Nazco, Inc.

National Labor Relations Board - Board Decisions

Aug 29, 1977

231 N.L.R.B. 711 (N.L.R.B. 1977)

NAZCO, INC.
Nazco, Inc. and its Agent Junius B. Caldwell, Jr. and
Drivers, Chauffeurs and Helpers Local 639 affili-
ated with International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of Ameri-
ca
Nazco, Inc. and its Agents Junius B. Caldwell, Jr., and
James Black and Drivers, Chauffeurs and Helpers
Local 639 affiliated with International Brotherhood
of Teamsters, Chauffeurs, Warehousemen and
Helpers of America. Cases 5-CA-7985 and 5-
CA-8015
August 29, 1977
DECISION AND ORDER
BY MEMBERS JENKINS, MURPHY, AND
WAI THER
On April 12, 1977, Administrative Law Judge
Herzel H. E. Plaine issued the attached Decision in
this proceeding. Thereafter, Respondent filed excep-
tions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and has
decided to affirm the rulings, findings, and conclu-
sions of the Administrative Law Judge, to modify his
remedy,I and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that the Respondent, Nazco, Inc., and
its Agents Junius B. Caldwell, Jr. and James Black,
Hyattsville, Maryland, its officers, agents, successors,
and assigns, shall take the action set forth in the said
recommended Order.
I In accordance with our decision in Florida Steel Corporation, 231
NLRB 651 (1977)., we shall apply the current 7-percent rate for periods pror
to August 25. 1977. in which the "adjusted pnme interest rate" as used by
the Internal Revenue Service in calculating interest on tax payments was at
least 7 percent.
DECISION
HERZEL H. E. PLAINE, Administrative Law Judge:
Respondent, an excavator, is charged with violations of
Section 8(a)(5), (3), and (1) of the National Labor
I The consolidated complaint was issued on July 20, 1976, on a charge
filed by the Union in Case 5 CA 7985 on June I, 1976, and amended
231 NLRB No. 112
Relations Act, as amended, for failing since April 2, 1976,
to bargain, and to bargain about the effects on employees,
with the Charging Party (the Union) regarding the
unilateral discontinuance or attempted discontinuance of
its trucking operation or the subcontracting or attempted
subcontracting thereof, for unilateral changes in working
conditions, and for the discharge of its eight truckdrivers
allegedly because they were members of the Union.
Respondent is further charged with 8(a)( I) and (3)
violations for allegedly discriminatorily threatening dis-
charge of employees and discharging rehired employee
Webb.'
Respondent contends that financial difficulties com-
pelled it to discontinue the trucking portion of its
operations, transfer its trucks to Junius B. Caldwell, who
was Respondent's yard superintendent, and discharge the
eight truckdrivers. Respondent further contends that the
truck operation, after the purported transfer to Caldwell,
was his operation as an independent contractor, and was
not Respondent's, and that it had no obligation to bargain
over the transfer to Caldwell, which it claims was not a
sham. Respondent concedes that it had the responsibility
to bargain with the Union over the effects on its employees
of "liquidating" the trucking portion of its operations, but
claims that the Union "implicitly" waived bargaining by
failing to respond to an alleged telephone call or calls from
Respondent that it had sold or was selling its trucks.
The case was heard in Washington, D.C., on August 12
and 13, 1976. Only counsel for the Respondent has filed a
brief.
Upon the entire record of the case, including my
observation of the witnesses and consideration of the brief,
I make the following:
FINDINGS OF FACT
I. JURISDICTION
Respondent is a Maryland corporation engaged, as a
subcontractor in the building and construction industry, in
the excavation and hauling of soil, working out of its
Hyattsville, Maryland, yard.
In the year preceding issuance of the complaint Respon-
dent purchased and received, in interstate commerce,
materials and supplies valued in excess of $50,000 from
points outside Maryland.
As the parties admit, Respondent is an employer within
the meaning of Section 2(2), (6), and (7) of the Act.
As the parties also admit, the Union is a labor
organization within the meaning of Section 2(5) of the Act.
II. THE UNFAIR LABOR PRACTICES
A. Respondent's Business Operations
Respondent was incorporated on May 16, 1973, as
Nazarian Construction Co., and later changed its name to
Nazco, Inc., on May 12, 1975 (G.C. Exh. 16). Its business is
excavating and hauling related to the excavating.
charged filed June 4, 1976; and a charge in Case 5-CA-8015 filed on June
14, 1976.
711
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The stockholders are the three Nazarian brothers-
Sarkis, Avedis, and Hagop (Jack)-and Eric Carlin. The
board of directors comprises Sarkis and Avedis Nazarian,
Eric Carlin, and Gregory Haight, who has also been the
company lawyer.
Respondent's president is Sarkis Nazarian, who, accord-
ing to his testimony, became actively and directly involved
in management of the Company, starting in the second half
of 1975, displacing in that role his brothers Avedis and
Hagop and others engaged in supervisory functions.
Avedis Nazarian, who is the largest single stockholder,
continued on in his role as a mechanic in the shop, and as
"final authority" in the shop, said President Sarkis
Nazarian. However, this latter assertion appears to be
contradicted by the fact that President Nazarian brought in
as superintendent of the yard, where Respondent's exca-
vating equipment and trucks are kept and from whence
they move out, Junius B. Caldwell, a former business
associate of the Nazarian brothers and of their multiple
construction enterprises.2
Notwithstanding vagueness and attempted evasion by
President Nazarian and Chief Executive Officer Carlin
concerning the supervisory status of Yard Superintendent
Caldwell, it was nevertheless clear from the testimony of
the employee and management witnesses (including Naza-
rian and Carlin), and from Caldwell himself, that Caldwell
was Respondent's yard supervisor, and, specifically, among
other things, was in charge of the 8 to 10 truckdrivers, who
operated Respondent's dump trucks out of the yard.3
Yard Superintendent Caldwell hired and fired truckdri-
vers, assigned them their work, and directed them where to
go. In addition to scheduling and dispatching the dump
trucks from the yard he would also follow them up from
time to time at jobsites. He was also in charge of the several
mechanics who worked on and repaired the equipment and
trucks at the yard and who sometimes doubled, when
needed, as truckdrivers. Caldwell was also responsible for
some of the heavy equipment used in excavating (there
were 38 pieces of equipment, said Chief Executive Officer
Carlin), and for fueling all of the equipment. Occasionally,
Caldwell might supervise an operator of such equipment,
but more usually the equipment operators were under the
direction of the general superintendent (Kaupish and his
predecessors) and the jobsite supervisors, in charge of the
excavating. On a rough division of authority, as Kaupish
put it, Caldwell was in charge of trucks (the hauling
operation) and Kaupish was in charge of excavating.
Yard Superintendent Caldwell performed other manage-
ment functions for Respondent, such as representing
Respondent at the grievance procedure under the union
contract in the matter of the discharge of employee David
Francis, whom Caldwell fired on November 12, 1975 (and
later put back to work as a result of an arbitration award).
2 Among these. according to Respondent's current general superinten-
dent. Shawn Kaupish, and employee Sinclair Wilhoit, is CSH Contractors.
of which Sarkis and Hagop Nazarian and Eric Carlin (who is Respondent's
chief executive officer) are the principals. It was testified that CSH was and
is a general contractor engaged in construction of government and
commercial buildings, and that Respondent does the excavation work for
CSH on subcontracts. It was further testified that some years ago, Caldwell
had his own company, C and C Trucking and Excavating Co. (now
defunct), and worked with and for CSH.
I Yard Superintendent Caldwell was killed in an accident while driving
Caldwell took his orders directly from President Nazari-
an and Nazarian testified that for his services to Respon-
dent Caldwell received "consulting fees" of $150 to $200 at
a time 4 and unspecified personal loans on which to live.
Unquestionably, Yard Superintendent Caldwell was a
supervisor and agent for Respondent within the meaning of
the Act.
Assisting Caldwell as foreman was James Black. Black
had been a former employee and associate of Caldwell in
Caldwell's former business. Black worked as a mechanic on
Respondent's trucks and assisted and filled in for Caldwell
in his several supervisory duties. Black hired employees
Francis and Poston in 1975 and in 1976 rehired employee
Webb (initially hired by Caldwell) after Webb's discharge
in the mass discharge of April 2, 1976. Black owned two
trucks which he leased to Respondent, but the employees
he hired were hired as Respondent's employees on
Respondent's payroll, and in his work as a mechanic he
worked on Respondent's trucks and equipment. Black's
authority as foreman is underscored by the fact that when
he hired employee Francis as a truckdriver at the end of
September 1975, Avedis Nazarian (who like Black did
mechanical work on equipment) expressed the view that
Francis needed a road test before being hired. Black
replied that Francis did not need a road test and hired him
without obtaining permission or approval of anyone.
Foreman Black was a supervisor and agent for Respon-
dent within the meaning of the Act.
As already indicated, Respondent's operational employ-
ees were divided into two categories, the one group called
operators, who worked at the jobsites operating Respon-
dent's excavating and related job equipment, the second
group called truckdrivers, who operated Respondent's
dump trucks. The operators were members of Local 77
Operating Engineers, according to truckdriver employee
Wilhoit, but were not directly involved in the events of this
case. The truckdrivers, prior to the mass discharge of them
on April 2, 1976, were members of Local 639 Teamsters,
the Charging Party Union in this case. The complement of
truckdrivers was usually 10, but at the time of the mass
discharge numbered 8. Respondent owned at the time, and
owns, eight dump trucks, and additionally regularly leased
from Foreman Black his two trucks, paying him an hourly
rate. In addition, said President Nazarian, since at certain
times there might be need for as many as 20 to 25 trucks to
do the hauling of dirt and debris, Respondent would
telephone other truckers or contractors to provide addi-
tional trucks, leasing temporarily from them the needed
trucks with drivers.
Respondent's work was largely in the greater Washing-
ton, D.C., area, that included nearby Maryland and
Virginia communities. Some of the contracts that were
operative both before and after April 2, 1976, included jobs
Respondent's low-boy tractor trailer moving a piece of equipment for
Respondent, on May 26, 1976, according to Chief Executive Officer Carlin.
Two weeks before his death Caldwell had given the Board an affidavit on
May 13, 1976. which Respondent asked to be put in evidence, and which is
part of the record, as G.C. Exh. 17.
4 Chief Executive Officer Carlin, whose duties charged him with
knowledge of such matters, testified, incredibly, that he was not sure
whether Yard Superintendent Caldwell received a weekly check from
Respondent.
712
NAZCO, INC.
at Boystown Center of Catholic University, at the Naval
Medical Center in Bethesda, at Maryland University, at
Fort Reno, at High Point High School in Beltsville, and at
the Harry Diamond Labratory, according to President
Nazarian and employee Webb, who worked on all of these
both before and after April 2, 1976.
B. The Union Relationship
The Union has a multiemployer collective-bargaining
contract, sometimes described as an area contract or dump
truck contract, with an association of contractors known as
the Construction Contractors Council (CCC). Nonmem-
bers of the association or independents may become party
to the contract. The current contract (G.C. Exh 14) is in
effect until April 30, 1978.
According to Union President Frank DeBrouse and
President Nazarian, Respondent first became party to the
Union-CCC contract by Hagop Nazarian signing, on
February 7, 1974, the predecessor contract that expired
April 30, 1975 (G.C. Exh 6). Respondent continued to be
party to the current contract by its (former) General
Manager Arthur Pelkey signing the amendments (G.C.
Exh. 8) to the predecessor contract on July 21, 1975, and
signing a retroactivity letter (G.C. Exh. 7).5 Respondent
also signed the union pension fund and health and welfare
fund agreements in February 1974, which adherence
remained binding without renewal signatures.
The union wage rate for the dump truck drivers up till
the mass discharge of April 2, 1976, had been $6.85 per
hour, according to the employees and the contract (G.C.
Exh. 14, p. 24) and thereafter rose on May 1, 1976, to $7.45
per hour.
C. The Mass Discharge of the Truckdrivers
Without warning or notice, starting after work Friday
night, April 2, 1976, on instructions from President
Nazarian, Yard Superintendent Caldwell began notifying
each of the eight truckdrivers that Respondent was
changing hands and that their jobs were ended.6 This was
the written testimony of Caldwell corroborated by the
testimony of the five of the eight employees who testified.
Employee Wilhoit testified that Caldwell called him at
home that night, told him that the Company was changing
hands, that he and the other truckdrivers no longer had
jobs, but that the change did not affect the equipment
operators. Employee Samuel got his call from Caldwell the
' At the hearing. President Nazarian, seemed to suggest that Respondent
did not become party to the current collective-bargaining contract in 1975
because it did not sign the later printed booklet form contract, G.C. Exh. 16,
embodying G.C. Exh. 6 as amended by G.C. Exh 8. Respondent
abandoned that suggested argument in its brief. Indeed, Respondent had
earlier admitted it was party to the current contract in its answer, filed July
27. 1976, by its lawyer and member of the board of directors. Gregory
Haight, in the suit by the Union in Superior Court of the District of
Columbia for enforcement of the arbitration award of backpay due
employee Francis (see par. 5 of G.C. Exh. 3, admitting par. 5 of G.C. Exh.
2). Moreover, Respondent complied with the wage provisions and other
conditions of employment of the current collective-bargaining contract,
without complaint or disavowal, and with its payment and reporting
obligations under the Union's health and welfare fund and pension fund.
untildefault after March 31, 1976.
a The eight employees were David Francis, Wallace Frye. Wilson
Roosevelt Samuel, Shirley W. Webb, Sinclair G. Wilhoit, Jr.. Jimmie
Peterson, Jr., Willie B. Poston, and Carl R. Tandy, Jr. The first five testified.
next day, Saturday, April 3, was told the Company was
changing hands, and that the new people would not need
him because they were bringing their own help. As a result,
Samuel came in and picked up his paycheck the same day.
Employee Frye reported for work on Monday, April 5, and
was told by Caldwell that the Company had been sold and
his work was over. He got his paycheck later that day.
Employee Webb received his call on Saturday, April 3,
from Foreman Black, who told him the Company had
folded, that the successor was changing the name, and
going nonunion. Employee Francis, who like the others
worked Friday, April 2, reported for work on Monday,
April 5, and was told by Foreman Black that the Company
had been sold, that no trucks were going out, and that there
were no jobs for the truckdrivers. 7 In no case were the
employees informed as to whom the business had been
sold.
President Nazarian conceded that he gave no prior
notice to the employees, or to the Union, of the termination
of the jobs, or of his reasons or the causes, or of any
transfer or termination of the trucking operation. Although
he claimed to have decided to sell the dump trucks to his
Yard Superintendent Caldwell in January 1976, and
executed a purported lease purchase agreement dated
March 31, 1976, Nazarian said he attempted without
success to telephone Union President DeBrouse, in early
April 1976, after the employment of the eight truckdrivers
had been terminated, 8 and he did not offer the Union an
explanation until May 5, 1976, in a letter mailed May 4,
1976 (see C. P. Exh. R-3), which was dated April 13, 1976
(Exh. R-1).
Actually, President Nazarian gave several conflicting
explanations. In the May 5, 1976, letter explanation to the
Union, I month after the mass discharge of the employees,
he claimed that Respondent had been losing money and
had unsuccessfully sought to sell the entire business, and
said that Respondent had "stopped our trucking operation
on April 3, 1976, and subsequently have been making
temporary arrangements and/or agreements with various
people and friends to make use of our trucks to help us make
the monthly payments." (Emphasis supplied.)
At the hearing 3 months later, President Nazarian
claimed that after deciding in January 1976 to sell
Respondent's trucks to Yard Superintendent Caldwell,
Respondent sold them to Caldwell on March 31, 1976, by
contract executed that day (G.C. Exh. 5). In this connec-
tion Nazarian testified that Caldwell paid $10,000 down.
7 At the heanring, President Nazanan claimed that on March 25 or 26 in
the week ending Friday, April 2. he had authorized the discharge of
employee Francis allegedly for not showing up at work on March 24, which
was not established, but admitted that neither he. Nazarian, nor anyone else
on his behalf had notified Francis that he was discharged. The evidence was
that employee Francis was a member of the work force of truckdnvers, who
worked through the week ending April 2, and whose employment was
terminated as a group immediately thereafter.
I President Nazarian did reach one of the union lawyers, Hart (who had
handled the arbitration of employee Francis' discharge of November 1975),
on the telephone in early April and told him Respondent was shutting down
the business and parking its trucks. Hart replied he could not speak for the
Union, and that Nazarian should communicate with Union President
DeBrouse because Respondent had a duty to bargain with the Union about
the effects of any termination.
713
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
At the same time, as earlier noted, Nazarian (and Chief
Executive Officer Carlin) also testified that Caldwell, who
had gone backrupt several years ago, and lost his trucking
business, had been living on personal loans from Respon-
dent up to his death on May 26, 1976, in addition to the
consulting fees Respondent paid for his supervisory
services.9
In further contradiction is a third version, President
Nazarian's written testimony given in an affidavit to the
Board on May 10, 1976.'0 Among other things, Nazarian
stated in his affidavit that 2 weeks before discharging
Respondent's truckdrivers on April 2, 1976, he, Carlin, and
Caldwell made an oral agreement, to be later reduced to
writing by Respondent, that Caldwell would take over the
trucking aspect of Respondent's business; that in a future
meeting of the same three men just prior to April 2, 1976,
Caldwell indicated he would like to run all of Respondent;
but that on April 2, 1976, Caldwell was informed he could
have the trucking operation on a lease-purchase arrange-
ment, which he signed some time after April 2. Further,
said Nazarian, he decided on lease-purchase rather than
purchase because of his prior experience with Caldwell and
the need to protect the interest of Respondent. Hence by
the terms of the agreement, said Nazarian, he (Nazarian)
could cancel the agreement, Caldwell was operating the
trucks without owning them, and the trucks remained in
Respondent's name until Caldwell contributed cash. And
as Nazarian said in his written testimony, in contrast to his
testimony at the hearing, Caldwell had paid no money to
Respondent; and Caldwell confirmed this in his contempo-
raneous written testimony of May 13, 1976 (G.C. Exh. 17),
stating that, "To date, I haven't paid Nazco anything yet,
because I haven't received my money from the D. C.
government"; and further, "I am not solvent."
Moreover, the sham nature of Respondent's alleged
"sale," or even "lease-purchase" arrangement, with Cald-
well, and its claim at the hearing that it retained no interest
in the trucks, is underscored in the terms of the agreement
itself (G.C. Exh. 5). Though it is labeled a "lease-purchase
agreement" and its opening clause suggests that Respon-
dent is desirous of leasing its eight dump trucks to Caldwell
on a lease-purchase basis, there is not an operative word in
the document about sale or transfer of title at any time. In
form it is a lease of Respondent's dump trucks on a month-
to-month basis for a year (April 3, 1976, to April 2, 1977),
for which Caldwell was obligated to pay a security deposit
of $10,000 on signing, and $10,000 per month for 12
months, if the lease was not terminated by Respondent
before then. There were no limitations on the reasons for
termination. Caldwell was given the right to lease the entire
fleet of trucks at rates he determined but was obligated to
turn over the proceeds of the monthly collections to
Respondent so that it could make the monthly payments
due on the financing of the trucks. Respondent could
terminate the lease for any or no reason on 30 days' notice,
or, if Caldwell discontinued operations, on 10 days' notice.
4 Both officers testified that Caldwell had long unfulfilled hopes of
collecting on some old claims against the District of Columbia government,
amounting to about $200,000, but apparently these were not realized.
D. Respondent Continues the Trucking Operation
Except for the alleged change in form and dropping of
the eight union truckdrivers on April 2, 1976, after an
interval of a few days Respondent resumed the use of its
trucks on its jobs. Yard Superintendent Caldwell, aided by
Foreman Black, hired other drivers on a nonunion basis
and wage scale, paying between $5.40 and $5.75 per hour
(in comparison with the union scale of $6.85 per hour that
increased to $7.45 per hour on May 1, 1976).
Of the eight newly hired truckdrivers only one, Shirley
Webb, had been among the eight whom Respondent
terminated on April 2. On April 8, Webb received a call
from Foreman Black to come in and talk. On Friday, April
9, Webb came in and talked to Yard Superintendent
Caldwell and Black. Webb testified he was told he could
have a job, but it would not be at union scale pay, rather it
would be $5.75 per hour. However, Caldwell assured him
he would gross more pay than working union, and Webb
accepted.
Employee Webb testified that he understood he was
rehired by and working for Nazco (Respondent), no one
told him differently, and except for the pay all of the
physical conditions of the hauling operation remained as
they had been before April 2. The trucks were housed, and
serviced by the same people, at Respondent's Hyattsville
yard. The trucks operated out of the yard as heretofore
under direction of Yard Superintendent Caldwell, assisted
by Foreman Black, who received their calls for trucks at
the same yard telephone, as heretofore. Webb worked at
the same job as he had worked and Respondent had
worked, before April 2. He used the same Nazco truck time
tickets, and generally, though not always, drove the same
Mack truck (one of two trucks rented by Foreman Black to
Respondent) as he had driven before April 2. In this
connection, Black testified that Respondent, and not
Caldwell individually, continued to rent his two trucks
after April 2, and that Respondent, and not Caldwell, paid
him the rental for the two trucks. The one different
condition that employee Webb noted was that he and the
other drivers received their weekly pay in cash, rather than
by Respondent's check, but distributed by Caldwell and
Black as heretofore. As Webb further testified, when he
was discharged a second time, on May 10, 1976, it was
Caldwell who fired him and gave him his final pay, under
circumstances discussed infra.
President Nazarian's testimony reinforced employee
Webb's testimony that apart from the replacement of the
former drivers with new drivers, the physical setup and
handling of the trucking operation, and the jobs worked
on, remained as had been the situation before April 2.
General Superintendent Kaupish, who was transferred
from the post of general superintendent of the Nazarian
enterprise CSH Contractors to become Respondent's
general superintendent in charge of excavating, testified
that Caldwell remained in charge of trucks for Respondent,
that those trucks were called and used first by Respondent
before calling for auxiliary hauling services of other
I' Respondent requested that the affidavit be received in evidence, and it
is part of the record as Resp. Exh. 5.
714
NAZCO, INC.
companies, and that, in the period April-May 1976 till
Caldwell's death, any truck services done by Respondent's
trucks for CSH were billed to CSH by Respondent, and not
by Caldwell as an individual.
Nonetheless, President Nazarian said, in furtherance of
maintaining the illusion that Caldwell had become an
independent trucking contractor rather than continuing as
an employee of Respondent, that Respondent gave
Caldwell "first choice" of its business for which he was
paid an hourly rental fee per truck. At the same time,
Nazarian conceded that he was not aware that the trucks
did any other work; and offered no evidence that Nazco
paid any truck rental money to Caldwell. Nazarian claimed
not to know who provided the money for the drivers'
wages, which in this April-May period were being paid in
cash, and Caldwell in his written testimony declined to say
where the money came from.
On Caldwell's death, May 26 1976, said President
Nazarian, Respondent resumed "possession" of the trucks,
and Respondent has continued the trucking operation.
According to Nazarian, no heirs, or anyone else, on behalf
of Caldwell has made any claim upon Respondent.
E. Other Antiunion Evidence, Second Discharge of
Employee Webb
Several of the employees testified to the antiunion
hostility expressed by Yard Superintendent Caldwell.
Employee Wilhoit, who was hired by Caldwell in October
1975, said that shortly after he was hired Caldwell told him,
and other drivers present, that he was going to get rid of the
Union; and repeated this again, to Wilhoit in March 1976,
Caldwell saying he was planning to take over the
Company. Employee Frye testified that in March 1976,
Caldwell told employee Willie Poston and himself that he
was tired of the Union, and that he was going to buy into
the Company and go nonunion.
In October-November 1975, according to employee
Francis, Yard Superintendent Caldwell apparently suc-
ceeded in persuading the truckdrivers to work two
consecutive Saturdays at straight time pay rather than at
overtime pay, as required by the union book contract, but
became angered when they refused to work a third
Saturday at straight time pay. Caldwell told them, said
Francis, they were going by the union book and the Union
wasn't worth a damn, that he was going to buy into the
Company, that the Union would be eliminated, and he
would clean house. A few days later, on November 12,
1975, Caldwell fired employee Francis. As already recount-
ed above, Respondent was directed as a result of the
arbitration proceeding to reinstate employee Francis, but,
as Francis pointed out, Yard Superintendent Caldwell
balked and the reinstatement was delayed until the end of
February 1976.'1 In connection with the stalling of the
reinstatement of employee Francis, Caldwell conceded in
" The backpa,. also ordered in the arbitration, was not paid, and the
Union brought suit for this on behalf of employee Francis, as previously
noted,
12 Foreman Black's claim. that employee Webb was his personal
employee. hired by Black to operate one of the two trucks Black rented to
Respondent, and was fired by Black, was without substance or support.
his written testimony that he told the drivers that no damn
union was going to make him hire back David Francis.
As set out in section II, D, above, employee Shirley
Webb, one of the employees in the mass discharge of April
2, 1976, was recalled on April 9 and went back to work
thereafter for Respondent doing the same job he had
previously done except for less pay per hour than the union
wage and without the payment of union benefits on his
behalf. He worked almost a month and apparently became
discouraged that the cut-rate pay in comparison with the
Union's rate and, as he said, working for 9 hours a day for
between 7 to 8 hours' pay, was not living up to Caldwell's
promise of greater earnings. Webb and two other employ-
ees drew up a letter of complaint about the pay and hours,
intended for the Union, dated May 5, 1976, adding that a
timeclock should be installed; and thereafter obtained the
signatures of the 10 employees (G.C. Exh. 15). Webb had
his wife deliver the letter to the Union.
Yard Superintendent Caldwell learned about the letter
and commented on it angrily to the employees the next
day. Webb said several admitted signing. Caldwell then
announced that whoever turned the letter into the Union
would be fired.
On the following day, Friday, May 7, said employee
Webb, all of the trucks and drivers went out but him. Yard
Superintendent Caldwell told Webb there was no work for
his truck and sent him home.
Employee Webb reported for work Monday, May 10,
1976. A foreman drove his truck away, said Webb, and
Caldwell told Webb he was not needed anymore, that he
(Caldwell) was tired of someone else running the Compa-
ny. Webb replied that it was a matter of not being paid as
they were supposed to be paid. Since Webb had not
received his pay on Friday, Caldwell handed him his final
pay that Monday morning. 2
F. 8(a)(1), (3), and (5) Findings
The record is evident that Respondent has sought,
without notice to or consent of the Union, to unilaterally
disengage itself from its union contract and the union wage
scale and benefit payments for its truckdrivers, under the
pretense that Respondent had sold and discontinued its
trucking operation or, short of sale, had leased its trucks
and subcontracted with the lessee for the hauling needed in
Respondent's excavation work. Obviously, there was
neither a bona fide sale nor lease, but a pure paper
transaction, without monetary or other consideration,
hastily put together with Respondent's impecunious yard
superintendent as the supposed lessee, in an attempt to
disguise as his independent subcontracted operation
Respondent's discharge of all of its union truckdrivers on
April 2, 1976, replacing them with nonunion drivers, but
otherwise continuing the hauling operation after April 2 as
it had been done before. Even the pretense of an
independent trucking operation was abandoned less than 2
Black said he fired Webb because he was not handling his truck right and
had been teanng up the truck for the previous 7 months. This, of course, is
incredible, because it was Black who initiated the call to Webb on April 8.
1976. to bring him alone, of the eight discharged employees, back and Black
participated with Caldwell in rehiringWebb on April 9.
715
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
months later when the yard superintendent, Junius Cald-
well, died.
By unilaterally attempting to abolish the collective-
bargaining unit of truckdrivers and terminating their
employment on April 2, 1976, without notice to or consent
of the Union, or bargaining with the Union over the
supposed decision to subcontract or its effects on the
employees, Respondent repudiated its undertakings under
the collective-bargaining contract with the Union before
the term of the contract had run its course.' 3 Such
repudiation was in derogation of Respondent's bargaining
obligation under Section 8(d) of the Act, and hence
violated Section 8(a)(5) and (1) of the Act. Respondent's
alleged financial necessity was not a defense that excused
such unilateral repudiation of the contract. C & S
Industries, Inc., 158 NLRB 454, 456-458, 460 (1966); Oak
Cliff-Golman Baking Co., 202 NLRB 614, 616 (1973), 207
NLRB 1063, 1064 (1973); Nassau County Health Facilities
Association, 227 NLRB 1680 (1977). Likewise, Respon-
dent's reduction of the contract wage and elimination of
contract benefits of employee Webb, who was the one
member of the discharged unit recalled by Respondent a
week after the April 2 discharge, was a similar midterm
repudiation of the undertakings of the contract, in violation
of Section 8(a)(5).
Moreover, Respondent's mass discharge of the eight
union truckdrivers on April 2, 1976, in order to replace
them with nonunion truckdrivers, and replacing them with
nonunion truckdrivers, was a discriminatory discharge
designed to discourage union membership, in violation of
Section 8(a)(3) and (1) of the Act. For a similar 8(a)(3) and
(5) violation, where the employer subcontracted (though
without pretense as here) the truck delivery portion of its
business and discharged the truckdrivers to avoid a union
obligation, see N.L.R.B. v. American Manufacturing Com-
pany of Texas, 351 F.2d 74, 79, 80 (C.A. 5, 1965).
Respondent's prior disparagement of the union represen-
tation of the employees and threats of discharge of the
union employees for adhering to the Union, by Respon-
dent's yard superintendent, Caldwell, before the discharges
of April 2, were coercive and constituted interference with
the employees' Section 7 rights in violation of Section
8(a)(1) of the Act.
Lastly, the second discharge of recalled employee Webb,
on May 10, 1976, was a violation of Section 8(aX3) and (1)
of the Act. Webb was fired by Respondent because he led
his fellow employees in making a concerted complaint to
the Union concerning Respondent's pay, hours, and
computation of time.
CONCLUSIONS OF LAW
1. By attempting unilaterally to abolish the collective-
bargaining unit of truckdrivers and terminating their
employment on April 2, 1976, under pretense of having
':' Respondent's contention that the Union "implicitly" waived its right
to notice or to bargain, because it allegedly failed to respond to a telephone
call from Respondent's president, Nazarian, is without foundation or
substance. The Union disputed receiving the telephone call, but, even if it
had received it, the information Nazarian was transmitting (taking any one
of his various and conflicting descriptions of Respondent's actions) did not
provide the accurate and truthful information on which the Union would
subcontracted their work in midterm of the collective-
bargaining contract with the Union without notice to or
consent of the Union, or bargaining with the Union over
the supposed subcontracting or its effects on the employ-
ees, Respondent has engaged in unfair labor practices
within the meaning of Section 8(a)(5) and (1) of the Act. In
addition, by unilaterally reducing the contract wage and
eliminating the contract benefits of recalled employee
Webb, without notice to or consent of the Union,
Respondent has engaged in an unfair labor practice also
within the meaning of Section 8(a)(5) and (1) of the Act.
2. By discharging the unit of eight truckdrivers on April
2, 1976, in order to replace them with nonunion truckdri-
vers, and by replacing them with nonunion truckdrivers,
Respondent has engaged in unfair labor practices within
the meaning of Section 8(aX3) and (1) of the Act.
3. By disparaging the union representation of the
employees and threatening discharge of the employees
because of their adherence to the Union, Respondent has
engaged in unfair labor practices within the meaning of
Section 8(a)(l) of the Act.
4. By discharging recalled employee Webb on May 10,
1976, because he led his fellow employees in making a
concerted complaint to the Union about Respondent's pay,
hours, and computation of time, Respondent has engaged
in an unfair labor practice within the meaning of Section
8(aX3) and (1) of the Act.
5. The unfair labor practices affect commerce within
the meaning of Section 2(6) and (7) of the Act.
THE REMEDY
It will be recommended that Respondent:
(I) Cease and desist from its unfair labor practices.
(2) Honor, and give retroactive effect from April 2, 1976,
to, the terms and conditions of its collective-bargaining
contract, including the payment of wages and benefits as
prescribed.
(3) Offer immediate and full reinstatement to the eight
employees discharged on April 2, 1976, dismissing if
necessary persons hired after April 2, 1976, and provide the
eight discharged employees with backpay and benefits,
from April 2, 1976, making in employee Webb's case an
appropriate adjustment for the partial wages he received in
the period between his recall and subsequent discharge on
May 10, 1976. The backpay is to be computed on a
quarterly basis as set forth in F. W. Woolworth Company, 90
NLRB 289 (1950), approved in N.L.R.B. v. Seven-Up
Bottling Co., 344 U.S. 344 (1953), with interest at 6 percent
per annum as provided in Isis Plumbing & Heating Co., 138
NLRB 716 (1962), approved in Philip Carey Manufacturing
Company v. N.LR.B., 331 F.2d 720 (C.A. 6, 1964), cert.
denied 379 U.S. 888.
(4) Give notice to and bargain with the Union over any
subcontracting of the work of employees.
have been called to act. Failure to respond to the deceptive call, if the failure
occurred, cannot be deemed a waiver of the statutory right, which, in any
event, cannot be relinquished by implication or inference or anything less
than "clear and unmistakable" language or showing that the waiver
occurred. The Timken Roller Bearing Co., v. N.LR.B., 325 F.2d 746, 751
(C.A. 6, 1963), cert. denied 376 U.S. 971 (1964).
716
NAZCO, INC.
(5) Post the notices provided for herein and because
Respondent violated fundamental employee rights guaran-
teed by Section 7 of the Act, and because there appears
from the manner of the commission of this conduct an
attitude of opposition to the purposes of the Act and a
proclivity to commit other unfair labor practices, it will be
further recommended that Respondent cease and desist
from in any other manner infringing upon the rights
guaranteed by Section 7 of the Act. N.LR.B. v. Entwistle
Mfg. Co., 120 F.2d 532, 536 (C.A. 4, 1941); P. R. Mallory
and Co. v. N.L.R.B., 400 F.2d 956, 959-960 (C.A. 7, 1968),
cert. denied 394 U.S. 918; N.L R.B. v. Bama Company, 353
F.2d 323-324 (C.A. 5, 1965).
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, there is hereby issued the following recommended:
ORDER 14
The Respondent, Nazco, Inc. and it Agents Junius B.
Caldwell, Jr., and James Black, Hyattsville, Maryland, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Attempting unilaterally to abolish the collective-
bargaining unit of employees by terminating their employ-
ment by pretended subcontract of their work in midterm of
the collective-bargaining contract with the Union without
notice to or consent of the Union, or engaging in
subcontracting of employee work without bargaining with
the Union over the decision to subcontract or its effects on
the employees.
(b) Unilaterally reducing the contract wage or eliminat-
ing the contract benefits of an employee during the term of
the contract with the Union, without notice to or consent
of the Union.
(c) Discharging employees who are union members in
order to replace them, and replacing them, with nonunion
members.
(d) Disparaging the union representation of the employ-
ees and threatening discharge of the employees because of
their adherence to the Union.
(e) Discharging employees because of their complaints to
the Union about Respondent's pay, hours, and other
conditions of employment, or otherwise discouraging
employee membership in or sympathy for the Union.
(f) In any other manner interfering with, restraining, or
coercing employees in the exercise of their rights guaran-
teed them in Section 7 of the Act.
2. Take the following affirmative action which is
necessary to effectuate the policies of the Act:
(a) Offer to the eight employees, David Francis, Wallace
Frye, Wilson Roosevelt Samuel, Shirley W. Webb, Sinclair
G. Wilhoit, Jr., Jimmie Peterson, Jr., Willie B. Poston, and
Carl R. Tandy, Jr., immediate and full reinstatement to
their former positions, dismissing if necessary persons hired
after April 2, 1976, or, if the former positions no longer
exist, to substantially equivalent positions, without preju-
dice to their seniority or other rights and privileges.
(b) Make said eight employees whole, in the manner set
forth in the section of this Decision entitled "The
Remedy," for any loss of earnings and benefits incurred by
each as a result of his discharge on April 2, 1976.
(c) Honor, and give retroactive effect from April 2, 1976,
to, the terms and conditions of the collective-bargaining
contract with the Union, including the payment of wages
and benefits as prescribed.
(d) Give notice to the Union and bargain with it over any
decision to subcontract the work of employees or its effects
on the employees.
(e) Preserve and, upon request, make available to the
Board and its agents, for examination or copying, all
payroll, social security, time, personnel, and other records
necessary to ascertain the backpay and benefits due under
the terms of this Order.
(f) Post in the office and yard at Hyattsville, Maryland,
copies of the attached notice marked "Appendix." 5
Immediately upon receipt of said notice, on forms provided
by the Regional Director for Region 5, Respondent shall
cause the copies to be signed by one of its authorized
representatives and posted, the posted copies to be
maintained for a period of 60 consecutive days thereafter,
in conspicuous places, including all places where notices to
employees are customarily pcsted. Reasonable steps shall
be taken by Repsondent to insure that said notices are not
altered, defaced, or covered by any other material.
(g) Mail copies of the foregoing signed notices to each of
the eight employees named in paragraph 2(a), above.
(h) Notify the Regional Director for Region 5, in writing,
within 20 days from the date of this Order, what steps
Respondent has taken to comply herewith.
14 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board. the findings.
conclusions. and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations, be adopted by the Board and become
its findings, conclusions, and Order, and all objections thereto shall be
deemed waived for all purposes.
'S In the event that 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 National 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."
APPENDIX
NoTIcE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board having found, after a
hearing, that we violated the National Labor Relations
Act, as amended, has ordered us to post this notice:
WE WILL NOT attempt unilaterally to abolish the
collective-bargaining unit of employees by terminating
their employment by pretended subcontract of their
work in midterm of the collective-bargaining contract
with the Union without notice to or consent of the
Union, or engage in subcontracting of employee work
without bargaining with the Union over the decision to
subcontract or its effects on the employees.
WE WILL NOT unilaterally reduce the contract wage
or eliminate the contract benefits of an employee
during the term of the contract with the Union, without
notice to or consent of the Union.
717
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
WE WILL NOT discharge employees who are union
members in order to replace them with nonunion
members and WE WILL NOT replace union member
employees with nonunion members.
WE WILL NOT disparage the union representation of
our employees.
WE WILL NOT threaten employees with discharge
because of their adherence to the Union.
WE WILL NOT discharge employees because of their
complaints to the Union about our pay, hours, and
other conditions of employment, and WE WILL NOT
otherwise discourage employee membership in or
sympathy for the Union.
WE WILL NOT in any other manner, interfere with,
restrain, or coerce our employees in the exercise of their
rights to belong to or be active for a labor union or to
engage in concerted activities, or to refrain therefrom.
Because the Board found that we unlawfully dis-
charged employees David Francis, Wallace Frye,
Wilson Roosevelt Samuel, Shirley W. Webb, Sinclair
G. Wilhoit, Jr., Jimmie Peterson, Jr., Willie B. Poston,
and Carl Tandy, Jr., WE WILL offer each his former or
like position, dismissing if necessary persons hired after
April 2, 1976, and WE WILL give each backpay and
benefits with interest from the time of discharge, April
2, 1976.
WE WILL honor, and give retroactive effect from
April 2, 1976, to, the terms and conditions of our
collective-bargaining contract with the Union, includ-
ing the payment of wages and benefits as prescribed.
WE WILL give notice to the Union and bargain with
it over any decision to subcontract the work of
employees or its effects on the employees.
NAzco, INC.
718