Challenge-Cook Brothers Of Ohio, Inc.

National Labor Relations Board - Board Decisions

Oct 24, 1986

282 N.L.R.B. 21 (N.L.R.B. 1986)

CHALLENGE-COOK BROS. 21
Challenge-Cook Brothers of Ohio , -Inc. and United
Steelworkers of America, AFL-CIO-CLC.
Cases 8-CA-15391 and 8-CA-16250
24 October 1986
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND BABSON
On 2 February 1984 Administrative Law Judge
Arline Pacht issued the attached decision. The Re-
spondent and the General Counsel filed, exceptions
and supporting briefs.
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,
except as found below, has decided to affirm the
judge's rulings, findings, and conclusions' and to
adopt the recommended Order as modified.
We Agree with the judge that the Respondent
locked out its employees on 30 November 19812 in
order to further its bargaining position, after reach-
ing an impasse in contract negotiations with the
Union, and further agree with her finding that the
lockout was not the equivalent of a layoff, as sug-
gested by the General Counsel. However, we do
not agree with her finding that the Respondent vio-
lated Section 8(a)(1), (3), and (5) of the Act by de-
i Member Babson agrees with the judge's conclusion that the Re-
spondent's refusal to allow locked-out employees to withdraw funds from
the Respondent's pension plan is distinguishable from the employer's re-
fusal to pay vacation pay to locked-out employees in Sargent-Welch Sci-
entific Co., 208 NLRB 811, 819 (1976) However, Member Babson does
not rely on the paragraph of the judge's decision that addresses Sargent-
Welch. That discussion errs in stating that the pension benefits at issue
were not accrued and that the Respondent had discretion to grant or
deny the benefits Rather, Member Babson distinguishes Sargent- Welch on
the following basis In Sargent-Welch, the applicable contract provision
stated- "In departments . . where there is a complete shutdown at a
period set out by the Company, employees shall take this period as their
vacation." This provision on its face did not distinguish between lock-
outs, layoffs, or other types of shutdowns and thus was held not to an-
thorize the employer to withhold vacation pay from employees who had
been scheduled to begin vacations shortly after the start of the lockout.
In the present case, however, the provision at issue expressly permits an
employee who is laid off to withdraw, certain funds from his pension ac-
count. It makes no mention of employees who are locked out. Thus,
unlike the employer in Sargent-Welch, the Respondent was abiding by the
precise language of the applicable provision when it denied' certain funds
to locked-out employees.
In adopting the judge's conclusion that the Respondent unlawfully re-
fused to bargain over the effects of moving its cement mixer production
from its Ohio plant to its Georgia plant, Member Babson notes that Park
Ohio Industries, 257 NLRB 413 (1981), cited by the judge, is relevant to
this case only for its discussion of the issue of whether the Union waived
its right to bargain. Thus, in the context of the present case, it is unneces-
sary to address Park Ohio's holding that the transfer of unit work from
one plant to another in that case was a mandatory subject of bargaining.
Park Ohio Industries was decided prior to the Board's decision concern-
ing mandatory bargaining subjects in Otis Elevator Co., 269 NLRB 891
(1984)
9 All dates are in 1981 unless otherwise indicated
nyitng pension withdrawal benefits to employees
during a 2-week period of the lockout.
The essential facts are not in dispute . In late 1981
the Respondent and the Union began negotiations
for a new contract to replace one which was to
expire on 14 November . After a 2-week extension
of the contract , the Union notified the Respondent
on Wednesday , 25, November , that it was rejecting
the Respondent 's latest contract offer ' but that the
employees would still be reporting for work on
Monday, 30 November , as scheduled . 3 However,
when the employees reported for work on 30 No-
vember , they were notified by the Respondent that
in the absence of a contract , the plant would be
closed until further notice . That same day , the Re-
spondent canceled a 2-week, layoff that was sched-
uled to begin on 18 December. The record reveals
that the lockout continued until 11 January 1982
and that an agreement was finally reached in May,
and executed in July 1982.
During the lockout several employees applied
for benefits under the employees' pension plan
which essentially allowed participants who were
"laid , off temporarily for lack of work" to with-
draw funds from the .account "during said layoff.",
After consulting with its attorney, the Respondent
denied . the applications for benefits on the grounds
that the plan precluded payment during a lockout.
In finding that the denial of pension withdrawal
benefits during the period of the scheduled 2-week
layoff was unlawful , the judge stated that the Re-
spondent had deliberately scheduled the lockout to
overlap with the, layoff so as to deprive employees
of the benefits they would . have received during
that 2-week period . She found - the Respondent's ac-
tions in this regard to be inherently , destructive of
employees ' protected rights. The evidence , howev-
er, does not support the judge's conclusion.
The record reveals only ' that the Respondent ini-
tiated the lockout on the first working day after
the Union rejected its latest contract proposal and,
according to the undisputed testimony of Plant
Manager Roger Caleb , the Respondent viewed the
lockout from its inception as being of indefinite du-
ration .4 The timing of the lockout raises the infer-
ence that its purpose was, as found by the judge in
another context, to place economic ` pressure on the
Union to accept the Respondent 's bargaining posi-
tion and not to overlap with a prescheduled layoff
so as to deprive employees of the benefits to which
they otherwise would have been entitled . In the ab-
sence of any evidence showing that ' the Respond-
8 The employees were not scheduled to work on Thursday and Friday
4 In fact, the lockout extended well beyond the period of prescheduled
layoff.
282 NLRB No. 2
22 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ent deliberately planned the lockout to overlap
with the scheduled layoff, we conclude that the
Respondent 's decision to deny pension withdrawal
benefits to locked-out employees , who previously
had been scheduled for layoff, did not violate Sec-
tion 8(a)(1), (3), and (5) of the Act, as alleged. The
judge's recommended Remedy and Order shall be
modified to reflect this finding , and shall be modi-
fied to include the traditional language used by the
Board to remedy an effects -bargaining violation.5
REMEDY
Having found that the Respondent violated Sec-
tion 8(a)(1) and (5) of the Act by refusing to bar-
gain with the Union over the effects of its decision
to relocate its cement mixer operation from Bryan,
Ohio, to Calhoun, Georgia, and by refusing to fur-
nish the Union with information relevant to such
bargaining , we shall order it to cease and desist
therefrom , and to take certain affirmative action
designed to effectuate the policies of the Act.
The Respondent shall be required to bargain
with the Union over the effects of its decision to
relocate its cement mixer operation and to furnish
the Union with the requested information . We shall
accompany our order to bargain with a limited
backpay requirement designed to make whole the
employees for losses sustained as a result of the
violation, and to recreate in some practicable
manner a situation in which the parties' bargaining
position is not entirely devoid of economic conse-
quences for the Respondent . We shall do so in this
case by requiring the Respondent to pay backpay
to its employees in a manner similar to that re-
quired in Transmarine Navigation Corp., supra.
Thus, the Respondent shall pay employees backpay
at the rate of their normal wages when last in the
Respondent 's employ from 5 days after the date of
this Decision and Order until the occurrence of the
earliest of the following conditions : (1) the date the
Respondent bargains to agreement with the Union
on those subjects pertaining to the effects on its
employees of its decision to relocate its cement
mixer operation ; (2) a bona fide impasse in bargain-
ing; (3) the failure of the Union to request bargain-
ing within 5 days of this decision , or to commence
negotiations within 5 days of the Respondent's
notice of its desire to bargain with the Union; or
(4) the subsequent failure of the Union to bargain
in good faith, but in no event shall the sum paid to
any of these employees exceed the amount the af-
fected employees would have earned as wages
from the date on which he was laid off to the time
he was recalled or secured equivalent employment
elsewhere , or the date on which the Respondent
shall have offered to bargain, whichever occurs
sooner; provided , however , that in no event shall
this sum be less than these employees would have
earned for a 2-week period at the rate of their
normal wages when last in the Respondent's
employ.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge as modified below and orders that the Re-
spondent, Challenge-Cook Brothers of Ohio, Inc.,
Bryan, Ohio , its officers, agents , successors, and as-
signs , shall take the action set forth in the Order as
modified.
1. Delete the language of paragraph 2(c) and
insert in its place the following language.
"(b) Pay the employees who were laid off as a
result of the decision to relocate the cement mixer
operation from Bryan, Ohio, to Calhoun, Georgia,
their normal wages for the period set forth in the
remedy section of this Decision and Order."
2. Substitute the attached notice for that of the
administrative law judge.
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, on request , refuse to bargain col-
lectively in good faith concerning the effects of the
relocation of the cement mixer operation from
Bryan, Ohio, to Calhoun, Georgia , with United
Steelworkers of America, AFL-CIO-CLC as the
exclusive bargaining representative of employees in
the following appropriate unit:
All production and maintenance employees at
Employer's Bryan, Ohio facility, including
shipping and receiving clerks, janitorial em-
ployees, partsmen and utilitymen, but exclud-
ing inspectors , chief inspectors , material con-
trol clerks, draftsmen , office clerical employ-
ees and professional employees, guards and su-
pervisors as defined in the National Labor Re-
lations Act.
s See Transmarme Navigation Corp., 170 NLRB 389 (1968); Handy
Spot, Inc, 279 NLRB 1320 (1986)
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the exer-
CHALLENGE-COOK BROS. 23
{
I
cise of the rights guaranteed you by Section 7 of
the Act.
WE WILL pay those employees who were laid
off due to our decision to relocate our cement
mixer operation from Bryan, Ohio, to Calhoun,
Georgia, their normal wages for a period required
by the National Labor Relations Board.
WE WILL, on request, furnish United Steelwork-
ers of America with information relevant to the ef-
fects of the relocation so as to enable the Union to
discharge its function as statutory representative of
our Bryan employees in the unit described above.
CHALLENGE-COOK BROTHERS OF
OHIO, INC.
Allen Binstock Esq., for the General Counsel.
George B. Smith, Esq. (Castangy, Brooks & Smith), of At-
lanta , Georgia, for the Respondent.
DECISION
STATEMENT OF THE CASE
ARLINE PACHT, Administrative Law Judge. This case
was heard in Bryan, Ohio, on July 19, 1983, pursuant to
charges filed initially on December 10, as amended on
December 14 and November 12, 1982. A consolidated
complaint and notice of hearing issued on February 25,
1983, alleging that Challenge-Cook Brothers of Ohio,
Inc. (Respondent or Challenge-Cook) violated Section
8(a)(1), (3), and (5) of the Act by denying pension plan
benefits to its locked-out employees; by refusing to bar-
gain with United Steelworkers of America (the Union)
over the effects of the transfer of its current mixer oper-
ation from Bryan, Ohio, to its plant in Calhoun, Georgia;
and by refusing to provide the Union with information
concerning the relocation. Respondent denies committing
any unfair labor practices.
On the entire record, together with my observation of
the demeanor of the witnesses and their demeanor, and
with due consideration of the briefs filed by the General
Counsel and the Respondent, I make the following
FINDINGS OF FACT
1. JURISDICTION
Respondent, a manufacturing concern producing in-
dustrial laundry dryers and cement mixers, is, and has
been at all times material, an Ohio corporation with a fa-
cility in Bryan, Ohio. During the past 12 months, a rep-
resentative period, in the course and conduct of its busi-
ness operations, Respondent has purchased and caused to
be transferred and delivered to its Bryan facility goods
and materials valued in excess of $50,000 that were trans-
ported directly from States other than Ohio. Based on
the foregoing admitted facts, I find that Respondent is
now, and has been at all material times, an employer en-
gaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
United Steelworkers of America, AFL-CIO-•CLC is a
labor organization within the meaning of Section 2(5) of
the Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. Background
Respondent has manufacturing facilities in California,
Ohio, and Georgia, each serving the portion of the coun-
try in which it is located. At the Bryan,, Ohio plant, the
site of the instant dispute, Respondent manufactures con-
crete mixers, industrial dryers, and other smaller prod-
ucts.
United Steelworkers, -representing the production and
maintenance employees at the, Bryan plant since 1974,
had executed successive collective-bargaining agreements
with Respondent, including one that governed the events
herein. This contract, which terminated on November
14, 1981, as well as its predecessors, incorporated by ref-
erence "The Employee Profit Sharing ' and Retirement
Plan of Challenge-Cook Brothers, Inc." -initiated by Re-
spondent in 1950. Contributions to the plan are made ex-
clusively by the Company that is expressly charged with
sole authority for its, administration.
B. The Lockout
Negotiations for a new agreement began prior to the
contract's November 1981 expiration date. When no con-
sensus was reached and after a 2-week extension period
elapsed, the Union advised Respondent by letter of No-
vember 25 that it had rejected the Company's last offer
and that the employees intended to',continue working.
On reporting to work on Monday, November 30., the,
employees were greeted by a notice announcing that in
the absence of a contract, the,plant would be closed ' and
operations suspended until further notice. Bargaining
continued during the lockout that ended on January 11,
1982. A new labor agreement finally was reached in May
and executed in July.
A few weeks prior to the lockout, about November 6,
1981, Respondent posted a notice on the plant bulletin
board announcing .a, 2-week plantwide shutdown from
December 18 to January 4. However,,, on the date the
lockout commenced,' Respondent removed the notice and
canceled the holiday, shutdown for the nonunion salaried
employees.
As the lockout progressed, a number of employees vis-
ited the plant and attempted to file applications in an
effort to withdraw funds from the profit-sharing plan
that provided in section ' 11.5(a) that:
A Participant who is laid off temporarily for lack of
work may, upon written request to the A dminiLstra-
tor, withdraw funds from ' his accounts up to the
extent of fifty percent thereof (whether or not oth-
erwise vested) at the rate of fifty dollars per week
during said layoff.
Other sections of the plan authorized the withdrawal of
funds where sickness or disability prevented an employee
24 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
from working or where an employee had 15 years of
vested service and was at least 55 years old.
Prior to the lockout, production and maintenance em-
ployees had withdrawn weekly payments under section
11.5 of the plan whenever layoffs caused by business ne-
cessity occurred. Typically, employees submitted appli-
cations for fund benefits to the plant personnel director.
These applications then were forwarded to Oyvind
Frock, Respondent's director of industrial relations, who
had authority for approving or rejecting them.
Having no prior experience in making such determina-
tions in a lockout situation, Frock consulted the attorney
who had drafted the pension plan for Respondent. Based
on the attorney's opinion that employees were ineligible
for benefits during a lockout, Frock concluded that the
applications should be rejected and relayed this position
to personnel at the Bryan facility.
Respondent did not notify the Union of its interpreta-
tion nor provide it an opportunity to bargain over the
decision to deny employees' plan benefits. Consequently,
no employee except those who qualified by virtue of dis-
ability or who met the plan's age requirement were per-
mitted to withdraw weekly pension benefits at any, time
between November 30 and January 11.
C. Transfer of Mixer Operations
On termination of the lockout on January 11, 1982,
some employees were recalled and others were placed
on layoff status, due to a continuing decline in customer
orders. i This economic downturn was not an isolated
event; rather, it was part of a trend that had begun as
early as the spring of 1980. As orders for concrete
mixers decreased, the work force, which reached a peak
of 450 to 500 employees in the summer of 1979, dwin-
dled to 1'50 employees working a 4-day week by early
1982. Notwithstanding the reduction in sales, Respondent
continued to produce cement mixers for inventory pur-
poses in anticipation of an economic revival in the fall.
However, by September it became apparent that Re-
spondent's expectations of increased sales were not to be
fulfilled. Consequently, Respondent decided to phase out
the cement mixer operation at Bryan and consolidate the
manufacture of new mixers at its Calhoun, Georgia plant
that had a greater volume of-business than did Bryan.2
By this time, the employee complement had been further
reduced so that ' only 115 or 120 production employees
remained at Bryan.
About September 29, Robert Sturmer, senior vice
president of manufacturing, telephoned Union Represent-
ative Bob,Kemp3 to advise him that he would be meet-
ing with the employees to announce the transfer of the
cement mixer operation and the resulting layoff, of as
many as 50 or 60 employees.
Shortly thereafter, on October 4, 1982, Kemp met
with Bryan Plant Manager Robert Caleb telling him that
' These laid-off employees 'again were permitted to make withdrawal
from the pension plan at the lockout 's conclusion
2 The phasing out of the operation in Bryan took approximately 30
days.
S Bob Kemp serves as the sub-district director for the Ohio subarea of
District 29 of the United Steelworkers and servicing staff man for Local
8334 representing the Bryan employees
the Union wanted to bargain about the effects of the
transfer decision. Caleb replied that the Company's
action in laying off employees was "just a normal reduc-
tion in the workforce due to a business downturn." In a
letter to Sturmer dated October 7, Kemp formally re-
quested that Respondent meet with the Union to negoti-
ate over the transfer decision and its effects. In addition,
the Union requested certain information itemized.4
Responding to the Union's inquiry by letter of October
25, Frock wrote that "Section 5.01, 5.02 (particularly
items 6, 7 and 22) and 36.02... were . . . negotiated in
contemplation of layoff situations such as are currently
underway in Bryan" and concluded "that no further ne-
gotiations of a formal nature [were] called for at this
time." The sections of the collective-bargaining agree-
ment referred to in this letter are set forth verbatim
below.5
4 The requested information was as follows
1 Date of the decision to partially close the plant.
2. Who made the decision
3 The reason for the decision.
4. Copies of all memorandum and letters in regard to the decision.
5. Copies of board meeting minutes or plant meeting minutes
where the decision was made or discussed
6. Copies of studies made on moving the operation, by either out-
side sources or in-house sources
7. Copy of cost for actual moving.
8. Copy of cost to manufacture the product in Georgia.
9. Copy of cost for in-house manufacturing.
10. Number of employees in the Bryan location prior to the deci-
sion to` move
11. Number of employees to be added in Georgia as a result of the
move
12. Number of employees in Bryan to be reduced because of the
move.
13. Estimated loss of earnings of the Bryan employees, as a result
of the move.
14. Estimated loss of fringe benefits and pension for the Bryan em-
ployees.
15. The amount of funds in the profit- sharing pension plan that is
not covered by vesting.
16 Estimated forfeitures in the profit-sharing pension plan due to
the plant closing for the Bryan employees' move
17 Loss of vacation benefits amounts for the Bryan employees.
Sec 5 reads
Section 5-RIGHTS OF MANAGEMENT
5 01 Except as otherwise specifically provided in this Agreement,
the Employer has the sole and exclusive right to exercise all the
rights or functions of management, and the exercise of any such
rights or functions shall not be subject to the grievance or arbitration
provisions of this Agreement
Twenty-six management rights are then numerated, including the
following
6. The location of the business, including the establishment of
new plants or departments, divisions, or subdivisions thereof, and
the relocation, sale, leasing or closing of plants, departments, divi-
sions or subdivisions thereof
7 The determination of products to be manufactured or services
to be rendered
22 The transfer of work from one job to another, or from one
plant to another, or from one department, division or other plant
unit to another
5 02 It is agreed that the enumeration of management prerogatives
above shall be deemed to exclude other management prerogatives
not specifically enumerated above.
36 02 The Union agrees that this Agreement is intended to cover
all matters affecting wages, hours, and other terms, and all condi-
tions of employment and similar or related subjects, and that during
the term of this Agreement neither the Employer nor the Union will
be required to negotiate on any further matters affecting these or any
other subjects not specifically set forth in this Agreement
CHALLENGE-COOK BROS. 25
The removal of the cement mixer " ' operation from-
Bryan to Calhoun was completed by November 1982.
Orders received but not yet started in Bryan and future
orders that would have been processed in Bryan prior to
the transfer were consolidated in Calhoun. Two large
pieces of manufacturing equipment, a lathe and shears
valued at one-quarter million dollars, were shipped from
Bryan to Calhoun. Two salaried employees at Bryan re-
located in Georgia where the complement of production
employees also was increased in response to the receipt
of new orders for mixers. After these shifts, the only
mixer production work remaining at Bryan was the fabri-
cation of replacement parts. In addition, 12 salaried em-
ployees were laid off and the Bryan work force reduced
from approximately 120 to 32.
III. DISCUSSION
A. The Pension Plan Issue
The General Counsel submits that Respondent's em-
ployees were entitled to pension plan benefits throughout
the lockout and that Respondent violated Section 8(a)(5),
(3), and (1) of the Act when it refused to dispense these
funds in accordance with the plan. In asserting the em-
ployees' entitlement, the General Counsel urges that a
lockout by Respondent is equivalent to a layoff in that
employees in both situations are involuntarily deprived
of work. Therefore , the General Counsel reasons that
section 11 (5)(a) of "The Employee Profit Sharing and
Retirement ' Plan- of Challenge -Cook Brothers," providing
pension withdrawal rights to employees "laid off tempo-
rarily for lack of work," must be construed to include
locked-out employees. The General Counsel cites as sup-
port - for her position Sargent-Welch Scientific Co., 208
NLRB 811 (1974), in which the Board concluded that
postponing vacations during a lockout was an unlawful
withholding of benefits violating Section 8 (a)(5), (3), and
(1) of the Act.
Respondent maintains, to the contrary, that the plan
language, "laid' off temporarily for lack of work," by
virtue of its specificity , excludes employees who are
idled due to a lockout . Therefore, the pension grants no
withdrawal rights to locked-out employees and Respond-
ent has no contractual obligation to disburse benefits in
such a situation.
The issue presented is whether , in the circumstances of
this case, locked-out employees are on "temporary layoff
due to lack ' of work." There is, of course, a superficial
similarity between a layoff and a lockout: in both in-
stances employees are subject to enforced idleness. How-
ever, in American Ship Building Co. v. NLRB, 380 U.S.
300; 308 ( 1964), the Supreme Court distinguished a lock-
out from other forms of temporary separation from em-
ployment-The Court made clear that a layoff occurring
when an employer temporarily shuts down its plant "for
lack of profitable work" cannot be equated to a lockout
that is used "to bring economic pressure to bear in sup-
port of the employer's bargaining position ." Id. at 308. In
other words, a layoff has an economic purpose divorced
from union activity whereas a lockout has a strategic ob-
jective in bargaining.
iA^ttliitlgh the record in this case reveals that, Respond-
ent's economic fortunes were waning prior to the time
impasse was reached, there is no concrete evidence that
the lockout was instituted on November 1 for any reason
other than to serve Respondent' s bargaining advanl age.
Thus, in light of the distinction drawn in American Ship
Building, it cannot be said that the Challenge-Cook em-
ployees were from the outset locked out due to lack of
work stemming from Respondent's economic shortfall.
In construing section 11(5), it is also important to bear
in mind that with the Union's consent, Respondent had
sole authority, qualified by its legal obligations under the
terms of the plan itself and under the National Labor Re-
lations Act to determine applicant eligibility. It is equally
significant that entitlement to withdrawals did not
depend on whether the applicant's pension fund had
vested. Thus, by interpreting section 11.5 in a way that
denied nonaccrued benefits to employees who were tem-
porarily laid off due to a lockout rather than to a lack of
work, Respondent exercised the discretion granted to it
in the plan in a permissible manner . It is the element of
discretion and the nonvested nature of the benefits that
distinguish the result reached in this case from that in
Sargent- Welch, supra, in which the contract mandated
that vacations be taken during any "complete shutdown
at a period set by the Company." Id. at 820. The Board
found in that case that although the employer had discre-
tion about whether and when to cease operations once a
shutdown occurred, the employer had no discretion to
deprive the employees their accrued vacation benefits
once the decision to shutdown was final. Id. at 820--821.
As noted above, Respondent's right to determine eligi-
bility under the plan is not wholly absolute; it must be
tempered by the dictates of Section 8 of the Act that
prohibits employers from engaging in conduct prejudicial
to employees' union interests. With this constraint in
mind, Respondent's canceling the 2-week shutdown
during the Christmas season raises a troublesome ques-
tion about the propriety of denying ' pension benefits
during that limited period of time., The record clearly
shows that on November 6, before a bargaining impasse
occurred, Respondent announced a 2-week' layoff to
begin on December 18 in response to a declining demand
for cement mixers. Moreover, the 'employees received no
notice that the layoff was rescinded since the announce-
ment of cancellation was posted'within the plant' on the
day the lockout began.
The Supreme Court warned in American Ship Building,
supra at 308, that not every lockout has a lawful pur-
pose; there are those that may be used "as a means to
injure a labor organization" From the facts set forth
above, it is reasonable to infer that even' without the
lockout, a 2-week layoff would have occurred at the
Bryan facility as originally planned. By scheduling; the
lockout to overlap with the preplanned layoff, Respond-
ent utilized the lockout to deprive the employees 'of ben-
efits to which they otherwise would have been entitled.
In so doing, Respondent demonstrated that benefits ordi-
narily guaranteed by contract are less than secure during
a union management controversy . Respondent 's conduct
in this regard is inherently destructive of rights guaran-
26 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
teed to employees to engage in protected concerted ac-
tivity. Accordingly, I. conclude that by, denying pension
withdrawal benefits during this prescheduled 2-week
period, Respondent violated Section 8(a)(1), (3), and (5)
of the Act. See NLRB v. Great Dane Trailers, 388 U.S.
26, 33-34 (1967); Sargent-Welch, supra at 821. For all
other times during the lockout, Respondent lawfully ex-
ercised its discretion in declaring locked-out employees
ineligible for plan benefits.
B. The Union did not Waive Bargaining Over the
Effects of Relocating
1. Position of the parties
The General Counsel submits that by refusing to bar-
gain with the Union over the effects of transferring its
Bryan cement mixer operation and consolidating it with
its existing operation in Calhoun, Respondent violated
Section 8(a)(1) and (5) of the Act.
Taking issue with this position, Respondent contends:
(1) it did nothing, more than exercise its right to reduce
its work force in the manner prescribed by the collec-
tive-bargaining agreement obviating any duty to bargain;
(2) even if its actions gave rise to an obligation to engage
in effects bargaining, the Union waived its right to 'nego-
tiate about the effects of the transfer by executing a con-
tract containing a management-rights provision (sec. 5)
and a "zipper clause" (Sec. 36).
2. The applicable precedents
The National Labor Relations Act imposes on an em-
ployer a statutory obligation to bargain over the effects
of a transfer of work from one plant to another. 6 In Park
Ohio Industries, 257 NLRB 413 (1981), enfd. 702 F.2d
624 (6th Cir. 1983), the Board found the transfer of unit
work from one plant to another to be a mandatory sub-
ject of bargaining and imposed on the employer the duty
to bargain about the terms and conditions of employment
affected by, the change. Although conceding that "a
union may waive its statutory right to bargain" over
such changes, the Board warned that such "waiver not
be lightly inferred." Id. at 414. Instead, the Board restat-
ed its long-held position that a "clear and unmistakeable"
waiver must "be found in express contract language or in
unequivocal extrinsic evidence bearing upon ambiguous
contractual language." Id. at 414 fn. 6. In short, a claim
that a statutory right has been waived must be strictly
construed. See Chesapeake & Potomac Telephone Co., 687
F.2d 633, 636 (2d Cir. 1982).
3. Respondent's relocation was not a typical layoff
In determining whether the Union forfeited its right to
insist on effects bargaining, the first question to be re-
solved is whether Respondent' s actions in fact involved a
relocation of operations in Georgia or were nothing
more than a temporary reduction of force in Bryan with
no collateral consequences.
6 The General Counsel concedes that Respondent has no obligation to
bargain over the transfer decision itself
The record provides an unaml- _ , answer to this
inquiry. There is sufficient evide. to support -the con-
clusion that the shift of the Bryan cement mixer oper-
ations to Georgia went beyond merely reducing the
work force and, instead, involved far-reaching conse-
quences not covered by the parties' contract. Respondent
did not simply temporarily terminate a portion of its
cement mixing operations in Bryan. Rather, orders that
were currently pending there were shifted to the Cal-
houn facility. Future' orders that also would have been
handled in Bryan also were redirected to the Georgia
plant and heavy equipment was shifted from one site to
the other. Accompanying these realignments, two sala-
ried Bryan employees relocated in Georgia and new pro-
duction employees were hired as work formerly done in
Bryan expanded there. This chain of events, beginning
with the transfer of orders, was unprecedented in
Bryan's history and suggests that Respondent was at that
time anticipating a more permanent move than it is now
willing to admit. At the very least Respondent gave no
hint of knowing when, if ever, it might resume cement
mixer production at Bryan.' Consequently, Respondent
oversimplifies when it claims that its actions amounted to
nothing more than routine, short-term layoffs within the
intendment of the collective-bargaining agreement.
The contract is silent concerning the rights of employ-
ees laid off as a result of an interplant transfer of unit
work. It does not address such matters as preferential
hiring for employees whose work has been relocated to a
sister plant or severance pay for those who lose their se-
niority when their work is transferred for an extended
period of time. Thus, the General Counsel accurately
characterizes, the above-described events as a relocation
of unit work obligating Respondent to bargain with the
Union over the collateral effects of its decision.
By motion dated November 7, 1983, Respondent requests that the
record in this proceeding be reopened for the introduction of evidence
unavailable at the time of the hearing. Specifically, Respondent seeks to
introduce evidence of production orders received after the close of the
hearing on July 19 that would result in the resumption of production at
the Bryan facility in December 1983 and the recall of some employees
laid off as a result of Respondent's transfer of unit work to Calhoun'
argues that this evidence is relevant to prove that the layoff of
employees resulting from the transfer of concrete mixer production was
temporary and thus covered by the layoff and recall provisions of the
contract that lie exclusively in management's control The General Coun-
sel contends in her opposition that Respondent's new evidence is more
appropriately raised at a compliance hearing as it does not affect the le-
gality of Respondent's conduct at issue in this proceeding. I find merit in
the General Counsel's position.
Sec. 102.48(dXl) of the Board's Rules and Regulations permits a record
to be reopened where, inter alia, the evidence "has become available only
since the close of the hearing" and pertains to a material issue. The evi-
dence proferred by the Respondent regarding production orders received
after this hearing adjourned was unavailable within the meaning of Sec.
102.48(d)(1). However, evidence of events occurring a year after the al-
leged unfair labor practice occurred is irrelevant to a determination of
whether the Act was violated at the time Respondent engaged in the
challenged conduct. Moreover, as noted above, at the time of the-reloca-
tion, Respondent had no knowledge that the transfer was temporary.
Indeed, the relocation of heavy machinery and hiring of personnel sug-
gest quite the contrary. Accordingly, I deny, Respondent's, motion, to
reopen hearing. However, the proferred evidence may appropriately be
introduced at the compliance stage of the proceeding. See Exchange
Bank, 264 NLRB 822 (1982):
CHALLENGE-COOK BROS.
4. The management-rights clause does not constitute
,a waiver
The management-rights provision of the contract au-
thorizes Respondent to relocate work from one plant to
another at will. Respondent contends that this provision
also serves as a waiver of the Union's right to bargain
about the consequences flowing from such a work trans-
fer. However, an examination of the management-rights
clause, section 5, compels a contrary conclusion. (See fn.
5, supra.)
Undeniably, subsections 6 and 22 of the management-
rights clause confer on Respondent exclusive decision-
making authority regarding the relocation of unit work.
But the contract is silent about the Union's right to bar-
gain over the consequences of such decisions.
In the absence of specific language waiving the
Union's bargaining rights about these effects, the next in-
quiry is whether a waiver is contained in the more gen-
eralized language of section 5,01 and 5.02 of the agree-
ment. Although the language in these provisions is ad-
mittedly broad, it does not follow that by agreeing to
these terms the Union also agreed to waive its right to
engage in effects bargaining.' Under circumstances similar
to those at hand, the Board concluded in Borg Warner
Corp., 245 NLRB 513, 518-519 (1979), that in the face of
a broad management-rights clause assuring that "the
management and operation of the business is vested in
... the Company" including "the exclusive right to sell,
close, liquidate or cease operations in whole or in part,
or to add to, change or modify existing operations" the
Union had waived its right to bargain over the decision
to relocate, but not over the effects thereof. Quoting
Cooper Thermometer Co. v. NLRB, 376 F.2d 684, 688 (2d
Cir. 1967), regarding an employer's obligation to engage
in effects bargaining, particularly where relocating work
causes a loss of jobs, the Board observed that "an em-
ployer does not i fulfilll his obligation, under § 8(a)(5) if he
refuses even to discuss with employees' representatives
on what basis they may continue to be employed." Id. at
518.
The contractual language in the instant case is no
broader than that in Borg Warner. It follows, then, that
here, as in that case, the management rights clause does
not operate to waive the Union's right to bargain over
the effects of Respondent's decision to transfer its cement
mixer operations to Calhoun.
5. The zipper clause does not preclude effects
bargaining
The final contractual provision relied on by Respond-
ent to support a waiver by the Union' is found in section
36, titled "Entire Agreement." 8
36.01 Neither the Employer nor the Union shall be
bound by any requirement which is not specifically
stated in this Agreement. Specifically, but not exclu-
sively, neither the Employer nor the Union is bound
by any past practice of the Employer, or under-
e Provisions binding parties to inclusive contract are commonly re-
ferred to as "zipper clauses."
27
standings with any labor organizations, unless such
past practices or ^ understandings are specifically
stated in this Agreement.
36.02 The Union agrees that this Agreement is in-
tended to cover all matters affecting wages, hours
and other terms and conditions of employment and
similar or related subjects, and that during the term
of this Agreement neither the Employer nor the
Union will be required to, negotiate on any further
matters affecting these or any other subjects not
specifically set forth in this Agreement.,
Respondent compares the "zipper clause" in its con-
tract to one in GTE Automatic Electric, 261 N]LRB 1491
(1982), and argues that the decision in that case dictates a
finding here that the Union waived' its right to bargain
over the effects of relocation. Midcontract, the employer
in GTE implemented a savings and investment plan for
salaried employees only. The union requested bargaining
concerning the inclusion of rank-and-file employees in
the plan. The employer refused, relying on the following
waiver clause:
The parties acknowledge that during the negotia-
tions which resulted in this Agreement, each had
the unlimited right and, opportunity to make de-
mands and proposals with respect to any subject or
matter not removed by law from the area of collec-
tive bargaining, and that the understanding and
agreements arrived at by the parties after the exer-
cise of that right and opportunity are set forth,in
this Agreement. Therefore, the Company and the
Union, for the life of this Agreement, each volun-
tarily and unqualifiedly waives the right, and each
agrees that the other shall not be obligated to bar-
gain collectively with respect to any subject or
matter referred to, or covered in this Agreement, or
with respect to any subject matter not specifically
referred to or covered by this Agreement even
though such subject or matter may not have been
within the knowledge or contemplation of either or
both of the parties at the time they negotiated[ or
signed this Agreement. [Id. at 1491.]
The Board held that the employer in GTE could rely on
the zipper clause in its contract as it "clearly and un-
equivocally" waived the right of the union to bargain
over a' new benefit for nonunion employees. (Emphasis
added.) Id. at 1491. However, in doing so, the Board em-
phasized that the status quo of bargaining unit employees
was not affected; the Respondent made no "unilateral
changes that directly and adversely affect[ed] unit em-
ployees," and did "nothing more than to have it and the
Union adhere to, and not alter, their contractual commit-
ments and the existing employment conditions." Id. at
1492. Thus, in GTE Electric, the Board carved out a
narrow exception to its longstanding rule that waivers be
expressed in clear and 'unmistakable terms, but only
when a new benefit is conferred on nonbargaining unit
personnel.
Respondent's reliance on GTE is misplaced for it ig-
nored the Board's pointed instruction in that case that its
28 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
"holding does not disturb cases involving," inter alia, "an
employer unilaterally changing the employees' existing
working conditions, then using the zipper clause as a
`sword' to justify its refusal to discuss the unilateral
changes made to the status quo." Id. at 1492 fn. 3.9
Here, the effects of the shift of mixer production from
Bryan to Calhoun struck directly at one of the most crit-
ical of employee concerns-the availability of jobs else-
where when bargaining unit work has been lost. Thus,
the instant case clearly falls within the mainstream of
cases ' left undisturbed by the Board's GTE decision.
Therefore, in the absence of clear and unmistakeable lan-
guage, no waiver can be read into the parties zipper
clause.
When no express language waives the parties' bargain-
ing obligations, the Board will examine the totality of the
circumstances surrounding the making of the contract,
including the prior bargaining history, to determine
whether a waiver may be implied. In the present case,
there is no evidence that the effects of transferring unit
work from one plant to another were ever mentioned
during contract negotiations. This absence of bargaining
history contrasts sharply with the circumstances in Ra-
dioear Corp., 214 NLRB 362 (1974). There, the Union's
request for a "maintenance of existing benefits clause" in
the contract was rejected by the employer. Instead, the
parties agreed to a zipper clause waiving the union's
right to bargain over benefits not specifically referred to
in the agreement. On these facts, the Board found that
the union had waived its right to bargain over the em-
ployees' decision to eliminate a Christmas and Thanks-
giving bonus that had not been expressly guaranteed in
the contract.
In the instant case, the parties engaged in no discussion
bearing on the effects of relocation. The Union's silence
may not be construed as a waiver. In the absence of ex-
press language or unambiguous bargaining history, for-
feiture of an important right such as bargaining over the
effects of a decision to relocate employees' work will not
be implied.
Recent case law confirms the significance that the
Courts and the Board attach to effects bargaining. In
First National Maintenance Corp. v NLRB, 452 U.S. 666
(1981), the Supreme Court noted that an employer has
the right 'unfettered by union participation to "change
... the scope and direction" of its business especially
when it is akin to the decision whether to be in business
at all. Yet, the employer does not enjoy the same inde-,
pendence with respect to a union concern over the ef-
fects of such a decision. See Borg Warner, supra, 245
NLRB at 518-519 (1979) (employer obligated to bargain
over effects of relocation despite waiver of right to ne-
gotiate over decision itself); Allied Mills, 218 NLRB 281,
286-288 (1975) (inclusion of severance pay provision in
contract did not waive union's right to bargain over ef-
fects of relocation). Given these precedents, and in light
of all the circumstances in this case, I conclude that Re-
spondent's rejection of effects bargaining violates Section
8(a)(1) and (5) of the Act.
9 See Pepsi-Cola Distributing Co. of Knoxville , 241 NLRB 869 (1979)
See also Latex Industries, 252 NLRB 855 (1980).
C. The Union's Right to Information
The Board and the courts have long held that an em-
ployer's obligation to bargain carries with it an obliga-
tion to provide relevant information to its employees'
bargaining representative. General Motors Corp. v.
NLRB, 700 F.2d 1083, 1088 (6th Cir. 1983); Cooper Ther-
mometer Co. v. NLRB, supra at 688.
In its letter of October 2, 1982, the Union requested in-
formation concerning Respondent's -decision to relocate
its mixer operation as well as the effects thereof. Since
the General Counsel has properly acknowledged that
Respondent has no duty to bargain about the decision
itself, it follows that information about that decision need
not be produced. At the same time, since Respondent is
obliged to bargain over the effects of that decision, it
also follows that Respondent must furnish to the Union
requested information bearing on those effects. There-
fore, Respondent's failure to comply with the Union's re-
quest violates Section 8(a)(1) and (5) of the Act.
CONCLUSIONS OF LAW
1. Challenge -Cook Brothers of, Ohio, Inc. is an em-
ployer engaged in commerce within the meaning of Sec-
tion 2(2), (6), and (7) of the Act.
2. United Steelworkers of America , AFL-CIO-CLC is
a labor organization within the meaning of Section 2(5)
of the Act.
3. The Steelworkers Union is the exclusive representa-
tive of employees in the following appropriate unit
within the meaning of Section 9 (a) of the Act:
All production and maintenance employees at Em-
ployer's Bryan, Ohio facility , including shipping and
receiving clerks, janitorial employees , partsmen and
utilitymen, but excluding inspectors, chief inspec-
tors, material control clerks, draftsmen , office cleri-
cal employees and professional employees, guards
and supervisors as defined in the National Labor
Relations Act.
4. By refusing to permit employees to withdraw bene-
fits from the employee profit-sharing plan during the 2-
week holiday shutdown , commencing December 18,
1981, the Respondent engaged in unfair labor practices
within the meaning of Section 8(a)(1), (3 ), and (5) of the
Act.
5. By refusing to bargain with the Union about the ef-
fects of its decision to relocate its cement mixer oper-
ation in Bryan, Ohio, to Calhoun, Georgia, and by refus-
ing to furnish the Union requested information relevant
to those effects, Respondent engaged in unfair labor
practices within the meaning of Section 8 (a)(1) and (5) of
the Act.
6. The unfair labor practices set forth in,paragraphs 4
and 5, above, affect commerce within the meaning of the
Act.
7. Respondent has not violated Section 8(a)(1), (3), and
(5) of the Act by refusing to permit employees to with-
draw benefits from the employee profit-sharing and re-
tirement plan during the lockout except as provided in
paragraph 4, above.
CHALLENGE-COOK BROS. 29
THE REMEDY
Having found that Respondent engaged in unfair labor
practices in violation of Section 8(a)(1), (3), and (5) of
the Act, I shall recommend that it be ordered to cease
and desist therefrom and to take certain affirmative
action designed to effectuate the policies of the Act. As
found above, Respondent violated Section 8(a)(1), (3),
and (5) of the Act by refusing employees pension bene-
fits for a 2-week period. As a remedy, I shall direct the
Respondent to permit employees locked out during the
scheduled 2-week holiday shutdown commencing from
December 18, 1981, to withdraw pension benefits as pre-
scribed in section 11.5 of the employee profit-sharing and
retirement plan, unless the applicant has withdrawn 50
percent or more of the available funds in his pension plan
account. I also find that Respondent violated Section
8(a)(1) and (5) of the Act by refusing to bargain with the
Union concerning the effects of its relocation and failing
to provide the Union with information relevant to the
bargaining. Accordingly, Respondent shall be ordered to
bargain with the Union concerning the effects and to fur-
nish all requested information relevant to those effects.
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
edio
ORDER
The Respondent, Challenge-Cook Brothers of Ohio,
Inc., Bryan, Ohio, its officers, agents, successors, and as-
signs, shall
1. Cease and desist from
(a) Refusing to bargain in good faith with the Union
concerning the effects of the relocation of the cement
mixer operation from Bryan, Ohio, to Calhoun, Georgia,
on employees in the following unit:
All production and maintenance employees at Em-
ployer's Bryan, Ohio facility, including shipping and
receiving clerks, janitorial employees, partsmen and
utilitymen, but excluding inspectors, chief inspec-
tors, material control clerks, draftsmen, office cleri-
cal employees and professional employees, guards
and supervisors as defined in the National Labor
Relations Act.
(b) In any like or related manner interfering with, re-
straining or coercing employees in the exercise of the
rights guaranteed them in Section 7 of the Act
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) On request, bargain collectively with the Union as
the exclusive representative of its employees in the
above-described unit concerning the effects on the em-
ployees of the transfer of cement mixer production from
Bryan to Calhoun.
(b) On request, furnish the above-named Union with
information relevant to the effects of the relocation to
enable the Union to discharge its function as statutory
representative of Respondent's Bryan employees in the
aforementioned unit.
(c) On application, permit eligible employees locked
out during the scheduled 2-week holiday shutdown that
commenced on December 18, 1981, to withdraw pension
benefits as prescribed in section 11.5 of the employee
profit-sharing and retirement plan unless the applicant
has withdrawn 50 percent or more of the available funds
in his pension plan account.
(d) Preserve and upon request, make available to the
Board or its agents for examination and copying all em-
ployee pension and retirement plan records, and all other
records necessary to analyze the monetary amounts due
employees under the terms of this Order.
(e) Post at its Bryan, Ohio facility and mail to all the
employees employed by the Respondent at Bryan at the
time of the lockout in November 1, 1981, copies of the
attached notice marked "Appendix."" with the proof of
service to be submitted to the Regional Director for
Region 8. Copies of said notice on forms provided by the
Regional Director for Region 8, after being signed by
Respondent's authorized representative, shall be posted
by Respondent immediately upon receipt and be main-
tained for 60 consecutive days in conspicuous places in-
cluding all places where notices to employees are cus-
tomarily posted Reasonable steps shall be taken by Re-
spondent to ensure that the notices are not altered, de-
faced, or covered by any other material.
(f) Notify the Regional Director in writing within 20
days from the date of this Order what steps Respondent
has taken to comply.
IT IS FURTHER RECOMMENDED that the allegations of
the complaint bearing on Respondent's refusal to distrib-
ute benefits under section 11.5(a) of the pension and
profit sharing plan during weeks of the lockout that were
not included in the 2-week holiday layoff be dismissed.
io If no exceptions are filed as provided by Sec 10246 of the Board's
Rules and Regulations , the findings , conclusions , and recommended
Order shall, as provided in Sec 102 48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses
i i 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 "