DISTRICT 65, RETAIL, WHOLESALE & DEPT. STORE U. v. NLRB

• Decision Date: 18 September 1961
• Docket Number: No. 13358,13406.,13358
• Citation: 294 F.2d 364
• Parties: DISTRICT 65, RETAIL, WHOLESALE AND DEPARTMENT STORE UNION, AFL-CIO, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. NATIONAL LABOR RELATIONS BOARD, Petitioner, v. Morris and David YOSEPH d/b/a M. Yoseph Bag Company, Respondent.
• Court: U.S. Court of Appeals — Third Circuit

294 F.2d 364 (1961)

DISTRICT 65, RETAIL, WHOLESALE AND DEPARTMENT STORE UNION, AFL-CIO, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. Morris and David YOSEPH d/b/a M. Yoseph Bag Company, Respondent.

Nos. 13358, 13406.

United States Court of Appeals Third Circuit.

Argued April 3, 1961.

Decided September 18, 1961.

Irving Rozen, New York City (Weisman, Allan, Spett & Sheinberg, New York City, M. H. Goldstein, Philadelphia, Pa., Joel A. Windman, New York City, on the brief), for petitioner Union.

Samuel M. Singer, Washington, D. C. (Stuart Rothman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Glen M. Bendixsen, Attys., N.L.R.B., Washington, D. C., on the brief), for National Labor Relations Board.

Geoffrey J. Cunniff, Philadelphia, Pa. (Josephine H. Klein, Philadelphia, Pa., on the brief), for respondent M. Yoseph Bag Co.

Before BIGGS, Chief Judge, and McLAUGHLIN and HASTIE, Circuit Judges.

BIGGS, Chief Judge.

The National Labor Relations Board has petitioned for enforcement of its order against Morris and David Yoseph d/b/a M. Yoseph Bag Company, and District 65, Retail, Wholesale and Department Store Union, AFL-CIO, has petitioned to review and to modify the Board's order.¹ The Board found that the Company violated Sections 8(a) (1) and 8(a) (3) of the Labor Management Relations Act, 29 U.S.C.A. §§ 158(a) (1), (3) by closing its plant and discharging its employees; that the Company violated Section 8(a) (5) of the Act, 29 U.S. C.A. § 158(a) (5) by refusing to bargain with District 65; and that the Company violated Section 8(a) (1) of the Act by interrogating and threatening its employees. District 65 has argued in this court that the remedy embodied in the Board's order is of too narrow scope to effectuate the policies of the Act. The Company has argued that the Board's decision is without basis in law and, alternatively, that its order was improper in various particulars. The facts, as found by the Board, are as follows.

The Company was a New Jersey partnership engaged in the business of purchasing feed bags, cleaning and repairing them, and selling the reconditioned bags to various customers. By July 11, 1957, District 65, a labor organization within the meaning of the Act, had been designated by 14 of the Company's 16 employees as their bargaining representative. On that date, Saul Klein and Romadell Jones, organizers for District 65, called David Yoseph, one of the partners, at his home, informed him of District 65's majority status, and requested recognition as the collective bargaining agent of the Company's employees. Yoseph asserted that the Company's financial position was deteriorating due largely to the inroads made by the "bulk feed system," a system by which feed is delivered by truck directly from mill to farm thus obviating the need for bags, and that he was in the process of deciding whether to remain in business. Yoseph requested a week's time in which to talk to his employees and to come to a decision.

The next day, July 12, David Yoseph asked an employee, Vernal Soltau, why he had joined District 65. Yoseph told Soltau "It is going to be hard for you" because the Company was "going to cut us sic down to 40 hours a week." After making this threat Yoseph deprived Soltau and another employee, Robert Johnson, of all overtime work. On July 15, Yoseph questioned employee Annie Johnson as to her knowledge of District 65. That same day Yoseph said to employee Randolph Allen, one of the Company's truckdrivers, "I know that you joined that union, but with or without the union would you still continue buying bags for me? I am going to close the plant down and if I can have the two drivers, including myself and the other driver, I would have the union licked."

On the morning of July 19, Yoseph assembled his employees and told them that he could not pay the wage rates demanded by District 65 and remain in business, but that he had looked over the wage rates of the "Philadelphia Union", Laborers Local No. 57, AFL-CIO, and if the employees would choose that union instead of District 65 he could stay in business. Yoseph gave the employees until 4 p. m. to make their decision stating that he had agreed to notify District 65 of his decision by 4:30 p. m. Sometime that afternoon the employees told Yoseph that they would remain with District 65. At 4:30 p. m. Romadell Jones, District 65's assistant organizer, arrived at the plant and, in the presence of the assembled employees, was told by Yoseph that the business was being closed because he could not pay District 65's wage rates. When Jones replied that District 65 was willing to negotiate wage rates and that he was sure an agreement could be reached, Yoseph refused to discuss the matter further. The Company discharged all of its employees by closing its plant and going out of business as of July 19. Yoseph, however, continued to receive and deliver bags for some time thereafter.

On August 17, 1957, Yoseph, by bill of sale, sold the assets of the Company, except for its land, buildings and two pieces of equipment, to the Girard Bag Company of Philadelphia in exchange for $46,000 worth of the capital stock of Girard.² Subsequently, and at the present time, the functions previously performed by the Company are performed by Girard which serves the same customers in the same area. Yoseph is presently a stockholder, director and officer of Girard and is in charge of production at Girard's Philadelphia plant where he spends full time. He does not supervise any particular phase of Girard's business.

On the basis of these facts four members of the Board agreed on the following conclusions of law:

"By discriminating in regard to the hire and tenure of employment of the employees by closing its plant and discharging the employees on July 19, 1957, the Respondent has discouraged membership in a labor organization and by such discrimination and by interfering with, restraining, and coercing employees in the exercise of the rights guaranteed in Section 7 of the Act, as hereinabove found, the Respondent has engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a) (3) of the Act and Section 8(a) (1) thereof.

"By refusing, on and after July 19, 1957, to bargain collectively with the aforesaid Union as the exclusive representative of the employees, in the aforesaid appropriate unit, the Respondent has engaged in and is engaging in, an unfair labor practice within the meaning of Section 8(a) (5) of the Act.

"By interrogating the employees, threatening to deprive them of overtime and in fact doing so, threatening individual employees that the plant would be closed, and threatening assembled employees, on July 19, 1957, that the plant would be closed if they did not renounce their chosen representative, the Respondent engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a) (1) of the Act."

Member Rodgers did not agree that the Company committed any unfair labor practice because in his view "there is nothing contained in the Act which limits an employer's right to go out of business at such time and under such circumstances as he chooses, regardless of the reasons therefor."

The Board ordered the Company, "its officers, agents, successors, and assigns" to cease and desist from refusing to bargain collectively with District 65, threatening and interrogating employees in a manner violating Section 8(a) (1) of the Act, and discouraging membership in District 65 by discriminating as to hire and tenure or by discharging employees for their union activities. The Board further ordered the Company to take the following affirmative action: to bargain with District 65 if and when operations are resumed; to pay back pay to the discharged employees for the period commencing July 19, 1957 and ending August 17, 1957, the date the business was sold, or the date the business ceased functioning, whichever was later; to create a preferential hiring list and to offer the employees reinstatement in the event operations are resumed; and to mail the usual notices to the discharged employees.

The right to modify the back pay and reinstatement provisions of the order if made necessary by circumstances not then apparent was reserved.³

Members Jenkins and Fanning concurred in the order "as far as it goes" but were of the opinion that it should have been expanded "by awarding back pay to the discriminatees for loss of earnings resulting from the discrimination against them until such time as they obtained substantially equivalent employment with other employers." As we have stated Member Rodgers was of the view that no unfair labor practice had been committed and, therefore, did not discuss the propriety of the extent of the order.

District 65 contends that the Board's remedy was inadequate and this court should modify it so as to include the following: a direction to the Company to reopen its plant and reinstate the employees with back pay to the date of reinstatement or; a direction to the Company to reinstate the employees, with back pay to the date of reinstatement, in Girard Bag Company, with resultant moving or transportation expenses or; a direction to the Company to pay back pay to the employees until they obtain substantially equivalent employment. District 65 seems to view the present case as one in which an employer, motivated by antiunion animus, "runs away" to a different location in violation of the Act. Alternatively, District 65 seems to suggest the Board's view of the law which is that an employer, who either discontinues operations, permanently goes out of business, or goes out of business and disposes of the business and as an incident thereto discharges his employees, is guilty of an unfair labor practice where his action is motivated by antiunion animus.

The Company, on the other...