Premium Foods, Inc.

National Labor Relations Board - Board Decisions

Mar 8, 1982

260 N.L.R.B. 708 (N.L.R.B. 1982)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Premium Foods, Inc. and United Food and Commer-
cial Workers Local Union No. 1439, affiliated
with United Food and Commercial Workers In-
ternational Union, AFL-CIO. Cases 19-CA-
12796 and 19-CA-12829
March 8, 1982
DECISION AND ORDER
BY CHAIRMAN VAN DE WATER AND
MEMBERS FANNING AND HUNTER
On September 29, 1981, Administrative Law
Judge James T. Barker issued the attached Deci-
sion in this proceeding. Thereafter, Respondent
filed exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and brief
and has decided to affirm the rulings, findings,'
and conclusions" of the Administrative Law Judge
and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board adopts as its Order the recommended
Order of the Administrative Law Judge and
hereby orders that the Respondent, Premium
Foods, Inc., Spokane, Washington, its officers,
agents, successors, and assigns, shall take the action
set forth in the said recommended Order, except
that the attached notice is substituted for that of
the Administrative Law Judge.3
i We note that although the Administrative Law Judge stated, in sec
III,B.1, of his Decision that the business of Swift Fresh Meat Company
was "primarily oriented to the retail trade, with a secondary emphasis on
food service," he correctly stated later in the same section that retail sales
constituted 40 percent of Swift's volume and food service sales constitut-
ed 60 percent until the last 2 months of Swift's operation when the per-
centages of retail and food service sales were equal
Member Hunter finds it unnecessary to pass upon the Administrative
Law Judge's characterization of the Union's letter of August 26, 1980, as
a continuing bargaining demand.
2 In adopting the Administrative Law Judge's conclusion that Re-
spondent is a successor employer to Swift. we do not rely upon his find-
ing that Respondent purchased Swift's existing inventory. Furthermore,
in adopting his conclusion that former production employees of Swift
constituted a majority of Respondent's work force at the time the Union
requested bargaining on August 26, we rely upon his finding that the op-
erating unit was then comprised of eight rank-and-file employees, exclud-
ing Jerry Anderson, a low-level supervisor
3 We have substituted a new notice which conforms to the recom-
mended Order of the Administrative Las Judge.
260 NLRB No. 92
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Act, as amended,
gives all employees the following rights.
To organize themselves
To form, join, or support unions
To bargain as a group through representa-
tives of their own choosing
To act together for collective bargaining
or other mutual aid or protection
To refrain from any or all such activity
except to the extent that the employees' bar-
gaining representative and employer have a
collective-bargaining agreement which im-
poses a lawful requirement that employees
become union members.
WE WILL NOT refuse to recognize and bar-
gain collectively with United Food & Com-
mercial Workers Local Union No. 1439, affili-
ated with United Food & Commercial Work-
ers International Union, AFL-CIO, as the col-
lective-bargaining representative of:
All production and maintenance employees,
including truckdrivers at our Spokane,
Washington, plant, excluding manager, sales-
men, clerical employees, guards, professional
employees, and supervisors as defined in the
National Labor Relations Act.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employ-
ees in the exercise of the rights guaranteed
them by the National Labor Relations Act, as
amended.
WE WILL, upon request, bargain collectively
with the above-named labor organization as
the collective-bargaining representative of the
employees in the unit described above, with
respect to rates of pay, wages, hours of em-
ployment, and other terms and conditions of
employment and, if an understanding is
reached, embody such understanding in a
signed agreement.
PREMIUM FOODS, INC.
DECISION
STATEMENT OF THE CASE
JAMES T. BARKER, Administrative Law Judge: This
case was heard before me at Spokane, Washington, on
708
PREMIUM FOODS, INC
June 16 and 17, 1981. pursuant to an order consolidating
case, consolidated complaint and notice of hearing issued
on November 6, 1980, by the Regional Director of the
National Labor Relations Board for Region 19. L The
charges giving rise to the instant cases were timely filed
in relation to the allegations of the complaint by United
Food and Commercial Workers Local Union No. 1439,
affiliated with United Food and Commercial Workers In-
ternational Union, AFL-CIO, herein called the Union.
The parties were represented by counsel at the hearing
and were provided full opportunity to make opening and
closing statements, to examine and cross-examine wit-
nesses, to introduce relevant evidence, and to file briefs
with me. Counsel for the General Counsel and counsel
for Respondent filed briefs with me.
Upon the basis of the entire record, the briefs filed in
this matter, and my observation of the witnesses, I make
the following:
FINDINGS OF FAcr
I. THE BUSINESS OF RESPONI)ENT
At all material times Respondent has been a corpora-
tion duly organized under the laws of the State of Wash-
ington, with a plant at its principal place of business lo-
cated in Spokane, Washington, where it is engaged in the
business of purveying meat and meat products.
In the course and conduct of its business operations
during the 12-month period immediately preceding the
issuance of the complaint herein, Respondent had gross
sales of goods and services valued in excess of $500,000.
During the same period of time Respondent purchased
and caused to be transferred and delivered to its Spo-
kane, Washington, facility goods and materials valued in
excess of $50,000 directly from sources outside the State
of Washington, or from suppliers within said State
which, in turn, obtained such goods and materials direct-
ly from sources outside the State of Washington.
Upon the foregoing facts, which are not in dispute, I
find that at all times material herein Respondent has been
an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act.
I1. THE LABOR ORGANIZATION INVOLVED
Respondent concedes, and I find, that at all times ma-
terial herein the Union has been a labor organization
within the meaning of Section 2(5) of the Act.
Ill. THE ALLEGED UNFAIR LABOR PRACTICES
A. The Issues
The principal issues in this proceeding are (1) whether
Respondent is a legal successor to Swift Fresh Meat
Company; (2) whether Respondent unlawfully denied
employment to Leslie Reetz and Jacob Hendrix on or
after August 24 when it commenced its business oper-
ations; and (3) whether Respondent unlawfully failed and
refused to bargain collectively with the Union on and
after August 26. Subsumed, and evolving from a determi-
I Unless otherwise specified, all dates herein refer to the calendar year
1980.
nation of the successorship issue, is the further question
of whether Respondent was free on August 4 and there-
after to fix initial terms and conditions of employment
without consulting with the Union. 2
Respondent denies the commission of any unfair labor
practices and asserts, affirmatively, that it was not the
legal successor to Swift Fresh Meat Company in that it
purchased nothing from Swift and embarked upon an en-
terprise different in character, scope, and ownership
from Swift, and was thereby free to select its employee
complement and establish initial terms of employment on
the basis of objective criteria and considerations without
the necessity of bargaining collectively without consult-
ing the Union. In any event, asserts Respondent, no bar-
gaining obligation ever arose, even assuming it is found
to be a successor to Swift, because on August 26, and
thereafter, it possessed a reasonably based good-faith
doubt as to the Union's majority status. Moreover, Re-
spondent contends, in substance, that for legitimate, ob-
jective reasons not grounded in their involvement in the
Union's activities, or affinity to the Union, Reetz and
Hendrix were not offered employment with the new en-
terprise.
B. Pertinent Facts
1. Background Facts
At relevant times immediately prior to August 1, Swift
was engaged at its Spokane facility engaged in the busi-
ness of purveying meat and meat products, cheese, fish,
shortening, and oils to approximately 230 hotel. restau-
rant, and retail customers located in the western portion
of the State of Washington, eastern Montana and the
northwest portion of the State of Idaho. Meat products
comprised approximately 90 percent of Swift's total busi-
ness which was primarily oriented to the retail trade,
with a secondary emphasis on food service.
Swift is a large multi-national corporation with numer-
ous facilities throughout the United States and in other
countries. At the time of the closure of the Spokane fa-
cility on August 1, Robert Racicot was serving as Swift's
sales unit manager in Spokane. He had served in that ca-
pacity since 1978 at which time he had been promoted
from his previous position of plant superintendent of the
Spokane operation. Prior to becoming plant superintend-
ent in 1974, Racicot, who had entered Swift's employ 10
years earlier, had served in positions of increasing re-
sponsibility including, cleanup boy, truckdriver, order
packer, and butcher. Racicot had been a union member
from 1964 to 1974 and had taken a withdrawal card from
the Union when he became superintendent in 1974.
At relevant times prior to the closure of the Spokane
facility, Swift had been a party to a collective-bargaining
agreement with the Union and the Union had been rec-
ognized as the exclusive bargaining representative of
Swift's employees employed in the following described
appropriate collective-bargaining unit:
2 The complaint alleges no unilateral changes, and Ihe duty to bargain
over initial terms and conditions arose, if at all, as a matter of law under
the "perfectly clear" exception defined in .VL.R.B v. William J Burns
International Detective .gency. Inc., 406 U S 272 (1972).
709
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
All production and maintenance employees, includ-
ing truckdrivers at the [Spokane] plant, excluding
manager, salesmen, clerical employees, guards, pro-
fessional employees, and supervisors as defined in
the National Labor Relations Act.
By its terms, the agreement was to be effective through
October 31, 1982. The agreement contained no union-se-
curity clause but prior to August I Swift was deducing
dues from the paychecks of all of the employees in the
unit and forwarding the proceeds to the Union. During
normal operating times, approximately 12 or 13 employ-
ees comprised the unit. On the closure date nine employ-
ees were employed in five separate job classifications
covered by the collective-bargaining agreement. These
classifications included butcher, truckdriver, order
packer, and utility and machine operator. Leslie Reetz
was employed as an order packer when Swift terminated
its Spokane operation and Jacob Hendrix was employed
as truckdriver. They, like the other employees in the
unit, worked under the general supervision of Wilfred
Leslie, plant superintendent.
Swift is headquartered in Chicago and at relevant
times operated a fresh meats division and a food service
division. The Spokane operation was a fresh meats unit
and typically 40 percent of its volume had been in the
area of retail sales and 60 percent in the foods service
area. Several months prior to closure, Swift lost a large
account which delivered food to schools in Spokane.
Thereafter, policy emanating from Chicago headquarters
dictated that emphasis be placed upon retail sales and in
the last 2 months prior to the cessation of operations at
the Spokane facility the retail phase of the operation had
reached approximately 50 percent of total volume. From
its headquarters in Chicago Swift determined the terri-
tory operation of the Spokane unit, as well as the type of
customers, product purchases, product mix, equipment
acquisition, and administration of company policy. Ulti-
mate decisions in personnel matters was dictated from
the Chicago headquarters. The loss of the catering ac-
count resulted in a reduction in force of approximately
four employees.
From the insight gained from his position as sales unit
manager of Swift's Spokane facility, Racicot formed the
impression in February or March that eventually the
Spokane operation would close. Based on this belief he
formulated in his own mind the elements of a plan to
enter into his own business should the closure occur. On
June 23, he had a chance meeting with James Millsap, a
field representative of the Union. Millsap was on Swift
premises during the lunch hour to obtain the signature of
Raymond Hansen on a union membership card. In sub-
stance, Racicot told Millsap that Hansen's signature
would be futile because Swift was going to close and he,
Racicot, was going to operate the plant on a nonunion
basis. Then, on or about June 27, Racicot was called to
Chicago and informed that the Spokane unit and 51
other sales units of Swift would close. Racicot was pre-
sented with a letter relevant to the closing and was in-
structed to read the letter verbatim to all of the Spokane
employees, and to limit discussion of the closing to the
content of the letter. A meeting of employees was held
on June 30 at which time Racicot read the letter to the
employees as instructed. The employees were thus in-
formed that the plant would close effective August 1.
After reading the letter verbatim, Racicot stated he was
going to attempt to organize a new operation but was
not certain of success at that point." Between June 30
and the scheduled closing date Racicot undertook dili-
gent efforts to organize a new enterprise and to obtain
financial and customer commitments sufficient to justify
the planned venture. Financial commitments remained
tenuous until August 1. However, as a prelude to obtain-
ing financial backing, a new corporation was formed
with Racicot as its president, Tom Purkett as vice presi-
dent, and Roger Purkett as secretary. The Purketts were
owners of Becwar Packing Company, a Spokane meat
company which had served as one of the suppliers for
Swift. Moreover, a letter over Racicot's signature stating
his intention to continue in business as a new entity, and
soliciting continuation of patronage was dispatched to all
of Swift's customers as an attachment to invoices.
In formulating his plans for the new operation, Raci-
cot determined that the business would be foods service
oriented and would feature new concepts in packaged
meat which would be promoted by advertising and
placed in retail outlets. He projected goods sales volume
and a significant increase in the employee complement to
a level of 18 to 20 employees within 2 years as a direct
result of this marketing approach. He concluded also that
he could not sustain a profitable operation with a com-
plement of nine employees.
As a corollary to launching the new enterprise, Raci-
cot formulated a personnel policy predicated upon the
need for a nucleus group of employees who could work
harmoniously together as a team. By reason of his in-
volvement with the Swift operation in Spokane, Racicot
had had the opportunity to observe the work of the var-
ious rank-and-file employees and to evaluate their effi-
ciency and attitudes. As the August I closure deadline
approached, and as the formulation of the new enterprise
came into clearer focus, Racicot reached the decision to
hire all of the Swift employees except Leslie Reetz,
Jacob Hendrix, and Jerry Denny. Racicot excluded both
Reetz and Hendrix because he did not believe they
would work in a friendly, cooperative, and harmonious
relationship with him or the other individuals whom he
intended to employ. Further, Racicot did not like either
Reetz or Hendrix and he believed that they felt similarly
toward him. Racicot planned not to employ Denny be-
cause his anticipated, initial personnel demands did not
justify an additional truckdriver.
During the month of July Racicot spoke with the re-
maining employees of Swift, except Reetz and Hendrix,
and communicated his hope to organize and operate his
own facility. He tentatively probed the interest of those
employees in working for him and told them he would
pay the union wage scale other purveyors were paying
3 I do not credit the testimony of I eslie Reetz and Jacob Hendrix to
the effect that during the meeting Racicot said he intended to operate the
business as his venture without interruption and without the Union Raci-
cot's testimony is to the contrary and no other testimony lends support to
that of Reetz and Hendrix
710
PREMIUM FOODS. INC.
at the time. As the month of July drew to a close, Raci-
cot spoke with representatives of two other unionized
meats supply firms seeking to learn the wage scale under
which they were operating. He obtained copies of the
collective-bargaining agreements. Then, between August
I and 4 Racicot extended to and received commitments
from six employees of Swift to work for him in his new
enterprise. Raymond Hansen asked the specific rate at
which he would be paid and Racicot quoted a rate 94
cents below the rate he was receiving from Swift. On the
last day or so of Swift's operation, Meinzinger discussed
his pay with Racicot. Then on August 4, during the first
day of operations he informed five of the six, including
Hansen, that he would compensate them at wage levels
equivalent or above those in effect in the area under two
union contracts. Through inadvertence he failed to
inform Bill Dormady of the wage level at which he
would be employed, and Dormady first learned his pay
scale when he received his first paycheck. Racicot did
not specifically address the question of benefits in his
conversations with employees prior to the commence-
ment of operations, although he told Schieche that he
would "go along with most of the [existing] benefits"
and "add to them" if the new business was successful. 4
2. The alleged proscribed conduct
a. The successorship issue
On August 4 Respondent commenced operations
under the corporate name Premium Foods, Inc. It used
the same building as Swift had utilized, retained the same
telephone number, and, on a rental basis used meat cut-
ting machines, freezers, and other in-plant machinery as
Swift had used. On one or two occasions trucks which
had been used by Swift were used in the operation of the
new entity but new trucks were purchased to replace
those used by Swift. While Respondent purchased the
existing inventory of Swift, it purchased nothing else
from Swift. When it ceased operations on August 1,
Swift was serving approximately 230 customers, approxi-
mately 122 of which gave Respondent its patronage from
the beginning of Respondent's operation on August 4.
Respondent discontinued operations in the State of Mon-
tana save for a bid customer in the Glacier Park area of
Montana, but otherwise served the geographic area en-
compassed by the Swift operation. Becwar Meats, which
had been a supplier to Swift, was used by Respondent as
a supplier, but under Racicot's operation of Respondent,
purchases are made from a wide variety of suppliers with
a "best buy" criterion serving as the yardstick. Respond-
ent sells products to Becwar. Swift did not.
Respondent commenced operations on August 4 under
the conceptual expectation of Racicot that the food serv-
ice and not the retail phase of the operation would be
the emphasis. He planned to market a variety of pack-
aged food service items through retail outlets and ad-
vanced this marketing concept in seeking and obtaining
financing for his new venture.
4 The foregoing findings are based upon credited testimony which is
not in dispute
As found, Respondent began on August 4 with six op-
erating employees, including Jerry Anderson, Bill Dor-
mady, Raymond Hansen, Dean Meinzinger, George
Schieche, and Ocee White. Each was employed in a job
classification which had been represented in the Swift
operating unit. Anderson had been employed by Swift as
a butcher and gang leader. Anderson served Respondent
in the same capacity of butcher and gang leader. Each of
the other five employees had been employed by Swift
prior to August 4. 5
Racicot had projected that to sustain a profitable oper-
ation 18 to 20 employees would be required. However,
at relevant times, Respondent's employee complement
has not reached that number. On August 26 when, as
found below, the Union made its bargaining demand
upon Respondent nine individuals comprised the operat-
ing unit, as follows:
Jerry Anderson
Jerry Denny
Richard Deitzel
Raymond Hansen
Dean Meinzinger
George Schieche
Larry Schmidt
Cecil Stanley
Ocee White
Butcher and gang leader
Driver
Utility,
Order packer/truckdriver
Driver
Butcher
Cutting room/patty
machine operator
Cleanup
Butcher
Anderson, Denny, Hansen, Meinzinger, Schieche, and
White had been employed by Swift at the time of the
plant closure. The other individuals had not previously
been in Swift's employment. By January 1981 Respond-
ent had introduced and was successfully marketing
through retail outlets a 5-pound box of ground beef pat-
ties, a food service item which had been promoted
through television advertising. During January Respond-
ent employed one full-time and two part-time employees
who had not previously been in the employ of Swift in
the bargaining unit represented by the Union. Subse-
quently in April 1981 the employee complement, includ-
ing Anderson, was comprised of 12 individuals, 6 of
whom had previously been employed by Swift. By June
1981 Respondent was selling to approximately 230 cus-
tomers with approximately 98 percent of the volume
centered in the food service industry catering to hotels
and restaurants. 6
b. The bargaining demand
On July 3 Ellis Katz, grievance administrator of the
Union, dispatched a letter to Robert Racicot in his ca-
pacity as manager of Swift, requesting information con-
cerning the impending closure of the Swift facility on
5 I find Ihat in the employ of Respondent Anderson is a low-level su-
pervisor, for the credited testimony of Robert Racicot establishes that he
had the authority and responsibility for scheduling work relating to the
grinding operation in the cutting room, for directing the work of subordi-
nate employees, and for taking disciplinary action in the absence of Raci-
cot or the plant superintendent Moreover, his recommendations with re-
spect to personnel actions swould be considered and followed by Racicol
All of the foregoing is based upon credited testimony of record
which is not in dispute
7 1 1
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
August 1, including the name and address of the new
owners and an opportunity to discuss with management
the impact of the closure and sale upon the "present bar-
gaining unit." No response was received and on July 21
Katz sent a letter to Wilfred Leslie in his capacity as su-
perintendent of Swift, calling Leslie's attention to the
July 3 communication to Racicot and seeking a response
to the request for information and bargaining contained
in that communication. Subsequently, on August 26,
Katz dispatched a letter to Roger Puckett, in his capac-
ity as manager of Becwar Packing Company. The con-
tent of the letter was as follows:
It is the Union's understanding that Becwar Packing
Company has purchased the old Swift Plant. It is
the Union's position that Becwar is a successor em-
ployer as that term is defined by the National Labor
Relations Board. As such you are required to rec-
ognize and bargain with the union chosen by em-
ployees of the old Swift Plant. In view of the
above, UFCW Local 1439 hereby notifies Becwar
that it represents those employees of the old Swift
Plant and that we request a meeting at the earliest
opportunity to discuss your obligations under the
labor agreement which was in effect with those em-
ployees. I will await your suggestions as to a date
and time to meet.
Puckett responded to Katz by letter of September 10
wherein he stated that Becwar did not own the business
"operating at the old Swift plant" and asserting that the
"new company is now a successor employer which has
any obligation to bargain." Puckett further answered, in
substance, that action taken by the "majority of the em-
ployees" formerly employed by Swift in signing and
mailing withdrawal cards had led management of the
new operation to believe that the Union no longer repre-
sented a majority of the employees, and that a reasonable
doubt had been created by said action. Puckett further
asserted in his letter that the bargaining request of the
Union was premature in that the "new operation has not
yet completed its planned program of hiring its full com-
plement of employees to staff and maintain the new busi-
ness." In due course, on September 18, Katz dispatched
the following letter, addressed to Premium Foods, Inc.:
This letter is to reiterate a request sent to Roger
Puckett of Becwar Packing Company. It is the
Union's position that Premium Foods is a successor
employer as that term is defined by the National
Labor Relations Act. As such you are required to
recognize and bargain with the Union chosen by
the employees of the plant.
In view of the above, UFCW Local 1439 hereby
notified Premium Foods that it represents those em-
ployees of the old Swift plant and that we request a
meeting at the earliest opportunity to discuss your
obligations under the labor agreement which was in
effect with those employees.
I would request that you respond within seven
days from the date of this letter.
Puckett replied by letter of September 22 wherein he re-
ferred Katz' attention to his previous letter of September
18, which Puckett characterized as a reply to Katz' most
recent communication.
No collective bargaining between Respondent and the
Union has taken place.
c. The failure to hire Reetz and Hendrix
Prefactory Facts
Leslie Reetz was initially employed by Swift in 1970
and during the 10 years of his employment worked as a
cleanup man, utility helper, truckdriver, patty machine
operator, and order packer. At the time of the plant clo-
sure, Reetz was serving as an order packer. Reetz was a
member of the Union and from 1974 until the plant
closed, he was a shop steward in the plant. Additionally,
in 1978 he served as a vice president of the local and
participated as a member of the bargaining committee in
negotiations which transpired in 1976 and in 1979.
During his term as shop steward, he processed approxi-
mately six or seven grievances, one of which was with
Racicot in his capacity as unit manager of the Swift
plant. One of the grievances filed by Reetz was a griev-
ance concerning seniority for truckdrivers and was filed
on behalf of Jacob Hendrix. In substance, the grievance
pertained to an asserted contractual right to bid for
routes and starting times on the basis of seniority. It al-
leged a unilateral modification of collective-bargaining
terms resulting from an assignment made by Wilfred
Leslie, the plant superintendent. As a result of a first-step
grievance meeting between Reetz and Leslie, and a
second-step grievance meeting between Reetz, Union
Representative Jim Millsap, and Leslie, the grievance
was formalized by a written submission. The matter was
taken under advisement and Leslie denied the griev-
ance.7
Jacob Hendrix entered the employment of Swift in
1974 and served as a utility cleanup man for the year and
became a truckdriver in 1975, in which capacity he was
employed when the plant closed. Hendrix was a member
of the Union.
In May, a few weeks after Reetz had filed the griev-
ance on behalf of Hendrix, Racicot learned of the griev-
ance and called Hendrix by telephone in Glacier Park,
Montana, where Hendrix was working. In speaking with
Hendrix, Racicot asked Hendrix to describe the nature of
the grievance. Upon receiving Hendrix's explanation, Ra-
cicot asked him why he had filed it. Hendrix gave his
reasons. Racicot responded, "You know, Jake, I pulled
your ass out of the fire about three times and now I'm
fighting like hell to [to] try keep this going and I sure
don't need any problems now." The conversation ended
on this note.8
I The credited testimony of Leslie Reetz and documentary evidence of
record supports the above findings.
I The foregoing finding is based upon the testimony of Robert Racicot,
which I credit. I have considered the testimony of Jacob Hendrix and
credit it only to the extent it is consistent with the above findings. I do
not credit Hendrix's testimony to the effect that Racicot asserted he
would get rid of Hendrix without regard to the cost to him or the Corn-
Continued
712
PREMIUM FOODS, INC.
On many occasions during the course of his employ-
ment Hendrix lodged complaints with Leslie concerning
the condition of tires and brakes on the trucks assigned
to him. Moreover, Hendrix lodged a complaint with
Richard Blomberg, Leslie's predecessor as superintend-
ent of Swift, complaining that Jerry Denny, another
truckdriver, was claiming and receiving overtime com-
pensation for completing delivery routes which he, Hen-
drix, routinely completed in less time. Hendrix com-
plained, in effect, that this unfairly rewarded Denny and
penalized him. This transpired in January and Blomberg
spoke with Denny who stated that he was making his
best effort and was expending full time in trying to com-
plete his route in a timely fashion. He expressed the
belief that he was being misrouted by Reetz and Hendrix
who were responsible for loading the truck used by
Denny. Denny informed Blomberg that this was a con-
tinuing problem. Blomberg consulted with Racicot and a
procedure was developed which would permit the driver
who was to make the run specify the order in which he
wished the merchandise be placed in the delivery truck.
Hendrix denies having received any complaints or com-
ments concerning the manner in which the trucks were
loaded."
Racicot made no offer of employment to Reetz or to
Hendrix. Neither Reetz nor Hendrix was employed by
Respondent when it commenced operations on August 4,
and they were not subsequently offered employment.
Both filed employment applications with Respondent in
October pursuant to the advice of a Board field examin-
er.
Racicot defined his reasons for not hiring Reetz and
Hendrix as follows:
Very basically, I didn't want them. When I picked
this thing-when I put this thing together, I put it
together as the people that I thought could work
the best together as a team to do what I needed
them to do and do what was needed to be done to
make Premium Foods go as-over the years, there
had been a lot of little things that had happened be-
tween Jake Hendrix, Les Reetz and myself.
Racicot testified that he considered Reetz and Hendrix
to be "insubordinate" and "troublemakers." Racicot
added:
I didn't employ them because they were not team
players as far as I was concerned on what they-on
what I wanted done, I knew there was a personality
pany. Hendrix's testimony on cross-examination to the effect that Racicot
had never indicated to him by either words or action that he did not like
him is as least facially inconsistent with Hendrix's testimony on direct ex-
amination to the effect that Racicot responded in a hostile manner to him
during their telephone conversation and vowed to spare no cost in order
to "get rid" of him. Moreover, Hendrix interposed denials as to his work
attitude and stated unwillingness to work for Racicot at anticipated wage
rates which are contradicted by the clear weight of the credible evi-
dence. I conclude therefore that Hendrix is not an entirely credible wit-
ness
9 The foregoing is based upon the credited testimony of Richard Blom-
berg and Jerry Denny I have also considered the testimony of Dean
Mcinzinger to the extent that it may bear upon these findings I eslie
Reetz was not interrogated concerning his participation in the loading of
trucks driven by Denny
conflict, they did not like me and I sure didn't like
them.
He testified also that in addition to being troublemakers
and insubordinate, Reetz and Hendrix "picked on any-
thing they could about working conditions or what they
had to do." Prior to August 4 Reetz and Hendrix had
told Wilfred Leslie that they would not work for Raci-
cot at the wages he was offering, and during the last
week of July Reetz told Jerry Anderson that he would
not work for Racicot at the wages he was going to
pay. ° These comments were reported to Racicot by
Leslie and Anderson. Moreover, from his own involve-
ment with Reetz and Hendrix, and from reports received
from Wilfred Leslie, Racicot was aware prior to August
4 that both Reetz and Hendrix continually complained
about a wide variety of matters, including working con-
ditions, with an indirect bearing upon the collective-bar-
gaining contract. Racicot credibly testified:
They bitched about working conditions, they-it
wasn't just the contract; you keep bringing that up,
but that's not the point at all and that's not what I
had in the back of my mind when I put this thing
together. They did not get along well with their
fellow employees.
Racicot added:
I knew that they didn't care for me but you have to
understand, too, that I would never take any guff
from them or anything, I gave it right back when
they did and so basically, they kind of stayed out of
my way, but I certainly knew how they treated
other employees, I knew what their work habits
were, and I looked at a number of things over the
years that I had know [sic] these too and that-
when I put all these things together and decided
who I was going to hire, that's why they did not fit
in. And, I'm not talking just about the employees in
talking, [sic] I'm talking about salesmen, and I'm
talking about customers, I'm talking about supervi-
sors, I'm talking about office people, I'm talking
about-I looked at everything. I had to.
In late August Racicot told Robert Higgins, a former
Swift employee who had resigned in 1976, that he had
not hired Reetz and Hendrix because they had not
shown the same loyalty towards "him and the company"
as those he employed, and because Reetz had been a
troublemaker in the past. Racicot considered both Reetz
and Hendrix to be "hard workers" and Leslie, who su-
pervised them for a substantial period of time, considered
them to be "good employees" when they worked sepa-
rately. In separate letters of recommendation which
Leslie gave to Reetz and to Hendrix, Leslie character-
ized each of them as an "excellent worker."
Racicot credibly testified that the meats supply busi-
ness is a highly competitive one and one in which cus-
tomers service is most significant. Racicot further credi-
io Both Leslie and Anderson credibly tetrfied that Reetz and Hendrix
had made statements to that effect in their presence I do not credit the
denial, of Reetl and Hendrix
713
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
bly testified that by reason of his direct, ongoing con-
tacts with customers, the truckdriver in the performance
of his delivery functions becomes an important "sales
arm" of the company, and essential to the maintenance
of good customer relations. Racicot further credibly tes-
tified that during the last 2 years of the Swift operation
he was the direct recipient of complaints from customers
concerning the attitude and appearance of Hendrix.
From these complaints he formed the impression that
Hendrix tended to compromise his service responsibilities
in order to achieve an appearance of speed in the accom-
plishment of his delivery duties. Moreover, by reason of
complaints received from customers concerning Hen-
drix's appearance, it became necessary for Racicot to
issue a written directive to all drivers reiterating the
policy of Swift that delivery personnel must wear white
smocks and hats. Hendrix complied with the directive.
Racicot testified credibly with respect to three sepa-
rate incidents involving delivery services performed by
Hendrix which resulted in customer dissatisfaction and
complaints. These incidents involved Zip's Drive-In, a
customer in Glacier Park, and Casey's Restaurant. Reetz
participated in the delivery at Casey's Restaurant. Each
of the three incidents caused serious dissatisfaction on
the part of the respective customers. The Casey's Restau-
rant delivery involved mitigating circumstances.
Racicot received a report to the effect that Reetz was
not cooperative in agreeing to work overtime to meet
exigencies. Personal considerations limited Reetz' avail-
ability for overtime work.
Leslie, his predecessor, Blomberg, and Anderson, each
found Reetz and Hendrix recalcitrant but not disobedient
to their direct orders.
(2) The alleged good-faith doubt
During the last 2 weeks of the Swift operation, Raci-
cot received reports from Ocee White, Bill Dormady,
and Jerry Anderson to the effect that they were seeking
to obtain withdrawal cards from the Union. Later, in
mid-August, he was informed by Dean Meinzinger that
he had been unable to obtain a withdrawal card, al-
though he had sought to do so. In substance, Racicot in-
formed the employees both verbally and in writing that
this was not a matter of his concern or responsibility and
that they should seek advice from the National Labor
Relations Board. Racicot had taken a withdrawal card
from the Union in 1974, and he formed the opinion that
by seeking to obtain withdrawal cards those employees
were signifying that they did not wish to belong to a
union. Racicot also knew that Raymond Hansen was not
a member of the Union.
Conclusions
A. The Successorship Issue
The initial question to be resolved is whether Premium
is the legal successor of Swift. I conclude that it is.
The Board has long held that a mere change in owner-
ship of the employing business enterprise does not itself
absolve the new owner from the obligation to recognize
and bargain with the labor organization that represented
the employees of the former owner. Cruse Motors, Inc.,
105 NLRB 242, 247 (1953); Lincoln Private Police, Inc. as
Successor to Industrial Security Guards, Inc., 189 NLRB
717, 719 (1971). Where there is a substantial continuity in
the identity of the employing enterprise, the purchasing
employer is bound to recognize and bargain with the in-
cumbent union. See Lincoln Private Police, Inc., supra,
and cases cited therein at footnote 6. In determining
whether the "employing industry" remains substantially
the same, the Board has applied such criteria as whether
(I) there has been a substantial continuity of the same
business operations; (2) the new employer uses the same
plant; (3) the same or substantially the same work force
is employed; (4) the same jobs exist under the same
working conditions; (5) the same supervisors are em-
ployed; (6) the same machinery, equipment, and methods
of production are used; and (7) the same product is man-
ufactured or the same service offered. See Georgetown
Stainless Mfg. Corp., 198 NLRB 234, 236 (1972). In re-
solving the successorship issue, the Board has not ac-
corded controlling weight to any single factor, but has
evaluated all the circumstances present in any given case
in arriving at the ultimate conclusion. See Lincoln Private
Police, Inc., supra. Differences in the scope and character
of the business operations of the new employer, as con-
tracted to those of the predecessor enterprise, form part
of the relevant circumstances, and must be weighed and
given proper perspective in relation to other relevant
factors. G. T. & E. Data Services Corporation, 194 NLRB
719, 721 (1972). However, in determining successorship,
the keystone is whether there is substantial continuity of
the employing industry. See Saks & Company, d/b/a
Saks Fifth Avenue, 247 NLRB 1047 (1980), enfd. in part
634 F.2d 681 (2d Cir. 1980).
Respondent contends that it differs from the Swift op-
eration both in nature and scope and was intended from
its origin to have a fundamentally different type of busi-
ness operation than did its predecessor, Swift. The evi-
dence in this regard establishes that Robert Racicot, Re-
spondent's president, organized the new corporated en-
terprise and achieved the financing necessary to render it
viable, upon the concept that emphasis would be upon
the customer service and not upon the retail fresh meats
aspect of the meat purveying business; and a program of
product development and promotion would augment the
generic plan to the end that new customer relations, dif-
ferent from those extent under the Swift operation would
emerge. Empirically, from the vantage point of 10
months of operating experiences, changes of significance
in the product mix were wrought and new customer re-
lationships were developed. Moreover, militating in
favor of Respondent's view that it is not Swift's succes-
sor is the evidence establishing that Premium purchased
nothing from Swift except its existing inventory, and un-
dertook none of Swift's commercial obligations. Howev-
er, I conclude that the differences which pertain in Re-
spondent's operation were not of a character sufficient to
change the "employing industry" or to render inappro-
priate the collective-bargaining unit in which the Union
had been contractually recognized as the exclusive repre-
sentative. Thus, Respondent, like Swift, commenced op-
erations as a purveyor of meat, cheese, oils, and related
714
PREMIUM FOODS, INC
products; drawing its clientele exclusively from former
customers of Swift situated in a geographic area, albeit
minimally reduced, formerly served by Swift; and utiliz-
ing the same plant, processing equipment and job classifi-
cations as were used by Swift during the time that its op-
eration was viable. Moreover, through the day-to-day in-
volvement of Robert Racicot and of Jerry Anderson in
plant operations, a significant carryover of managerial
and supervisory authority from the Swift operation to
that of Respondent was accomplished. Further, Respond-
ent recruited its entire initial work complement from the
production and maintenance unit of Swift's Spokane fa-
cility and utilized them in each of the job classifications
represented in the former Swift unit. This "most impor-
tant" consideration, when weighed in conjunction 'with
the continuity factors detailed, strongly supports the
finding here made that Respondent is a successor to
Swift. See Zimns Foodliner. Inc., d/b/a Zim's IGA Food-
liner, 201 NLRB 905, 909 (1973), enfd. 495 F.2d 1131
(7th Cir. 1974), cert. denied 419 U.S. 838; N.L.R.B. v.
Burns International Security Services, Inc., 406 U.S. 272
(1972); Saks & Company v. N.L.R.B., 634 F.2d 681
(1980). While managerial control over purchasing, prod-
uct development, product mix, and employee relations
has been localized under Respondent's operating scheme,
and while both from planning and actual operating expe-
rience, product lines have been modified and significant
changes have been wrought in the clientele served, these
changes are not of such magnitude as to be controlling in
a circumstance where, as here, the enterprise operates in
the same industry, employing the same classification of
employees in essentially unchanged working conditions.
See Zim's Foodliner, Inc., d/b/a Zinis IG.A Foodlin er,
supra: Saks & Company. supra. Cf. Pacific Hide & -Fur
Depot, Inc. v. V.L.R.B., 553 F.2d 609, 611 (9th Cir.
1977), denying enforcement of 223 NLRB 1029 (1976).
B. The Refusal To Hire Ilendrix and Reetz
It is well established that a successor employer is
under no obligation to hire any or all of the employees
of the former employer, but the selection process may
not be influenced by discriminatory considerations pro-
scribed by the Act. Howard Johnson Company, Inc. v.
Detroit Local Joint Executive Board, Hotel & Restaurant
Employees Union, AFL-CIO, 417 U.S. 249, 262, fn. 8
(1974); N L.R.B. v. Burns International Security Service.
Inc., 406 U.S. 272, 280, fn. 5 (1972). It follows, therefore,
that in selecting the employee complement for the new
operation, Racicot was under no legal obligation to hire
either Hendrix or Reetz, but was free under the statute
to recruit employees from any source, including the
Swift unit, so long as the selection process did not dis-
criminate on the basis of union or protected concerted
activity. Contrary to the General Counsel, I find that
Respondent did not violate Section 8(a)(1) and (3) of the
Act by its decision to exclude Hendrix and Reetz from
the work force selected to staff the successor enterprise.
The record contains evidence from which an inference
of discriminatory motivation may be inferred. This arises
entirely from the role of Reetz as a union steward, and
his vigorous efforts to enforce the terms of the collec-
tive-bargaining agreement; and from the apparent sup-
port accorded Reetz by Hendrix through a process of
passive resistance, as it were, to the directive and instruc-
tive efforts of supervision. Augmenting this body of
proof is the further evidence relating to the Hendrix
grievance and the aftermath conversation between Hen-
drix and Racicot which portrays Racicot as resentful and
distainful of Hendrix for grieving the issue of allegedly
ignoring seniority in the reassignment of routes. But
beyond this the General Counsel adduced no convincing
evidence from which it could be concluded that Racicot
was hostile to the grievance process per se, or that
Reetz-or Reetz and Hendrix in tandum-had so aggres-
sively pursued contractual or union interests as to devel-
op in Racicot a rigidity or antipathy towards them or the
Union. The grievances which Reetz did interpose were
not numerous, and. except for the Hendrix grievance,
were resolved in the initial phases without the direct in-
volvement of Racicot. Reliance by the General Counsel
upon Racicot's statement to Milsap, the Union's field
representative, in late July to the effect that he was
going to operate "nonunion" is misplaced for I conclude,
in context both of circumstances which prevailed at the
time of the statement, including the subsequent staffing
of the new operation entirely with union members, that
Racicot's statement referred not to membership consider-
ations but to the then prevailing terms and conditions of
employment defined in the collective-bargaining agree-
merit between the Union and Swift.
Strongly countering the General Counsel's evidence is
the defense interposed by Respondent which establishes
to mv satisfaction that Racicot would have excluded
both Reetz and Hendrix from employment in the work
force of the new enterprise even if there had been no in-
volvemerit on their part in the grievance process or in
the councils of the Union. A distillation of the evidence
adduced by Respondent supports the finding, which I
make, that Racicot's objection to both Reetz ahd Hen-
drix as employees was not to the legitimate involvement
of either of them in seeking to enforce contractual terms,
but to their arrogation of a status endowing them with
the presumed right to challenge legitimate supervisory
policy and directives and to respond only grudgingly to
those which did not correspond to their perception of
propriety. It was this attitudinal approach to their work,
and the reported and verified instances of their failure to
cooperate with unit and sales personnel, alike, which cc-
mented Racicot's adverse opinion of Reetz and Hendrix
as employees, an opinion which became more deeply en-
grained with respect to Hendrix, evolving from customer
complaints regarding him. Only a simplistic, myopic
view of the credited evidence would warrant the conclu-
sion that Racicot's rejection of Reetz and Hendrix as em-
ployees likely to contribute to the success of his new, fi-
nancially vulnerable enterprise was based in significant
part upon their activist role in pressing the contract. The
foundation of Racicot's objections to them as employees,
and the considerations which, I find, would have caused
him to exclude from his complement at the new enter-
prise even if, contrary to fact, they had not engaged in
any protected concerted activity, was the irascibility
which they shared and which they displayed towards
715
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Racicot himself and supervision and the plant rank-and-
file also. The record fully warrants the conclusion that,
in matters having nothing to do with the enforcement of
contractual terms, Racicot and supervision found Reetz
and Hendrix, in tandum, recalcitrant. Moreover, the
credited testimony of employees and salesmen who had
worked with Reetz and Hendrix at the Swift plant sup-
ports the finding, which I make, that they were loath to
cooperate in the accomplishment of work tasks and ob-
jectives, and this was a matter of common notoriety in
the plant. Finally, I conclude and find that the sum total
of the relation between Racicot, on the one hand, and
Reetz and Hendrix, on the other, had led over the years
to a conviction on Racicot's part that Reetz and Hendrix
did not like him personally, and he felt similarly disposed
toward them.
On the record as a whole, I conclude and find that in
formulating the work unit at his new enterprise, Racicot
selected personnel which he believed would work in har-
mony together to achieve efficiency and good customer
relations, to the end that the likely success of the new
venture would be enhanced and the threat of financial
loss minimized. I further find that for reasons unrelated
to their union or concerted activity, Racicot excluded
Reetz and Hendrix because he felt they would hinder
rather than contribute to these objectives. I find, there-
fore, that Respondent sustained its burden of showing
that the exclusion of Reetz and Hendrix from the new
employee unit was not based on impermissible, discrimi-
natory considerations and would have occurred even if
they had never engaged in union or concerted activities.
C. The Bargaining Obligation
Although I have found that Respondent is a successor
employer to Swift, it does not follow that Respondent
was precluded from establishing different conditions of
employment for the new complement. See Spruce Up
Corporation, 209 NLRB 194 (1974), enfd. on other
grounds 529 F.2d 516 (4th Cir. 1975). In Burns the Su-
preme Court carved an exception to the general rule that
a successor employer is ordinarily free to initially set the
terms and conditions of employment under which it will
hire its predecessor's employees, stating:
[T]here will be instances in which it is perfectly
clear that the new employer plans to retain all of
the employees in the unit in which it will be appro-
priate to have him initially consult with the employ-
ees' bargaining representative before he fixes terms.
The General Counsel contends that, at the outset of its
operations, Respondent employed a majority of the
Swift's employees, and did so without clearly announcing
the wages and terms and conditions of employment under
which they would be employed. It is the General Coun-
sel's contention that Respondent thereby forfeited "the
opportunity to fix initial terms and conditions of employ-
ment" when it commenced operations on August 4. On
the other hand, Respondent contends, in effect, that the
presence of a bargaining obligation turns on whether, or
at what point in time, a full complement of employees
had been achieved, and, if so, whether former unit em-
ployees comprised a majority thereof.' I
In the decision in Spruce Up Corporation, supra, the
Board majority stated:
When an employer who has not yet commenced
operations announces new terms prior to or simulta-
neously with his invitation to the previous work
force to accept employment under those terms, we
do not think it can fairly be said that the new em-
ployer "plans to retain all of the employees in the
unit," as that phrase was intended by the Supreme
Court. The possibility that the old employees may
not enter into an employment relationship with the
new employer is a real one, as illustrated by the
present facts. Many of the former employees here
did not desire to be employed by the new employer
under the terms set by him-a fact which will often
be operative, and which any new employer must re-
alistically anticipate. Since that is so, it is surely not
"perfectly clear" to either the employer or to us
that he can "plan to retain all of the employees in
the unit" under such a set of facts.
We concede that the precise meaning and appli-
cation of the Court's caveat is not easy to discern.
But any interpretation contrary to that which we
are adopting here would be subject to abuse, and
would, we believe, encourage employer action con-
trary to the purpose of this Act and lead to results
which we feel sure the Court did not intend to flow
from its decision in Burns. For an employer desirous
of availing himself of the Burns right to set initial
terms would, under any contrary interpretation,
have to refrain from commenting favorably at all
upon employment prospects of old employees for
fear he would thereby forfeit his right to unilateral-
ly set initial terms, a right to which the Supreme
Court attaches great importance in Burns. And
indeed, the more cautious employer would probably
be well advised not to offer employment to at least
some of the old work force under such a decisional
precedent. We do not wish-nor do we believe the
Court wished-to discourage continuity in employ-
ment relationships for such legalistic and artificial
considerations. We believe the caveat in "Burns,"
therefore, should be restricted to circumstances in
which the new employer has either actively or, by tacit
inference, misled employees into believing they would
all be retained without change in their wages, hours, or
conditions of employment, or at least to circumstances
where the new employer, unlike the Respondent here,
has failed to clearly announce its intent to establish a
new set of conditions prior to inviting former employees
to accept employment. [Emphasis supplied.]
The comments of the Court majority in Saks & Compa-
ny, 634 F.2d 681, 687 (2d Cir. 1980), is deemed pertinent
in the precise circumstances of this case. In addressing
the Burns "perfectly clear" exception the Court noted:
X For present analytical purposes, unit membership and not formal
union affiliation or designation is controlling.
716
PREMIUM FOODS. INC.
Under that exception, as developed by the National
Labor Relations Board, a successor employer is re-
quired to bargain with respect to initial terms only
if it is perfectly clear that it plans to retain all the
employees in the predecessor unit and hires those
employees in a manner which leads them to believe
that they will be hired on the terms and conditions
that existed under the predecessor employer.
It is apparent from the instant record that, with the
advent of the June 30 closure announcement, employees
of Swift looked to Racicot as the source of future em-
ployment. No explicit proffers of employment were
made in the aftermath of the closure announcement,
however, it became clear to the employees at a point in
time prior to August 4, that if Racicot were successful in
organizing a new venture, the initial complement would
be selected from among the Swift employee group. This
arose from the feelers and tentative inquiries initiated by
Racicot, and the grapevine interchange that undoubtedly
functioned between the members of the small, tightly
knit Swift employee group holding natural concern over
future employment prospects. The record contains no
proof that in the course of his conditional discussions
with members of the Swift complement Racicot condi-
tioned ultimate hire in the enterprise he was undertaking
to organize upon abdication of union allegiance, although
Racicot had forthrightly informed Union Representative
Millsap that he would not operate the new entity which
was in the planning stage on union terms and conditions
of employment. The commonly accepted notion among
Swift employees prior to August 4 that prevailing terms
and conditions of employment would not survive in the
new operation has origin both in the clear implication to
be drawn from Racicot's conversations with the employ-
ees prior to August 4 indicating that wage rates other
than those mandated by Swift's contract would prevail,
and by employee acceptance of the economic reality that
the new enterprise was an untested one in a highly com-
petitive field in which the former employer, Swift, had
not prospered. While it cannot be said that in specifically
declaring his intention prior to August 4 to form a nucle-
us employee group from former employees of Swift, Ra-
cicot explicitly offered employment "only on different
terms," neither may it be found that he misled employees
into believing they would be retained "without change in
their terms and conditions of employment." Cf. Spruce
Up Corporation, supra. The precise terms were not fully
defined, but the clear inference is that every employee
affected possessed certitude that they would be on an al-
tered footing. Thus, while the formulation of the initial
complement was intended by Racicot to be from a ma-
jority of the Swift employees, his intentions were from
the outset tied to different rates and benefits from those
prevailing, and the employees fully comprehended this. I
specifically conclude, therefore, that as Respondent nei-
ther actively nor tacitly misled the employees he was
seeking to recruit into believing they would be retained
without changes in their wages, hours, or conditions of
employment, and where whose employees were fully
aware of the intention of the new employer to establish a
new set of conditions, there was no failure of communi-
cation, expression of intent, or clear announcement
within the meaning of Spruce Up as to lead to a forfeiture
of the Burns right to unilaterally set initial terms. When
these considerations which attended the emergence of
Respondent's operation are evaluated in context of the
full thrust of the record evidence establishing that Raci-
cot intended the initial work force to serve only as a
transitional nucleus group to be augmented by employees
recruited from random sources, I find that on August 4
and in the days that immediately followed a full comple-
ment of employees had not been achieved and the date
of attainment not susceptible of accurate projection. Ac-
cordingly, I further find that Respondent was free to set
the initial terms of employment on which he would hire
employees. See Pacific Hide & Fur Depot. Inc. v.
N,.L.R.B., 553 F.2d 609 (9th Cir. 1977). Cf., e.g., Spitzer
Akron, Inc., 219 NLRB 20 (1975), enfd. 540 F.2d 841
(6th Cir. 1976); Stewart Granite Enterprises, 255 NLRB
569 (1981); L.A.X. Medical Clinic, Inc.. et al., 248 NLRB
861 (1980).
D. The Full Complement Issue
However, the inquiry does not end here. Concluding,
as I do, that the Union made an efficacious bargaining
demand upon Respondent by and through the auspices of
the Union's August 26 letter, which demand was, in legal
effect, a continuing one, reenforced by the Union's subse-
quent letter of September 18, it becomes necessary to de-
termine whether Respondent has achieved a full comple-
ment of employees so as to give rise to an 8(d) bargain-
ing obligation and, if so, when the full complement was
achieved. This determination is made necessary because,
as found, the facts of record fully establish that the ini-
tial, nucleus group of employees was not intended as the
full work force necessary to sustain projected operations.
Respondent contends that Pacific Hide & Fur Depot,
Inc. v. N.L.R.B., 553 F.2d 609 (9th Cir. 1977), denying
enforcement of 223 NLRB 1029 (1976), is instructive and
the rationale of the court fully applicable at the case at
bar. The factual similarity between the two cases is strik-
ing and the analysis of the court compelling. Thus, the
court stated:
The Burns ["full complement" language] implies
that when a new employer hires only part of the
old unit, together with others who were never part
of the unit, any decision regarding the employer's
duty to bargain with the Union affects the new em-
ployer, the old employees whom he has hired, and
the new employees who were not previously repre-
sented by the Union. The rights of all three must be
considered. Basic to this consideration in Section
9(a) of the Act, 29 U.S.C. Section 129(a) which
places in the hands of the majority of the employees
in the unit the decision whether to be represented
or not by the Union. That majority's right is para-
mount. The "full complement" standard of Burns
attempts to define when the makeup of the control-
ling majority is to be determined.
The problem then becomes one of defining what
is meant by a "full complement." That cannot be
717
I)t-CISIONS 01 NATIONAL LABOR RELATIONS BOARD
done by the application of a mathematical formula
but only by considering the facts of each case in
light of the general goal which is sought-to assure
majority rule within the new employer's unit as to
whether and if so with what union there must be
collective bargaining.
In Pacific Hide, as here, the employer embarked upon
his new enterprises without full knowledge of how many
employees he would need or how long it would take to
have a full work force. There, as in the case at bar, the
original nucleus group was comprised entirely of em-
ployees of the predecessor employer and this work force
was soon enlarged to include employees recruited from
sources other than the predecessor's work force. Similar-
ly, in Pacific Hide, as here, the predecessor's employees
constituted a majority both at the time the union de-
manded recognition and on the date the successor em-
ployer refused to bargain on the grounds that a full com-
plement had not been achieved. In Pacific Hide the full
complement was achieved within 60 days. Respondent
contends, in effect, that its expanding operation achieved
the stability sufficient to support a "full complement" de-
termination only after the enterprise had been in exist-
ence for 10 months and management's plans for restruc-
turing the product line and expanding and solidifying its
clientele had been tested. In discussing and applying the
Pacific Hide rationale, the court in N.L.R.B. v. Pre-Engi-
neered Building Products, Inc., 603 F.2d 134 (10th Cir.
1979), stated:
The process of identifying a full complement thus
involves balancing the objective of insuring maxi-
mum employee participation in the selection of a
bargaining agent against the goal of permitting em-
ployees to be represented as quickly as possible. It
would be ludicrous to postpone defining a full com-
plement until the successor of a small enterprise had
achieved a status of a multi-billion dollar interna-
tional corporation. But it could also be inappropri-
ate to precipitately point to a full complement as ex-
isting at the moment a successor assumes operation
of an essentially moribund predecessor.
The rebuilding task which faced the successor employer
in Pre-Engineered Building Products, Inc., was different in
degree from that confronting Respondent here, but the
need to "rebuild both production demand and work
force" which the court there found significant requires
cognizance here. The task is one of "balancing the objec-
tive of selection of a bargaining representative by the
maximum number of employees with the objective of
employee representation as soon as possible." N.L.R.B.
v. Hudson River Aggregates, 639 F.2d 865 (2d Cir. 1981),
enfg. 246 NLRB 192 (1979). If Swift was not a moribund
business at the time of closure, neither did Respondent
succeed to "an on-going business, continuing its oper-
ations essentially unchanged," as was the case in Hudson
River. Factual particularities dictate whether an employ-
er may delay its bargaining obligation until it has ex-
panded its business to the proportions contemplated
when it purchased the enterprise. Id. at 870. But in a cir-
cumstance, as here, wherein the employing industry re-
mains the same, and the collective-bargaining unit appro-
priate by reason of the carryover from the predecessor
employer to the new employer of the same job classifica-
tions and similar job functions, the bargaining rights and
the interest of the former unit members now employed
by the new employer, newly hired employees and the
new employer are best accommodated and balanced by
determing the majority status of the union as of the date
the new employer began full-scale operations with a rep-
resentative complement, even though the hoped for ex-
pansion of clientele, revenue, and operating personnel
had not been fully achieved. See Hudson River Aggre-
gates. Inc., 246 NLRB 192 (1979). The record establishes
that in the 3-week period between August 4 and 26 there
were four acquisitions to the operating unit, offset by the
termination of one of the newly acquired employees and
the resignation of Dormady, a Swift employee who
worked for 3 days with Respondent. On August 26 the
operating unit was comprised of eight rank-and-file em-
ployees, including five former employees of Swift. An-
derson, who had worked for Swift, and who was em-
ployed by Respondent in a supervisory capacity, but
with production duties, also comprised Respondent's
work force on August 26. The numerical size of the op-
erating unit remained unchanged for the next 5 months.
From this it must be concluded that on August 26 Re-
spondent's operation was no longer a transitional one,
but had evolved into a full-scale mode with the work
force comprised of a representative complement. Nor did
subsequent eventualities, which included the launching of
a new food service item in January, the resultant hire of
one full-time and two part-time employees, and the
achievement after less than 10 months of operating expe-
rience of an expanded complement of 13 employees,
serve to so change the nature of the operation or the size
of the complement as to invalidate the use of the full-
scale operations/representative complement criterion for
fixing the date for determining the Union's majority
status. See Pre-Engineered Building Products, Inc., 228
NLRB 841, fn. 1 (1977).
I conclude and find that former production and main-
tenance employees of Swift comprised a majority of the
production and maintenance unit at Respondent's Spo-
kane plant when the Union made its August 26 demand
for recognition and bargaining. I further find that, absent
a valid defense, Respondent had an obligation on and
after August 26 to recognize and bargain with the Union.
In this connection, Respondent contends that it enter-
tained a reasonably based good-faith doubt as to the
Union's continued majority when evaluated against the
objective considerations' test defined by the Board. E.g.,
Terrell Machine Company, 173 NLRB 1480, 1481 (1969).
See also Triplett Corporation, 234 NLRB 985 (1978). Re-
spondent's reliance upon information that some of the
new employees recruited from the Swift unit (White and
Meinzinger, as well as Dormady, who had resigned, and
Anderson, a supervisor) had sought to obtain withdrawal
cards from the Union is clearly deficient as a basis for
sustaining the defense of a reasonably based good-faith
doubt. See Triplett Corporation. supra. Indeed, Racicot's
assumption that in seeking to obtain withdrawal cards
718
PREMIUMl F()O())S. INC
the employees were, in effect. expressing a desire no
longer to be represented collectively by the Union as a
bargaining agent is itself an exercise in subjective inter-
pretation. This is so. because on the basis of Racicot's
own credited testimony. he refrained from engaging in
any conversation or other conduct designed to determine
whether this action by a segment of the employee group
signaled a desire on their part not to be represented in
collective bargaining by the Union, and he was prix 3y to
no reliable information reflecting a disinterest on the part
of the employee complement as a whole in further repre-
sentation by the Union. The Board has frequently held
that a showing as to employee membership in, or actual
financial support of, an incumbent union is not the cquiv-
alent of establishing the number of employees who con-
tinue to desire representation by that union. E.g., Orion
Corporation. 210 NI3RB 633 (1974). Racicot knew on
August 26 when the Union made its bargaining demand
that the majority of the present employee group had
been emploved in the unit represented by the Union arind
he thus had basis for assuming that the Union had at
least colorably claim to recognitional entitlemniLt irre-
spective of any other legal challenge whlich Respondent
might interpose on the basis of Burns. I find that the evi-
dence does not support Respondent's defense of a rea-
sonably based good-faith doubt as to the Uinion's major-
ity status on August 26. See Glenn Spooner d/1,/a D & IF
Super Market, 208 NLRB 891 (1974). Cf. StrcsAkIn Prod-
ucts Co., Division of Tool Research, 197 NLKR 1175, 1178
(1972); lihe Ireeman Company, 194 NL RB 595, 598
(1971). As a majority or Respondent's operating employ-
ees on August 26 were former employees of Swift repre-
sented by the Union who had paid dues to the Union in
its capacity as their exclusive collectivec-bargaining repre-
sentative, I find that, in its capacity as a legal successor
to Swift and as an employer of a full complement, Re-
spondent had the duty pursuant to the Union's August 26
demand to recognize and bargain with the Union as the
exclusive representative of that work complement. As
Respondent has refused to accord recognition to the
Union and to engage in collective bargaining, I find that
Respondent has violated Section 8(a)(5) of the Act.
Upon the foregoing findings of fact, and upon the
entire record in this proceeding, I make the following:
CONCLUSIONS otF LADW
1. Premium Foods, Inc., is an employer engaged in
commerce within the meaning of Section 2(2), (6), and
(7) of the Act.
2. United Food & Commercial Workers Local Union
No. 1439, affiliated with United Food & Commercial
Workers International Union, AFL-CIO, is a labor orga-
nization within the meaning of Section 2(5) of the Act.
3. The following described unit is a unit appropriate
for the purposes of collective bargaining:
All production and maintenance employees, includ-
ing truckdrivers at Respondent's Spokane, Washing-
ton, plant, excluding manager, salesmen, clerical
employees, guards, professional employees, and su-
pervisors as defined in the National Labor Relations
Act.
4. At all times on and after August 26, 1980, the Union
has been the exclusive collective-bargaining representa-
tive of the employees in the unit described above.
5 Respondent is a successor of Swift Fresh Meat
Company and as of August 26, 1980, had employed a full
complement of production and maintenance employees
to operate its Spokane, Washington, plant.
6. On August 26, 1980() the Union made a valid
demand for recognition and bargaining, which demand
Respondent refused, and continues to refuse.
7. 13F failing anrd refusing on and after August 26,
1980, to recognize and bargain with the Union as the
representative of the employees in the unit described
abho e, Respondent violated Section 8(a)(5) and (1) of the
Act.
8. Except to the extent specifically found herein, Re-
spondent engaged in no other conduct in violation of the
Act.
Ti ti Ri Msi tk
Hlaving found that Respondent has engaged in certain
unfair labor practices, I shall recommend that It cease
and desist therefrom and take certain affiriiativ e action
designed to effectuate the policies of the Act,
Ha ving found that Respondent violated Section X(a)(5)
and (1) of the Act by refusing to recognize and bargain
writh the Urion after August 26, 1 shall recommend that
it be ordered to recognize and bargain with the Union
upon request.
Upon the foregoing findings of fact, conclusions of
law, and upon the entire record, and pursuant to Section
10((c) of the Act, I hereby issue the follo wing recom-
mended:
ORDER 12
The Respondent, Premium Foods, Inc.. Spokane.
Washington, its officers, agents. successors, and assigns,
shall:
I. Cease and desist from:
(a) Refusing to recognize and bargain collectively with
United Food & Commercial Workers Local Union No.
1439, affiliated with United Food & Commercial Work-
ers International Union, AFL-CIO, as the exclusive col-
lective-bargaining representati e of employees described
below:
All production and maintenance employees. in-
cluding truckdrivers at Respondent 's Spokane,
Washington, plant, excluding manager, salesmen,
clerical employees, guards, professional employees,
and supervisors as defined in the National Labor
Relations Act.
" In Ihe c'.cile noi cxccpilnll, art filed as proxided hi Sc 1i1i2 46 of
Ihe Rules anrd Rcgulatiions of Ihe N onal aI . abhor Rclationls tlard, the
findings. co, nlu ,ns,, anid reco mmended Order herel hihall, as proldcd
In S.c 1(12 48 of he Rulcs anid Reguilaillons. he adopted h Ihe HI,;lrd and
bhcorne its findings. Corlltliorl,. and ()rder. arid all ohblclims Ihcrcto
shall he dmcrned .i l id for all purpo,css
719
DECISIONS OF NATIONAL LABOR RELATIONS HOARD
(b) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of rights
guaranteed them by Section 7 of the Act.
2. Take the following affirmative action deemed neces-
sary to effectuate the policies of the Act:
(a) Upon request, bargain collectively with United
Food & Commercial Workers Local Union No. 1439, af-
filiated with United Food & Commercial Workers Inter-
national Union, AFL-CIO, as the exclusive representa-
tive of all employees in the unit described above, and if
an understanding is reached, embody it in a signed agree-
ment.
(b) Post at its plant in Spokane, Washington, copies of
the attached notice marked "Appendix." 3 Copies of said
a In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by
Order of the National Labor Relations Board" shall read "Posted Pursu-
notice, on forms provided by the Regional Director for
Region 19, after being duly signed by its representative,
shall be posted by Respondent immediately upon receipt
thereof, and be maintained by it for 60 consecutive days
thereafter, in conspicuous places, including all places
where notices to employees are customarily posted. Rea-
sonable steps shall be taken by it to insure that said no-
tices are not altered, defaced, or covered by any other
material.
(c) Notify the Regional Director for Region 19, in
writing, within 20 days from the date of this Order, what
steps the Respondent has taken to comply herewith.
ant to a Judgment if the United States Court of Appeals Enforcing an
Order of the National L abor Relations Board"
720