Shop Rite Foods, Inc.

National Labor Relations Board - Board Decisions

Jan 19, 1967

162 N.L.R.B. 1020 (N.L.R.B. 1967)

1020 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Shop Rite Foods, Inc. and Retail Clerks International Association,
Local Union No. 455, AFL-CIO, Petitioner. Case 23-RC-26392.
January 19, 1967
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9 (c) of the National
Labor Relations Act, as amended, a hearing was held before Hearing
Officer C. L. Moser on March 16 and April 12, 1966. The Hearing
Officer's rulings made at the hearing are free from prejudicial error
and are hereby affirmed. Subsequent to the hearing, the Petitioner
and the Employer filed briefs with the National Labor Relations
Board.
Upon the entire record in this case, including the briefs of the par-
ties, the Board finds :
1. The Employer is engaged in commerce within the meaning of
the Act.
2. The labor organizations involved claim to represent certain
employees of the Employer.
3. The Employer, Shop Rite Foods, Inc., is engaged in the retail
sale of groceries and related products in New Mexico, Oklahoma, and
Texas. The Petitioner, Retail Clerks International Association, Local
Union No. 455, AFL-CIO, requests a unit of all store employees in
the nine stores of the Employer in the Galveston-Beaumont, Texas,
area, formerly owned by C. P. Evans Food Stores, Inc., which was
a wholly owned subsidiary of Food Mart Corporation also engaged
either directly or through its subsidiaries in the retail sale of grocer-
ies and related products. The Intervenor, Evans Food Stores Employ-
ees Association, and the Employer, agree that the unit is appropriate
but contend that they are parties to a valid, existing contract which
is a bar to the present petition. The Petitioner contends the contract
is a premature extension of a prior agreement and thus no bar.
In April 1963, Evans and the Intervenor entered into a 3-year con-
tract which was to run from April 12, 1963, to April 12, 1966. On
May 10, 1965, they entered into another agreement which provided
that it "takes precedence over any other agreements ... heretofore
existing between the two contracting parties." This new agreement
covered the same multistore unit as the previous contract and ran
from April 12, 1965, until April 12, 1968. It was clearly a premature
extension of the 1963 contract and normally would not bar a petition
timely filed with respect to the termination date of the 1963 contract.'
However, in October 1965, the Employer and Food Mart, Evans'
1 Deluxe Metal Furniture Company, 121 NLRB 995, 1001-02.
162 NLRB No. 98.
SHOP RITE FOODS, INC. 1021
parent corporation, merged and only the Employer survived as a
legal entity. Food Mart and its subsidiaries including Evans were
dissolved. On December 21, 1965, the Employer entered into a one-
page agreement with the Intervenor which read in pertinent part :
It is hereby recognized that Shop Rite ... having acquired all
rights, title and interest in C. P. Evans Food Stores, Inc., does
approve and adopt the Collective-Bargaining Agreement pre-
viously negotiated and agreed to, and which is presently in effect
between Evans Food Stores, Inc., and Evans Food Store Em-
ployees Association ....
The Employer maintains that this December 21 agreement is a new
agreement between newly contracting parties, and is a bar to the
petition.
The merger agreement between Shop Rite and Food Mart pro-
vided in part that :
Shop Rite desires to acquire substantially all of Food Mart's
assets, business and good will in exchange for shares of Shop
Rite's . . . Preferred Stock ... .
Food Mart desires that substantially all of Food Mart's
properties be exchanged solely for shares of Preferred Stock .. .
whereupon Food Mart will dissolve and completely liquidate and
distribute to the holders of its Common Stock, pro rata, all
its . . . shares of Preferred Stock to be received by Food Mart as
aforesaid . . . for the purpose of carrying out a tax-free
reorganization ... .
The agreement also set out that Food Mart was to deliver to Shop
Rite all of its and its subsidiaries' collective-bargaining agreements;
that neither the parties nor their subsidiaries were having "any labor
trouble other than routine grievances arising in connection with the
renegotiation of existing collective bargaining agreements expiring,
or being subject to reopening between the date of the agreement and
the Time of Closing ...." As indicated, the actual merger took place
in October 1965. Shop Rite took over the operations of Food Mart
and its subsidiaries, the stockholders of Food Mart became stock-
holders of Shop Rite,2 and Shop Rite's complement of officers and
directors was modified to include Food Mart officers and directors.
Insofar as the "Evans" stores subject of the petition were con-
cerned, there were after the merger apparently no changes in their
supervisory personnel or in employee working conditions. At all times
the terms of the Evans contract were complied with. Further, the
a Prior to the merger , Shop Rite had about 2,000 and Food Mart about 4,500 stock-
holders ; both had annual sales of about $100 million.
1022 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
stores continued to operate under the Evans name and employees con-
tinued to receive paychecks from Evans until after January 1, 1966,
when the names of the stores were changed to "Piggly Wiggly" and
the employees started to receive paychecks from Shop Rite.
It is clear from the above that the merger's changes in the corpo-
rate ownership and structure did not result in any significant changes
with respect to the stores here involved in the nature of their opera-
tion and their management, the composition of the contractual unit,
the terms and conditions of employment, or the stability of the exist-
ing bargaining relationship. Thus, we conclude that there has been
at all times material a substantial continuity of identity in the em-
ploying business enterprise before and after the merger. In conse-
quence, for purposes of this proceeding, we find that Shop Rite is
substantially the same enterprise as the one that signed the 1963
agreement and its 1965 extension. Accordingly, we further find that
the 1963 contract as extended between Evans and the Intervenor sur-
vived the merger and that the December 21, 1965, adoption of that
extended agreement was not a new contract newly executed.3 It thus
follows, and we find, that the contract raised as a bar is a premature
extension and is not a bar to the petition as it was timely filed with
respect to the 1963 contract's original anniversary date 4 Consequent-
ly, we find that a question affecting commerce exists concerning the
representation of the employees of the Employer within the meaning
of Sections 9(c) (1) and 2(6) and (7) of the Act.
4. The parties stipulated and we find that the following employees
constitute an appropriate unit for the purposes of collective bargain-
ing within the meaning of Section 9 (b) of the Act : All store employ-
ees of Shop Rite Foods, Inc., stores formerly owned by C. P. Evans
Food Stores, Inc., including stockers, checkers, fruit and vegetable
employees, Courtesy Booth employees, Home Center employees,
carryout and utility employees, stockroom employees, produce de-
partment managers, and Home Center department managers; but
excluding meat department employees, bakery employees, office clerical
employees, guards, watchmen, and supervisors as defined in the Act.
[Text of Direction of Election omitted from publication.] 5
[Member Brown took no part in the above Decision and Direction
of Election.]
3 See, Grainger Brothers Co , 146 NLRB 609.
4 Deluxe Metal Furniture Company, supra.
5 An election eligibility list, containing the names and addresses of all the eligible voters,
must be filed by the Employer with the Regional Director for Region 23 within 7 days
after the date of this Decision and Direction of Election . The Regional Director shall make
the list available to all parties to the election . No extension of time to file this list shall be
granted by the Regional Director except in extraordinary circumstances . Failure to comply
with this requirement shall be grounds for setting aside the election whenever proper
objections are filed. Excelsior Underwear Inc. and Saluda Knitting Inc., 156 NLRB 1236.