Telford & Doolen, Inc.

National Labor Relations Board - Board Decisions

Dec 11, 1985

277 N.L.R.B. 1054 (N.L.R.B. 1985)

1054 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Telford & Doolen , Inc. and Local No. 324, Interna-
tional Union of Operating Engineers, AFL-
CIO. Cases 7-CA-20455 and 7-CA-20505
11 December 1985
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
DENNIS AND BABSON
On 29 March 1983 Administrative Law Judge
Walter H. Maloney Jr. issued the attached decision.
The Respondent filed exceptions and a supporting
brief, and the Charging Party filed a brief in sup-
port of the judge's decision.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge' s rulings, findings, and
conclusions, as modified, but not to adopt the rec-
ommended Order.
1. The judge concluded that the Respondent vio-
lated Section 8(a)(1) and (5) when it "permanently
laid off' Richard Fanko without following the se-
niority, provisions of an expired collective-bargain-
ing agreement . The Respondent excepts, urging
that Fanko's termination was for cause and, thus,
the seniority provision of the collective-bargaining
agreement was irrelevant. We find merit to this ex-
ception.
Fanko was the Respondent's senior mechanic.
On 27 July 1981 he received a letter of reprimand
for work done on a "Brown Brother's" engine.'
He received another letter of reprimand, dated 1
December 1981, in which the Respondent com-
plained about Fanko's servicing of a "Warner &
Swasey G-440 grade-all," a backhoe or excavator
used for ditching and ripping up concrete and
street pavement. On 12 March 1982, the Respond-
ent discharged Fanko.
At the hearing, the Respondent's customer serv-
ice manager testified that the Respondent fired
Fanko because it was dissatisfied with his work.
The Respondent's president added that a second
motivation for discharging Fanko was that its busi-
ness was slow. (The Respondent's four mechanics,
its entire service department, were laid off on 13
November 1981.) Although the judge did not
reject the Respondent's contention that its decision
to discharge Fanko was "prompted by its realiza-
i Although Fanko filed a grievance in which he asserted that the 27
July reprimand was improper, he did not grieve that reprimand until 7
January 1982, 5-1/2 months later Not only was the grievance untimely
vis-a-vis the parties' collective-bargaining agreement , but Fanko 's delay in
filing the grievance suggests that, at least initially, he acquiesced in the
appropriateness of that reprimand
tion that business was in a state of permanent re-
trenchment," coupled with its determination that
Fanko was a "less than satisfactory employee," he
nevertheless concluded that when the Respondent
discharged Fanko, it was trying to avoid the
impact of the seniority provisions of its expired col-
lective-bargaining agreement. The sole support for
this conclusion is that the Respondent delayed until
12 March 1982-3 months after the second repri-
mand-to terminate Fanko.
If the discharge was based on problems with the
employee's work performance, the seniority provi-
sions of the contract would not apply. We find that
the letters of reprimand clearly document the Re-
spondent's dissatisfaction with Fanko's work; the
Respondent's explanation that it discharged Fanko
for cause is thus well supported by the record.
Despite the record regarding Fanko's poor work
performance, the judge found that the Respond-
ent's 3-month delay in terminating Fanko evi-
denced an attempt to avoid the seniority provisions
of the expired collective-bargaining agreement. We
do not agree. Fanko was already laid off when he
received the second reprimand. Thus, we are not
presented with a situation where an employer tol-
erated a poor worker in its operations for several
months before discharging him. Here, there was no
urgency for the Respondent to discharge Fanko be-
cause Fanko was not working and could not jeop-
ardize the Respondent's operations with a poor
work performance.
In these circumstances, we find that the Re-
spondent's delay is insufficient evidence to establish
a violation of Section 8(a)(1) and (5) of the Act.
We therefore find that Fanko is not entitled to re-
instatement as recommended by the judge.2
2. The judge concluded that by assigning unit
work to a supervisor while employee Thomas A.
Berrill was on layoff, the Respondent unilaterally
changed provisions of the expired collective-bar-
gaining agreement without having bargained with
the Union, thereby violating Section 8(a)(1) and (5)
of the Act. In support of his conclusion, the judge
cited two sections of the expired collective-bargain-
ing agreement . The Respondent contends that nei-
ther provision applies to the instant case . We agree.
2 As we affirm the judge's conclusion that the Respondent unilaterally
changed a term or condition of employment without bargaining with the
Union when it failed to recall Fanko pursuant to the seniority provisions
of the expired collective-bargaining agreement, we adopt that part of the
judge's remedy which provides that the Respondent make Fanko whole
for any loss of earnings which he may have suffered by reason of the
Respondent's violation of the Act However, we modify the backpay
award so that it runs only from 13 November 1981 until 12 March 1982,
the period when Fanko was on layoff prior to his discharge, during
which period the Respondent occasionally recalled mechanics
277 NLRB No. 112
TELFORD & DOOLEN, INC.
Thomas Berrill was the union steward at the af-
fected facility and, as such, was contractually
granted job retention superseniority. Accordingly,
he was the last bargaining unit employee in his de-
partment, the parts department, to be laid off. He
was laid off on 4 December 1981. Thereafter, the
supervisor ran the parts department by himself
until 27 August 1982, when the Respondent closed
the department. After Berrill was laid off, the su-
pervisor spent approximately 20 percent of his time
dispensing parts and doing what had previously
been bargaining unit work.
Article I(j) of the expired collective-bargaining
agreement provides:
The Company agrees to respect the jurisdic-
tional rules of the Union and shall not direct
or require its employees other than the em-
ployees in the bargaining units here involved,
to perform work which is recognized as the
work of the employees in said units, subcon-
tracting work to be excluded. Furthermore, it
is agreed that Supervisory Personnel and sales-
men will not perform any work regularly as-
signed to the bargaining unit.
The judge reasoned that a unit employee was con-
tractually entitled to do the work that had previ-
ously been assigned to the bargaining unit which
the supervisor spent 20 percent of his time doing
after Berrill was laid off. The Respondent contends
that the provision of the parties' collective-bargain-
ing agreement quoted above is part of a union-se-
curity clause which governs terms and conditions
of the employer-union relationship (as opposed to
the employer-employee relationship), and thus did
not survive the contract's expiration. Bethlehem
Steel Co., 136 NLRB 1501, 1502 (1962). The judge
did not respond to this contention and we need not
pass on it because we find that, in any event, there
are insufficient grounds to apply the clause in such
a manner to sustain a finding of unilateral change.
All the unit employees in the parts department had
been lawfully laid off when the supervisor per-
formed the small amount of work at issue. The
judge nevertheless determined that the clause ap-
plied even in the absence of any unit employees.
However, the clause does not specifically address a
situation in which all unit employees have been laid
off nor does it appear that the parties in negotiating
that clause contemplated such a situation arising.
Therefore, contrary to the judge, it is not clear that
that clause prohibited the Respondent from utiliz-
ing its supervisory personnel to do incidental parts
handling work that needed to be done rather than
close its parts department when the work level
dropped below that warranting the retention of at
1055
least one unit employee. Accordingly, we cannot
find that the Respondent failed to apply the clause
in violation of Section 8(a)(5) of the Act.
The second provision the judge relied on, article
XXVIII(c), states that on Saturdays and during
overtime "parts . . . shall not be dispensed other
than through a Partsman ." Because there was no
evidence that the "bargaining unit work" the su-
pervisor, performed involved any Saturdays or
overtime, this article was not implicated and the
judge 's reliance on it was in error.
Accordingly, we conclude that the Respondent
did not unilaterally `change any contract terms it
was obligated to follow and, thus, did not violate
Section- 8(a)(1) and (5) of the Act when it assigned
work to the parts department supervisor. There-
fore, Berrill is not entitled to the relief awarded by
the judge.
AMENDED CONCLUSIONS OF LAW
Substitute the following as Conclusion of Law 5:
"5. By failing to observe the seniority provisions
of an expired collective-bargaining agreement in
laying off and failing to recall Richard Fanko prior
to his discharge on 12 March 1982, the Respondent
violated Section 8(a)(1) and (5) of the Act."
ORDER
The Respondent, Telford & Doolen, Inc., Grand
Rapids and Lansing, Michigan, its officers, agents,
successors, and assigns, shall
1. Cease and desist from
(a) Refusing to bargain collectively in good faith
with Local No. 324, International Union of Operat-
ing Engineers, AFL-CIO by unilaterally changing
the terms and conditions of employment of its bar-
gaining unit employees, including but not limited to
the failure to observe the seniority provisions of its
contract in recalling Richard Fanko.
(b) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of the rights guaranteed them by Section 7
of the Act.
2. Take the following affirmative action neces-
sary to effectuate the policies of the Act.
(a) Give full force and effect to the provisions of
its collective-bargaining agreements requiring the
observance of seniority in the layoff and recall of
employees.
(b) Make Richard Fanko whole for any loss of
pay suffered by him by reason of the violations of
the Act found herein, with backpay and interest
thereon computed in the manner prescribed in F.
W. Woolworth Co., 90 NLRB 289 (1950), and Flori-
da Steel Corp., 231 NLRB 651 (1977).
1056 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(c) Preserve and, on request, make available to seniority provisions of the expired collective-bar-
the Board or its agents for examination and copy- gaining agreement.
ing, all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of backpay due under the terms of this
Order.
(d) Post at the Respondent's places of business in
Lansing, Grand Rapids, and Livonia, Michigan,
copies of the attached notice marked "Appendix."3
Copies of the notice, on forms provided by the Re-
gional Director for Region 7, after being signed by
the Respondent's authorized representative, shall be
posted by the Respondent immediately upon re-
ceipt and maintained for 60 consecutive days in
conspicuous places including all places where no-
tices to employees are customarily posted. Reason-
able steps shall be taken by the Respondent to
ensure that the notices are not altered, defaced, or
covered by any other material.
(e) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply.
IT IS FURTHER ORDERED that all other allega-
tions of the consolidated complaint are dismissed.
3 If 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 Nation-
al 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 has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
WE WILL NOT unilaterally change the terms and
conditions of employment of our bargaining unit
employees without first bargaining, on request,
with Local No. 324, International Union of Operat-
ing Engineers, AFL-CIO and WE WILL NOT unilat-
erally change the terms and conditions of employ-
ment of our bargaining unit employees by laying
off or recalling employees out of seniority.
WE WILL NOT in any like or related manner
interfere with, restrain, or' coerce you in the exer-
cise of the rights guaranteed you by Section 7 of
the Act.
WE WILL make Richard Fanko whole for any
loss of pay, with interest, which he may have suf-
fered by our failure to recall him pursuant to the
TELFORD & DOOLEN, INC.
John Ciaramitaro, Esq., for the General Counsel.
J. R. Telford, President of Telford & Doolen, Inc., of Lan-
sing , Michigan , for the Respondent.
Frederick B. Gold, Labor Relations Consultant of Bir-
mingham , Michigan , for the Charging Party.
DECISION
FINDINGS OF FACT
STATEMENT OF THE CASE
WALTER H. MALONEY JR., Administrative Law Judge.
This case came on for hearing before me at Grand
Rapids, Michigan, on a consolidated unfair labor practice
complaint,' issued by the Regional Director for Region
7, which alleges that Respondent Telford & Doolen,
Inc.2 violated Section $(a)(1), (3), (4), and (5) of the Act.
More particularly, the consolidated complaint alleges
that the Respondent violated its duty to the Union by re-
fusing to bargain with it over its refusal to recall steward
Thomas Berrill from layoff, by its decision to lay off
Richard Fanko out of seniority and later to discharge
him, and by its refusal to consent to an audit of its fringe
benefit payments. The General Counsel also contends
that the layoffs and refusal to call Berrill were discrimin-
atorily motivated because of the union activities of Ber-
rill and Fanko and because they filed charges and gave
statements under the Act. Respondent denies the charges
of unlawful layoffs and recalls, points to the fact that no
contract requiring superseniority for stewards or requir-
ing seniority was in effect at the time these events oc-
curred, and claims that it did in fact submit to an audit of
its fringe benefit payments and has in fact made the pay-
ment required by the audit. On these contentions, the
issues herein were joined.3
1. THE UNFAIR LABOR PRACTICES ALLEGED
At the time the events in question took place, the Re-
spondent operated three small sales and service establish-
i The principal docket entries in this case are as follows:
Charge filed against Respondent in Case 7-CA-20455, by Local 324,
International Union of Operating Engineers , AFL-CIO (the Union), on
March 24, 1982; charge filed by the Union against Respondent in Case 7-
CA-20505, on April 6, 1982; amended charge filed by the Union in Case
7-CA-20455, on April 30, 1982; consolidated complaint issued by the Re-
gional Director against Respondent on May 24, 1982; Respondent's
answer filed on June 1, 1982; hearing held in Grand Rapids, Michigan, on
January 25, 1983
2 Respondent admits, and I find, that it is , a Michigan corporation
which maintains sales and service facilities for heavy equipment at Li-
vonia, Lansing, and Grand Rapids, Michigan. In the preceding year, it
sold and distributed in Michigan products valued in excess of $100,000, of
which products valued in excess of $50,000 were shipped directly into
Michigan from points and places located outside of Michigan. According-
ly, Respondent is an employer within the meaning of Section 2(2), (6),
and (7) of the Act. The Union is a labor organization within the meaning
of Sec. 2(5) of the Act.
3 Certain transcript errors have been noted and corrected.
TELFORD & DOOLEN, INC.
ments in Livonia, Lansing, and Grand Rapids, Michigan,
where it sold and repaired heavy construction machin-
ery. At those three locations, it employed a total of 16
shop employees all of whom were divided into 2 catego-
ries, mechanics and partsmen . These locations were su-
pervised by the, Respondent from its office in Lansing.
For a number of years the Union has represented the
Respondent 's mechanics and partsmen . The Livonia
shop, which is located in the Metropolitan Detroit area,
is part of a multiemployer unit in which bargaining for
employers is conducted by an association known as the
Detroit Area Equipment Dealers Association. The Lan-
sing and Grand Rapids shops together constitute one
single-employer unit. In representing both employees of
the Respondent and others throughout the state, it has
been the practice of the Union first to negotiate a con-
tract covering the Detroit area heavy equipment shops
on a multiemployer basis and then to ask other out-of-
state employers to sign the same contract on a single-em-
ployer or single-unit basis. This is the track which the
Union followed in 1981, after the expiration of the 1978-
1981 agreement and after the conclusion of multiemploy-
er negotiations in Detroit.
Toward the end of September 1981, Marvin McLaren,
the Union's business representative, visited J. R. Telford,
president of the Respondent, at the latter's office in Lan-
sing . He presented Telford with a copy, of the Detroit
Association agreement and asked Telford to sign it for
his Lansing and Grand Rapids shops. Telford was famil-
iar with the contents of the agreement since. he had
served as a member of the Association 's bargaining com-
mittee. He told McLaren that he wanted to go over the
agreement with his partner and would either sign it then
and send it to him or would sign it when he came to De-
troit for the signing of the association agreement. In fact,
Telford did not sign the Lansing-Grand Rapids agree-
ment during that time and did not do so until September
2, 1982, nearly a year later. The agreement in question
runs from July 1, 1981, to June 30, 1984.
Between September and December 1981, Telford and
McLaren exchanged some correspondence concerning
the agreement. On September 30 Telford wrote to
McLaren and told him that the Respondent interpreted a
rider to the contract to exempt the Respondent from any
hourly contribution to the Union's pension plan or to the
Respondent's pension plan. He also told McLaren that he
would not deduct 5 cents per hour from the wages of
the Respondent's unionized employees. On November 11
McLaren responded in writing, saying that the sum in
question should not be deducted for the pension plan but
should be added to the hourly rate paid to the Respond-
ent's employees. A month later, McLaren again wrote to
Telford, complaining that Telford had continued to
refuse to execute the contract which was assertedly
agreed on , and threatened to pursue any and all legal
remedies to effect an execution of the agreement.
During 1981 the Respondent's business reflected the
depressed condition of the,building and construction in-
dustry which it serves. In its Lansing shop, the focal
point of this case, it had laid off two of its three parts-
men during 'the fall of 1980 and the spring of 1981 be-
cause of lack of work. Neither was ever recalled. On
1057
November 10, it called its four Lansing mechanics into
the, office and told them that they were being indefinitely
laid off because of lack of work. The net effect of this
action was to leave on the Lansing payroll only one non-
supervisory employee, partsman Thomas A. Berrill, who
was also the shop steward for the entire brand Rapids-
Lansing unit.
Shortly thereafter, the city of Lansing brought a gra-
deall into the shop for servicing. Stan Drushel, the cus-
tomer service manager, instructed an office clerical em-
ployee, known only as Linda, to contact Fanko.and ask
him to come in to work on the equipment. Fanko was
the senior mechanic in point of service. Fanko came to
the shop the following Monday to pick up his paycheck
and was asked by Linda on this occasion to report for
work. He told her that he had made previous arrange-
ments with Drushel to go deer hunting and suggested
that she contact George Wedel, the next senior employ=
ee. Wedel was put to work on this repair job. At times,
not indicated in the record, the Respondent recalled the
other two mechanics, John Vogt and Art Andrews.
During the week of Thanksgiving, all service mechanics
and Berrill were again laid off. Berrill was recalled the
following week and was laid off again on December 4.
Following the second layoff, he was never again em-
ployed by the Respondent. In late August 1982, Re-
spondent closed its parts department. Between December
1981 and August 1982, the parts department was manned
by former Parts Supervisor Del McCann. Drushel esti-
mated that McCann spent 20 percent of his working day
doing the parts department work, which Berrill formerly
did, and the rest of his time performing other functions.
When the parts department was finally closed, McCann
was laid off. Vogt, Andrews, and Wedel continued to
work in the shop sporadically throughout the winter of
1981 and 1982 and thereafter, but Respondent never
again recalled Fanko.
During the week of Thanksgiving, the Respondent had
occasion to service the city of Lansing's Warner &
Swasey G-440 gradeall. The machine had been in the
shop previously for regular 30- and 90-day inspections
following sale. On this occasion, a Warner & Swasey
factory representative was present to assist in the 180-
day inspection. They found, for the first time, that the
previous inspections, which Fanko had performed, had
not been properly performed and that Fanko had signed
or initialed inspection reports which, in part, were false.
On December 1, Drushel wrote Fanko a letter of repri-
mand and sent it to his home. The letter read:
Because of your failure to perform your work
satisfactorily, this is your second official warning of
our dissatisfaction with your work.
We refer to the Warner & Swasey G-440 owned
by the City of Lansing on which you performed the
pre-delivery 30, 90, and 180 day inspections and
you stated in your report that you had checked the
complete machine and all were O.K." However, you
had not removed the upper air cleaner for inspec-
tion, boom rollers and boom tilt were never adjust-
ed, and were so, far out of adjustment that serious
damage did exist.
1058 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The above items were brought to our attention
by our Warren & Swasey Service Representative.
We shall expect an improvement in your work.
On January 7, 1982, Fanko filed a grievance relating
to the December 1 letter denying all responsibility for
shoddy inspections.
During this same period of time , other grievances
were lodged against the Respondent . On January 7
Fanko also filed a grievance objecting to a letter of rep-
rimand , which he had received on July 27 , relating to
the improper repair of a Brown Brothers engine some-
time in the early summer of 1981 . It was this reprimand
to which Drushel made reference in his December 1
letter . Fanko also filed a grievance concerning the Re-
spondent 's failure to recall him in order of seniority fol-
lowing the November 23 layoff.
For his part, Berrill also filed a grievance . On Decem-
ber 15 , he grieved that a supervisor was doing parts de-
partment unit work during the Thanksgiving week layoff
and that the same supervisor was doing unit work fol-
lowing his December 4 layoff.
On February 26, 1982, Telford denied these grievances
on the basis that the Company was not operating under a
contract with Lansing and Grand Rapids and that there
was no grievance procedure in effect . Article VI of the
contract , which had expired the previous June , provided
that "all grievances , disputes or complaints arising under
and during the terms of this Agreement" would be set-
tled in accordance with the grievance machinery . It also
required that grievances be filed within 15 days after
they became known.
The provisions of the 1981-1984 contract contained
changes in the employer contribution to various fringe
benefit trust funds. In the fall of 1981, McLaren felt that
the Respondent was failing to make payments in accord-
ance with the new rate and asked Linda Bodalski, the
contributions clerk for the Operating Engineers health
care plan, to inquire into the matter and to bill the Re-
spondent for any delinquent payments . On December 23,
1981, she sent the Respondent the following letter:
It has been brought to our attention that your
contract with Operating Engineers Local 324 re-
quires a rate increase for the insurance fund effec-
tive July 1 , 1981, to $1.10 per hour.
This increase results in an additional amount due
of $2155 .00 for July thru October 1981, as shown:
July 1981-3387 hrs.-$846.75
Aug. 1981-2699 hrs.-674.75
Sept. 1981-2534 hrs.-633.50
Oct. 1981-3100 hrs.-775.00
Please remit the additional monies due as early as
possible. A return envelope is enclosed for your
convenience.
that the new contract and the new rate applied only to
its Livonia operation , Telford replied on January 4, 1982,
as follows:
In response to your letter of December 23, 1981,
we are in the process of breaking out the hours
worked by our Livonia employees . As soon as this
is done , a remittance will follow.
We have a contract in Livonia but have not
reached an agreement as yet in Lansing or Grand
Rapids.
On March 24 , Wilbur A . Staley , field coordinator of
the Operating Engineers Fringe Benefit Funds, again
wrote to the Respondent:
On behalf of the Board of Trustees of the Operat-
ing Engineers Fringe Benefit Fund , you are hereby
requested to contact me in regard to performing an
audit to confirm your contribution to these funds.
This examination will include all your employees,
regardless of occupation and will include your De-
troit , Lansing, and Grand Rapids operations.
Please contact the writer within ten days at (313)
644-4360 so that a mutually convenient date may be
arranged to commence with this examination.
Enclosed is a list of records required to properly
perform this audit.
Although the record on this point is unclear , apparently
Telford objected to the audit, as requested , because the
demand made in the March 24 letter was overly broad.
On April 6 , the Union filed the charge in Case 7-CA-
20505 complaining that Telford had refused to submit to
an audit as required by the Respondent 's collective-bar-
gaining agreement.
Eventually an audit was performed for the years 1979
through June 30, 1982. On August 18 , 1982, Mark
Armijo , an employee of the Fund 's outside auditor, met
with the Respondent's comptroller, who made available
to him the Respondent 's records for all three facilities.
On October 7, Armijo returned to the Respondent's
office and obtained additional records which were neces-
sary to complete the audit. On October 19 Armijo sub-
mitted to the Respondent the results of the audit, which
indicated that , for the 4 years in question , Respondent
owed the Fund $894.97, plus liquidated damages in the
amount of $89.50 . The breakout of employee records au-
dited , which was attached to Armijo's October 19 letter,
does not include the name of any employee in the Lan-
sing bargaining unit . As of the date of the hearing, Janu-
ary 25 , 1983, the amount requested had not been paid, al-
though Telford , acting in his capacity as Respondent's
attorney , stated for the record that the money would be
paid. Both Respondent and the Charging Party agree in
their posttrial briefs that the sum requested by the audi-
tor was paid shortly after the close of the hearing.
McLaren did not personally follow up on this request,
even though he was in touch with Telford from time to
time on other matters , and apparently the Respondent
failed to supply the promised breakout of hours worked
by employees in his respective shops . In light of the fact
Analysis and Conclusions
The events involved in this case took place , for the
most part , during a hiatus when the Lansing shop was
not subject to the terms of an existing collective -bargain-
TELFORD & DOOLEN, INC.
ing agreement . The old agreement had expired and a
new agreement covering that location had not yet been
signed . The General Counsel's theory apparently pro-
ceeds on the proposition set forth in Bay Area Sealers,
251 NLRB 89 (1980), as well as other cases. In that case,
the Board stated (at 90):
Although an employer's contractual obligations
cease with the expiration of the contract, those
terms and conditions established by the contract
and governing the employer-employee, as opposed
to the employer-union, relationship survive the con-
tract and present the employer with a continuing
obligation to apply those terms and conditions,
unless the employer gives timely notice of its inten-
tion to modify a condition of employment and the
union fails to timely request bargaining, or impasse
is reached during bargaining over the proposed
change.
In applying Day Area Sealers, it is well to remember
that there is a difference between a breach of contract
and the unfair labor practice of unilaterally changing the
terms and conditions of a collective-bargaining agree-
ment. As the Supreme Court pointed out in NLRB v. C
& C Plywood Corp., 385 U.S. 421 at 427 (1964):
When Congress determined that the Board
should not have general jurisdiction over all alleged
violations of collective bargaining agreements and
that such matters should be placed within the juris-
diction of the courts, it was acting upon a principle
which this Court had already recognized:
"The Railway Labor Act, like the National
Labor Relations Act, does not undertake govern-
mental regulation of wages, hours, or working
conditions. Instead it seeks to provide a means by
which agreement may be reached with respect to
them."
Terminal Railroad Assn. v. Brotherhood of Railroad
Trainmen, 318 U.S. 1, 6. To have conferred upon
the National Labor Relations Board generalized
power to determine the rights of parties under all
collective agreements would have been a step
toward governmental regulation of the terms of
those agreements. We view Congress' decision not
to give the Board that broad power as a refusal to
take this step.
What applies to the Board's jurisdiction over the terms
of existing agreements should apply with even greater
force to expired ones.
With respect to the layoffs of Berrill and Fanko and
the Respondent's ultimate discharge of Fanko, I do not
feel that there is any basis for the General Counsel's con-
tention that these actions were prompted by discrimina-
tory motives or by a desire to take punitive action
against either employee because they filed charges or
gave testimony under the Act. Respondent's motives
were purely economic, coupled with its dissatisfaction
with Fanko's recent job performance. No one denies that
1059
the Respondent was in bad financial shape and apparent-
ly still is. It laid off its entire Lansing work force during
the 1981 to 1982 fall and winter and recalled those em-
ployees only from time to time. It ultimately closed the
parts department at Lansing in August 1982, and laid off
the supervisor who had been operating that department
on a part-time basis. No one has been hired to replace
either Fanko or Berrill. Accordingly, I conclude that
they were both removed from the Respondent's payroll
as part of an effort to pare costs and keep the business
from folding, so I would dismiss so much of the consoli-
dated complaint which alleges a violation of Section
8(a)(3) or (4) of the Act.
However, a finding that the Respondent's motivation
was not illegal does not dispose of the Fanko or Berrill
cases. The Respondent was party to an expired collec-
tive-bargaining agreement covering both men. The
agreement contained conventional seniority provisions
requiring that layoffs and recalls be made in accordance
with length of service. Article 111(a) of the agreement
further provided that seniority should be by department
and that the "departments shall be the Parts Department
and the Service Department." Article VII(a) provided
that "steward, alternate or committee man shall work
when three (3) or more union men work in the Service
Department or Parts Department excluding working
Fieldmen away from the Shop." Despite the fact that se-
niority is a right which is exclusively the creature of
contract, the Board has held that it is the type of em-
ployee benefit which does not expire when a contract ex-
pires and that contractual seniority must be followed
during the postcontract period unless it has been bar-
gained away or subsequent bargaining over the issue has
reached an impasse. Caravelle Boat Co., 227 NLRB 1355
(1977). It follows from this premise that Fanko, who had
the most seniority of any service mechanic, was entitled
to be the last man in the service department at Lansing
to be laid off and the first to be recalled. He was not ac-
corded this right.
Respondent was not at fault on November 13 by as-
signing certain repair work to Wedel, the second man on
the seniority list. By electing to go deer hunting rather
than work, Fanko waived his recall right on that occa-
sion. However, he did not by that action quit his em-
ployment and the Respondent's contention to the con-
trary is frivolous. When Respondent went back to a full
complement of mechanics, he was obligated to recall
Fanko. It failed to do so.
I agree with the Respondent's position that it had no
obligation to honor the grievances which Fanko filed in
December and January. The expired contract, by its
terms, extended the grievance procedure only to disputes
arising during the term of the contract. The events
giving rise to Fanko's grievances took place after the
contract expired. Moreover, the contract contains a 15-
day limitation on the filing of grievances, so Fanko's
complaints were stale, even under a literal application of
grievance provision.
When the Respondent discharged Fanko on March 12,
1982, it sent him a terse, two-line notification which
read, "This letter will serve to notify you that you are
1060 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
no longer employed by Telford & Doolen, Inc." There
was no accompanying explanation, either oral or written,
to explain this action. Drushel testified at the hearing
that Fanko was fired because the Company was dissatis-
fied with his work. Telford added from the counsel table
that another reason for the discharge was that work was
slow. Fanko had done no work for the Respondent be-
tween December 1, the date of his second written repri-
mand, and March 12, the date of discharge. Telford was
unable to explain the reason for his delay in taking
action.
Giving full credence to the Respondent' s explanation
that the timing of the discharge was, in effect, prompted
by its realization that business was in a state of perma-
nent retrenchment and its further statement that Fanko
was selected for discharge because he was a less than sat-
isfactory employee, it appears that the Respondent was,
on March 12, attempting to avoid the impact of the se-
niority clause of its expired contract, a restriction which
it was still duty bound to observe. When making either a
temporary or permanent layoff,_ the Respondent was obli-
gated to follow length of service as the criteria for
layoff. It was not free to pick and choose among its serv-
ice mechanics, retaining the ones it prized most highly
and eliminating the one who gave it the most trouble.
Had the Respondent moved promptly and discharged
Fanko in December when it first uncovered his question-
able inspection work on the city of Lansing gradeall,
there might have been some merit to its contention that
it was discharging an unsatisfactory employee for cause.
In such an event, the seniority provisions of the expired
contract would have been simply inapplicable. However,
Respondent's overriding concern in March appears to
have been that it wanted to trim its sails for a long
voyage on stormy economic seas. In such an event, the
termination must be deemed an economic layoff, in
which event seniority, not proficiency, must be the gov-
erning factor. Having laid off Fanko both temporarily
and permanently without observing the seniority provi-
sions of the expired contract, the Respondent was guilty
of unilaterally changing a term or condition of his em-
ployment without bargaining with the Union and thus of
violating Section 8(a)(1) and (5) of the Act.
The General Counsel's argument that the Respondent
violated the contract, and hence Section 8(a)(1) and (5)
of the Act when it laid off Berrill is without merit. The
contract provides for superseniority for shop stewards.
Such provisions have been upheld, in the face of conten-
tions that they are discriminatory and a violation of Sec-
tion 8(a)(3), on the premise that an employer may lawful-
ly keep the shop steward on its payroll while releasing
others with greater seniority so that an official union rep-
resentative will be at the premises for the purpose of as-
sisting in the day-to-day administration of the contract.
An employer's failure to observe supersemority provi-
sions of a contract which are limited to layoff, recall,
and other relevant and justifiable benefits is a violation of
Section 8(a)(1) and (5) of the Act. Union Carbide Corp.,
228 NLRB 1152 (1977).
In this case, the Respondent kept Berrill on the payroll
while laying off two other partsmen who had greater se-
niority. Although Berrill was the only partsman em- chanic.
ployed at Lansing when he was laid off on December 4,
the General Counsel maintains that the Respondent was
still under an obligation to retain his services, even
though no other job was available that he was qualified
to fill.4 The contract in question provides for supersen-
iority for shop stewards but it also provides that seniori-
ty shall be accorded to all employees by department in
two separate departments, parts and service. Berrill had
no seniority in the service department and would not,
under the contract , be entitled to bump anyone in that
department in order to retain his job. No case has been
cited by the General Counsel or the Charging Party in
which the Board has accorded lawful superseniority to a
shop steward which extends beyond his department or
seniority roster, and there would be little, if any, justifi-
cation for such a contractual provision. Therefore, I con-
clude that, far from violating the provision of the con-
tract providing for superseniority, the Respondent com-
plied with that provision in retaining Berrill in prefer-
ence to senior partsmen and in laying him off when it
felt it no longer wanted to staff the parts department.
Another provision of the expired contract comes into
play in determining whether the Respondent observed its
residual contractual obligations toward- Berrill. Article
I(j) provides that "supervisory personnel and salesmen
will not perform any work regularly assigned to the bar-
gaining unit." Article XXVIII(c) provides that "parts,
other than standard supplies such as gasket material,
nuts , bolts, cotter keys and similar supply items not cov-
ered by manufacturers parts number, shall not be dis-
pensed other than through a partsman ." It is admitted by
the Respondent that after Berrill was laid off, McCann,
the parts supervisor, dispensed parts from time to time
and spent about 20 percent of his time in doing so. Al-
though this assignment does not render the initial layoff
of Berrill invalid or a violation of the contract, it is con-
trary to the provisions of the expired contract and has
incidental effects which were detrimental to Berrill while
he was in layoff status. I conclude that, by assigning
parts work to McCann, the Respondent unilaterally
changed a provision of the expired agreement without
observing its duty to bargain with the Union and, in so
doing, violated Section 8(a)(1) and (5) of the Act. The
consequences of this violation will be examined infra in
the remedy section of this decision.
The General Counsel and the Charging Party request
an order directing the Respondent to submit to an audit
of its fringe benefit fund payments and further requiring
it to pay over to the various funds an amount of money
determined to be due and .owing during an audit which
was conducted. The legal. premise for this request is well
settled but the factual premise is in considerable doubt. It
is well established that an employer has a duty under
Section 8(a)(5) of the Act to provide to trustees of fringe
benefit funds books and records sufficient to enable them
to conduct an audit of payments required to be made
under the terms of a collective-bargaining agreement. In
the event of a refusal to produce books and records nec-
4 Berrdl admitted that he was unqualified to perform the job of me-
TELFORD & DOOLEN, INC 1061
essary to conduct such an audit, an appropriate remedy
may include not only an order requiring production but
also a "make whole" remedy requiring payment of past
arrearages and liquidated damages. A necessary incident
of any such order is that it is prospective in character
and would apply to future audits and future delinquen-
cies as well as to past disputes. Michael Rossi Carpet Co.,
208 NLRB 748 (1974); Michigan Drywall Corp., 232
NLRB 120 (1977); Merryweather Optical Co., 240 NLRB
1213 (1979); Yates Drywall, 256 NLRB 591 (1981); W. L.
Moore & Sons, 257 NLRB 967 (1981); Exco Contracting,
261 NLRB 1120 (1982). It is also well settled that, if a
violation of the Act has been established, subsequent
compliance with the law is no defense to the issuance of
a Board order. NLRB v. Mexia Textile Mills, 339 U.S.
563 (1950).
In this case, the Union felt that the Respondent was in
arrears in the amount of $2155 for unremitted fringe ben-
efit payments. It caused the Respondent to be billed for
this amount. The initial bill was far in excess of what
was ultimately determined to be owed. The Respondent
replied to the bill by notifying the Union that it did not
owe increased fringe benefits for its Lansing and Grand
Rapids employees because they were not covered by the
new contractual increases. It told the Fund that it would
furnish a breakdown of employee hours to assist in a
more accurate determination. Two months later, the
Fund requested an audit of the records of "all your em-
ployees, regardless of occupation" and including employ-
ees at all three of the Respondent's shops. Leaving aside
the troublesome question whether the right to an audit
governs an employer-employee relationship and survives
the expiration of a contract, or whether it governs a
union-employer relationship and dies with the expiration
of the contract, it is clear that a union may not demand
an audit which exceeds the scope of the unit which it
represents. When the Fund demanded to see the payroll
records' of all of the Respondent's employees, regardless
of their occupations, it was exceeding its contractual
rights and the Respondent was well within its right in re-
sisting such a demand. In this case, the parties eventually
resolved their differences about the proper scope of a
fringe benefit audit, and an audit was then performed.
The time it took for this resolution to occur, as well as
the time it took the Fund to perform the audit, was
rather extended, but it appeared from the outset of this
controversy that neither party was in a great hurry.
After the audit was completed, an amount due and
owing was determined and, if we are to accept the repre-
sentations of union and Respondent counsel, the amount
determined to be due and owing was ultimately paid.
Here again , slowness, rather than a brisk , businesslike
pace, characterized the progress of the parties toward a
resolution of their differences. However, the Respondent
has complied in full with its contractual commitments,
assuming that any such commitments still remained in
force in the spring and summer of 1982, so any finding of
an 8(a)(5) violation must be premised on the notion that
it did not do so as rapidly as it should have. I am reluc-
tant to make such a finding. The expired contract, which
terms give rise to the obligation here in question, sets
forth no time limits within which an audit must be per-
formed after a valid request has been made. We do not
know at what point in time the Fund narrowed the
scope of its audit request to agreeable and permissible
limits. In applying a rule of reasonableness , it is well to
note that a lack of urgency on the part of the Fund con-
tributed to the delay in question. The fact that the Re-
spondent ultimately complied with its obligations, includ-
ing payment of the amount due and owing, is further in-
dication that it did not unilaterally change the terms and
conditions of'a collective-bargaining agreement, which is
the essence of an 8(a)(5) violation. It actually observed
the terms and conditions of the agreement but was
merely slow in doing so. Accordingly, I would dismiss
so much of the consolidated complaint which alleges that
the Respondent unlawfully refused to make available
books and records for the purpose of conducting an
audit to confirm Respondent's contributions to the Oper-
ating Engineers Fringe Benefit Funds.
On the foregoing findings of fact, and on the entire
record considered as a whole, I make the following
CONCLUSIONS OF LAW
1. Respondent Telford & Doolen, Inc. is now and at
all material times has been engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
2. Local No. 324, International Union of Operating
Engineers , AFL-CIO is a labor organization within the
meaning of Section 2(5) of the Act.
3. All service mechanics and parts men employed by
the Respondent at its Lansing and Grand Rapids, Michi-
gan shops but excluding professional employees, office
and clerical employees , salesmen , watchmen, janitors,
guards and supervisors defined in the Act, constitute a
unit appropriate for collective bargaining within the
meaning of Section 9(b) of the Act.
4. At all material times Local No. 324, International
Union of Operating Engineers , AFL-CIO has been and
is now the exclusive representative of all of the employ-
ees in the unit described above within the meaning of
Section 9(a) of the Act.
5. By failing to observe the seniority provisions of an
expired collective-bargaining agreement in laying off and
failing to recall Richard Fanko; and by failing to observe
the provisions of an expired collective-bargaining agree-
ment requiring that parts be dispensed exclusively by
partsmen and that supervisors be forbidden from per-
forming bargaining unit work, the Respondent violated
Section 8(a)(1) and (5) of the Act.
6. The aforesaid unfair labor practices affect commerce
within the meaning of Sections 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in cer-
tain unfair labor practices, I will recommend that it be
required to cease and desist and to take certain affirma-
tive actions designed to effectuate the purposes and poli-
cies of the Act.
I will recommend that it be required to offer to Rich-
ard Fanko full and immediate reinstatement to his former
or substantially equivalent employment and to make him
whole for any loss of earnings which he may have suf-
1062 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
fered by reason of the violation of the Act found herein,
with interest computed at the adjusted prime rate used
by the Internal Revenue Service for determining interest
due on tax payments . Olympic Medical Corp ., 250 NLRB
146 (1980); Isis Plumbing Co, 138 NLRB 716 (1962). In
the case of Thomas Bernll , I have not found that he was
laid off in violation of the contract . Following his layoff,
the Respondent violated the contract by permitting a su-
pervisor to dispense parts from its parts inventory as one
of several supervisory duties. This practice lasted until
August 1982 , when the department was entirely closed
and the supervisor in question was also laid off . As Ber-
nll was not unlawfully laid off and as there is no position
to which he can return , I will not recommend a rein-
statement remedy. It would be an abuse of discretion for
the Board to require the Respondent to employ an indi-
vidual on a full -time basis when it has no work for him
to perform which he was capable of performing. A
Board remedy does not exist to create a boondoggle.
However , the fallout from the violation found does have
a financial impact on Berrill , and he should be made
whole to the extent of that impact . Accordingly, I will
recommend that the Respondent be required to make
whole Thomas A. Berrill for the loss of wages and bene-
fits he suffered for so * much of the time he lost from his
employment from the date of his layoff, December 4,
1981, to the date the parts department was closed, which
was caused by the utilization of a supervisor doing the
bargaining unit work of dispensing parts . This sum
should be augmented by interest , as in the case of a rou-
tine backpay order I will also recommend that the Re-
spondent be required to post the usual notice, advising its
employees of their rights and of the results in the case.
[Recommended Order omitted from publication.]