining; (3) the Union’s failure to request bargain-
ing within 5 business days after receipt of this Decision
and Order, or to commence negotiations within 5 busi-
ness days after receipt of the Respondent’s notice of its
desire to bargain with the Union; or (4) the Union’s sub-
sequent failure to bargain in good faith.
In no event shall the sum paid to these employees ex-
ceed the amount they would have earned as wages from
the date on which the Respondent ceased operations of
its St. Louis, Missouri 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 Respondent’s employ. Backpay
shall be based on earnings which the unit employees
would normally have received during the applicable pe-

5 See also Live Oak Skilled Care & Manor, 300 NLRB 1040 (1990).
KOHLER & SONS, INC.

223
riod, less any net interim earnings, 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).6
Further, having found that the Respondent violated
Section 8(a)(5) and (1) by failing and refusing to con-
tinue in effect all of the terms and conditions of the
2007–2011 collective-bargaining agreement since Octo-
ber 9, 2009, by failing to pay unit employees accrued
vacation pay, we shall order the Respondent to make the
unit employees whole for any loss of earnings and other
benefits attributable to its unlawful conduct. Backpay
shall be computed in accordance with Ogle Protection
Service, 183 NLRB 682 (1970), enfd. 444 F.2d 502 (6th
Cir. 1971), with interest as prescribed in New Horizons
for the Retarded, supra.
Also, having found that the Respondent has violated
Section 8(a)(5) and (1) by failing to continue in effect all
of the terms and conditions of the 2007–2011 collective-
bargaining agreement since October 9, 2009, by failing
to make pension fund and retirement fund contributions
on behalf of the unit employees for September and Octo-
ber 2009, we shall order the Respondent to make all such
delinquent pension and retirement fund contributions that
were not made for September and October 2009, includ-
ing any additional amounts due the funds in accordance
with Merryweather Optical Co., 240 NLRB 1213, 1216
fn. 7 (1979).7 We shall also order the Respondent to
reimburse unit employees for any expenses ensuing from
its failure to make the required contributions, as set forth
in Kraft Plumbing & Heating, 252 NLRB 891 fn. 2
(1980), enfd. 661 F.2d 940 (9th Cir. 1981), such amounts
to be computed in the manner set forth in Ogle Protec-
tion Service, supra, with interest as prescribed in New
Horizons for the Retarded, supra.
Finally, in view of the fact that the Respondent has
ceased operations at its St. Louis, Missouri facility, we
shall order the Respondent to mail a copy of the attached
notice to the Union and to the last known addresses of
the unit employees who were employed by the Respon-

6 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).
7 To the extent that an employee has made personal contributions to
a benefit or other fund that have been accepted by the fund in lieu of
the Respondent’s delinquent contributions during the period of the
delinquency, the Respondent will reimburse the employee, but the
amount of such reimbursement will constitute a setoff to the amount
that the Respondent otherwise owes the fund.
dent on October 9, 2009, in order to inform them of the
outcome of this proceeding.
ORDER
The National Labor Relations Board orders that the
Respondent, Kohler & Sons, Inc., St. Louis, Missouri, its
officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Failing and refusing to bargain collectively and in
good faith with Local 6-505M, Graphic Communications
Conference of the International Brotherhood of Team-
sters, as the exclusive collective-bargaining representa-
tive of its unit employees over the effects of the Respon-
dent’s decision to cease operations at its St. Louis, Mis-
souri facility and to lay off all of the unit employees.
The unit is comprised of those employees covered by the
2007–2011 collective-bargaining agreement between the
Respondent and the Union.
(b) Failing to continue in effect all the terms and con-
ditions of its 2007–2011 collective-bargaining agreement
with the Union by failing to pay employees accrued va-
cation pay.
(c) Failing to continue in effect all the terms and con-
ditions of its 2007–2011 collective-bargaining agreement
with the Union by failing to make pension fund and re-
tirement fund contributions on behalf of the employees.
(d) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) On request, bargain collectively and in good faith
with the Union concerning the effects of the Respon-
dent’s decision to cease operations at its St. Louis, Mis-
souri facility and to lay off all of the unit employees, and
reduce to writing and sign any agreement reached as a
result of such bargaining.
(b) Pay the unit employees their normal wages for the
period set forth in the remedy section of this decision,
with interest.
(c) Make whole the unit employees for any loss of
earnings and other benefits resulting from the Respon-
dent’s failure to pay employees accrued vacation pay
since October 9, 2009, with interest, as set forth in the
remedy section of this decision.
(d) Make the delinquent pension fund and retirement
fund contributions on behalf of employees, with interest,
that were not made for September and October 2009, in
the manner set forth in the remedy section of this deci-
sion.
(e) Make whole the unit employees for any expenses
ensuing from the Respondent’s failure to make the con-
tractually-required pension fund and retirement fund con-
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD

224
tributions, with interest, as set forth in the remedy section
of this decision.
(f) 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-
tronic copy of such records if stored in electronic form,
necessary to analyze the amount of backpay due under
the terms of this Order.
(g) 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”8 to the Union
and to all unit employees who were employed by the
Respondent on October 9, 2009.
(h) 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 the Respondent has taken to comply.

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
violated Federal labor law and has ordered us to post 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
benefit and protection

8 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.”

Choose not to engage in any of these protected
activities.

WE WILL NOT fail and refuse to bargain collectively
and in good faith with Local 6-505M, Graphic Commu-
nications Conference of the International Brotherhood of
Teamsters, as the exclusive collective-bargaining repre-
sentative of the employees in the unit over the effects of
our decision to cease operations at our St. Louis, Mis-
souri facility and to lay off all of the unit employees.
WE WILL NOT fail to continue in effect all the terms
and conditions of our 2007–2011 collective-bargaining
agreement with the Union by failing to pay employees
accrued vacation pay.
WE WILL NOT fail to continue in effect all the terms
and conditions of our 2007–2011 collective-bargaining
agreement with the Union by failing to make pension
fund and retirement fund contributions on behalf of the
employees.
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 St. Louis, Missouri facil-
ity and to lay off all of the unit employees, 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.
WE WILL make whole the unit employees for any loss
of earnings and other benefits resulting from our failure
to pay employees accrued vacation pay since October 9,
2009, with interest.
WE WILL make the delinquent pension fund and re-
tirement fund contributions on behalf of employees, with
interest, that were not made for September and October
2009.
WE WILL make whole the unit employees for any ex-
penses ensuing from our failure to make the contractu-
ally-required pension fund and retirement fund contribu-
tions, with interest.

KOHLER & SONS, INC.