St. George Warehouse, Inc.

National Labor Relations Board - Administrative Judge Opinions

Jan 10, 2005

22-CA-025400 (N.L.R.B. Jan. 10, 2005)

JD(NY)–02-05
South Kearny, NJ

UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
NEW YORK BRANCH OFFICE

ST. GEORGE WAREHOUSE, INC.

and Case 22-CA-25400
Case 22-CA-25938
MERCHANDISE DRIVERS LOCAL NO. 641,
INTERNATIONAL BROTHERHOOD OF TEAMSTERS,
AFL-CIO

Julie L. Kaufman, Esq., Brian Caufield, Esq.,
for the General Counsel
John A. Craner, Esq., (Craner, Satkin & Scheer)
of Scotch Plains, New Jersey, for the
Respondent
Gary Carlson, Esq., (Lynch Martin), of West
Orange, New Jersey, for the Charging Party

DECISION

Statement of the Case

ELEANOR MACDONALD, Administrative Law Judge: This case was tried in Newark,
New Jersey, on seven days between July 22, 2003 and January 6, 2004. The Amended
Consolidated Complaint alleges that Respondent, in violation of Section 8 (a) (1), (3), (4) and (5)
of the Act, informed employees that Respondent was not providing its regularly scheduled merit
wage increases because employees supported the Union, solicited employees to sign a petition
decertifying the Union, suspended employee Tony Daniels and disciplined employees Tony
Daniels and Purcell Wallace, failed to grant employees regularly scheduled merit wage
increases, unilaterally changed employees’ break time and changed its rule concerning
employees’ use of cellular telephones, undermined the Union’s majority status by letter dated
September 26, 2003, and engaged in surface bargaining. The General Counsel seeks a
remedy pursuant to Mar-Jac Poultry, 136 NLRB 785 (1962).1 The Respondent denies that it
has engaged in any violations of the Act and argues that the allegations relating to informing
employees that Respondent would not provide regularly scheduled merit wage increases are
barred by Section 10 (b) of the Act.

On the entire record, including my observation of the demeanor of the witnesses, and
after considering the briefs filed by General Counsel and Respondent in March 2004, I make the
1 A Complaint issued herein in 22-CA-25400 on February 27 and in 22-CA-25938 on
September 30, 2003. The cases were consolidated by Order dated October 8, 2003. The
Consolidated Complaint was amended at the hearing on November 17, 2003 .

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following2

Findings of Fact

I. Jurisdiction

The Respondent, a corporation with a place of business in South Kearny, New Jersey, is
engaged in the warehousing of commodities. Annually, Respondent performs warehousing
services valued in excess of $50,000 in states other than the State of New Jersey. The parties
agree, and I find, that Respondent is an employer engaged in commerce within the meaning of
Section 2 (2), (6) and (7) of the Act and that Merchandise Drivers Local No. 641, International
Brotherhood of Teamsters, AFL-CIO, is a labor organizational within the meaning of Section 2
(5) of the Act.

II. Alleged Unfair Labor Practices

A. Background

Respondent has been a party to various proceedings before the Board.3

In St. George Warehouse, 331 NLRB 454 (2000), the Board found that Respondent
unlawfully discharged two employees because of membership in Local 641, interrogated
employees about their Union activities, promised increased benefits if employees did not select
the Union, solicited grievances, created the impression of surveillance, issued written warnings
rather than the customary oral warnings and maintained an unlawful no-distribution, no-
solicitation clause. The Third Circuit enforced the Board’s decision in a memorandum opinion
based on “the entire record, including the employer’s demonstrated hostility to its employees’
organizing efforts.” St. George Warehouse v. NLRB, No. 00-2433 (3d Cir. April 23, 2001).

In an unpublished decision at 333 NLRB No. 113 (2001), the Board ordered Respondent
to bargain with the Union after Respondent had refused to recognize and bargain with the Union
following its certification on October 27, 2000 as the exclusive collective bargaining
representative of a unit of the following employees of Respondent:4

All full-time and regular part-time warehouse employees employed by the Respondent at
its South Kearny, New Jersey facility, but excluding all temporary agency employees,
2 The record is hereby corrected so that at page 24, line 22, the name of the case is Bannon
Mills; at page 36, line 22, and at page 40, line 6, the name of the case is Mar Jac; at page 41,
line 15, the phrase should read “we would be able to stipulate”; at page 44, line 2 and for many
pages thereafter, the word “cars” should be replaced by “cartons”; at page 75, line 5 and in
numerous places thereafter, the word “clothes” should be replaced by the word “close”; at page
96, line 25 the phrase should read “union shop”; at page 440, line 15, and thereafter until page
445, the General Counsel was not speaking and the record should show that Counsel for the
Union was speaking and introduced Charging Party Exhibit # 1; on page 884 at line 20, the first
word is “blades”; on page 897, line 5, the phrase should read “handled rigs”.
3 In an effort to prevent the instant decision from assuming gargantuan proportions I shall
assume familiarity with previous ALJ and Board decisions and I shall give only an abbreviated
description of the negotiations between the parties.
4 enf’d sub nom. NLRB v. St. George Warehouse, No. 01-2215 (3d Cir. Aug. 7, 2001). The
election was held on April 16, 1999.

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office clerical employees, professional employees, guards and supervisors as defined in
the Act.

Negotiations between the company and the Union began in October 2001, following the
Circuit Court’s enforcement of the Board’s bargaining order.

In St. George Warehouse, 341 NLRB No. 120 (2004), the Board found that Respondent
unlawfully delayed in providing the Union with information on health insurance premiums and
failed to provide the Union with information relating to temporary agency employees who have
performed bargaining unit work. The Board found that prior to the election Respondent had
used a fluctuating number of temporary agency employees to supplement directly hired
employees in the bargaining unit. Following the election Respondent did not replace unit
employees who quit or were fired for cause; instead it used temporary agency employees. As a
result the number of unit employees decreased from 42 at the time of the election to 8 at the
time of the July 2002 hearing before ALJ Steven Davis. The Board found that Respondent had
violated the Act by unilaterally transferring unit work to temporary agency employees without
notice to the Union or an opportunity to bargain. The Board did not disturb the ALJ’s findings,
made after extensive analysis of testimonial and documentary evidence, that some time after
the Union won the 1999 election Respondent made a decision to use agency employees rather
than directly hired unit employees. The Board ordered the company, inter alia, to rescind the
unlawful unilateral transfer of unit work to temporary agency employees and restore the status
quo by restoring the unit to where it would have been without the unilateral changes.5

In its Answer to the instant Complaint dated February 27, 2003, Respondent admitted
that the following individuals hold the positions set forth opposite their respective names and are
supervisors and agents of Respondent:

Anthony Fortunato Owner
Linda Kuper Executive Vice President6
Steven Kuper Terminal Manager
Gabriel Maldonado Assistant Terminal Manager7
Anthony Oliveri Night Shift Supervisor
Robert Chapman Supervisor

The Respondent denied that Paul Smith is a supervisor of Respondent.

A number of other employees testified in the proceeding in addition to the managers and
supervisors listed above:

Purcell Robert Wallace, sometimes referred to as “Rob”, has worked at the warehouse
for 13 years, and has been a loader of containers in the export department for 8 years.8
Wallace has been a member of the Union negotiating committee since October 2001
and has attended bargaining sessions with Respondent since November 2001.

5 As will be discussed below, the Board reversed the ALJ’s finding that the Respondent had
engaged in surface bargaining.
6 At the time of the instant hearing Linda Kuper had become president of St. George USA.
7 Maldonado testified that he was general manager for 7 years and had recently been
named terminal manager.
8 Witnesses also referred to loaders as hi-lo drivers.

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Tony Daniels has worked at the warehouse for 11 years performing the duties of a
loader in the export department. Daniels has been a member of the Union negotiating
committee since October 2001 and has attended bargaining sessions with Respondent
since November 2001. Daniels assisted in the investigation of Board charges and
testified in the case leading to 341 NLRB No. 120 and in the instant case. Daniels
testified in the instant case in July and October 2003 and January 2004.

Louis Buono has been a forklift driver in the warehouse for 6 years. He was on leave of
absence from April 20 to August 20, 2000. Buono has been a member of the Union
negotiating committee since January 2003.

B. Morning and Afternoon Breaks

The record shows that employees in the warehouse receive two 15 minute breaks, one
in the morning and one in the afternoon. Employees do not clock out during these breaks.9 All
the witnesses agreed that employees had a tendency to extend the 15 minutes into longer time
spans.

Purcell Robert Wallace testified that after October 2002 management began pushing the
breaks back to 15 minutes. Wallace said that Maldonado stated that the employees wanted a
union shop and “we’re going to show you how a union shop runs.” Wallace said that Maldonado
made this announcement to all loaders in the warehouse. For a while the breaks were indeed
held to 15 minutes but eventually the employees went back to their old habit of taking longer
breaks. On cross-examination Wallace could not recall whether Maldonado made his
statements in 2002 or 2003. Wallace went on to testify that Maldonado made the “union shop”
statement once when Wallace was walking alone on his way back to work from the lavatory and
another time when the announcement was made to anyone within hearing distance. Wallace’s
affidavit given to a Board Agent mentions that for two weeks the company enforced 15 minute
breaks but the affidavit does not refer to Maldonado’s alleged statements linking the
enforcement to a union shop. Wallace further testified that he took only 15 minutes for his break
and that he does not know how long anyone else took. Of course, this testimony is inconsistent
with his earlier testimony. Given the contradictory nature of Wallace’s testimony on this subject
and the fact that Wallace’s affidavit makes no mention of the “union shop” statement, I shall not
rely on Wallace’s testimony concerning the enforcement of 15 minute breaks.

Louis Buono testified that employees, including himself, occasionally lengthened their
breaks by 5 to 15 minutes. After he filed a decertification petition in October 2002 the
supervisors came out and told everybody that the break was over after 15 minutes. Buono said
this went on for a few days in a row. He identified the supervisors as “Edwin” and “Harry”.

General manager Gabriel Maldonado testified that he has indeed gone around the
warehouse saying “break is over” because the employees often took breaks of over 15 minutes.
Maldonado denied telling Wallace in relation to break times that “you want a union shop, we will
show you how a union shop is run.”

I find, based on the testimony of Buono and Maldonado, that after Buono filed the
9 Employees may take a ½ hour lunch break, but they must punch the time clock when they
cease work for lunch and when they return to work and they are not paid for this time. Many
warehouse employees do not take a lunch break.

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decertification petition Respondent enforced the 15 minute break time rule. Apparently this 15
minute limit had not been enforced previously. Respondent did not give notice to the Union and
an opportunity to bargain concerning this change in working conditions. This was a violation of
Section 8 (a) (5) of the Act.

C. Use of Cell Phones During Working Hours

Tony Daniels testified that on October 30, 2002 he believed that he had lost his wallet.
Daniels wished to check whether his wallet was in his truck. Daniels asked Maldonado for
permission to go to his truck which was parked across the street from the warehouse.
Apparently this permission was granted. Daniels did not tell Maldonado about a lost wallet. Not
finding the wallet in the truck, Daniels telephoned his wife to see whether the wallet was at
home. His wife called him back “at the job” to say that she had found the wallet. Daniels
received a written warning, signed by Paul Smith, “Supervisor”, for “unauthorized use of cell
phone during working hours … 8:15 AM.”10

Daniels testified that Maldonado had told the employees that they were not permitted to
use their cell phones on the warehouse floor during working hours. Employees were permitted
to use their cells during work hours off the warehouse dock. Daniels has seen other employees
go down the ramp that leads off the dock and use their cell phones. Buono testified that he had
never been given any company policy about cell phone use. He stated that if he had to use a
phone he would ask his supervisor. Buono used his break time to telephone the Regional
Office from a container parked in a loading dock.

Maldonado testified that employees are not permitted to make phone calls during work
time. He denied telling employees that they could use a cell phone while on duty as long as
they were off the dock. Employees are permitted to make phone calls on their break time
outside the warehouse. Maldonado said that if he observed an employee using a cell phone
during working hours he would give the employee a verbal warning. If the employee were
caught a second time using a cell phone during working hours he would send the employee
home for the day.

Maldonado said that on October 30, 2002 he was at door 52 and he observed Daniels at
the dock by door 25 using a cell phone. Maldonado instructed Paul Smith to find out why
Daniels was using the phone. Maldonado explained that “Smith is one of the dock bosses, he’s
my right hand, the one I trust.” Smith reported back that Daniels said Maldonado had given him
permission to talk on the phone with his wife. Maldonado told Smith to “write him up” for cell
phone use.

Paul Smith testified that he saw Daniels in a loading bay using his cell phone. When
Smith asked why he was on the phone Daniels replied that Maldonado had given him
permission. Maldonado denied giving permission and Maldonado told Smith to write up a
warning.

I find, based on the testimony of Maldonado, that Respondent did not permit its
employees to make telephone calls during working hours. I note that Daniels claimed to Paul
Smith that Maldonado had given him permission to use the telephone, thus implying that he
needed permission to call during working time. Buono testified that he had used a cell phone
10 The recitation of facts concerning the wallet and the phone calls is taken both from
Daniels’ testimony and from his written remarks on the warning notice.

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during his break time. He was unaware of any other policy concerning phone use. I do not
credit Daniels that Respondent had no objection to employees using working time to make calls
so long as they did this off the dock. I find it incredible that Respondent maintained a policy that
employees could walk off the dock to use a cell phone while they were supposed to be working.
The fact that some employees may have used a cell phone surreptitiously does not show that
Respondent condoned this activity. Thus, I do not find that Respondent unilaterally changed its
telephone policy.

Although Maldonado said that for the first offense of using a telephone during working
hours he would give the employee a verbal warning, this is not the procedure he followed in the
instance of Daniels using the cell phone. Instead of issuing a verbal warning to Daniels
Maldonado ordered Smith to write up Daniels. Respondent offered no testimony to explain why
Daniels received more onerous discipline than a mere verbal warning. Nor does Respondent
contend that this was a repeat infraction. In the case of Daniels, a known and active supporter
of the Union, Respondent did not follow its disciplinary policy as enunciated by Maldonado;
instead it imposed harsher punishment for a first instance of using a cell phone during working
hours. I shall deal below with this incident in my discussion of discipline imposed on Daniels.

D. Status of Paul Smith

Wallace identified Paul Smith as a supervisor. He testified that Smith and other
supervisors including “Edwin” and Maldonado went around telling employees to get back to
work because break was over.

Daniels also identified Paul Smith as a supervisor. When Daniels was hired, Smith
looked at his application and telephoned him to begin work. As discussed in detail below,
Daniels received a written warning notice dated October 30, 2002 signed by Smith in the space
reserved for “supervisor.” Smith was walking by a container being loaded by Daniels and he
accused Daniels of damaging the cargo. Smith notified Maldonado and Daniels was given a
warning. Daniels stated that he had worked with Smith in March 2003 and he observed Smith
give orders to hi-lo drivers about which freight to pick up and which truckers to assist. Smith
walks all around the warehouse seeing what the employees are doing. He gives recheck
sheets to employees when freight must be rechecked. Those supervisors who have company
issued walkie-talkies include Maldonado, “Edwin”, “Carlos” and Smith. Rank and file workers do
not have walkie-talkies.

Linda Kuper stated that Paul Smith is a dock boss. Kuper said that Smith, who has
worked for the company for 13 or 14 years, had begun work as a hi-lo driver and had eventually
been promoted to export supervisor. However, Smith had a break in service in 1997 or 1998
and came back again as a hi-lo driver.11 Smith has been a dock-boss since 2002.12 According
to Kuper, Smith assigns truck drivers to a door where they are to park the container for loading.
Smith also assigns loaders to loading duties at a door. Depending on how much freight is to be
loaded Smith assigns a helper to the loader. Smith’s job description, according to Kuper, is to
use his discretion to determine how best to utilize labor in the warehouse to get the job done.
Smith uses this discretion without consulting a manager. Smith is assigned to fill the soda
machine and to empty out the cash; according to Kuper no other employee is trusted to do this.
Kuper testified that Smith can write up a warning without authorization of a manager. He offers
his opinion concerning discharges. Smith fills out accident reports and he may excuse an
11 Smith said the break in service was in 1995.
12 Smith voted in the 1999 election.

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injured employee to go home. Kuper identified a number of documents where Smith was
described as a supervisor. On August 8, 2002 Kuper wrote to the U.S. District Court in Trenton,
NJ, asking that Smith be excused from jury service for a number of reasons, including that
during a popular vacation time “We had planned for Mr. Smith, as one of our supervisors, to
open & close our facility.” In addition, Smith signed as “Supervisor” on February 5, 2003 a
“Supervisor’s Report of Accident.” On February 12, 2002, Respondent certified a document for
hazardous materials transportation training on behalf of Smith whose title was given as “dock
supervisor.” On December 30, 2002 the accounting manager of Respondent signed a
document needed by Smith for a loan and identified Smith as “supervisor.” On June 19, 2002,
Smith signed as “supervisor” a notice that an employee had abandoned his job by being a no-
call no-show for three consecutive days.

Kuper testified that unlike managers, Smith and other dock bosses are paid hourly and
receive overtime and the same benefits as loaders. Kuper identified an employee named
Chapman as an hourly supervisor. She stated that an hourly supervisor is a dock boss. He is
like a front desk manager, getting everybody going in the right direction, keeping things
organized, enforcing the rules, manipulating the truck drivers and the paperwork.

Maldonado testified that there is no set number of employees that “Smith is responsible
for.” Depending on what Smith is doing at a particular time, “I have him do anything for me … it
could be with 10 guys over here … it could be 15 guys doing something that I want to get done.”
Maldonado said that if Smith saw an employee in any part of the warehouse doing something
incorrect he could issue discipline to that person because “he’s a dock boss.” As discussed
above, Maldonado said that Smith was one of the dock bosses, “he’s my right hand, the one I
trust.”

Paul Smith, testifying about his duties, stated that he reported to Maldonado but Smith
contradicted Maldonado’s testimony and attempted to downplay his own authority in the
warehouse. I note that in questioning Smith, Counsel for Respondent twice referred to
“employees whom you supervise.” Smith said that he does not sign a warning without
consulting his manager; he recommends discipline to either Maldonado or Steve Kuper.13
Smith agreed, however, that if he sees an employee doing something wrong he fills out a
warning slip and signs it, because he was the one that brought up the incident. Smith
described his duties as working in the import and pick-up department. Daniels and Wallace and
Buono work in the export department. He sees them during the day and he offers them advice.
Smith stated that he assigns helpers to the loaders and he admonishes the helpers if they are
not doing their work.

Smith testified that in lieu of a raise in 2001 he asked for and was granted an additional
week of vacation. In December 2002, also in lieu of a raise, owner Anthony Fortunato rented
him the vending machines in the warehouse for $100 per month and permitted Smith to stock
the machines and keep the cash deposited in the machines. Smith has a Nextel walkie-talkie.
Fortunato allows him to make personal calls on the Nextel as long as he contributes “a little” to
the cost of the service.

I rely on the testimony of Linda Kuper and Maldonado, as well as Respondent’s written
records, to find that Paul Smith is a supervisor. Smith became a dock boss in 2002. From that
date Smith has been identified as a supervisor on disciplinary notices, in correspondence to
government entities and in other official correspondence. Respondent utilized Smith to open
13 The chain of command runs from Steve Kuper, to Maldonado and to Smith.

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and close the warehouse. Kuper identified dock bosses as “hourly supervisors” who enforce
the rules and keep employees organized and going in the right direction. As will be discussed in
detail below, Kuper testified that when an employee asks for a raise the dock boss gives his
opinion to the manager on the issue of granting the raise. Smith assigns employees to tasks
such as loading containers and helping a loader with a difficult cargo. Smith exercises his
discretion in utilizing the available labor force in the warehouse. Smith initiates disciplinary
action and gives his advice concerning terminations. He admonishes employees when he sees
them doing something wrong.

I find that Smith is a supervisor and agent of Respondent within the meaning of Section
2 (11) and (13) of the Act.

E. The Issue of Wage Increases

1. Alleged Unilateral Change

The General Counsel alleges that Respondent ceased its merit wage increase program
in violation of Section 8 (a) (1), (3) and (5).

Linda Kuper testified that before the April 1999 election employees received wage
increases based on merit and productivity, including attendance, speed, accuracy and the like.
According to Kuper an employee’s performance was evaluated when the employee asked his
supervisor for a review. The review was up to the dock boss who would provide an opinion to
the manager. Kuper said she was not involved in doing these reviews.

Kuper testified that the company had never told the Union that employees received
regular annual merit wage increases. Kuper stated that the company did not automatically
review wages and that no fixed amount of wage increase was paid. She denied that raises
were given on an employee’s anniversary date. Kuper stated that the Union had not made a
demand for merit increases, but had only sought to establish a minimum wage, starting rates
and across-the-board increases. The Respondent has offered a $.30 annual wage increase as
its final position and has offered to implement this proposal.

Kuper testified that Respondent gives Christmas presents to employees, but that not
every employee receives a present and that a range of amounts is given. She discusses the
matter of these gifts with Steve Kuper, Maldonado and Fortunato and takes into account
employees’ performance, attention, accuracy and productivity. Kuper said that employees do
not request gifts.

Kuper identified a letter which John A. Craner, Esq., who represents the Respondent in
collective bargaining negotiations, wrote to Counsel for the General Counsel on December 12,
2002, as follows:

[T]he Company has not granted merit increases since the Union was certified because
to do so would place the Company in an extremely difficult position. … Moreover, the
Union insisted at the outset of negotiations in 2001 [prior to year end when such merit
increases would be considered] that the Company no longer grant discretionary
increases but rather bargain for across-the-board increases…. Thus, because of the
bargaining position of the Union seeking across-the-board wage increases, the
Company has not given any employee a merit increase. The Company chose to
respond to the Union’s demands concerning across-the-board increases and abandoned

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its merit increase program in 2001 when negotiations commenced. The Union did not
object at year end 2001 to the fact there were no merit increases.

I note that there is no testimony to support Craner’s assertion that the Union insisted in
2001 that the company no longer grant discretionary increases. Further, Kuper’s testimony that
the company stopped giving raises after the election in 1999 is not correct. As will be seen
below, the record shows that the last raises were given in January through March 2001.

Lori Smith, Esq., is the Union’s legal representative and has been its collective
bargaining representative since October 2001. Smith testified that the first discussion of
economics during the negotiations took place in April 2002 when the Union made an economic
demand. The Union proposed that all employees be brought up to a rate of $16.75/hr, with
increases of $1.00/hr in two succeeding years of a three year contract. New hires would have
less favorable rates.

Craner replied in a letter dated April 8, 2002 which proposed:

an across-the-board increase of $0.25 per hour in each of the three years of the
proposed contract for a total package of $0.75. … The company will also continue its
present practice of discretionary bonuses (and please note I used the word
“discretionary” to mean that the discretion is with the company alone).

In May 2002 the Union changed its demand to a top rate of $15.50. Lori Smith testified
that the Union did not mention merit increases in its demands.

Smith testified that Craner had informed her that the company gave only discretionary
bonuses. Craner told her that Respondent could not continue giving the bonuses because such
action would constitute an unfair labor practice. Eventually, Smith stated, she found out that
what Craner had termed discretionary bonuses were in fact regular merit increases.

Lori Smith testified that at a negotiation session on September 18, 2002 she asked the
company about the manner in which wage increases had been given in the past. Linda Kuper
told her that on an employee’s anniversary date a merit increase of $.50 to $1.00 was granted.14
Before this exchange, Smith had not known that Respondent gave regular wage increases.
She believed that the company gave only the discretionary bonuses mentioned in Craner’s
letter. Smith said that previous to September 18 the Union had been concentrating on bringing
all employees up to a higher wage rate and trying to establish a minimum hiring rate. Between
April and September she had not spoken to bargaining committee members about any other
type of wage issue. At the September 18 session, Smith requested a history of wage increases
for unit employees in order to prepare for a scheduled meeting on September 24. On
September 23 Smith received an incomplete list with figures which Craner characterized as “not
100% accurate.” Because the wage information was so inaccurate as to be unusable the
September 24 session ended after only ½ hour. On September 27 Smith wrote to Craner
detailing the problems with the information and again requesting that accurate information be
provided to the Union. In a letter from Craner and in a subsequent spreadsheet, both provided
to the Union on September 30, 2002, Respondent corrected the information it had previously
supplied and filled in many, but not all, the gaps in the wage history of unit employees.

14 Steve Kuper was present at this meeting. Steve Kuper, the highest manager who was
involved in the decisions about raises, was not called to testify herein.

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Respondent provided revised wage data which purport to show a history of wage
increases given to employees who were on the Excelsior list in 1999 revised as of September
30, 2002. Many employees on this list were employed for less than one year and thus received
no wage increases. For other employees Kuper stated that the payroll records were
incomplete. However, the wage data show that in general Respondent did provide annual wage
increases to its employees:

1. Employee Aroca was hired in January 1997 and he received increases of $.50 in August
1997, $1.00 in May 1998, $.75 in June 1999, and $1.00 in November 2000.
2. Buono was hired in April 1998 and he received wage increases of $1.00 in August 1998,
June 1999 and January 2001.
3. Daniels was hired in October 1991 and he received wage increases of $1.00 in 1992, $.50
and $1.00 in January and July of 1993, $1.00 in 1994, $1.50 in February 1995, $.50 in February
1996, $.50 in February 1997, $.50 in February 1998, $.50 in February 1999 and $.75 in March
2001.
4. Employee Leach was hired in January 1990 and he received raises of $1.00 in November
1990, $.50 in August 1991, $.50 in August 1992, $.50 in August 1994, $.50 in July 1996, $.75 in
October 1997, and $1.00 in August 1998.15
5. Employee Mateo was hired in March 1992. He received raises of $.50 in October 1992, $.50
in June 1995, $1.00 in January 1998, $1.00 in August 1999, and $1.00 in March 2001.16
6. Employee Pericles was hired in November 1996 and he received increases of $.50 in
February 1997, $.50 in January 1998, $.75 in December 1999 and $1.00 in February 2001.
7. Employee Rivera was hired in February 1991 and he received increases of $.50 in
November 1992, $.50 in January 1993, $.50 in January 1994, $1.50 in March 1995, $1.00 in
January 1997, $1.00 in January 1998, $.75 in February 2000 and $1.00 in February 2001.
8. Smith, who testified to having received annual wage increases, was hired in March 1990 and
he received increases of $.50 in November 1990, $1.50 in January 1993, $.75 in August 1994,
$.50 in July 1996, $.75 in October 1997 and $1.00 in August 1999.
9. Wallace was hired in February 1988 and he received increases of $.50 in August 1988,
$2.00 in July 1989, $1.00 in October 1991, $1.00 in June 1995, $1.00 in January 1997, $1.00 in
February 1999 and $1.00 in January 2001.17
10. Employee Zapatier, who was hired in October 1997, received raises of $1.00 in June 1998,
$.75 in August 1999 and $1.00 in November 2000.

As will be discussed below the Respondent and the Union continued bargaining
concerning various matters. On April 8, 2003 the parties held a negotiating session during
which Lori Smith proposed that the company should put its regular merit increase into effect so
as to bring the employees up to date for the two or three years during which many of them had
not had any increase. Smith said this would result in the parties not being so far apart on
wages. The company asked the Union for a proposal and it also suggested that a mediator be
called in. The Union took the position that it would discuss merit increases in the presence of a
mediator. Smith testified that other than the discussion on April 8, 2003 the Union had never
made any proposal concerning regular merit increases and it had never taken the position that
Respondent should either continue with or cease granting merit increases.

Lori Smith denied that the company had offered to implement its $.30/hr wage increase
15 Although Respondent’s records show that Leach was hired in 2000 this is clearly
incorrect.
16 Mateo’s records are marked incomplete by Respondent.
17 Wallace took a leave in 1998.

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proposal at any of the bargaining sessions.

In Daily News of Los Angeles, 315 NLRB 1236 (1994), enf’d 73 F 3d (D.C. Cir. 1996),
the Board set forth its rationale governing the duty of an employer to persist in a merit raise
program that is entirely discretionary as to amount. The Board summed up the employer’s
program in that case as “appraising every employee once a year, considering each employee
for a merit wage increase, and granting a merit increase to at least 80 percent of the
employees.” The Board found that a merit review program in which an employer retains
elements of discretion can be a term and condition of employment. The Board reviewed cases
arising under NLRB v. Katz, 369 U.S. 736 (1962) and found that a discontinued merit raise that
constitutes a change in a term of employment is unlawful under Katz. The employer must
bargain to agreement or impasse before making any change in such a term of employment.
Further, the Board stated, an employer with a practice of granting regular merit increases must
bargain with the Union as to the exercise of discretion in determining the merit increase.
Members Stephens and Cohen joined the opinion but did not “fully subscribe to the reasoning in
the discussion concerning … a past practice that is scheduled to recur during negotiations for a
contract.” Members Stephens and Cohen stated their views as follows: “Where there is a past
practice concerning an annual event (e.g., an annual wage increase), and the event is
scheduled to recur during negotiations for a contract, the employer satisfies its bargaining
obligation if it gives reasonable advance notice and opportunity to bargain about the scheduled
event.” The employer may propose to continue the practice, to modify it or to delete it. The
Board’s decision distinguished cases where the merit increases had been given at random
irregular intervals in the past. In Ithaca Journal-News, 259 NLRB 394 (1981), the Board had
discussed a practice under which employees received increases at varying intervals from their
anniversary dates. The Board found that in one year only 10 out of 13 employees received a
raise while in the next year two employees received two increases, nine received one increase
and seven received no increases. The dates the raises were granted appeared largely random.
The amount of wage increases also did not follow any discernible pattern. There was no formal
or written evaluation of employees, there was no minimum standard nor any objective,
articulable criteria. The Board found that the employer did not have a merit increase program
that it was bound to continue during negotiations. In American Mirror Co., 269 NLRB 1091
(1984), the Board found that the raises were in discretionary amounts based on diverse
considerations and “the raises there had been given at random irregular intervals in the past
and, hence, the employer’s withholding of them did not constitute a change … in a clearly
established pattern that had become a term of employment.” 315 NLRB 1240-1.

It is evident from a summary of the testimony given above that there is a degree of
confusion about the merit wage increases given by Respondent. Linda Kuper testified that the
last increases were given in 1999 but this is clearly contrary to the evidence. Craner wrote that
the increases were given at the end of the year, but this is also inaccurate. Lori Smith testified
that on September 18, 2002 she asked Kuper about the manner in which wage increases had
been given in the past and purportedly learned that there were anniversary date increases. I do
not credit this because Respondent’s records show there was no such thing as anniversary date
increases. Further, Kuper denied telling Smith that Respondent gave anniversary date raises.
Moreover, the negotiating committee had two bargaining unit members, Daniels and Wallace,
both of whom were long term employees of the company. It strains credulity that they had not
informed their bargaining agent of the manner of providing wage increases at the company and
had not made it clear that the merit increases were not being given after the first few months of
2001. Thus, I do not credit Lori Smith that she had somehow been mistakenly led to believe
that Respondent gave discretionary increases and later learned that it also gave regular merit
increases.

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The list of employees given above shows that in every calendar year most bargaining
unit employees, (8 out of 10), received a raise. Aroca received a raise every year from 1997 to
2000. Buono received three increases from 1998 to 2001. Daniels received 10 increases from
1991 to 2001. Leach received 7 raises from 1990 to 1998. Pericles received 4 raises from
1997 to 2001. Rivera received 8 increases from 1991 to 2001. Zapatier received three
increases from 1998 to 2000. Mateo’s records are incomplete, but he did receive at least 3
raises from 1998 to 2001. Paul Smith testified that he received annual wage increases although
the records submitted by Respondent do not bear this out.

As shown in the recitation of facts above, the dates on which the raises became effective
do not appear to fit any pattern, and the amounts of the increases vary. It is impossible to
conclude that the increases, over time, bear any consistent relationship to an individual
employee’s anniversary date. For example, Daniels was hired in October and he received one
increase in each of January, March and July and 5 increases in February. Rivera was hired in
February and he received one increase in each of November and March, 4 increases in January
and 2 increases in February. There is no evidence that a merit review was routinely conducted
at a fixed time in the calendar year or in relation to a hiring date. The only evidence in the
record shows that employees were reviewed when they asked. Further, although Kuper stated
that the amount of the raise an employee received was based on the dock boss’ report to
management concerning the employee’s productivity, attendance, accuracy and speed, there is
no evidence that the criteria were standardized in any way or that the criteria were applied
equally so that, for example, in a given year the best employees received $1.00 and lesser
performing employees received $.75 or $.50.

I have not been able to find any case where so little predictability was attached to a merit
wage increase practice and yet the practice was held to constitute a term and condition of
employment as to which an employer must give notice and an opportunity to bargain. In Daily
News of Los Angeles and in the numerous cases discussed by the Board therein, the raises
were based on performance appraisals and were regularly given at fixed times, either calendar
dates or anniversary dates with only the amount of the increases being left to the employer’s
discretion, based on established merit appraisal criteria.

The Court of Appeals decision enforcing Daily News of Los Angeles describes the
program in that case as “an established practice of annually evaluating the merit of each
employee based upon standard performance evaluations, and then determining an appropriate
increase based only on the merit criterion. The program was in no sense whimsical, for each
employee was assured an annual evaluation and a merit increase if his or her evaluation
warranted it.” 73 F.2d at 408. (emphasis in original)

In contrast, in the instant case, there is no evidence that Respondent was committed to
granting annual merit evaluations and no evidence that an employee who met established
criteria was assured of a wage increase. The record simply does not contain any evidence that
each time an employee asked for an evaluation it would be done and a raise would follow a
good evaluation. The record bears out Linda Kuper’s testimony that the merit wage increases
were not regular or automatic and that no fixed amount was paid each year. It is clear that
Respondent exercised its discretion in all aspects of deciding whether to grant a wage increase
including timing and amount and application of criteria.

I do not find that the Respondent’s practice of granting merit wage increases was a term
and condition of employment. Thus, I do not find that the Respondent violated Section 8 (a) (1),
(3) and (5) of the Act by failing to continue the practice during negotiations with the Union.

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2. Statements to Employees Concerning Wage Increases

Daniels testified that in the fall of 2002 supervisor Paul Smith came to speak to him
during break time. Smith said, “I haven’t had a raise in two years because of the Union.” Smith
said no supervisors and no workers were getting raises. Daniels replied that he had not had a
raise in three years going on four years. Smith continued by saying the Linda Kuper said no
worker was getting a raise because of the Union. Smith told Daniels that because Daniels was
on the negotiating team he was taking bread out of Smith’s mouth and from the workers’
mouths. According to Daniels, Smith concluded by saying he hoped they never signed a
collective-bargaining agreement.

Paul Smith testified that he knew that Daniels had a role with the Union and he asked
Daniels about the Union in passing once in a while. Smith denied that he informed employees
that the company would not give regularly scheduled merit wage increases because they had
brought in a union. He testified that he could not recall a conversation where he complained to
Daniels that he had not received a raise for two years and that Daniels was taking bread out of
his mouth. Smith did not recall telling Daniels that he hoped the company would not sign a
contract with the Union.

I credit Daniels’ testimony about his conversation with Paul Smith. Smith confirmed that
he asked Daniels about the Union periodically because he knew that Daniels was involved with
the Union. Daniels’ recollection of the conversation comports with the reality, confirmed by
Smith’s testimony, that Smith had not received a raise for two years running. Further, I have
found above that Kuper told employee Buono that the company was not giving raises because it
was negotiating with the Union and it is likely that Smith knew the company’s explanation for
failing to give raises. Finally, Smith did not deny salient portions of Daniels’ testimony, he
merely said he could not recall the conversations.

As discussed above, I have found that Maldonado told Buono in April 2002 that
Respondent was not giving raises due to the proceeding with the Union. Also in April 2002
Linda Kuper told Buono that the company was not giving raises because it was negotiating with
the Union.

An employer violates the Act when it informs employees that they are being deprived of
a benefit which the employer has regularly granted in the past because they have chosen Union
representation. I have found above that the merit wage increases given by Respondent were
not a term and condition of employment. It appears that Linda Kuper’s statement to Buono that
no raises were given because the company was negotiating with the Union was an accurate
statement of fact. Maldonado’s statement that the company was not giving raises due to the
proceeding with the Union was also accurate. The Company and the Union had not reached
agreement as to wages; therefore, no wage increases were being given. I do not find that
these statements violated the Act.

I do not find that Paul Smith’s statements to Daniels were unlawful. Daniels was a
member of the negotiating team and he was well aware of the status of discussions between the
employer and the Union. Smith expressed his displeasure at the length of the negotiations and
the fact that supervisors were being deprived of raises. Smith blamed the Union and the
members of the negotiating committee, including Daniels. I find that Smith’s comments
concerning the length of the negotiations and the concomitant delay in wage increases are
reasonably interpreted as an expression of frustration with the failure to reach agreement.

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F. The Decertification Petition

Louis Buono filed a decertification petition in Case 22-RD-1355 on October 17, 2002.
Buono works on the day shift as a forklift driver. He has been employed by Respondent since
April 1998 with a break for a leave of absence from April to August 2000. Buono, who said he
understood that the company gave annual raises of $.50 or $1.00, testified that he received
$1/hr raises in August 1998, June 1999, and January 2001.18 Steve Kuper always informed
Buono that he was receiving a raise. In April 2002 Buono asked Maldonado about getting a
raise. Maldonado replied the company was not giving out raises due to the proceeding with the
Union and he suggested that Buono should speak to Linda Kuper. Other employees were
asking Buono what was going on with the Union about this time.

Maldonado accompanied Buono when he went to speak to Kuper in her office. Buono
did not punch out before he attended this meeting. Buono asked Kuper questions about what
was going on with the Union and whether the employees could get raises. Buono was
concerned that the negotiations had gone on for three years and the employees had not
received any raises or benefit increases. Kuper said that the company was in negotiations with
the Union and if she gave a raise it could be used against the company as “bribery.” Kuper said
the Union had accused the company of surface bargaining, a term which she compared to hard
bargaining. Kuper said she did not want a Union; she is the person running the company and
she wants to decide who deserves a raise. Buono, who knew that in order to remove a union a
petition had to be signed, asked Kuper whether, if he obtained a petition to get rid of the Union,
she would be able to start giving employees their raises. Kuper said she could not make any
promises but she said “they would continue their business as usual before the Union was there.”

During this meeting Kuper told Buono how unions work and what was going on. After
consulting with company counsel over the telephone, Kuper gave Buono a copy of a collective-
bargaining agreement between Local 641 and a company named Railhead, a competitor of
Respondent. Kuper told Buono he could show the contract to other employees. Kuper said the
Railhead contract showed that at the other company the Union had obtained annual raises of
$.40 and $.30 per year.

Kuper testified that Buono came to her office asking for a raise and wanting to know
what he could do to get a raise. Kuper told him to speak to the Union. Kuper denied telling
Buono that if the Union left then the company would go back to business as usual, meaning
raises every year. She denied telling Buono that she did not want a Union and that she wanted
to be the one to decide who deserved a raise. Kuper acknowledged that she gave Buono a
copy of the Railhead contract.

Buono eventually spoke to eight employees who were directly employed by Respondent
about signing the decertification petition. Buono used the Railhead contract when he spoke to
his co-workers. He reminded them that Respondent gave raises of $1 per year.

One day after he had punched out Buono spoke to three employees whom he believed
did not speak English. Buono testified that he asked supervisor Anthony Oliveri to interpret.19
Continued
18 Buono did not receive a raise in 2000 because of his four month leave of absence.
19 Anthony Oliveri is not Buono’s supervisor but their shifts overlap. Buono testified that
Oliveri assigns duties to the men on the night shift and decides which crew is working on which
particular job. Oliveri assigns helpers and he roams the docks checking to make sure

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_________________________
Buono told Oliveri that he had a petition about the Union and he asked Oliveri to call three
employees who were working so that he could speak to them. At first Oliveri refused, saying it
would be a problem. Eventually Buono convinced Oliveri and the latter called the three
employees off the job to the dock office. Oliveri translated while Buono explained that he had a
petition against the Union and that he was asking the three men to sign the petition. Oliveri told
Buono that the men said they wanted to take some time to decide. After the three went back to
their jobs Oliveri said that he and the three employees did not get along. Buono apologized to
Oliveri because he had not realized that there was a personal problem. Buono then asked a
temporary employee to come with him to interpret and he went over to speak to the three men
again. At this point he realized that one of the three, “Jose”, speaks good English. Buono then
explained that the petition had nothing to do with Oliveri and that he himself was filing the
petition. Jose asked what the company was offering if they signed the petition. Buono replied
the company was not offering anything because it would be bribery. Buono said he hoped if the
Union left that the company would go back to giving a raise every year.

One week before the petition was officially filed, Buono and two other employees went to
the Regional Office with a draft signed petition.20 Buono informed Maldonado that he had to
leave work to file a petition against the Union. Maldonado said, “go ahead.” Maldonado did not
tell Buono to punch out and Buono did not punch out. Buono testified that he was paid for the
few hours that he spent at the Regional Office. Buono testified that normally Respondent
requires one day’s notice from employees who ask to leave work early.

Linda Kuper testified that Buono should have punched out for his trip to the Regional
Office. Buono’s manager should have checked Buono’s time card to see that he punched out.
Maldonado stated that he told Buono to punch out when he left for the Regional Office.
Maldonado said that Buono was punched out “for an hour or so … something like that.” I note
that Respondent did not introduce Buono’s time card or payroll records to show that Buono
punched out and was not paid for the time he spent taking the petition to the Regional Office.

At some point after these events Maldonado told Buono that he was on the Union
negotiating committee and that he would henceforth attend bargaining sessions.

The Complaint herein alleges that Anthony Oliveri is the Night Shift Supervisor and a
supervisor and agent of Respondent within the meaning of Section 2 (11) and (13) of the Act.
The Complaint further alleges that Oliveri solicited employees to sign a decertification petition.
Respondent’s Answer admitted that Oliveri and others are supervisors and agents but
specifically denied that Smith is a supervisor. Respondent’s Answer denied that Oliveri solicited
employees signatures for the decertification petition. On the second day of the instant hearing
while Counsel for the General Counsel was presenting evidence concerning the decertification
petition Counsel for the Respondent said the admission of Oliveri’s supervisory status was a
mistake and moved to amend the Answer to deny that Oliveri is a supervisor. This motion was
denied on the basis that the Complaint, issued in February 2003, was specific in its mention of
Oliveri so that Respondent could not have overlooked Oliveri’s name and made a mistake, and
that Respondent’s motion was made after 1 ½ days of trial in late July and after General
Counsel had prepared the case and had begun to present it.

employees are doing their jobs. There are 40 night employees and Oliveri is the person on the
dock responsible for these men. Another supervisor named “James” works at night. This
person has office duties.
20 The petition was typed at the Regional Office and Buono returned it by mail a week later.

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Anthony Oliveri testified that he is a dock boss. Oliveri recalled that about one year ago
Louis Buono asked him to act as an interpreter for some Spanish speaking employees. Buono
said he had a petition to get the Union out. Oliveri said he had known Buono for a long time so
he overcame his initial reluctance and agreed to do Buono a favor. Buono brought employee
Jose Aroca into the office where Oliveri has a desk and keeps supplies.21 Oliveri translated
Buono’s statements to Aroca for about five minutes. The subject of the translation was that
Buono had a petition to get the Union out.22 Oliveri said that he had not known that this would
be the subject matter until Buono began speaking. After he ceased translating Oliveri told
Buono that he should have warned him because Oliveri did not want to be in the middle of this.
On October 14, 2002 Linda Kuper sent a memo to Oliveri stating, “It has come to our attention
that you permitted Louis Buono to speak to employees during working hours. This is not
permitted and is against company rules. Please ensure that this not happen again.” (sic)

I credit the testimony of Buono that Maldonado took him to see Linda Kuper to discuss
the question of a wage increase. I credit Buono’s version of the conversation with Kuper. I find
that she told him she could not give raises because it might be seen as bribery, that she told
him she was engaging in hard bargaining, that she did not want a union and that she said she
wanted to run her own company and decide who would get a raise. As I observed Buono I
formed the impression that he was completely candid and, although he was subject to some
confusion over dates, I believe that Buono was accurate about the substance of his testimony.
Buono is still employed by Respondent and thus has no motive to shade his testimony against
the interests of his employer; indeed, Buono has every incentive to help his employer. Further,
Buono’s narration of his meeting with Kuper was given forthrightly and gave the impression of
deriving from his memory of the meeting rather than being learned by rote. Buono’s general
recollection of the meeting and most of the details he testified to were not denied by Kuper.
Thus, I do not credit her denial that she told Buono that she did not want the Union, that she
wanted to decide who gets a raise and that if the Union left the company would go back to
business as usual.

I credit the testimony of Buono and Oliveri that Buono told Oliveri that he had a petition
to get the Union out and that he needed an interpreter for some employees. I credit the
testimony of Buono that Oliveri took the three employees off the floor and brought them to his
office and interpreted for Buono.23 As stated above, Buono’s testimony was against his own
interest because he is still employed by Respondent. Oliveri’s testimony was not convincing.
Oliveri said that he took an employee away from his work as a favor to Buono without knowing
the subject about which Buono wished to address him. It is not credible that a dock boss would
agree to such an action without knowing what it was all about, especially since Oliveri
acknowledged that he himself was going to be translating for the employee. Further, although
Oliveri said that had he known it was about a decertification petition then he would have refused
he stated that he continued to translate for Buono for five minutes. Surely, quite soon after
beginning the translation of Buono’s remarks Oliveri must have known that he was talking about
an effort to decertify the Union. Yet he continued on for five minutes. This convinces me that
Oliveri was not averse to translating the decertification message and lends credence to Buono’s
version of the incident. I find that Oliveri took three employees away from their work and
brought them to his office and translated for Buono in an effort to obtain the employees’
21 Although Oliveri stated that Buono wanted him to translate for other employees, only
Aroca came into Oliveri’s office.
22 Oliveri never saw the petition.
23 I find that three employees were involved in this incident. Buono so testified and Kuper’s
warning notice to Oliveri speaks of “employees.”

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signatures on a decertification petition.

I credit the testimony of Buono that Maldonado did not tell him to punch out when he
went to the Regional Office with his decertification petition and I credit Buono’s testimony that
he was paid for the time. Kuper said that Maldonado had the responsibility for checking
Buono’s time card. Maldonado said that he told Buono to punch out and he maintained that
Buono was not paid for the time. Yet Respondent, which was in a position to produce the
documentary evidence to support this declaration, did not produce Buono’s time card or payroll
record. These documents are the best evidence on the question whether Buono was on the
clock when he traveled to the Regional Office in an effort to decertify the Union. In the absence
of reliable evidence to the contrary, I credit Buono that he was paid for the time. I also find that
Kuper encouraged Buono in his attempt to decertify the Union. She told him that she did not
want a union and that she wanted to be the one to decide who gets a raise. She told Buono
that in the absence of the Union the company would go back to business as usual in the
granting of wage increases. To emphasize her position concerning the Union Kuper gave
Buono a copy of the Railhead contract and said he could show it to other employees.

The totality of the Respondent’s conduct with respect to the decertification petition at St.
George Warehouse would lead employees to believe that it supported the petition. Linda Kuper
gave Buono a copy of the Railhead contract to show other employees so that he could convince
them that the company gave larger wage increases than were obtained by the Union through
collective bargaining. Kuper told Buono that she did not want a Union because she wanted to
be the one to decide who would get a raise. The employer provided assistance by permitting
Buono to solicit signatures of employees during their work time, by providing a supervisor’s
translation services during work time and by permitting Buono to travel to the Regional Office
with his petition while he was on the clock. Respondent thus violated Section 8 (a) (1) of the Act
by assisting in the circulation of the decertification petition. Process Supply, 300 NLRB 756,
758 (1990).

G. Respondent’s September 26, 2003 Letter to Employees

On September 22, 2003 the hearing in the instant case was scheduled to continue.
Instead, the hearing was adjourned based on an off the record statement to the ALJ which was
summed up as “the parties are attempting to settle the contract, which would wrap up the
outstanding cases as well.” The parties met with a mediator the next day, September 23, and
they scheduled another meeting for October 1, 2003. In the interim the company sent a letter to
unit employees signed by Linda Kuper. The two page letter mentions various issues, including
the size of the unit, the length of negotiations, the wage proposals made by both sides to the
negotiations, the demand for a Union shop and the decertification petition. General Counsel’s
brief cites the following three paragraphs as evidence that the Respondent, in violation of
Section 8 (a) (1), blamed the Union for its own unlawful conduct and informed employees that it
is futile to support the Union.24

For almost the past year and a half, St. George has also been trying to convince the
Union to allow us to pay you the $.90, three year, wage increase we have offered – but
the Union refuses to allow us to do so. They believe that they can somehow compel St.
George to pay more. Needless to say, they can believe whatever they want. The Union,
realizing that the demands it made were not realistic, has reduced its demands – your
demands – to $1.50 over three years, or a $.60 difference over three years ($.20 per
24 The original letter contains the italicized portions in the quotations.

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year), between what St. George is willing to pay and what the Union is seeking in wages,
and, still they will not let us pay you anything! The reason we cannot pay you by
ourselves is because it is against the law.

What we believe the Union does not understand is that if the Company is unwilling to
pay more money in wages and is not willing to force those who do not want to pay dues
to pay dues to the Union, where does that leave you? The answer is that it leaves you
where you are right now and where you have been for the past two plus years and
where you may be for years to come. Where are we all going with this scenario?

The problem is that while all the legal maneuvering between St. George and the Union is
going on, you, our employees, are not receiving wage increases because the Union will
not agree to allow us to do so. Please understand that all of this legal maneuvering
could go on for years!

I have found above that Respondent did not violate the Act by failing to grant the
discretionary merit wage increases. Therefore, I cannot find that the letter blames the Union for
the company’s unlawful action. As pointed out by General Counsel, there is no evidence in the
record that the Union told the employer to cease giving wage increases or that the employer
offered to put wage increases into effect before a contract was signed. It is possible to read
Kuper’s letter as implying that the company was willing to grant a raise but that the Union
refused to permit this. It is also possible to read the letter as a statement that the Union is
unwilling to agree to the company’s wage proposals. In any case the letter clearly says that it is
against the law for the company to increase wages “by ourselves”. It is correct that the
Respondent may not take unilateral action to raise wages and Respondent is truthfully informing
the employees of its lawful action in failing to grant a wage increase. General Counsel also
contends that the three quoted paragraphs advise employees that it is futile to support the
Union because the Union could not force Respondent to agree to contract terms, and that the
letter is meant to disparage the Union and undermine employee support for it during the parties’
first contract negotiations. However, the letter only states the positions of the parties and that
the company is “unwilling” to pay what the Union demands. The letter does not state that
Respondent will not bargain over the Union’s demands, only that the bargaining may continue
for some time. I do not find that the cited portions of the letter violate Section 8 (a) (1) of the
Act.

H. Surface Bargaining

1. The Negotiations

Lori Smith testified that at the September 24, 2002 negotiating session Craner told her
that until the decision by ALJ Davis was reviewed by the Board there would not be any kind of
agreement. Smith’s September 27, 2002 letter to Craner protests that he has “made it quite
clear that no agreement will be reached until the ALJ’s decision is rendered – other than an
agreement in which the union accepts … the ‘proposals’ which are on the table.” Smith testified
that after Judge Davis’ decision was issued, Craner said on several occasions that the parties
should wait until the Board ruled on the ALJ decision. Smith acknowledged that the Board
decision in the case before Judge Davis was expected to have an impact on the number of
people who would be subject to a prospective agreement. Craner said that in light of the
parties’ adverse position it was unlikely that a collective-bargaining agreement would be
reached before the Board decided the case.

Lori Smith testified that the parties received ALJ Davis’ decision around October 22,

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2002. Smith then received a letter dated October 31, 2002 from Craner which supplied certain
information concerning the agency personnel used by Respondent to perform bargaining unit
work.

The October 31 letter acknowledged that ALJ Davis found a violation in the unilateral
transfer of unit work to agency employees. Accordingly, the letter amended the Respondent’s
contract proposal to include the following language which the company offered to bargain over
at the next meeting:

In view of the fact that the certification issued by the National Labor Relations Board
finds the appropriate bargaining unit as all full-time and regular part-time warehouse
employees, excluding all temporary agency employees (inter alia), the Company shall
have the right to transfer unit work to agency employees in the event a full-time or
regular part-time warehouse employee employed directly by the Company resigns, quits,
or is terminated for cause, and that such agency employee shall not be covered by the
terms of this collective bargaining agreement and that the employment of said agency
employee shall not constitute a violation of any other provision of this contract to the
contrary notwithstanding. (sic)

The parties next met for negotiations on November 5, 2002. Lori Smith testified that she
told Craner that the proposed language codified the destruction of the bargaining unit, but
Craner insisted on that language. Smith also asked why the fact that the warehouse was
bonded would affect a Union agent’s ability to enter the warehouse to investigate grievances.
Smith asked whether there were any restrictions required by Respondent’s customers. Craner
did not offer a legal basis for denying access to the Union. Craner proposed that the Union
agent would discuss his need to investigate a grievance with Linda Kuper, that Kuper would
then review the grievance to see whether access was required and if she determined that the
agent needed to speak to employees she would bring employees to her office to speak with the
Union agent. The Union agent would not be permitted to enter the warehouse.

Lori Smith next received a letter from Craner on November 12, 2002. Craner agreed to
certain dates for bargaining sessions. The letter also requested the Union’s “final position with
regard to all of the matters we have discussed” including the Company proposal regarding the
use of agency employees. On November 22, Smith answered Craner’s letter saying that the
Union was not prepared with any final positions because the request was “premature given the
course of negotiations to date.”

At the next meeting the parties went through the various Union proposals. The Union
offered a formula which permitted agency employees to constitute 10% of warehouse
employees and provided that agency employees would become permanent employees after 45
days. The company rejected this stating that it wished to replace directly hired employees as
they left its employ. The Union made a revised visitation proposal which provided reasonable
access to company premises to investigate grievances and enforce the contract. This was not
accepted.

Before the next bargaining session, Craner wrote a letter dated January 7, 2003 to Lori
Smith which stated the company’s position. In relevant part, the letter stated the company’s
agreement to a three year contract except that it objected to the Union’s desire to make it
retroactive to November 1, 2001. The company would agree to a contract effective as of the
date agreement was reached. The Respondent reiterated that it would not agree to any
provision that gave the Union “recognition over agency employees without having to petition the
National Labor Relations Board.” Apparently Craner viewed the unit as consisting only of the

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directly hired employees then employed and was taking the position that the unit was now fixed
at 8 employees.25 The company proposed that it have “the right to hire agency employees in
order to meet fluctuations and work load.” The company adhered to its position that it would not
agree to a union shop or check off provision. The company renewed its proposal that in the
case of grievance investigations the Union agent would “first come to see Linda Kuper … and
any investigation or discussion of the grievance can proceed from that point forward.” Craner
stated, “What the company does not want … is to have a Union representative wandering
through a bonded warehouse….” The company responded to the Union’s vacation language by
proposing “one week of vacation after one year of continuous employment and two weeks of
vacation after ten years….” This was a change from prior practice which had been to grant two
weeks of vacation after three years of employment. The letter also accepted or rejected many
Union proposals dealing with a myriad of issues including health insurance, where the company
rejected the Union demand and instead proposed to “continue the present employee
contribution toward hospitalization.”

The parties next met on January 9, 2003 when they discussed Craner’s letter. The
Union presented new access language. The new demand would grant the Union access to the
shop four times a month during the first year of the agreement and twice a month thereafter,
and also access during breaks and lunch hours. Reasonable notice was to be given by the
Union and there would be no interference with company business. After some discussion, the
Union agreed to prepare another proposal. The Union made a new wage proposal which
countered the company’s May 2002 offer of a $.30 across the board yearly increase, the
granting of discretionary bonuses and a minimum of $8.00/hr for new hires. The Union now
asked for $.50/hr across the board and a minimum $13/hr rate. This was lower than previous
Union demands.26 When it was pointed out to Craner that he had changed the vacation
provision, he reverted to the existing policy of two weeks after three years.

On January 13, 2003 Craner wrote to Lori Smith responding to some of the Union
proposals made on January 9. There appeared to be some agreement on hours of work and an
additional third week of vacation after 15 years. Regarding wages, Craner rejected the Union’s
$.50 proposal and said, “The company still maintains its $.30 proposal.” Craner reduced the
$8.00 minimum starting rate he had offered in May 2002 stating, “With regard to the minimum
starting rate, the Company counterproposes a $7.00 per hour minimum starting rate.”

The parties met on February 3, 2003. Lori Smith presented a new proposal to deal with
Union visitation to investigate grievances and enforce the contract. The new language provided
for notice to the employer, the provision of a private area to confer with employees and a
management escort if the union agent required access to the work area. The parties discussed
wages and the company pointed out that the Union’s agreement with Railhead provided only
$.30/hr wage increases. The Union replied that the Railhead contract was generous in medical
insurance, holidays and other economic benefits.

After the February 3 session company representatives took the Union agents into the
warehouse to show the Union a video of a hi-lo accident which had led to termination of an
employee. Lori Smith, Jan Katz and employee committee members walked through the
warehouse. At one point Jan Katz said hello to a person in the warehouse and Craner said that
was a problem, that was why the Respondent would not permit Union access to the warehouse.
25 When the negotiations had begun in 2001 there had been 14 directly hired employees. At
the time of the instant hearing there were 7 directly hired employees in the unit.
26 The Union had no demand for merit increases.

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On February 18, the bargaining session was cancelled due to weather and Craner wrote
to Smith giving the company responses to Smith’s February 3 proposals. Craner modified the
employer’s proposals relating to the management rights clause, the unit work clause and the
issue of Union access. Regarding visitation, the company agreed to some of the language
proposed by the Union on February 3, but still required notice to Linda Kuper and still seemed to
permit Kuper to decide, in each case, whether the Union needed to meet with a employees in
order to investigate grievances. The company agreed to provide a private location for the Union
to confer with employees. The company proposal required consent of management before a
Union agent could enter the warehouse.

The parties met on April 8, 2003. Lori Smith asked that the company put its regular
merit increase into effect to bring the employees up to date on their hourly wages. If raises
were given to make up for the last two or three years, then the parties would not be so far apart
on minimum wages. The employer asked the Union for its proposal. Further, the employer
suggested that the parties employ a mediator. The Union said it would hold its merit increase
proposal for the mediator and discuss merit increases with a mediator present.

On April 23, 2003 the parties met in the mediator’s office. Lori Smith stated that the
Union did not seek further negotiations because the instant hearing was about to begin and she
thought she would let the proceeding go forward and see what happened.

As set forth above, the instant hearing was adjourned on September 22, 2003 to permit
the parties to discuss a resolution of the issues including the unfair labor practices and the
collective-bargaining agreement. Lori Smith testified that she told Respondent that the Union
would not withdraw any charges unless a contract were signed. The Union wanted a “global
agreement.” Smith understood that Craner wished to resolve issues relating to the ratio of
direct to agency hires and other issues in the case decided by ALJ Davis. Smith was told that
Craner wanted the Board to continue to process the decertification petition.

On September 23, 2003 the parties attended a mediation session with Mediator
Wellington Davis. Each side stayed in a separate room. At the end of the day the parties
agreed to meet on October 2.27 In the interim, the September 26 letter from Kuper to unit
employees was distributed. Lori Smith thought the letter showed the company’s bad faith; the
company would not pay more in wages, it would not agree to a check off and it implied that the
Union was to blame for the failure of employees to receive wage increases.

The parties met again on October 9, 2003 with Mediator Alan Budd. There were
extensive face to face discussions on this occasion. The Union made wage proposals designed
to bring wages up to date on missed wage increases. The Union proposed a signing bonus of
$1500 per employee, a raise in each employee’s current rate of $1.50 per hour and annual
wage increases for a three year contract. The company proposed that instead of retroactive
pay it would give a signing bonus of $1664 to the seven remaining unit employees. The bonus
would not go into the wage scale but there would be a $.30/hr increase on the effective date of
the contract. The employer for the first time proposed a one-year agreement rather than the
three-year agreement that the parties had been discussing throughout their negotiations.28 The
Continued
27 Apparently this meeting took place, with the parties situated in separate rooms and
Mediator Wellington Davis presiding.
28 The employer’s proposal was for either a one-year agreement or a hypothetical three-year
agreement with only one year to run until completion. Either way, there would be only a one

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_________________________
company offered an $8.00/hr rate for new employees and it proposed to move 23 agency
employees onto its own payroll. The employer’s offer was contingent on an election being held
among the 30 unit employees. Craner explained that either a Board election or a private
election must be held within 45 days of the agreement. If the Union won, then the contract
would become effective. Craner said there had to be an election or there would be no contract.

The Union asked for a $10.00/hr starting wage rate for the 23 agency people to be
added to the unit. Eventually, Lori Smith agreed to the $8.00/hr starting wage rate proposed by
the company. At that point Craner responded, “Well, I think $8.00 is a little bit too rich. I’m
beginning to think $8.00 is too rich.”

Smith stated that she would not agree to an election, saying that there had already been
an election and the Union had won.

Jan Katz, vice president and business agent of Local 641, testified that he was present
at the meeting on October 9, 2003 with Mediator Budd. Katz testified that although from the
beginning of their negotiations the parties had been bargaining for a three year contract, on this
day Craner proposed a one year contract. Craner said the contract would be treated as the last
year of a three year contract but there would be no retroactivity. A signing bonus of about
$1660 would be paid but the amount would not go into the wage rate. Katz was taken aback
because the length of the contract had never been an issue before this day. In previous
negotiations, Katz testified, the Union and the company had agreed to an $8.00/hr start rate for
new hires. Craner said at this meeting, “We rethought the $8.00 and it is too rich.”

Katz recalled that the company was willing to reach a compromise based on the decision
of ALJ Davis. The judge had ordered that 49 agency employees become part of the unit and
the company was willing to accept 23. The company also demanded that an election be held in
a unit consisting of the 7 directly hired employees now in the unit and the 23 agency employees
to be added. Without a vote, the company would not agree to anything. Katz testified that he
recalled Linda Kuper’s “exact words.” She said that the Union only won by one vote last time
and she could win it this time.

Linda Kuper stated that she could not recall Craner’s statement that the company was
withdrawing the offer of an $8.00/hr starting rate. She said she never heard Craner say the
company would only agree to a one year contract. However, the company position at the
meeting with Mediator Budd was for a contract with no retroactive pay which would expire one
year after it was signed.

Linda Kuper testified that she had agreed to attend settlement negotiations in order to
resolve all the charges. She had agreed to increase the labor force if the Union would withdraw
its charges and go forward with an election.

Craner’s notes of the October 9 session with Mediator Budd were admitted into
evidence. Craner stated on the record that his notes show that the Union spoke of settling the
unfair labor practice case dealing with the annual merit wage increases by the computation of a
“back pay” amount. The Union believed that the remedy would amount to $170,000. The Union
suggested that instead of a remedy it would settle for a $1.50/hr increase for the seven unit
employees and a signing bonus of $1000. The Union demanded a $10.50/hr start rate for the
agency people to be added to the company based on the fact that the employer was currently
year wage increase added to each unit employee’s wage scale.

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paying the agency $10.50/hr for each employee. The company counter proposed $8.00/hr.
After a caucus, Craner and Linda Kuper returned and made the following proposal:

1A. The pending ALJ Case would be settled and pending charges withdrawn. As a quid
pro quo the employer would add 23 people to the unit.

1B. An election would be held in a unit of 30 employees within 45 days from the date of
agreement.

2. The starting rate for the 23 new employees would be $8.00/hr with a $.30/hr increase
after one year.

3. The contract would be retroactive for existing employees only two years from the date
of signing. The contract would begin on October 1, 2001. The 7 existing employees
would receive $1,664 on the date of signing and a wage increase of $.30/hr in the third
year.

4. There could be either a Board election or a private election.

Katz testified that he and Linda Kuper met again on October 29, 2003.29 Katz gave
Kuper an outline of Union proposals. The first paragraph of the proposals dealt with the 23
agency employees to be added to the unit. The Union proposal contained paragraphs dealing
with start rates and wage increases, health insurance, union security, discipline, contract terms
and a section which stated simply “No election.” Katz testified that at the beginning of the
meeting Kuper said she would not agree to anything without a vote and she would not agree to
hire the 23 people without a vote. Kuper said there would be no contract without an election.
Katz said that he never got beyond the first paragraph in telling Kuper what he was proposing.
Katz and Kuper did not discuss anything further that day.

Katz testified that Linda Kuper told him she did not want anybody running her business.
She thanked him for filing additional unfair labor practice charges which she said would “bring
this to another two years.” Kuper said she would retire in seven years time and it would not
make a difference if this were still going on.

Linda Kuper agreed with Katz’s recollection that they never got beyond discussing the
first paragraph of his proposals because the Union would not agree to an election. She said the
only reason she would agree to add to the labor force was to have an election. Kuper testified
that after Katz left the meeting she read his entire proposal and then sent it to Craner with her
comments. Kuper did not deny Katz’ testimony that she told him she did not want anybody else
running her business, nor did she deny that she thanked Katz for filing more charges and
adding another two years to the proceedings. Kuper did not deny that she told Katz she
planned to retire in seven years and it would not make a difference to her if the dispute were still
going on at that time.

Kuper said that the company and the Union had reached agreement previously on the
employer’s contribution for the cost of individual health insurance coverage, but not family
coverage.

On January 6, 2004, the final day of the instant hearing, Kuper testified that she had
29 No other representatives were present.

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been considering a new company wide health insurance plan for employees throughout the fall
of 2003. The old insurance plan expired on November 1, 2003, and on that date the
Respondent implemented a new health insurance plan for employees, including unit employees.
She did not inform the Union and did not negotiate about the new plan. There is no record
evidence that the Union was aware of the situation before January 6, 2004.

2. Conclusions

The General Counsel contends that various factors show that Respondent has engaged
in surface bargaining by conduct both “at the table” and “away from the table” which establishes
that Respondent was determined to prevent the parties from reaching agreement.

In Atlantic Hilton & Tower, 271 NLRB 1600, 1603 (1984), the Board summarized its
views on surface bargaining. The Board began by stating the obligation of the parties under
Section 8 (d) of the Act to meet and confer in good faith “but such obligation does not compel
either party to agree to a proposal or require the making of a concession.” Although the parties
have a duty to negotiate with a sincere purpose to find a basis of agreement the Board cannot
force a party to make a concession on any specific issue. An employer’s overall conduct must
be scrutinized to determine whether it has bargained in good faith. The total conduct will show
whether an employer is lawfully engaging in hard bargaining or unlawfully endeavoring to
frustrate the possibility of arriving at any agreement. A party may stand firm on a position based
on a reasonable belief that it is fair and proper or that “he has sufficient bargaining strength to
force the other party to agree.” Thus, adamant insistence on a bargaining position is not of itself
a refusal to bargain in good faith. Conduct indicative of a lack of good faith includes delaying
tactics, unreasonable bargaining demands, unilateral changes in mandatory subjects of
bargaining, efforts to bypass the union, failure to designate an agent with sufficient bargaining
authority, withdrawal of already agreed-upon provisions and arbitrary scheduling of meetings.

The General Counsel cites the cessation of the merit increase program and the
September 26, 2003 letter to employees about their failure to receive wage increases. I have
found above that the Respondent’s conduct in these two instances did not violate the Act.

The General Counsel cites as evidence of delaying tactics the fact that Respondent
replied to the Union’s September 18, 2003 request for wage information with incomplete
information on September 23, thus rendering the Union “unable to conduct an analysis of
employees’ past wages increases … and intelligently formulate proposals” for the scheduled
September 24 negotiating session. Indeed, it would have been better had Respondent
produced complete wage information on its first try. However, Respondent did not have much
time to compile wage information going back more than 10 years in some instances. A time
period of 5 days to furnish the information excuses some inaccuracies and incompleteness.
Further, Respondent did ultimately supply corrected information. I do not find that Respondent
deliberately engaged in delaying tactics by failing to supply complete wage information on
September 23, 2003.

The General Counsel asserts that Respondent’s desire to delay negotiations is
evidenced by Craner’s suggestion that negotiations be held in abeyance until after Judge Davis
issued his decision. I do not find that Respondent violated the Act in this regard. Respondent
did not refuse to meet and negotiate and it did in fact meet with the Union and bargain for a
contract.

In its review of ALJ Davis’ decision at 341 NLRB No. 120 the Board found that
Respondent had not engaged in surface bargaining. The Board restated the standard it applied

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as follows: “Good-faith bargaining presupposes a desire to reach ultimate agreement, to enter
into a collective bargaining contract. … However, a party is entitled to stand firm on a position if
he reasonably believes that it is fair and proper or that he has sufficient bargaining strength to
force the other party to agree. … In determining whether a party has violated its statutory duty to
bargain in good faith, the Board examines the totality of the party’s conduct, both at and away
from the bargaining table. … From the context of a party’s total conduct, the Board determines
whether the party is engaging in hard but lawful bargaining to achieve a contract that it
considers desirable or is unlawfully endeavoring to frustrate the possibility of arriving at any
agreement.” (Citations omitted)

In its review of ALJ Davis’ decision the Board found that Respondent had not engaged in
bad faith actions at the table. Respondent had met regularly with the Union, Respondent had
not engaged in regressive bargaining, Respondent had agreed to certain of the Union’s
demands, including a grievance and arbitration provision, Respondent had proposed a wage
increase and Respondent had explained its position on various Union demands. The Board
also found that that Respondent’s conduct away from the table had not demonstrated surface
bargaining. Although the Board found that Respondent had violated Section 8 (a) (1) and (5) by
unilaterally transferring unit work and refusing to provide certain information to the Union, the
Board found that “General Counsel failed to show a nexus between the Respondent’s 8 (a) (5)
violations and the Respondent’s conduct at the bargaining table.”

Based on the record in the instant case, however, I find that Respondent engaged in bad
faith bargaining and that Respondent’s conduct comprises the use of tactics designed to
frustrate the possibility of arriving at an agreement and evinces its lack of sincere desire to
reach ultimate agreement.

The General Counsel cites the unilateral implementation of a new health insurance plan
for employees on November 1, 2003. It is clear that during the time that Linda Kuper was
meeting regularly to negotiate with the Union she knew that the current policy was expiring, and
she was engaged in choosing and implementing new health insurance for unit employees. It is
also clear that the parties had bargained and exchanged proposals concerning health insurance
costs and employer contributions. Respondent was under a duty to give notice that the policy
was expiring and to negotiate concerning this term and condition of employment before
selecting a new policy. Christopher Street Owners Corp., 294 NLRB 277 (1989). The making
of a unilateral change in a mandatory subject of bargaining is an element considered by the
Board in finding an intent to frustrate the bargaining process indicative of surface bargaining.

I note that Judge Davis had found a violation in Respondent’s refusal to provide, and
delay in providing, health insurance information on the ground that it was confidential. The
Board agreed that the failure to furnish the information was unlawful, but the Board disagreed
with Judge Davis that the failure to provide insurance information showed bad faith bargaining.
The Board stated, “when the Respondent provided information about employees’ health care
premiums, negotiations ensued.” The Board cited those negotiations in support of its finding
that Respondent had not engaged in surface bargaining. As the evidence in the instant case
shows, the Respondent eventually decided that it need not negotiate about employees’ health
care.

Respondent had been negotiating with the Union concerning employee health insurance
and Respondent had received an opinion from the National Labor Relations Board reiterating its
duty to bargain about health insurance. The record shows that the parties had agreed on a rate
of contribution for individual coverage. Yet a few months later, Respondent adopted a new
health insurance program without informing the Union in open defiance of the Board’s language

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about the necessity of negotiating on this subject. This unilateral change had a direct effect on
the bargaining. It sent a message that Respondent would not adhere to its duty to bargain and
refrain from unilateral changes. The Union could not know whether, after it exchanged offers
and made compromises on any subjects, its efforts would be negated by Respondent’s failure to
adhere to a component of the bargain or by the company’s unilateral action .

The General Counsel asserts that Respondent engaged in bad faith bargaining when it
took new positions on vacations and on the minimum starting rate. As set forth above the
company practice had been to grant one week of vacation after one year of employment and
two weeks vacation after three years of work. There is no dispute that the company had
proposed to continue this practice. Without any explanation Craner’s January 7, 2003 letter
offered a new proposal that three weeks vacation would only be earned after ten years. At the
negotiation session of January 9, 2003 Craner reverted to the employer’s original offer of two
weeks vacation after three years of employment. Similarly, the record is clear that the company
had proposed a minimum wage rate of $8.00/hr and that the company had maintained this
proposal since Spring 2002. However, Craner’s January 13, 2003 letter clearly states that the
employer is counter proposing a $7.00/hr minimum. At the October 9, 2003 meeting held with
Mediator Budd the employer once again proposed an $8.00/hr minimum wage. Lori Smith
accepted this proposal, whereupon Craner replied that the company had rethought the $8.00/hr
and, “It is too rich.”30 The record does not offer any illumination of the reason for Respondent’s
see-sawing position on vacations. The only testimony on the minimum wage issue on behalf of
the Respondent is Linda Kuper’s statement that she could not recall Craner withdrawing the
$8.00/hr starting rate. Thus, the record does not show that the changes in the employer’s
minimum hourly wage position are based on any movement in other areas of the bargaining or
have any rational connection to a desire to further the progress of the negotiations. Vacations
and minimum hourly starting wages are essential elements of a collective-bargaining
agreement. By engaging in regressive bargaining on these two major issues the Respondent
impeded and frustrated the progress of negotiations and showed that it did not have a sincere
desire to reach agreement with the Union.

Much the same analysis can be applied to the Respondent’s position on the length of the
contract. Since October 2001 the parties had been negotiating on the basis of a three year
contract. All the wage proposals exchanged between them had provided for increases over a
period of three years. Craner’s letter of January 7, 2003 specifically signified agreement to a
three year contract and questioned only the retroactivity: the employer wanted a three year
contract effective as of the date of signing. However, at the October 9, 2003 meeting with
Mediator Budd the company for the first time proposed that any agreement signed would expire
after one year. Thus, the employer would sign a fictionally titled three year agreement with no
retroactivity that would expire in one year or it would sign a one-year agreement. Respondent
offered no testimony on the record to show why after two full years of negotiations it changed its
position on such a significant item. I can only draw the conclusion that Respondent changed its
position to inject yet another roadblock into the bargaining and frustrate the chances of
agreement. Such a major change without explanation does not evince a sincere desire to come
to terms on a contract.

The General Counsel asserts that Respondent engaged in bad faith bargaining
concerning Union access to investigate grievances and enforce the collective-bargaining
agreement. As a basis for his conclusion that the company engaged in surface bargaining ALJ
Davis relied on Respondent’s refusal to permit Union agents access to the warehouse for the
30 I credit the testimony of Jan Katz and Lori Smith to this effect.

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investigation of grievances. Judge Davis found that Respondent “unreasonably maintained that
the agent could contact employees at home or present his request to Kuper who would decide if
he could speak to an employee or investigate an issue. This would result in the Union
surrendering its authority to act as the employees’ representative.” In its reversal of the Judge
on the issue of surface bargaining, the Board discussed and rejected many factors cited by the
ALJ to support his conclusion that the company engaged in surface bargaining. However, the
Board did not disturb the ALJ’s finding that Respondent maintained an unreasonable position
with regard to Union access to investigate grievances.

After receipt of ALJ Davis’ Decision, in a letter dated October 31, 2002, the company
informed the Union that it based its restrictive offers of Union access in part on the fact that the
warehouse is bonded. The only other indication in the record of the employer’s concerns came
much later, in February 2003, when management walked the Union through the warehouse to
view a video and Craner objected to Katz greeting an employee, saying that was why the
employer would not permit access. Following the October 2002 ALJ Decision, bargaining on
Union visitation continued. At the November 5, 2002 session, Craner maintained his position
that Linda Kuper would decide whether the Union representative needed to speak to an
employee to investigate a grievance and the Union agent would not be permitted to enter the
warehouse. The Union revised its visitation demands to incorporate a “reasonable” criterion for
determining whether access was necessary, but the employer rejected this new language. On
January 7, 2003 Craner reiterated the company’s position that a Union agent wishing to
investigate a grievance must first come to see Linda Kuper and that the Union agent could not
wander through the warehouse. The Union presented new access language on January 9 and
the parties discussed this. On February 3, 2003 the parties discussed yet another Union access
proposal which went further towards dealing with the employer’s concerns and provided for
notice before a Union agent appeared at the warehouse, a private area to confer with
employees and management escort before entering the work area. On February 18, 2003
Craner approved some of the Union’s new language but maintained his position that Linda
Kuper would decide whether the Union needed to meet with an employee in each case where
the Union requested such a meeting in order to investigate a grievance. The Respondent’s
language required that if a union representative needed to confer with an employee to
investigate a grievance “he shall first contact Linda Kuper” and “If the grievance is such that the
need to meet with the grievant or/or shop steward is reasonable, and will not interfere with the
operation of the Company ‘s business, the Company will make the employee/grievant and/or the
shop steward available….” Respondent has presented no evidence that it ever changed its
position that Linda Kuper would be the one to decide whether a Union agent needed to speak to
an employee to investigate a grievance. Indeed, Respondent presented no testimony to
contradict Lori Smith’s recitation of the substance and meaning of Respondent’s position on
Union access and visitation.

The essence of the employer’s contract proposal is that before gaining access to
employees to investigate grievances the Union must convince Respondent’s second highest
ranking manager that it has a reasonable need to do so. Thus, the Union would be required to
disclose to Linda Kuper the substance of the grievance and obtain her agreement to investigate
it. In fact, the Union would have a partner in deciding whether a grievance should be
investigated, and that partner would be the company’s vice president. In such a case, the Union
could not exercise its statutory function to represent the employees. Employees would be loath
to contact the Union representative with complaints or questions and the Union’s ability to
investigate meritorious grievances would be compromised. The Respondent’s insistence on
maintaining Linda Kuper as the arbiter of the Union’s need to speak to employees in order to

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investigate grievances shows a lack of good faith bargaining because it unreasonably intrudes
management into one of the prime functions of the labor organization.31

The General Counsel argues that the Respondent’s position on the use of agency
employees to perform unit work further demonstrates its bad faith in the negotiations. As set
forth above, ALJ Davis found a violation in the unilateral transfer of unit work to agency
employees. Upon review, the Board held, “We … agree with the judge, for the reasons stated in
his decision, that the Respondent’s unilateral transfer of unit work to temporary agency
employees violated Section 8 (a) (5) and (1).” Judge Davis found that following the election the
Respondent increased its use of agency employees and eroded the unit from 42 employees to 8
at the time of his hearing.32 The Board ordered Respondent to “Rescind the unlawful unilateral
transfer of unit work to temporary agency employees and restore the status quo by restoring the
unit to where it would have been without the unilateral changes.” The Board stated that it would
“leave to the compliance stage the determination of the proportion of direct hires and agency
employees that the Respondent must maintain in order for the unit to be properly restored.” 33

Immediately upon receiving Judge Davis’ decision, the company provided the Union with
the information it had requested concerning the agency employees. As quoted above in
Craner’s October 31, 2002 letter the company also offered to bargain about the use of agency
employees. In fact, the employer proposal was that it have the right to transfer unit work to
agency employees and that the agency employees shall not be covered by the agreement.
Thus, Respondent was proposing that the Union agree to the ratification of a practice that had
just been found unlawful by ALJ Davis because of its unilateral nature. Lori Smith objected to
this proposal but Craner insisted on his language. The Union next proposed a formula which
permitted agency employees to constitute 10% of warehouse employees. Respondent rejected
this stating that it wished to replace directly hired employees as they left the company. On
January 7, 2003 Respondent repeated its determination that no more directly hired employees
would be added to the unit and it proposed that the contract give it the right to hire agency
employees. Respondent emphasized that it would not agree to the Union gaining recognition
over additional employees without having to petition for an election.

The next discussion of agency employees took place at the October 9, 2003 meeting
with Mediator Budd. The employer offered to add 23 agency employees to the payroll
contingent upon an election in the unit within 45 days of the agreement. If the Union won the
contract would become effective. The Union rejected this offer. Craner made it clear that
without an election the Respondent would not agree to anything. Kuper stated that she would
agree to increase the labor force if the Union would withdraw its charges and go forward with an
election. Linda Kuper said the Union only won by one vote last time and this time she could win
the election.34 When Katz and Linda Kuper met again on October 29, 2003 the Union
presented an offer which included the addition of 23 agency employees to the 7 directly paid
employees. At the beginning of the meeting Kuper said she would not agree to anything without
a vote and she would not agree to hire the 23 people without a vote. Linda Kuper told Katz that
31 I have noted above that the Board did not disturb Judge Davis’ finding that the
Respondent’s position unlawfully required the Union to surrender its authority to act as the
employees’ representative.
32 At the time of the instant hearing this number had declined to 7.
33Because the Board issued its Decision on review of ALJ Davis’ findings after the close of
the instant hearing and after the filing of Briefs, I do not have the benefit of the parties’ views
concerning the effect of the Board Remedy on the instant case.
34 Kuper did not deny making this statement. I credit Katz’ description of this meeting.

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she did not want anyone running her business and she thanked him for filing new charges,
thereby adding two years to the proceedings. Kuper said she would retire in seven years and it
would not make a difference if the dispute were still going on at that time.35

Respondent’s Brief urges that “wanting to codify existing practices is not ‘surface
bargaining.’ ” Respondent further argues that its proposal to hire 23 agency employees in
exchange for an immediate election and a voiding of the contract if the Union lost the election
was a “settlement proposal” and not a “collective-bargaining proposal.” Respondent asserts
that it is unfair to add 23 people to a unit of 7 employees because the unit would then “be bound
to a Union they had no role in choosing.”

Respondent seems to urge that the proposal to add 23 agency workers to the unit in
return for an immediate election was made only during negotiations with a mediator.
Respondent seems to take the position that the company’s demand for an election in exchange
for hiring 23 agency employees was made during settlement negotiations for all pending cases
in addition to a contract and therefore the demand cannot be unlawful. Respondent’s Brief
ignores the evidence in the record. Craner’s letter of January 7, 2003 setting forth the
company’s bargaining position was written before any negotiations took place to settle all the
outstanding cases. The January 7 letter states that the employer would not agree to any
contract that gave the Union “recognition over agency employees without having to petition the
National Labor Relations Board for recognition.” This language thus sets forth that Respondent
would not agree to add agency employees to the direct hires in the unit without an election.
Respondent did not modify this position from January 7, 2003 onwards. Indeed, when Katz and
Linda Kuper met at the final bargaining session of October 29, 2003 the record is
uncontradicted that Kuper told Katz that she would not agree to anything without a vote and
there would be no contract without an election. Kuper testified that she and Katz never got
beyond the Union’s first proposal which provided for the addition of 23 agency employees into
the unit because the Union would not agree to an election.

The Board has found that the Respondent’s unilateral erosion of the bargaining unit and
transfer of unit work to agency employees was unlawful. The Board has ordered that
Respondent rescind the unlawful transfer of work and restore the status quo. That is the law of
the instant case. Therefore, any insistence by the Respondent that it would continue its
unlawful erosion of the bargaining unit is unlawful and constitutes bargaining in bad faith. The
record is clear that the Respondent continued its insistence on replacing directly hired
employees with agency employees and continued its determination that no more directly hired
employees would be added to the unit from the moment it received Judge Davis’ decision in
October 2002 until the last bargaining session on October 29, 2003. Further, the record is clear
that on January 7, 2003 the Respondent not only repeated its determination to continue its
unlawful course of action and further erode the bargaining unit but it also stated its
determination that it would demand an election as a quid pro quo for ceasing its unlawful
unilateral action. If the Union did not win the election the contract would not become effective.
This position that there would be no contract without an election, and therefore no cessation of
unlawful unilateral activity without an election, was repeated by Linda Kuper at the final
bargaining session. There can be no greater indication of “at the table” bad faith bargaining
than outright defiance of the Act and a Board Order. Respondent has been told that it was
unlawful to erode the bargaining unit by unilateral transfer of work yet Respondent will not agree
to cease the activity and begin restoring the any employees to the unit unless the Union offers
35 Kuper did not deny making these statements. I credit Katz’ description of this meeting.

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the concession of an immediate election.36 Respondent’s position is that if the Union does not
win this election there will be no contract. In effect, Respondent is conditioning its compliance
with the Board order and its duty to bargain on the Union’s agreement to an election.

Respondent’s argument that it has offered to bargain about the agency employees is
disingenuous. The testimony and documentary evidence show that Respondent was not
prepared to budge on this issue. Kuper’s position was, as she stated, that she had no reason to
add to the bargaining unit unless an election was held. The undisputed evidence shows that
she told Katz that she could win this election. Thus, Kuper conditioned the signing and
effectiveness of a collective-bargaining agreement on the holding of an election which she
believed the Union would lose. Respondent’s position was not lawful “hard bargaining”: it was
outright defiance of the agency entrusted with enforcement of the Act.

In this regard it is useful to take note of Linda Kuper’s statement to Katz in which she
thanked him for filing new charges and said that would add two years to the legal proceedings
involving the parties. Kuper added that it would make no difference if the dispute were still
going on in seven years. Kuper did not deny making these statements and she did not attempt
to explain them away. Thus, I take these statements at face value. I observed Kuper closely
during the seven days of the instant hearing. Kuper is a very competent, self-possessed,
intelligent and hard driving executive with national responsibilities for the company. She does
not loosely toss comments into the air and she is always in control of her language and
demeanor. I observed that Kuper was at all times aware of the import of her comments and that
everything she said in the hearing room had a purpose. This was true both while Kuper was
testifying and while she was at counsel table engaging in off the record discussions for various
purposes such as responding to General Counsel’s subpoenas. I conclude that at the last
bargaining session between the parties when Kuper thanked Katz for filing more charges and
prolonging the legal proceedings she was not engaging in “water-cooler banter.” Kuper was
serious when she told Katz that she did not care if there were still a dispute in seven years.
Kuper was telling Katz the truth. She did not care how long matters dragged on between the
parties. She was not in a hurry to reach agreement and she did not care whether the parties
reached agreement or not. Linda Kuper’s attitude is the antithesis of a sincere desire to agree
to a collective-bargaining contract with the Union.

Finally, Respondent’s unlawful assistance in filing the decertification petition had a direct
impact on the negotiations between the parties. At a time when Respondent had a duty to
bargain in good faith it was engaging in actions to undermine the Union. The effort to decertify
the Union, together with Respondent’s unlawful, shifting, capricious and unexplained bargaining
positions and its unilateral changes, shows a desire to frustrate negotiations rather than to
conclude a collective-bargaining agreement. Respondent has engaged in unlawful surface
bargaining in violation of Section 8 (a) (5) of the Act.

I. Disciplinary Actions Against Daniels and Wallace

1. Background

Most of the disciplinary actions alleged as violations of the Act arise from the job
performance of Daniels and Wallace while engaged in the task of loading containers.
36 Respondent’s argument that it would be unfair to saddle 23 employees with a Union they
did not choose ignores that Respondent’s own unlawful actions have brought about the situation
it now decries.

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Each loader is given a manifest or “load plan” to show the freight that must be loaded on
a particular container to which the loader has been assigned.37 The load plan shows the
location of the freight in the warehouse, the number of pieces to be shipped by each customer
and the weight of the pieces of freight. The freight must be “picked” from locations in the
warehouse, then it must be staged near the loading bay of the warehouse where the container
is parked and then the freight must be loaded into the container. On some occasions the loader
has also picked the freight. On other occasions, the individual who has picked the freight and
staged it is not the one who is assigned to load the container. According to Linda Kuper, three
individuals are responsible for insuring that the correct pieces of freight are loaded onto a
container according to the manifest prepared for each container. These are the “picker”, the
“checker” and the “loader.” Indeed, the checker must indicate by his initials on each load plan
that he has checked that all items indicated have been staged for loading and the loader must
indicate by showing the number of items loaded that he has correctly followed the load plan.
Linda Kuper testified that if a container goes out without all of its freight all three individuals
must be disciplined, namely, the person who pulled the freight from the warehouse, the checker
and the loader.

Various employees testified about the frequency with which mistakes are made in
dealing with freight. Purcell Robert Wallace testified that employees occasionally leave freight
off a container. Sometimes the supervisor orally informs the employee and sometimes the
supervisor says nothing but merely puts the freight on the next container going to the
destination. Wallace said this type of short-shipping occurred often.

Wallace testified, without contradiction, about a meeting held by Linda Kuper in her
office about August 27, 2002. The purpose of the meeting was to discuss the mishandling of
freight by shipping it to the wrong destination. An employee named Hilda was in tears at this
meeting. Linda Kuper said everybody was mishandling freight. At the meeting Kuper said that
from now on they would be more careful. Kuper said that from now on there would be three
signatures on each load sheet: the loader, the checker and the supervisor would all sign to
show that the freight is correct.

The record shows that containers must be loaded so that the weight on each axle of the
container is within legal limits. If one axle carries too much weight the container may be
deemed overloaded even if the total weight of freight in the entire container is within legal limits.
The weight of the freight indicated on a manifest is based on information supplied by the
customer. When a loader loads freight onto the container he must calculate the weight on each
axle to achieve a legal and safe load. A loaded container is taken by a driver to a weigh station
prior to being loaded on a vessel or driven out on the road. If the container is overweight an
overweight ticket is issued and the driver returns to the warehouse with the container so that the
freight may be repositioned or “reworked.” The company is responsible for getting the driver of
a container out on the road in a specified length of time. Respondent pays drivers for extra time
spent due to mistakes such as overloading and the need to rework the freight.

The warehouse is equipped with video recorders that show the staging areas and the
loading bays or doors. The videos are kept for an unspecified time so that if questions arise as
to the location or loading of freight or damage to freight the videos may be reviewed. Further,
loaders and supervisors take still pictures of freight both outside and inside the containers on
37 The company also maintains other extensive documentation relating to each shipment
received and each container that is loaded in the warehouse.

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certain occasions. These practices were not described in full detail in the instant record.

The documents in the record show that the employer maintains a system of progressive
discipline, although not all written warnings lead to suspensions. Maldonado testified that for
the first offense of using a cell phone during working hours he would give an employee a verbal
warning and for the second offense of such a cell phone use he would send the employee home
for the day. Documents submitted as a joint exhibits to establish all discipline given to unit
employees from February 1, 2000 to January 31, 2003 show the following pattern:

Louis Buono

In February 2000 Buono was given a “2nd warning” for absence without phone call and
suspended for two days. When he was again absent without phone call he was given a
“3rd warning” and suspended for a week.

In September 2002 Buono was given a written warning for misloading a skid of freight
bound for Oregon onto a container bound for San Francisco. The load numbers were
specified on the warning.

In November 2002 Buono was given a warning for leaving the warehouse without
punching out. Two weeks later Buono was given a warning for damaging the roof of a
container while using a forklift to load freight. A picture of the damage was included on
the warning.

Jose Aroca

In April 2000 Aroca was given a one day suspension for “damaging freight by putting two
holes into two drums.” The freight number was specified on the warning.

Richard Zapatier

In February 2000 Zapatier was given a warning for taking 10 ½ hours to strip (unload)
two containers. The freight numbers were specified on the warning.

Luis Gonzalez

In April 2000 Gonzalez was given a “2nd warning” for being late on three occasions in
one week. He was told that the next day he was late he would be given a one-day
suspension.

In June 2002 Gonzalez was terminated for being a no show, no call for three
consecutive days.

Thurman Smith

On September 6, 2000 Smith was given a warning for refusing to clean up and leaving
without permission.

On September 29, 2000 Smith was given a warning for refusing to clean up and leaving
without permission and he was suspended for one day.

Juan Mateo

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In April 2000 Mateo was given a written warning for missing freight on a load. The
freight number was specified on the warning.

Felipe Rivera

In March 2000 Rivera was given a “3rd warning” for leaving one case off a load. Rivera
was suspended for a day. The number of the load was specified on the warning.

Mark Allen

In April 2000 Allen was given a warning for taking 5 ¼ hours to strip a container. The
number of the load was given. Allen was told that next time he would get a one-day
suspension.

In September 2000 Allen was given a written warning for miscounting freight on a load
and indicating 40 instead of 39 cartons. The number of the load was indicated on the
warning.

In June 2001 Allen was given a one-day suspension for refusing to wear his safety vest.

Eduardo Cuyuch

In August 2000 Cuyuch was given a written warning for checking a load and indicating
that 16 cartons had been loaded when in fact the cartons were left behind.

In October 2000 Cuyuch was given a “2nd warning” for leaving one pallet on the dock
and he was suspended for one day. The number of the load was specified on the
warning.

In September 2001 Cuyuch was given a written warning for being late three times in one
week.

In November 2001 Cuyuch was given a “2d warning” for no call, no show. He was
suspended for a day.

In January 2002 Cuyuch was given a “4th warning” for calling in sick and failing to bring
an excuse. He was given a two-day suspension.

Jose Martinez

In February 2000 Martinez was given a written warning for taking six hours to strip a
container. The number of the load was specified on the warning.

On April 12, 2000 Martinez was given a “2nd warning” for taking 6 ¼ hours to strip a
container. He was told that he would be suspended next time. The number of the load
was specified on the warning.

On April 25, 2000 Martinez was given a written warning for “damaging freight.” The
number of the load was indicated on the warning.

In June 2000 Martinez was given a “2nd warning” for taking 6 ½ hours to strip a container

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and failing to mark the damages on the freight. The number of the load was specified on
the warning.

In August 2000 Martinez was given a written warning for writing the wrong lot numbers
on freight. The number of the load was specified on the warning.

On September 1, 2000 Martinez was given a written warning for driving carelessly and
causing damage to a hi-lo. He was given a one day suspension and warned that he
would be terminated next time.

On September 29, 2000 Martinez was given a written warning for failure to clean up and
leaving. He was suspended for one day.

On November 11, 2002 Martinez was given a “2nd warning” for leaving without advising
his supervisor and not completing his load. He was told that the next incident would lead
to a one-day suspension. The number of the load was specified on the warning.

On January 31, 2003 Martinez was terminated for deliberately driving his hi-lo into
another hi-lo, injuring the driver of the other hi-lo, denying that he engaged in the
conduct and defying management when confronted with his actions.

Edward Ortolaza

In December 2000 Ortolaza was given a written warning for loading extra cargo which
then had to be returned at the company’s expense. The destination of the cargo was
given on the warning.

Johnny Seggara

In June 2002 Seggara was terminated for no call, no show for three days and then giving
a false excuse by saying that his mother was on life-support.

2. Tony Daniels

a. April 26, 2002 Warning for Overweight Containers

On April 26, 2002 Daniels was given a written warning stating that in the “given week”
four containers he had loaded had been sent back from the weigh station to the warehouse
because they were overweight. No freight numbers or destinations were given on the warning
nor were the four containers identified in any way. The warning stated that one container
missed the cut off, meaning that because time was taken to rework the load the container did
not make it to the dock in time to be loaded onto the vessel for shipping. Daniels was given a
one day suspension with this warning. Daniels wrote his remarks on the warning stating that he
had asked for help in loading one container but did not receive help. Daniels had a problem
with some rolls that were 10 feet long. As to a second container, Daniels wrote that the client
had supplied a manifest with incorrect weights listed for the freight. Daniels loaded the
container according to the listed weights and did not know that they were incorrect when he did
this. Daniels noted that this was his first written warning and it was unfair to issue a suspension
for a first warning.

Daniels testified that he had asked manager Robert Chapman for assistance in loading
one container but that no helper had been assigned to help him. Without assistance, Daniels

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had trouble positioning the freight correctly in the container. As to the container where the
customer supplied incorrect weights, Linda Kuper testified that customers did supply bad
information on occasion; sometimes the customers make a mistake and sometimes they
deliberately lie. With respect to this specific incident Kuper stated that Daniels may have relied
on a load plan that had incorrect weights and in that case the overweight was not his fault.
Maldonado also testified that customers supplied incorrect weights on occasion.

Daniels did not know anything about the other two containers mentioned in the warning.

Daniels testified that it had happened in the past that containers he had loaded came
back from the weigh station because they were overweight. He had never been issued
discipline for such an occurrence in the past.

Daniels testified that after serving the suspension on April 29, 2002 he saw an
overweight ticket in the dock supervisor’s office for a container loaded by employee Louis
Buono. Respondent’s records show that Buono was not disciplined for this occurrence.

Linda Kuper testified that the decision to discipline Daniels had been made by
Maldonado or Steve Kuper. Steve Kuper was not called to testify by Respondent. Maldonado,
who testified for Respondent, was not asked about this incident. Linda Kuper could not recall
being involved in the incident. Thus, there is no testimony and no evidence in the record about
the two containers that Daniels did not acknowledge overloading. Not one scrap of paper with a
name or number was introduced to show that Daniels had in fact overloaded the two “phantom”
containers. For aught that appears in the record Daniels was blamed for another employee’s
failings. I note that in the vast majority of warnings issued by the company where the problem
relates to cargo the warning slip identifies the freight by number or destination.

Further, Respondent presented no evidence to refute Daniels’ testimony that he asked
for but was not given help in loading one container. Daniels, a long term employee with a clean
disciplinary record, knew that he needed help and he blamed the lack of help for the problem
with the container. As to the second container for which Daniels blamed the overload on
incorrect customer weight information, Respondent offered no evidence to refute Daniels’ claim.

Thus, I find that Respondent has not connected Daniels with two of the four containers
cited in the warning and has not met the testimony showing that he was unfairly blamed for
problems with the other two containers. Further, the record shows that no other employees
have been given written warnings or suspended for overweight containers. Indeed, Buono was
responsible for an overweight ticket and he was not disciplined. Daniels himself has not been
disciplined in the past when a container loaded by him was found to be overweight. Finally, the
evidence shows that Respondent generally warns employees before issuing suspensions for
problems with freight. As detailed above many employees receive repeated written warnings for
similar infractions without being suspended.

b. September 4, 2002 Warning for Missing Freight and Final Warning Notice

This freight in question was loaded on May 6, 2002. Respondent learned from a client
on August 27, 2002 that one piece out of a lot consisting of five cartons (or pallets) destined for
Hong Kong/Melbourne had been incorrectly shipped. Four of the cartons arrived in one
container as scheduled, but one carton was loaded into the wrong container and arrived instead
in Kee Lung, Taiwan and had to be reshipped at the company’s expense.

Daniels had pulled the freight from the locations where it was stored in the warehouse

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and he had loaded the container which was bound for Hong Kong/Melbourne.

On September 4 Daniels was issued a warning for carelessness due to the missing
carton. Daniels wrote his response on the warning stating, “I pulled the cargo and it was verified
by checker. But one pallet someone loaded in their container.” Also on September 4 Daniels
was issued a “Final Warning” for substandard/careless performance. This document cites the
April 26 warning and one-day suspension and the May 6 misloading of one pallet.38

The facts show that the errant carton or pallet was placed into a container being loaded
by Rob Wallace at a bay about 40 feet distant from the area where Daniels was loading his
container. Wallace’s container was bound for Taiwan.

Daniels testified, and the record shows, that he had correctly pulled all the freight and
marked the load plan correctly when this was done. Daniels noted on the load plan that he split
the lot of 5 pallets in order to balance the load in the container; that is, he loaded part of the lot
and kept the rest in the staging area for loading in another part of the container. This is not an
uncommon procedure. The same load plan indicates that Daniels split another lot in the
container and there have been no complaints that this lot was not complete when received.
Daniels explained that a loader counts the freight before it is loaded but once he starts splitting
a load he can’t always recall how many pieces are on and how many pieces are left to load.

Respondent claims that some of the photographs show Daniels and Wallace speaking
near the staging area. Daniels could not recall whether he spoke to Wallace while he was
loading the container. Daniels was unable to identify himself in the picture where he is allegedly
speaking to Wallace. Linda Kuper testified that neither videos nor still pictures would enable a
viewer to check the marks and numbers on a piece of freight and thus identify the freight.

Daniels testified that when he received the September 4 warning he asked Maldonado to
show him the videos of the area in order to determine who moved the fifth carton. There are
two video cameras trained on the relevant area. Maldonado did not respond and he did not
show Daniels a video.

Daniels testified that he had no idea how the fifth carton ended up in Wallace’s
container. He denied moving his carton from his staging area to Wallace’s staging area. He
denied seeing Wallace take one of his cartons away from the staging area. Daniels stated that
the carton could have been moved while he was on break or lunch; it would take one minute for
the pallet to be moved from Daniels’ location to Wallace’s location.

Maldonado testified that he had viewed the video tape. Although Maldonado said that
the tape no longer existed, he did not explain why it had not been preserved. Maldonado gave
two conflicting accounts of what he saw on the video tape before it ceased to exist. In response
to questions by Counsel for Respondent, Maldonado stated that the video tape showed Tony
Daniels and Rob Wallace talking. Wallace had the errant pallet and he dropped it and then
“Tony [Daniels] picked it up, and he went and got it again. The cargo ended up being
completely wrong at the time…. I don’t recall exactly how it happened.” Of course, this account
of the missing video does not support Respondent’s theory of the incident. The cargo could
have ended up on Wallace’s container only if Rob Wallace, and not Tony Daniels, had picked it
38 The Final Warning states that the four containers mentioned in the April 26 warning were
rejected due to “improper loading and bracing of hazardous material.” There is no evidence in
the record concerning hazardous material and I shall disregard this unsupported statement.

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up. And Maldonado acknowledges that he does not recall “exactly” how it happened.
Immediately after giving this testimony, Maldonado responded to leading questions by Counsel
for Respondent that the missing video showed Rob Wallace picking up the cargo and taking it to
his container.

Linda Kuper also testified about the video; she did not view the video but Steve Kuper
saw it and told her about it.39 Linda Kuper did not explain why the video had ceased to exist.
Linda Kuper stated that the video shows Daniels pulling the freight to his staging area. The
video shows Wallace pulling freight from an area that is not his staging area but Kuper did not
say whose area this was. Kuper said that the video showed Daniels and Wallace standing
together. Kuper said she had no explanation for how the mix-up happened. Kuper did not
testify that the missing video showed Daniels giving Wallace his freight or Wallace picking up
Daniels’ freight. Kuper testified that she issued the final warning to Daniels because she
believed that the mix-up was intentional.

I note that none of the still pictures produced at the instant hearing show any transfer of
freight such as Respondent alleges must have taken place.

Robert Wallace testified about this incident.40 Wallace stated that he did not purposely
move Daniels’ freight and load it in his container. He said that someone else could have moved
the freight while he was on break or lunch. Wallace explained that sometimes all the loaders
are called away from their jobs to help with urgent pick-ups at the other end of the warehouse.
If that occurred on May 6 then only the supervisors would be present in his area. Wallace said
that when he got the warning notice for this incident he and Daniels asked Maldonado to show
them the video as proof of misconduct, but the company never showed them the video.

I find that the evidence before me does not show that Daniels and Wallace engaged in
any behavior that resulted in placing one carton of Daniels’ cargo into the container that Wallace
was loading. First, both Daniels and Wallace deny that they had a part in moving the freight to
the wrong container. Second, the video that should have shown this behavior has ceased to
exist under conditions that were not explained by the company. Third, Steve Kuper, who
viewed the video, did not testify that it showed Daniels and Wallace moving the errant carton
from one location to another. Fourth, Maldonado, who also viewed the video, testified about the
incident in contradictory ways and then admitted he could not recall “exactly” how it happened.
Finally, anyone in the warehouse could have placed the carton in the wrong location while
Daniels and Wallace were on break or at lunch or away from the loading bays for any other
reason. The record is undisputed that this mischief could have been done in just one minute.

c. October 14, 2002 Warning for Substandard Performance

On October 14, 2002 Daniels was given a warning for taking too long to load a 72 cubic
meter cargo weighing 40,000 pounds that was started at 10:15 AM and done at 3 PM. The
warning stated that this was substandard performance. Daniels wrote his disagreement on the
warning slip saying that he was balancing the load according to the weight and checking and
rechecking the freight. Daniels testified that a 72 cubic meter load should take four to five hours
to load depending on the type of freight. This amount of cargo would fill the container to
capacity. Daniels noted that the time span indicated on the warning would include time for the
39 Steve Kuper did not testify in this proceeding.
40 Wallace received a warning and final warning for this incident. These will be discussed
below.

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checker to perform his job and for the driver to count the freight, if he was so minded. Daniels
stated that he had been spoken to before about slowness but that he had never been warned or
disciplined on that subject. Respondent supplied no evidence about the specific nature of the
October 14 warning. Linda Kuper testified generally that she had heard that Daniels spent time
talking to drivers about religion but she did not have any knowledge of the incident leading to
the warning. No one from the company testified on the basis of expert and direct knowledge as
to the time required to load the freight in question. Thus, Daniels’ testimony that he took a
reasonable length of time to load the container is unrefuted and I shall credit it. I therefore find
that Daniels did not take an unreasonable length of time in loading the container referred to in
the October 14, 2000 warning.

d. July 24, 2003 Warning for Damage

On July 22, 2003 Daniels testified in the instant hearing. On July 24 he was given a
written warning for carelessness, damage to company property, violation of company
procedures and unnecessary damage to cargo. The warning states that Daniels put the blades
of his forklift between the pallet and the cargo while attempting to remove the cargo from the
pallet, that the pallet broke and that the blades went into the cartons damaging the cartons and
the contents. The warning states that Daniels’ excuse as to why he and his helper did not load
the cartons manually was that he was “trying to save [his] arms.” Daniels wrote on the warning
slip that he disagreed. He did not recall saying he was saving his arms. Daniels wrote that he
loaded the freight partially by hand. Daniels said the pallet was broken before he began loading
the freight and that some of the cartons were damaged before he began loading them. Daniels
wrote that he took pictures of the freight before loading it into the container that would bear out
his contentions.

Daniels testified that the cargo in question consisted of about 100 bolts of fabric
enclosed in reconditioned cardboard that was soft enough to tear by hand. Each bolt was about
80 inches long and 12 inches wide and weighed from 75 to 80 pounds. A number of pallets
were stacked up; each pallet contained numerous cartons. One or more of the pallets were
already broken when Daniels began unloading the freight. Daniels stated that he took pictures
of the freight before beginning to load and he gave the camera chip to his supervisor. At first
Daniels and his helper tried loading the cartons by hand but just one pallet of cartons took 10 to
15 minutes to unload. In an effort to work faster, Daniels had the helper lift the corner of the
freight so that the forklift blades could be inserted between the cartons and the pallet and the
cartons could be lifted onto the blades and put into the container. This method took two minutes
per pallet. Daniels admitted that while he was removing the freight in this way he accidentally
caused four or five inches of his forklift blade to enter a carton. The carton was torn but Daniels
was not aware of this until Paul Smith entered the container and said the carton was torn.
Smith did not open the carton to check the fabric for damage. Smith left the container and
returned with Maldonado. Maldonado did not ask to see the punctured carton and he did not
check the cargo for damage. Respondent did not introduce any evidence at the hearing that the
freight was considered damaged by the customer or that a damage report had been lodged by
the customer.

Maldonado testified that Daniels should have taken each pallet into the container with
his hi-lo and then, with the helper, manually removed the cargo from each pallet. Maldonado
stated that he saw cartons that were ripped and rolls of fabric inside. Maldonado testified that
the company did not open the cartons to check for damage because the cargo was already
loaded and “we left the cartons in place and [the customer] will let us know the damages.”
Maldonado stated that if there were a damage claim it would be in the file. Maldonado said that
the cartons in question had yellow tape on them. When the cartons were delivered to the

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warehouse they were already ripped open and crushed and the company put yellow tape over
some of the damaged areas. Maldonado maintained that Daniels was responsible for further
damage to the cartons.

In an effort to show that Daniels did not perform his task properly Maldonado produced
pictures of the loading process. However, the load sheet shows that Daniels began loading at
12:25 PM and ended at 3:15. Daniels took lunch from 12:30 to 1 PM. Maldonado’s pictures do
not cover the entire time period in question. He admitted that certain information could have
been missing due to the gaps in his video. I shall not rely on any information based on the
pictures because they are fragmentary.

I find that the evidence shows that the cartons of fabric were damaged before Daniels
began to load them. Maldonado acknowledged that the cartons were damaged and that the
company had put yellow tape on some areas of the damage. I also credit Daniels’ testimony
that the pallets were damaged before he began to load. Daniels took pictures of the damage to
the cartons and pallets before beginning to load the container and these pictures are in the
custody of Respondent. Because the pictures were not produced at the hearing I will assume
that they would not have supported Respondent’s position herein. I note that Paul Smith and
Maldonado did not inspect the cartons for damage after Daniels had been loading them and that
there is no evidence that the customer considered that the freight was damaged. Thus, as far
as this record is concerned, Daniels did not break the pallets, he did not damage the freight and,
at most, he may have made a few holes in the already damaged reconditioned cartons. I find
that Respondent did not consider the damage to be significant.

e. July 25, 2003 Suspension for Mishandling Freight

Daniels was suspended on July 25, 2003 by letter from Linda Kuper. Kuper informed
Daniels that on July 15 he “negligently and carelessly mishandled freight, possibly damaging the
freight, contrary to established freight handling procedures… more seriously, you failed to report
what had occurred so that the freight could be examined to determine the extent of the
damage.” Kuper stated her intention to hold a hearing to determine whether Daniels should be
discharged or otherwise disciplined “particularly in light of the final warning issued to you this
past September, [2002]. Before a hearing can be held we must first determine the extent of the
damage to the freight in question. As soon as this information is received, I will contact you….”
Kuper ended the letter by saying she would be away until August 4 at which time “I should have
a report regarding damage.”

The freight in question was loaded on three pallets stacked in a pyramid. Respondent
contends that Daniels incorrectly removed the top pallet. Instead of inserting his forklift blades
under the top pallet and removing it Daniels removed the bottom pallet in order to cause the top
pallet to dislodge and tip over to the floor. Daniels testified that the top pallet was heavy and
had sunk into the cartons stacked on the pallet beneath. Daniels maintained that there was no
space to insert the blades between the pallet and the cartons on which it was resting. Daniels
testified that the freight was staged by a temporary forklift driver named Carlos. Daniels asked
Carlos why he had brought the freight in a pyramid even though the manifest showed that the
freight consisted of heavy door hardware. Carlos said he could not get the top pallet off. It had
sunk into the freight on which it rested and he could not get inside to lift the pallet off.

Daniels testified that if a carton is dropped or damaged he is not required to report it. It
is common to load freight that has been dropped. However, if a drum is punctured or there is a
leak of freight then it cannot be loaded.

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The record contains detailed statements by Daniels and Union president William
Cunningham that Daniels used a correct method to handle the freight.41 The record also
contains a detailed statement by Maldonado given when the video tape of the event was played
at the instant hearing to the effect that Daniels used an improper method and that the corner of
one carton was crushed. Maldonado stated that the video does not show any damage to the
freight.42

The freight in the cartons consisted of metal door parts such as door handles and door
knobs. Daniels testified that he did not believe he had damaged the freight because he did not
hear any rattling from inside the cartons. Daniels recalled that the cartons were shrink wrapped
and he saw no damage. However, the company practice is to tape such types of damage and
continue the shipping process. Cunningham stated that the video showed that no damage had
occurred. If there had been damage then the shrink wrap around cartons would have broken
and the cargo would have spilled on the floor.

No evidence was presented that the freight had in fact been damaged. Linda Kuper did
not present any damage report or claim when she met with the Union to discuss the
suspension. Neither Linda Kuper or Maldonado testified that there had been a damage report
or claim. Thus, there is no proof in the record that the cargo was damaged. Although Counsel
for Respondent stated on the record that Linda Kuper would identify and testify about a damage
report, Kuper never did so.

Kuper testified that if Daniels had informed his supervisor of the damage he would have
been less likely to receive discipline for the incident because the company would have had a
chance to recoup the freight. However, Maldonado testified that there is no set reporting
procedure at the company in case freight drops to the floor. If a loader sees damage to a carton
he should tell his dock boss who will take a picture of the carton and then the carton will be
taped up.

Linda Kuper testified that she met with Daniels and Union president Cunningham to
discuss the penalty. Kuper maintained that Cunningham agreed Daniels had mishandled the
freight and that the parties then negotiated the length of the suspension. Cunningham disputed
this version of the meeting. Cunningham stated that Kuper had suspended Daniels indefinitely.
By the time he met with Kuper on August 3, Daniels had lost a lot of work and Cunningham was
mainly concerned with getting him back to work immediately. I credit Cunningham’s testimony.
Cunningham’s demeanor was impressive and his recitation of the events had the ring of truth.

I credit Cunningham that Daniels used a proper method to deal with the pyramided
pallets. As I viewed the video in the courtroom, it did seem to me that the top pallet was very
heavily embedded into the cartons on which it rested and that it would have been impossible to
insert the blades under the pallet without piercing the cartons. I believe that Daniels made the
best of a bad situation. He used his judgment and his judgment was proved correct: the freight
was loaded and no damage occurred to the contents of the cartons.

I do not credit Linda Kuper’s testimony about any of the matters relating to this
suspension. First, Kuper’s letter stated that the purpose of the hearing would be to consider the
damage report and to decide Daniels’ discipline accordingly. Kuper’s letter mentioned the
41 Cunningham has over 30 years experience driving a fork lift and moving freight.
42 Managers at the warehouse had first reviewed the video tape while searching through it to
go over an event not involving Daniels.

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possibility of discharge. No damage report was received and Kuper did not offer any
explanation for her failure to support the basis of the suspension letter. Kuper did not explain
why a suspension from July 25 through August 3 was appropriate in light of the fact that the
freight was not damaged. The fact that Kuper may have been away from the premises is not a
justification for imposing a two-week suspension. Manager Maldonado testified that the video
on which Kuper based her letter did not show any damage to the freight. The conclusion seems
inescapable that Kuper seized upon a serendipitously discovered incident on a video tape to
attempt to discharge, and at least to suspend, Daniels.

f. October 9, 2003 Warning for Short Shipments

On October 9, 2003 Daniels received a “final, final warning” from Linda Kuper. The
warning was for two short shipments on containers loaded by Daniels. The warning stated, in
part

This type of conduct, which has only recently occurred after your many years of service
without similar incidents, cannot be tolerated any longer. The cost to the company is
simply too great…. The fact that you indicated on your tally sheets that the material had
been shipped is evidence of your negligence. There will be no further reprieves. The
next time there is an incident, you will be terminated immediately. …

Daniels admitted that he made a mistake regarding one load by failing to count all nine
cartons of freight that comprised one lot thereby leaving off two of the cartons. Daniels had
been the one who picked the freight in the warehouse as well as loaded it on the container.
When Daniels went to pull the freight he found a large circled “9” on the pallet and he assumed
all the pieces on his load plan were on the same pallet. The pallet contained both large and
small cartons and Daniels assumed that some small cartons were hidden by the larger ones.

The record shows that the checker who counted the freight after Daniels picked it and
staged it also miscounted the freight and indicated by his initials that all nine pieces of freight
had been correctly staged for loading. There is no evidence that the checker was disciplined for
his malfeasance.43 Testifying about this incident, Linda Kuper stated that if there are pieces
missing the checker is supposed to inform the loader of this fact.

Maldonado informed Daniels that there were two cartons missing from the lot. When
Daniels and Maldonado searched the location in the warehouse area indicated on the load
sheet used by Daniels to pick the freight, the two cartons were not in the location. Further, the
load sheet did not indicate that the freight had been split up in the warehouse. Eventually,
Daniels and Maldonado found the two cartons in a different location of the warehouse.

The second load referenced in Linda Kuper’s warning letter involved freight that was not
picked by Daniels. This load had already been staged when Daniels was assigned to load the
container. Daniels did not count the freight but he asked the checker if the freight was all there.
The checker informed Daniels that all the freight was present and Daniels loaded the container.
In the event, one piece of freight was missing. The load plan indicates that someone circled the
number representing the two pieces to show that they had been loaded. Daniels denied making
the circle. The record shows that many people in the warehouse have access to the load plan
43 The copy of the load sheet given to Daniels contains the checker’s initials. There is
another load sheet used by the checker and not given to Daniels which apparently does not
show that the checker circled the missing items.

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both in the office and in the warehouse and it is impossible to determine who placed the mark
on the paper. There is no evidence in the record that the person who picked the freight or the
person who checked it have been disciplined for negligence in failing to account for the missing
freight.

3. Purcell Robert Wallace

Purcell Robert Wallace has worked for the company since February 1988. In 1999 he
tested positive for a controlled substance and he served a 30 day suspension from the
company. Since then his record has been spotless until the discipline discussed below.
Wallace is a member of the Union negotiating committee and has attended bargaining sessions
since November 2001.

Linda Kuper testified that overall the company has been happy with his performance.

a. July 31, 2002 Written Warning for Missing Freight

Wallace received a written warning on July 31, 2002 for failing to load 52 cartons into a
container. Wallace admitted that he had made a mistake. He participated in a dock search for
the freight and it was found in the location indicated on the load sheet. There is no evidence
that the checker was disciplined for failing to catch this error.

b. August 2, 2002 Written Warning

Wallace received a written warning on August 2, 2002 for “loading eight pallets with the
wrong marks.” The cargo went to Miami instead of Boston. Wallace testified that his supervisor
told him that the freight had been mismarked. Apparently when the freight had been unloaded
into the warehouse the night crew had put a partially incorrect set of numbers and marks on the
freight. Wallace had been assigned to pick the freight as well as to load it. He checked the
numbers on the freight against the load sheet he had been given and then he picked and staged
the freight. Wallace said that from one to four times a month he comes across freight that is
mismarked; sometimes it is possible to check the mistake because a customer name might
have been written on the freight. Wallace emphasized that from the warning slip one could not
tell whether he had made a mistake or whether because the freight had the wrong mark it would
have been impossible to prevent the cargo going to the wrong destination.44 Wallace stated
that since the checker had not caught the mistake it may be that only the night crew was to
blame. In any case, the record contains no indication that the checker was disciplined for this
mistake.

c. September 4 and 5, 2002 Warning and Final Warning

Wallace was given a written warning for carelessness in loading one pallet bound for
Hong Kong into his container going to Kee Lung. (This is the May 6 incident discussed above in
relation to Tony Daniels.) Wallace was also given a “Final Warning Notice” dated September 4,
2002 written by Linda Kuper. Kuper cited the two warnings dated July 31, and August 2, 2002.
Kuper went on to state that Wallace had wrongfully placed a pallet from Daniels’ cargo area into
his container: “Surveillance cameras clearly show you placing this pallet into your container….
This means that you would have had to make a physical effort to go to [Daniels’ staging area]
44 I note that no load number was given on the warning slip and no supporting paperwork
was introduced at the hearing.

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and pull one of the five pallets belonging in [Daniels’ container]. … Under normal circumstances
we would have terminated you for the incident … because we believe it was intentionally done.
However, because of your length of service and prior performance we are offering you another
chance to correct yourself.”

As discussed above, Wallace denied placing Daniels’ pallet into the Kee Lung container
and when Wallace demanded to see the video he was told that Maldonado had nothing to show
him.

Also, as discussed above, Linda Kuper testified that she had not seen the video to which
she referred in the warning notice and she did not testify that it showed any improper transfer of
freight from Daniels to Wallace. As discussed above, Maldonado did not testify reliably about
what he may have seen on the missing video tape.

I conclude that the record does not support the discipline meted out to Wallace in
connection with this incident. In fact, other than conjecture there is no evidence to show that
Wallace and Daniels engaged in any misconduct. Both of these long-term employees denied
under oath transferring the cargo to the wrong container and thus I conclude that an unknown
person is responsible for the deed.

4. Conclusions about Discipline to Daniels and Wallace

Daniels and Wallace were the two original employee members of the Union negotiating
committee. They were identified as supporters of the Union and they attended the bargaining
sessions at which Linda Kuper was present from the inception of negotiations in 2001. Tony
Daniels assisted in the investigation of Board charges leading to the case before ALJ Davis and
the instant case. Daniels testified as a witness for the General Counsel in the unfair labor
practice trails before ALJ Davis as well as in the instant case.

Daniels has worked for the company since 1991. He had a spotless record until the
spate of disciplinary warnings recited above. Daniels was given yearly wage increases by the
employer.

Wallace has worked for the company since February 1988. In 1999 he tested positive
for a controlled substance and he served a 30 day suspension from the company. Since then
his record has been spotless until the discipline discussed below. Linda Kuper testified that
overall the company has been happy with his performance.

The Respondent’s anti-Union animus is well established. In 331 NLRB 454 (2000), the
Board found that Respondent unlawfully discharged and disciplined employees, interrogated
employees and engaged in other activity violative of the Act because its employees supported
Local 641. As discussed above, in April 2001 the Third Circuit cited “the employer’s
demonstrated hostility to its employees” organizing efforts.” Since that time, the Board has
concluded that Respondent unlawfully eroded the bargaining unit and refused to supply
information to the Union. I have found above that Respondent unlawfully assisted in the filing of
a decertification petition. I find that Respondent’s anti-Union animus was a motivating factor in
discipline issued to both Daniels and Wallace. Wright Line, 251 NLRB 1082 (1980). It is clear
that Respondent is engaged in a course of conduct to rid itself of members of the bargaining
unit and supporters of Local 641. By issuing pretextual and disparate warnings and final
warnings to Daniels and Wallace Respondent is constructing a basis for eventual discharge of
these two employees.

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I have found above that the April 26, 2002 warning to Daniels for four overweight
containers was not supported by the evidence. In effect, the incidents cited in the warning were
a pretext for issuing discipline to Daniels because of his support for the Union and assistance to
the General Counsel. Even if Daniels had been at fault with respect to the containers,
Respondent has not shown that it would have imposed the discipline it chose in the absence of
Daniels’ protected activity. As stated above, I have found that contrary to its usual practice
Respondent suspended Daniels for one day for this first infraction.45 This discipline was a
violation of Section 8 (a) (3) and (4) of the Act.

I have found above that Respondent had no evidence of improper action by Daniels with
respect to the misloaded carton that resulted in the September 4, 2002 warning and final
warning. In effect, the discipline was based on a pretext and on a misstatement of what was
shown on the missing video tape. This discipline was issued in violation of Section 8 (a) (3) and
(4) of the Act.

I have found above that Respondent presented no evidence to counter Daniels’
testimony that he took a normal amount of time to load the container cited in the October 14,
2002 warning notice. Thus, I find that this discipline was a pretext to punish Daniels for his
protected activity. This discipline was issued in violation of Section 8 (a) (3) and (4) of the Act.

I have found above that Respondent gave Daniels a written warning for using his cell
phone on October 30, 2002 rather than the verbal warning that Maldonado testified was the
customary penalty for a first infraction. As discussed above, I find that this was a violation of
Section 8 (a) (3) and (4) of the Act.

I have found above that contrary to the July 24, 2003 warning Daniels did not damage
company property and he did not damage the freight. Daniels may have put a few holes in the
cartons which had already been damaged and taped by Respondent before he began the
loading process. The record shows that Respondent does not discipline employees for
damaging cartons, although it does issue warnings for damage to freight. Employee Aroca was
suspended for putting holes into two drums, thereby “damaging the freight” and Martinez was
warned for “damaging freight.” Thus, I find that in the absence of Daniels’ protected activity and
assistance to the General Counsel, Respondent would not have issued the written warning.
Respondent thus violated Section 8 (a) (3) and (4) of the Act.

I have found above that with respect to the July 25, 2003 indefinite suspension letter for
damaging freight, the evidence shows that there was no damage to the freight being handled by
Daniels. I have found that Daniels followed an accepted procedure in handling the freight.
Maldonado conceded that there is no set rule for reporting a carton that is dropped and
Maldonado testified that in viewing the video he ascertained that there was no damage to the
freight. Some cartons were pierced, but I have accepted Daniels’ and Cunningham’s testimony
that this was inevitable. As discussed above, Respondent does not have a practice of
disciplining employees who damage cartons. Thus, the infraction was a pretext. But even if
Daniels had damaged the freight, the two-week suspension was all out of proportion to the
discipline imposed on other employees for more serious infractions, for example, Martinez who
45 As shown above, Buono was suspended only for the second and third infractions
involving absence, Thurman Smith was not suspended on the second occasion he refused to
work and left early, Rivera was suspended for a third warning, Cuyuch was suspended for the
second instance involving missing freight, and Martinez engaged in a dizzying number of
infractions before receiving even a one day suspension.

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was suspended for one day when he damaged his hi-lo by careless driving. Respondent
treated Daniels disparately when it suspended him for two weeks for damaging some cartons.
Respondent thus violated Section 8 (a) (3) and (4) of the Act.

I have found above with respect to the October 9, 2003 final, final warning that Daniels
alone was disciplined for mistakes which were attributable to other employees as well. Although
Linda Kuper testified that the picker, the checker and the loader should all be disciplined when
freight was missing from a container, this did not occur in either of the two instances cited in the
October 9, 2003 warning. In one instance a checker mistakenly assured Daniels that the freight
was correct before he loaded it and in the other instance both the picker and the checker
missed one piece of freight that Daniels should have loaded. Respondent treated Daniels
disparately in this instance. Further, the warning informed Daniels that he was in danger of
being discharged. Respondent may not rely on prior unlawfully imposed discipline to impose
further discipline. Respondent violated Section 8 (a) (3) and (4) of the Act by issuing the
warning and informing Daniels that he would be discharged for further infractions.

I have found above that Respondent disciplined Wallace for errors cited in warning
notices dated July 31, 2002 and August 2, 2002. In both of these instances the checker
involved in the loading mistake was not disciplined and in one instance the night crew had
mismarked the freight but the evidence does not show that members of the crew were
disciplined for their mistake. Wallace was treated disparately because of his activities in support
of the Union. I find that he was disciplined in violation of Section 8 (a) (3) of the Act.

I have also found above that Respondent disciplined Wallace on September 4 and 5,
2003 and gave him a final warning notice where there is no proof that Wallace was responsible
for the freight being loaded into the wrong container. Respondent relied on a pretextual
statement of what was shown on the missing video tape to discipline Wallace because of his
support for the Union. Respondent thus violated Section 8 (a) (3) of the Act.

Conclusions of Law

1. At all material times the Union has been, and is, the exclusive representative of the
employees in the following appropriate collective-bargaining unit within the meaning of Section 9
(a) of the Act:

All full-time and regular part-time warehouse employees employed by the Respondent at
its South Kearny, New Jersey facility, but excluding all temporary agency employees,
office clerical employees, professional employees, guards and supervisors as defined in
the Act.

2. By unilaterally changing employee break times Respondent violated Section 8 (a) (5)
and (1) of the Act.

3. By assisting in the circulation and filing of a decertification petition Respondent
violated Section 8 (a) (1) of the Act.

4. At all times since October 2002 and at all material times thereafter Respondent has
failed and refused to bargain in good faith with the Union as the exclusive bargaining
representative of the employees in the unit set forth above in violation of Section 8 (a) (5) and
(1) of the Act.

5. By issuing a written warning to and suspending Tony Daniels on April 26, 2002

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Respondent violated Section 8 (a) (3) and (4) and (1) of the Act.

6. By issuing a written warning and final warning to Tony Daniels on September 4, 2002
Respondent violated Section 8 (a) (3) and (4) and (1) of the Act.

7. By issuing written warning notices to Tony Daniels on October 14 and October 30,
2002 and July 24, 2003 Respondent violated Section 8 (a) (3) and (4)and (1) of the Act.

8. By suspending Tony Daniels on July 25, 2003 Respondent violated Section 8 (a) (3)
and (4) and (1) of the Act.

9. By issuing a final, final warning to Tony Daniels on October 9, 2003 Respondent
violated Section 8 (a) (3) and (4) and (1) of the Act.

10. By issuing written warning notices to Purcell Robert Wallace on July 31 and August
2, 2002 Respondent violated Section 8 (a) (3) and (1) of the Act.

11. By issuing a written warning notice on September 4 and a final warning notice on
September 5, 2003 to Purcell Robert Wallace Respondent violated Section 8 (a) (3) and (1) of
the Act.

12. The General Counsel has not shown that Respondent engaged in any other
violations of the Act.

Remedy

Having found that the Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative action designed to
effectuate the policies of the Act.

The Respondent having discriminatorily suspended an employee, it must offer him
reinstatement and make him whole for any loss of earnings and other benefits plus interest as
computed in New Horizons for the Retarded, 283 NLRB 1173 (1987).

The General Counsel seeks a remedy pursuant to Mar-Jac Poultry Co., 136 NLRB 785
(1962). The Board has long held that where there is a finding that an employer has failed or
refused to bargain in good faith with the union after it has been certified the Board’s remedy
should ensure that the union has at least one year of good faith bargaining during which its
majority status cannot be questioned. A shorter period of time may be assigned depending on
the nature of the violations found, the number and extent of collective-bargaining sessions and
the impact of the unfair labor practices upon the bargaining process. It is plain from my
discussion above that I consider Respondent’s bad faith bargaining particularly egregious
especially because it was carried on in defiance of prior Board and ALJ decisions. However,
the Board has previously declined to extend the certification year. 341 NLRB No. 120, (2004),
sl. op. p. 6. Therefore, I am unable to afford the additional remedy that would normally be
ordered for the surface bargaining engaged in by Respondent.

Because the Respondent has a proclivity for violating the Act (see, e.g., St. George
Warehouse, 331 NLRB 454 (2000), enf’d sub nom NLRB v. St. George Warehouse, No. 00-
2433 (3d Cir. April 23, 2001); St. George Warehouse, 341 NLRB No. 120, (2004), and because
of the Respondent’s egregious misconduct, demonstrating a general disregard for the
employees’ fundamental rights, I find it necessary to issue a broad Order requiring the

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Respondent to cease and desist from infringing in any other manner on rights guaranteed
employees by Section 7 of the Act. Hickmott Foods, 242 NLRB 1357 (1979).

Because the unilateral change in employee break times was not enforced by
Respondent after some period of time it is unnecessary to order Respondent to restore the prior
practice with regard to employee break times.

On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended46

ORDER

The Respondent, St. George Warehouse, Inc., South Kearny, New Jersey, its officers,
agents, successors, and assigns, shall

1. Cease and desist from

(a) Unilaterally changing employee break times.

(b) Assisting in the circulation and filing of a decertification petition.

(c) Failing and refusing to bargain in good faith with Merchandise Drivers Local No. 641,
International Brotherhood of Teamsters, AFL-CIO by engaging in surface bargaining.

(d) Issuing warnings to and suspending employees because of their membership in and
support of the Union.

(e) In any other manner interfering with, restraining, or coercing employees in the
exercise of the rights guaranteed them by Section 7 of the Act.

2. Take the following affirmative action necessary to effectuate the policies of the Act.

(a) On request, bargain with the Union as the exclusive representative of the employees
in the following appropriate unit concerning terms and conditions of employment and, if an
understanding is reached, embody the understanding in a signed agreement:

All full-time and regular part-time warehouse employees employed by the Respondent at
its South Kearny, New Jersey facility, but excluding all temporary agency employees,
office clerical employees, professional employees, guards and supervisors as defined in
the Act.

(b) Make Tony Daniels whole for any loss of earnings and other benefits suffered as a
result of the discrimination against him in the manner set forth in the remedy section of the
Decision.

(c) Within 14 days from the date of the Board’s Order, remove from its files any
46 If no exceptions are filed as provided by Sec. 102.46 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 purposes.

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reference to the unlawful warnings and suspensions, and within 3 days thereafter notify the
employees in writing that this has been done and that the warnings and suspensions will not be
used against them in any way.

(d) Preserve and, within 14 days of a request, or such additional time as the Regional
Director may allow for good cause shown, provide at a reasonable place designated by the
Board or its agents, all payroll records, social security payment records, timecards, personnel
records and reports, and all other records, including an electronic copy of such records if stored
in electronic form, necessary to analyze the amount of backpay due under the terms of this
Order.

(e) Within 14 days after service by the Region, post at its facility in Kearny, New Jersey,
copies of the attached Notice marked “Appendix.”47 Copies of the Notice, on forms provided by
the Regional Director for Region 22, after being signed by the Respondent’s authorized
representative, shall be posted by the Respondent and maintained for 60 consecutive days in
conspicuous places including all places where Notices to employees are customarily posted.
Reasonable steps shall be taken by the Respondent to ensure that the Notices are not altered,
defaced, or covered by any other material. In the event that, during the pendency of these
proceedings, the Respondent has gone out of business or closed the facility involved in these
proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the Notice
to all current employees and former employees employed by the Respondent at any time since
April 26, 2002.

(f) Within 21 days after service by the Region, file with the Regional Director a sworn
certification of a responsible official on a form provided by the Region attesting to the steps that
the Respondent has taken to comply.

IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges
violations of the Act not specifically found.

Dated: January 10, 2005.

____________________
Eleanor MacDonald
Administrative Law Judge

47 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 National Labor Relations Board” shall read “Posted
Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
JD(NY)–02-05
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 Federal labor law and has
ordered us to post and obey this Notice.

FEDERAL LAW GIVES YOU THE RIGHT TO

Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities

WE WILL NOT suspend and issue warnings or otherwise discriminate against any of you for
supporting Merchandise Drivers Local No. 641, International Brotherhood of Teamsters, AFL-
CIO or any other union.

WE WILL NOT change your break times without bargaining with your Union.

WE WILL NOT assist in the circulation and filing of a decertification petition.

WE WILL NOT engage in conduct indicative of surface bargaining.

WE WILL NOT in any other manner interfere with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.

WE WILL, on request, bargain with the Union and put in writing and sign any agreement
reached on terms and conditions of employment for our employees in the bargaining unit:

All full-time and regular part-time warehouse employees employed by us at our South
Kearny, New Jersey facility, but excluding all temporary agency employees, office
clerical employees, professional employees, guards and supervisors as defined in the
Act.

WE WILL make Tony Daniels whole for any loss of earnings and other benefits resulting from
his suspensions, plus interest.

JD(NY)-02-05

WE WILL, within 14 days from the date of this Order, remove from our files any reference to the
unlawful warnings and suspensions of Tony Daniels and the unlawful warnings of Purcell Robert
Wallace and WE WILL, within 3 days thereafter, notify them in writing that this has been done
and that the suspensions and warnings will not be used against them in any way.

St. George Warehouse, Inc.
(Employer)

Dated By
(Representative) (Title)

The National Labor Relations Board is an independent Federal agency created in 1935 to enforce the National Labor
Relations Act. It conducts secret-ballot elections to determine whether employees want union representation and it
investigates and remedies unfair labor practices by employers and unions. To find out more about your rights under
the Act and how to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website: www.nlrb.gov.
20 Washington Place, 5th Floor, Newark, NJ 07102-3110
(973) 645-2100, Hours: 8:30 a.m. to 5 p.m.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF POSTING AND MUST
NOT BE ALTERED, DEFACED, OR COVERED BY ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS
NOTICE OR COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S
COMPLIANCE OFFICER, (973) 645-3784.