Shell Co., 133 (1993)

The Shell Company (Puerto Rico) Limited and

International Association of Machinists and Aerospace Workers, AFL-CIO. Cases 24-CA- 6335, 24-CA-6364, and 24-CA-6414

November 23, 1993

DECISION AND ORDER

BY CHAIRMAN STEPHENS AND MEMBERS DEVANEY AND RAUDABAUGH

On March 2, 1993, Administrative Law Judge Wallace H. Nations issued the attached decision. The Respondent filed exceptions, and the General Counsel filed an answering brief.

The National Labor Relations Board has considered the decision and the record in light of the exceptions and brief and has decided to affirm the judge's rulings, findings,1 and conclusions and to adopt the recommended Order.

The judge found, inter alia, that the Respondent violated Section 8(a)(5) and (1) by failing to furnish to the Union requested financial information. We agree with the judge that the Respondent's economic claims with respect to its Airport operation triggered a duty to disclose relevant financial information under NLRB

v. Truitt Mfg. Co., 351 U.S. 149 (1956).

The credited evidence shows that in preparation for

bargaining on a successor contract the Respondent effectively pleaded that it was presently unable to pay.2

The Respondent expressly told Union Negotiator Juan Maldonado that economic conditions had affected them ''very badly, very seriously,'' that present circumstances at its Airport operation were ''bad'' and a matter of ''survival'' and, that ''we are telling you all of this because we need your help, your assistance, because of this condition.'' In portraying to the Union its present circumstances at the Airport, the Respondent expressly referred to steps it already had taken to address the threats to its survival, i.e., a hiring freeze of all management and employee positions and an early

retirement plan, and stated that it was losing business, that it had lost an important customer, and that it faced serious regulatory and cost problems. Indeed, in a letter to employees dated March 8, 1991,3 the Respondent admitted that it had informed Maldonado that the situation at the Airport was ''critical'' and a matter of ''survival.'' Although the Respondent referred to economic disadvantages it had in relation to other competitors, Maldonado's credited testimony reveals that the essential core of the Respondent's bargaining posture as a whole, as expressed to the Union, was grounded in assertions amounting to a claim that it could not economically afford the most recent contract at its Airport operation, that it was faced with a present threat to that operation's survival, and that, therefore, it was at present unable to pay those terms in the successor contract.4

In view of Maldonado's credited testimony, we agree with the judge that the Union was entitled to verify the Respondent's dire claims with respect to the survival of its Airport operation. The Board's decision in Nielsen Lithographing Co., 305 NLRB 697 (1991), petition denied sub nom. Graphic Communications Local 508 v. NLRB, 977 F.2d 1168 (7th Cir. 1992), is not to the contrary. In Nielsen, unlike here, the employer repeatedly stated that it was still making a profit; the thrust of its economic assertions pertained to its future economic competitiveness.5 Similarly, in Burruss Transfer, 307 NLRB 226 (1992), the employ-er's claims were grounded in its claims of competitive disadvantage, and it did not assert that it needed economic concessions as a matter of survival. Further, in Beverly Enterprises, 310 NLRB 222 (1993), the employer expressly stated that it was not going out of business and essentially indicated that it simply was

1 The Respondent has excepted to some of the judge's credibility findings. The Board's established policy is not to overrule an administrative law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect. Standard Dry Wall Products, 91 NLRB 544 (1950), enfd. 188

F.2d 362 (3d Cir. 1951). We have carefully examined the record and find no basis for reversing the findings.

The judge inadvertently stated that a May 17, 1991 letter (Jt. Exh.

30) was from Vazquez to Maldonado. The letter was from Maldonado to Vazquez.

2 The complaint does not allege that the Respondent engaged in surface bargaining. In adopting the judge's 8(a)(5) and (1) findings, we find it unnecessary to reach or consider the question whether the Respondent's bargaining posture was, as the judge found, ''aimed at inducing or forcing impasse so its contract goals could be implemented as formulated.'' For the same reason, we do not rely on the judge's finding that the Respondent's bargaining posture was predicated on its reading of Board cases rather than one designed to gain union cooperation in bargaining.

3 The judge erroneously stated that this letter was dated March 22, 1991.

4 We also note that the Respondent, through its human resources manager, Ana T. Battle, asked Union Negotiator Maldonado on January 19, 1991, to release the Respondent from its contractual commitment to pay overtime to union stewards attending an arbitration proceeding because ''as we explained to you [previously] . . . we cannot pay all of this amount of money to the stewards.'' As the judge found, the Respondent thereby gave to the Union yet another indication that the Respondent, consistent with its previous economic assertions, was claiming that it could not meet its present economic obligations.

The judge inadvertently attributed the January 19, 1991 remarks to the Respondent's attorney, Tristan Reyes-Gilestra, rather than to Battle. In adopting the judge's crediting of Maldonado, we do not rely on Reyes-Gilestra's failure to explain the basis for the Respond-ent's request.

5 Chairman Stephens notes that he dissented in Nielsen because he viewed the employer's claims of economic hardship there as sufficient to trigger a duty to furnish relevant economic information under Truitt. He views the Respondent's claims here as also sufficient to trigger a Truitt obligation. Because he would find that a Truitt obligation arises in both cases, he finds it unnecessary to consider whether Nielsen and the instant case are factually distinguishable under the majority view in Nielsen.

not as profitable as it once had been.6 And in Concrete Pipe & Products Corp., 305 NLRB 152 (1991), the employer's claims were wholly derived from its stated desire to be competitive and its claims as to ''survival'' did not refer to any imminent risk or immediate economic peril.

As the Board majority noted in Nielsen, supra at 700.

Depending on the facts and circumstances of a particular case, the evidence may establish that the employer is asserting that the economic problems have led to an inability to pay or will do so during the life of the contract being negotiated.

Because of the immediacy of the Respondent's claims here concerning the Airport's present survival and ''critical'' condition, we find that the facts and circumstances warrant a finding that the Respondent pleaded a present inability to pay.7

ORDER

The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, The Shell Company (Puerto Rico) Limited, San Juan, Puerto Rico, its officers, agents, successors, and assigns, shall take the action set forth in the Order.

Antonio F. Santos, Esq., for the General Counsel.

Tristan Reyes-Gilestra, Esq., of San Juan, Puerto Rico, for the Respondent.

DECISION

STATEMENT OF THE CASE

WALLACE H. NATIONS, Administrative Law Judge. On May 22, 1991,1 International Association of Machinists and Aerospace Workers, AFL-CIO (the Union) filed a charge against The Shell Company (Puerto Rico) Limited (Respondent, the Company, Shell, or the Employer) in Case 24-CA- 6335. The Union filed another charge against Respondent in Case 24-CA-6364 on July 11, and filed an amended charge in this case on August 30. The Union filed yet another

charge against Respondent in Case 24-CA-6414 on October 8, and filed an amended charge in that case on November

19. A second amended charge in this case was filed on December 17. Based on all but the last amended charge, the Regional Director for Region 24 issued an order consolidating cases, second consolidated amended complaint and notice of hearing (the complaint) on November 29. The complaint alleges that Respondent has violated Section 8(a)(1) and (5) of the National Labor Relations Act (the Act). Respondent filed a timely answer to the complaint wherein, inter alia, it admitted the jurisdictional allegations of the complaint.

Hearing was held in these cases in Hato Rey, Puerto Rico, on August 10 and 11, 1992. The record was held open until November 4, 1992, to allow the parties sufficient time to agree on proper translation from Spanish into English of the voluminous written documentation in the record. Briefs were received from the parties on or about January 31, 1993. Based on the entire record, including my observation of the witnesses, and after consideration of the briefs, I make the following

FINDINGS OF FACT

1. JURISDICTION

   It is admitted, and I find, that at all times material to this proceeding, the Shell Company (Puerto Rico) Limited is a corporation, with an office and place of business at Pueblo Viejo, Guaynabo, and at Luis Munoz Marin International Airport, Carolina, Puerto Rico, wherein it has been engaged in the nonretail sale of petroleum bulk and packaged products. As noted the jurisdictional allegations of the complaint were admitted and I find that Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act.

2. THE INVOLVED LABOR ORGANIZATION

   It is admitted, and I find, that the Union is a labor organization within the meaning of Section 2(5) of the Act.

3. THE ALLEGED UNFAIR LABOR PRACTICES

   The complaint alleges that Respondent has violated Section 8(a)(1) and (5) of the Act by failing or refusing to supply the Union with necessary...