Adirondack Construction Corp.

National Labor Relations Board - Board Decisions

Mar 13, 1992

306 N.L.R.B. 704 (N.L.R.B. 1992)

704
306 NLRB No. 136
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 The record does not set forth the actual substance of art. I, sec.
3, and art. XXI of the collective-bargaining agreement. That agree-
ment or pertinent parts of it, have not been made part of the record,
and the relevant complaint allegations only identify the nature of
those articles as set forth above. Nevertheless, from such terse iden-
tification of the articles and the substance of the Respondent’s af-
firmative defense, it is apparent that art. I, sec. 3 concerns payments
owing to the welfare and pension fund or funds covered by the
agreement, that article XXI relates to the checkoff of authorized dues
and the remission of them to the Union, and that the gravamen of
the complaint is that the Respondent has stopped making the re-
quired payments and remitting dues.
2 As Member Oviatt stated in Tammy Sportswear Corp., supra, he
is of the opinion that there may be limited circumstances in which
an employer’s financial inability to pay may constitute a defense to
an allegation that it unilaterally and unlawfully ceased contractually
required payments to a union benefit fund. To make this defense
successfully, an employer must establish that it continued to recog-
nize—and did not repudiate—its contractual obligations. To satisfy
this requirement, an employer must prove that its nonpayment was
followed by its request to meet with the union to discuss and resolve
the nonpayment problem. In so doing, an employer demonstrates its
adherence to the contract and the bargaining process. In such cir-
cumstances, Member Oviatt would find that an employer’s non-
payment of contractually required benefit fund payments would not
violate Sec. 8(a)(5) of the Act. Such circumstances, however, are not
present in this case.
Adirondack Construction Corporation and District
Council of Carpenters of the United Brother-
hood of Carpenters and Joiners of America,
Local 229. Case 3–CA–16571
March 13, 1992
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS OVIATT
AND RAUDABAUGH
Upon a charge filed by the District Council of Car-
penters of the United Brotherhood of Carpenters and
Joiners of America, Local 229 (the Union) on Sep-
tember 4, 1991, and an amended charge filed on Octo-
ber 8, 1991, the General Counsel of the National Labor
Relations Board issued a complaint on October 10,
1991, against Adirondack Construction Corporation,
the Respondent, alleging that it has violated Section
8(a)(5) and (1) by discontinuing its obligations under
the welfare and pension and dues-checkoff provisions
of the collective-bargaining agreement. Copies of the
complaint and notice of hearing were served on the
Respondent. The Respondent filed a timely answer ad-
mitting all the factual allegations and asserting an af-
firmative defense.
On December 8, 1991, the General Counsel filed a
motion to transfer proceeding to Board, to strike Re-
spondent’s affirmative defense, and for summary
judgement. On December 18, 1991, the Board issued
an order transferring the proceeding to the Board and
Notice to Show Cause why the motion should not be
granted. The Respondent filed no response.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
On the entire record, the Board makes the following
Ruling on Motion for Summary Judgment
Although the Respondent has admitted all the fac-
tual allegations in the complaint, including its failure
since March 1, 1991, to abide by ‘‘Article 1, Section
3 (Welfare and Pension)’’ and ‘‘Article XXI, (Dues
check-off Service by Employer)’’ of the collective-bar-
gaining agreement with the Union, it asserts as an af-
firmative defense that: ‘‘[d]ue to cash flow problems
[it] has not been able to make payments since March
1991. . . . [It] expects to make payments within the
next 60 days.’’1
It is well settled that an employer who is a party to
an existing collective-bargaining agreement violates
Section 8(a)(5) and (1) of the Act when it modifies the
terms and conditions of employment established by
that agreement without obtaining the consent of the
Union. Rapid Fur Dressing, 278 NLRB 905, 906
(1986). Here the Respondent has admitted that it has
unilaterally discontinued certain of its obligations
under the contract. It attempts, however, to defend its
conduct by asserting, as an affirmative defense, that it
lacks the financial ability to make the required pay-
ments. Such an economic necessity claim, even if
proven, does not constitute an adequate defense to an
allegation that an employer has unlawfully failed to
abide by the provisions of a collective-bargaining
agreement. Tammy Sportswear Corp., 302 NLRB 860
(1991); Raymond Prats Sheet Metal Co., 285 NLRB
194, 196 (1987); International Distribution Centers,
281 NLRB 742, 743 (1986); and Hiysota Fuel Co.,
280 NLRB 763 (1986).2 Accordingly, we find the af-
firmative defense submitted by the Respondent to be
inadequate, and we grant the General Counsel’s motion
to strike it.
Because the Respondent has admitted all the facts
material to a resolution of the unfair labor practice
issues raised by the complaint, there are no material
facts in dispute. In the absence of good cause to the
contrary having been shown by the Respondent, we
grant the General Counsel’s Motion for Summary
Judgment.
On the entire record, the Board makes the following
FINDINGS OF FACT
I. JURISDICTION
The Respondent maintains its principal office and
place of business at Glens Falls, New York, where it
has been engaged as a general contractor in the con-
struction business. The Respondent during the past 12
months has derived gross revenue in excess of $50,000
from providing services to other enterprises, including
705ADIRONDACK CONSTRUCTION CORP.
3 In the event there is one fund for welfare and pension, the Deci-
sion and Order shall be amended accordingly.
4 Because the provisions of employee benefit fund agreements are
variable and complex, we leave to the compliance stage the question
whether the Respondent must pay any additional amounts into the
benefit fund in order to satisfy our ‘‘make-whole’’ remedy.
Merryweather Optical Co., 240 NLRB 1213 (1979).
New York Telephone Co., which are engaged in inter-
state commerce. The Respondent also is a member of
the Glens Falls Contractors Association (the Associa-
tion), an association comprising various employers in
the construction contracting industry who have dele-
gated to the Association the authority to represent
them for the purposes of collective bargaining. During
the past 12 months, the members of the Association,
in the course and conduct of their business operations
located in New York State, collectively purchased and
received goods and materials valued in excess of
$50,000 that were transported to the businesses directly
from points located outside the State of New York. At
all times material, the Respondent has delegated au-
thority to the Association to represent it for the pur-
poses of collective bargaining with the Union. Accord-
ingly, we find that the Respondent is an employer en-
gaged in commerce within the meaning of Section 2(6)
and (7) of the Act and that the Union is a labor organi-
zation within the meaning of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
The Union represents the following employees of
the Respondent who constitute a unit appropriate for
the purposes of collective bargaining within the mean-
ing of Section 9(b) of the Act:
All journeymen, foremen and apprentices.
About June 1, 1989, the Respondent and the Union
entered into a prehire collective-bargaining agreement
within the meaning of Section 8(f) of the Act, effective
June 1, 1989, to May 31, 1992. By virtue of the prin-
ciples established by the Board in John Deklewa &
Sons, Inc., 282 NLRB 1375 (1987), the Union has
been, and is, the limited exclusive collective-bar-
gaining representative of the employees in the unit for
the purposes of bargaining with respect to rates of pay,
wages, hours of employment, and other terms and con-
ditions of employment.
Although, as noted previously, the relevant contrac-
tual provisions are not in the record, we infer that arti-
cle I, section 3 of the parties’ collective-bargaining
agreement requires the Respondent to make monetary
contributions to certain welfare and pension funds3 for
and on behalf of the employees. Similarly, we infer
that article XXI requires the Respondent to deduct
union dues from employees’ paychecks pursuant to
valid checkoff authorizations and to remit them to the
Union. The Respondent admits that since about March
1, 1991, it has failed to abide by the above provisions.
Accordingly, we find that the Respondent has violated
Section 8(a)(5) and (1) of the Act.
CONCLUSIONS OF LAW
By ceasing during the term of the contract to abide
by the contractual provisions concerning welfare and
pension payments and dues checkoff on and after
March 1, 1991, the Respondent has engaged in unfair
labor practices within the meaning of Section 8(a)(5)
and (1) and Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in
certain unfair labor practices, we shall order it to cease
and desist and to take certain affirmative action de-
signed to effectuate the policies of the Act.
We shall order the Respondent to make whole the
unit employees by making all contributions that would
have been paid into the welfare and pension funds but
for the Respondent’s unlawful discontinuance of pay-
ments4 and to reimburse them for any expenses or loss
of benefits they may have suffered as a result of the
Respondent’s discontinuing these payments, as set
forth in Kraft Plumbing & Heating, 252 NLRB 891 fn.
2 (1980), enfd. 661 F.2d 940 (9th Cir. 1981), the
amounts to be computed in the manner set forth in
Ogle Protection Service, 183 NLRB 682 (1970), with
interest as computed in New Horizons for the Re-
tarded, 283 NLRB 1173 (1987). We shall also order
the Respondent to make the Union whole for the Re-
spondent’s failure to abide by its obligations under the
dues-checkoff provision in the contract, also with inter-
est computed as described above.
ORDER
The National Labor Relations Board orders that the
Respondent, Adirondack Construction Corp., Glens
Falls, New York, its officers, agents, successors, and
assigns, shall
1. Cease and desist from
(a) Failing and refusing to bargain with District
Council of Carpenters of the United Brotherhood of
Carpenters and Joiners of America, Local 229 by fail-
ing to abide by its obligations under the welfare and
pension and dues-checkoff provisions of the collective-
bargaining agreement.
(b) In any like or related 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) Make all contributions to the welfare and pen-
sion funds that have not been paid and that would have
been paid in the absence of the Respondent’s unlawful
706 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
5 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.’’
discontinuance of the payments, and make the employ-
ees whole, in the manner set forth in the remedy sec-
tion of this decision.
(b) Comply with the terms of the dues-checkoff pro-
vision in the collective-bargaining agreement and remit
to the Union dues checkedoff pursuant to that provi-
sion and valid authorizations and required by the
agreement to be turned over to the Union by the Re-
spondent, with interest as set forth in the remedy sec-
tion of this decision.
(c) Preserve and, on request, make available to the
Board or its agents for examination and copying, all
payroll records, social security payment records, time-
cards, personnel records and reports, and all other
records necessary to analyze the amount of backpay
due under the terms of this Order.
(d) Mail a copy of the attached notice marked ‘‘Ap-
pendix’’5 to the Union and to all unit employees who
were employed by the Respondent. Copies of the no-
tice, on forms provided by the Regional Director for
Region 3 after being signed by the Respondent’s au-
thorized representative, shall be mailed by the Re-
spondent immediately upon receipt as above directed.
(e) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
WE WILL NOT refuse to bargain in good faith with
District Council of Carpenters of the United Brother-
hood of Carpenters and Joiners of America, Local 229,
as the exclusive collective-bargaining representative of
the unit by failing to abide by our obligations under
the welfare and pension or dues-checkoff provisions of
the collective-bargaining agreement.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.
WE WILL make all contributions to the welfare and
pension fund that have not been paid and that would
have been paid in the absence of our unlawful dis-
continuance of the payments, and make unit employees
whole, with interest.
WE WILL remit to the Union dues checked off pur-
suant to the collective-bargaining agreement and re-
quired to be turned over to the Union by us, with in-
terest.
ADIRONDACK CONSTRUCTION CORP.