N.L.R.B. v. Centra, Inc.

• Decision Date: 29 April 1994
• Docket Number: No. 91-5236,91-5236
• Citation: 954 F.2d 366
• Parties: 139 L.R.R.M. (BNA) 2304, 120 Lab.Cas. P 11,069 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. CENTRA, INC.; Central Transport, Inc.; and Central Cartage Company, Respondents.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 366

954 F.2d 366

139 L.R.R.M. (BNA) 2304, 120 Lab.Cas. P 11,069

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. CENTRA, INC.; Central Transport, Inc.; and Central Cartage

Company, Respondents.

No. 91-5236.

United States Court of Appeals, Sixth Circuit.

Argued Oct. 28, 1991.

Decided Jan. 17, 1992.

Rehearing and Suggestion for Rehearing En Banc

Denied April 29, 1994.

Aileen A. Armstrong, Deputy Associate Gen. Counsel, Frederick Havard, Argued & Briefed, Howard E. Perlstein, David A. Fleischer, Judith A. Dowd, Washington, D.C., Frederick Calatrello, Director, N.L.R.B., Cleveland, Ohio, for petitioner.

Robert L. Duty, Timothy K. Carroll, Argued & Briefed, Dykema & Gossett, Detroit, Mich., for respondents.

Before RYAN and BOGGS, Circuit Judges, and GODBOLD, Senior Circuit Judge. ^*

RYAN, Circuit Judge.

The National Labor Relations Board seeks enforcement of its order issued against Centra, Inc. and its subsidiaries, Central Cartage Company ("Cartage") and Central Transport, Inc. ("Transport"), for violations of sections 8(a)(1) and (3), and 8(a)(1) and (5) of the National Labor Relations Act, 29 U.S.C. §§ 158(a)(1), (3), (5). ¹ The order is reported at 299 N.L.R.B. No. 97. Centra, Cartage, and Transport have agreed, for purposes of this proceeding, to be treated as a single employer.

For the reasons set forth below, the Board's application for enforcement is granted.

I.

In the middle of 1982, Central Transport successfully bid on a contract with General Motors to break down, consolidate, and deliver freight in the Cleveland area. Central Cartage regularly did consolidation work, but Centra decided to perform this contract work through Central Transport. Transport leased a Cartage terminal for the GM consolidation work and, rather than employing Cartage workers, contracted with D & S Leasing Company to supply labor for the operation. D & S had already supplied drivers to Transport in Cleveland. Cartage dock workers in Cleveland were represented by Teamsters Local 407. The D & S employees, however, both drivers and dockworkers, were represented by Teamsters Local 507.

The employees performing GM consolidation work for Transport were on the payroll of D & S. Transport reimbursed D & S for its expenditures plus a percentage, fluctuating with the size of the payroll. Charles Garavaglia, then vice president for labor relations at Transport and Cartage, attended the initial contract negotiations between D & S and Local 507 in 1982, in order to identify acceptable economic terms of the contract and to stress Transport's need for flexible working hours to accommodate GM's "just in time" delivery requirements. The 1982 negotiations led to a so-called "white paper" agreement, differing from the Teamsters National Master Freight Agreement ("NMFA") with respect to the terms and conditions of employment. Later in 1982, Teamsters Local 964 replaced Local 507 as the bargaining representative of D & S employees.

In 1985, D & S and Local 964 negotiated a new agreement, effective June 1, 1985 through March 31, 1988. Attending the 1985 negotiations were George Rogers of D & S, Stephen Bridge of a multi-employer association representing D & S, and Andrew Suckart, a representative of the Ohio Conference of Teamsters. The 1985 negotiations and agreement, unlike 1982, involved D & S employees working in other jurisdictions, specifically Teamsters Locals 20, 118, and 449, as well as 964. In 1985, the union sought a work preservation clause that would allow D & S employees to "follow the work" should Central Transport cancel its contract for labor with D & S, but the proposal was rejected by D & S as unacceptable to its client, Central Transport.

In February or March 1986, Centra officials determined that the GM consolidation work could be done for less money if performed by "new hires" employed under the auspices of Central Cartage and subject to the NMFA. The NMFA would apply to Cartage employees represented by Teamsters Local 407 and allowed for "new hire" wages approximately $2 less per hour than those paid to Local 964 members. Moreover, "new hires" formerly employed by D & S would lose seniority and health and welfare benefits which had accrued under the "white paper" agreement between D & S and Local 964. Garavaglia, then vice president for labor relations, testified that economics alone motivated the changeover to Cartage.

In early May 1986, Joe Goryl, a Centra official, asked Bruce Morrison, Cartage's terminal manager at the Cleveland dock, to prepare a list of D & S employees that Morrison felt should be hired by Cartage when it took over the GM consolidation work. Morrison listed 17 employees. He denied that union activity or support played a role in the selection of the employees and claimed to have picked only the "superstars" to continue on with Cartage. Jim Berquist, operations manager at the terminal, recommended five more D & S employees to be hired by Cartage, and Centra officials apparently chose four others. In all, 26 former D & S employees were ultimately hired by Cartage. Though the decision as to which D & S employees would be hired by Cartage was already made, short, perfunctory interviews were held with all employees.

On May 8, 1986, Goryl issued a memorandum to Cartage president Larry Thomas setting forth a four-week plan for the transition from D & S to Cartage. According to the memorandum, approximately 15 former D & S employees were to be employed at the new 45-man Cartage operation. Weeks one through three were to be used to conduct background checks on the 15 D & S candidates, hiring 5 dockmen per week. By week three, applicants for the other 30 positions were also to be hired "anonymously." To this end, an advertisement was published in the Cleveland Plain Dealer on May 15, 1986, seeking employees for Central Cartage's local operations.

Oswald Kelm, president of Teamsters Local 964 and bargaining representative of the D & S employees at the Cleveland dock, learned of the advertisement and telephoned Bruce Morrison to find out why Cartage was seeking dockmen. Morrison told Kelm that he knew nothing about the matter. Kelm sent a registered letter dated May 16, 1986 to Morrison, expressing the local's concerns about the advertisement and seeking clarification of its meaning to and effects on the members of Local 964.

Kelm's letter was never answered. Other testimony regarding the events of May 16, 1986 to June 2, 1986 is conflicting. Principally, the question before the Board was whether Local 964 was given notice of Centra's plan to terminate D & S and afforded an opportunity to bargain over that decision and the effects of the decision.

Kelm testified that neither Cartage's president, Larry Thomas, nor Richard Silverwood, who handled labor relations, responded to his phone calls. Kelm also testified that other discussions with terminal manager Bruce Morrison were uninformative, as Morrison continued to tell Kelm that he had no knowledge of the matter. According to Kelm, Silverwood returned his call only after the June 2 changeover to Cartage had already occurred. Silverwood had a different recollection of events. He testified to several telephone discussions with Kelm in May 1986, during which he informed the union president that Teamsters International officials had told the company to do away with personnel leasing companies, or "flesh peddlers," that Cartage would be taking over the Cleveland dock operations and already had a contract with Teamsters Local 407, and that while D & S employees would be permitted to apply for positions with Cartage, the company would hire its own personnel for the job.

Silverwood also testified to a conversation in the week prior to the transition to Cartage with "Mr. Compo," another official with Local 964, after he had received word that Kelm had been assuring D & S employees that Cartage would hire the workers in seniority order. According to Silverwood, Compo was informed that Kelm had never been told that personnel would be hired in seniority order. Silverwood placed another call that day to Local 964 and again spoke to Compo, though Silverwood believed that Kelm was present during the conversation and aware of the information provided by Silverwood.

Based on the conflicting evidence presented, the ALJ found that Local 964 lacked adequate notice of Cartage's plans not to hire all of the D & S employees until at least May 28, 1986, based upon Kelm's assertions to the D & S employees regarding seniority hiring on that date, a letter from another union official on that date stating that he understood that former employees of D & S would become employees of Central Cartage, and the timing of telephone calls between Silverwood and Kelm.

Centra also asserts that Local 964 received notice of the changeover earlier than May 28 through conversations Silverwood had with Andrew Suckart, the representative of the Ohio Conference of Teamsters who negotiated the 1985 "white paper" agreement between D & S and several Teamsters local unions, and Robert Cassidy, the head of the Ohio Conference of Teamsters, at a Teamsters convention in Las Vegas during the week of May 19, 1986. In these conversations, Silverwood claims to have sought and gained assurances from Suckart and Cassidy that Cartage was not obligated to hire all of the D & S employees when it assumed control of the Cleveland dock operations. The ALJ and the Board determined that Local 964 was not placed on notice of Centra's plan by these conversations.

On May 31, 1986, the dockworkers were informed by Lawrence Koubeck, vice president of D & S, that they would have no job after that date unless Cartage called on them. One employee, Donald Gruszezynski, a former union steward, testified that Jim Bowen, a dock foreman, told him that Centra was trying to get rid of certain employees because of union activity. Another D & S employee, Kenneth Meyers, testified that dock foreman Wayne Gentry told him...