LIR 863Richard N. Block
Fall, 2006
MID-TERM TAKE-HOME EXAM
DIRECTIONS: This is an individual take-home assignment. It is due on Tuesday, October 17, 2006 at 10:30 AM. The exam may be submitted in person at that time, placed in my mailbox in 405 South Kedzie Hall, or by e-mail attachment to . (You may not fax the exam.) In doing this assignment, you may consult your textbook, case supplement, statutory supplement, overheads, and any notes or briefs which you have prepared, either by yourself or in a group of students. There is no reason to consult any material beyond that required in class (i.e. additional cases not in the class material, law review articles, etc.). No credit will be given for citing such materials. In answering the questions, you should consider all possible issues, even if your decision on one issue may technically render a decision on other issues unnecessary. The assignment should be no more that four double-spaced pages, if typed, or six sheets, written on every other line, if handwritten.
Rotten Foods, Inc., a Michigan-based company, is engaged in the business of food processing and food distribution. The company was founded in 1963. In 1988, Rotten was purchased by Bloated Industries, as Bloated desired a food distribution outlet in the upper Midwest.
Rotten has two facilities in Lansing. The original facility (Rotten) prepares and distributes deli type foods (cole slaw, salads, prepared meats, etc.) to grocery stores in an area within 150 miles of Lansing. Hourly employment at the Rotten facility in Lansing consists of 70 production and maintenance employees on three shifts (6:00 AM – 3:00 PM, 3:00 PM – 11:00 PM, and 11:00 PM – 7:00 AM, all seven days per week), 10 salaried management personnel, and 8 hourly office and clerical staff who work from 8:00 AM – 5:00 PM Monday-Friday. Rotten once employed eight truck drivers, but as the truck drivers retired, the company gradually sold its trailers and, by 2002, had contracted for all trucking services.
In 1999, Rotten acquired JailChow, Inc., a Lansing company that specialized in preparing cooked meals for various local jails in the area which often had the responsibility for feeding prisoners while they were locked up prior to being transferred. The acquisition of JailChow also provided an additional outlet for the processed food from the original (Rotten) plant. The JailChow kitchen is located about 3 miles from the Rotten preparation and distribution facility. The JailChow facility employs 20 hourly kitchen workers, 2 salaried management personnel, and 4 hourly office workers. Eight of the kitchen workers work from 6:00 AM – 3:00 PM Monday through Friday, six work from 11:00 AM – 7:00 PM Monday and Friday, and six work 6:00 AM – 3:00 PM on weekends. The office workers and management personnel work from 8:00 AM – 5:00 PM, Monday-Friday, with one hour for lunch.
When Rotten acquired JailChow, JailChow employees made less than Rotten employees, and JailChow retained that same differential. Since then, however, Rotten and JailChow employees have received equal percentage increases every January 1. Rotten and JailChow employees have the same benefit package and, since 1999, eight Rotten employees have permanently transferred to positions at JailChow, albeit keeping their (higher) Rotten salaries. No JailChow employees have ever permanently transferred to Rotten, as the matter has never come up. At times, however, employees at both facilities have been sent to the other facility for a few hours as the need has arisen, but this is not a frequent occurrence.
In November 2003, Bloated, concerned about the financial performance of the Rotten food distribution and processing plant, hired Laura Leek as plant manager at Rotten. Leek studied the situation and determined that employment was unnecessarily high in the Rotten facility. On December 20, 2003, Leek informed the Rotten employees that it was necessary that employment be reduced by 10% by June 30, 2004, and that if this could not be accomplished through attrition (quits and retirements), she would discharge the poorest performing employees.
In January 2004, after hearing Leek’s comments, Rotten employees Tom Mato, who worked in the meat preparation department, and Calli Flower decided that their only option was to organize. Flower was a senior member of the kitchen staff. Mato and Flower contacted Lettuce Represent You[1] (hereinafter Lettuce), a union that represented many employees in the food preparation industry. Lettuce organizer Barbara Bean met with Mato and Flower on January 24. She suggested that they begin speaking with each of the employees at Rotten in order to determine if there was any interest in unionization, and that she would help as much as she could.
Mato and Flower began talking to employees the next day, January 25. On January 26, an employee approached Human Resources Manager Moe Lasses and informed him that some of the employees were talking about “starting a union.” When Lasses asked who they were, the employee named Mato and Flower. Lasses then informed Leek about the interest in unionization. Leek said that she was surprised about Flower, because she was a “good worker,” but that Mato would be “out of there soon,” and “they didn’t need to worry about him.” She then thanked Lasses for telling her about it, saying that where there was “one pro-union, anti-management employee, there were more.”
On February 1, Leek called a meeting on each shift for all the employees on that shift. She said that it had come to her attention that some employees were interested in a union, and that she thought that was a bad idea, that the employees did not need a union. She said that since it appeared that “unionization was in the air,” the employees might wish to keep in mind that Rotten’s finances were “not so great,” and that they should know that the union probably wouldn’t improve them, noting that “employees don’t organize to help the company, only to harm it.” She also said that no Bloated operation had ever been unionized because Bloated had worked hard to convince employees they didn’t need a union, and that she doubted this attempt would be successful.
On February 4, Mato and Flower, while on their lunch hour, solicited employees to sign union authorization cards in the “coffee and break room,” a room with tables and chairs and vending machines that was frequented by both managers and hourly employees. Leek walked by the table at which Mato and Flower were soliciting employees. She stood by the employees’ table for approximately 2 minutes before interrupting them. She then gave management’s perspective on unionization at the Rotten facility, essentially repeating the message she had delivered on February 1. She spoke for 8 minutes and then left the employee dining room.
On February 6, Mato solicited employee Orville Onion at a table in the break room to sign a union authorization card Lassos overheard the conversation and approached the employees and offered management’s view of unionization at the Respondent’s facility. Lassos then asked Mato what he thought about the union. Mato said that he thought the union might help the employees. He said until the new plant manager, things had been great at Rotten, but since that time, “Rotten had become rotten.” Lassos said “that kind of talk could get you into trouble,” and he had better watch what he said. Lassos also said that he would be listening. Mato pointed out that it appeared to him that Lassos had been spending “a lot” of time in the break room since the organizing began. Lassos suggested that Mato focus on his own job, and not tell Lassos how to do his.
On February 10, Leek posted the following notice on the bulletin board.
As I stated in my December 20 communication, Bloated has directed that staffing be reduced at Rotten by 10% by June 30. My examination of the payroll records indicates that no employees are scheduled to retire by June 30. Moreover, since only one employee resigned during the period July 1 – December 31, I must assume that no more than one or two employees will resign between now and June 30. Thus, reductions in employment will be by performance-based layoffs and terminations. This process will start within a few days.
On February 15, Leek called Mato into her office and told him he was fired. When Mato asked why, Leek referred to the December 20 and February 10 announcements. She said that she had been examining the 2003 payroll records over the last several weeks, and that Mato had the worst attendance record of any employee in 2003. Mato said that he was aware of that, that his wife had been ill over the past year, and that this had caused him to use much of his sick leave, but that she was recovered, and he had not missed any work since the beginning of the year. Mato also pointed out that he had perfect attendance in 2001 and 2002. Leek said the situation regarding Mato’s wife was “unfortunate,” but “not the Company’s problem.” The company needed people who showed up to work, and that her decision was made.
On February 27, Lasses called Flower into his office and informed her that he had some good news for her. In order to save money on supervisors, the company was appointing one employee as “shift leader” for each department for each shift and he wanted her for that position for the salad department. When Flower asked what that meant, Lasses said she would be the liaison between the plant manager and the employees in the salad department on the first (6:00 AM – 3:00 PM) shift, and that she would receive an extra $1.00 per hour for these responsibilities. She would have the authority to assign the six employees in her department to various jobs on the shifts (washing, cutting, packaging, cleaning, etc.) Questions regarding time off, staffing in the department, discipline, pay, etc. should go directly to him. Lasses said that he “expected her to accept the offer.” Flower did so. Nine other employees were also selected as shift leaders and they were to have responsibilities similar to those of Flower.
During the next several weeks, Leek asked Flower to order food, and she did so. In addition, on April 5, the other salad department employees on the shift complained to Flower about the performance of employee Mae O’Naise, a new employee. When Flower asked why they were telling her about it, one employee said that they had gone to Leek, and Leek had told them to “see your shift leader.” In response to this, Flower, concerned that perhaps the employees were unsure of their job responsibilities, asked Lassos for job descriptions for each employee. Lasses provided these for her, and they were distributed to all the employees in the salad department on shift on April 10. On April 20, Lasses asked Flower “how things were going with O’Naise?” Flower said she was doing “OK.” Lassos responded that under Leek, “ ‘OK’ was no longer good enough.” On April 21, Lasses fired O’Naise.
On April 24, Lasses informed Flower that employee Hugh Muss was being considered for transfer to the meat department, and asked Flower if Muss was a good employee. Flower said he was. On April 27, Muss was transferred to the meat department.
On May 2, Lasses observed Flower taking a union authorization card from employee Brad Bacon on their break. After the conversation had ended, Lasses took Flower aside and said he was “disappointed in her,” that he thought she understood that she was on “the company’s side,” and that he “could not tolerate her” supporting the union. Later that day, Lasses informed Leek regarding what he had observed.
On May 5, Lasses informed Flower that she was being changed to the position of shift leader in the bakery on the evening shift Monday - Friday (3:00 PM – 11:00 PM) because that shift leader was out with a long-term illness. Lasses said he was selecting Flower because Flower was the best shift leader in the plant, and that a strong shift leader was needed on the evening shift because there was no generally no management personnel in the plant after 6:00 PM. Flower responded that she could not work the evening shift; her husband worked an evening shift at another company and could not change, and she doubted she would be able to find evening care for her 4-year old son during the week. Lasses said that was not his problem, they expected their supervisors to support the company; she would be required to accept the transfer. Flower asked if another of the shift leaders could do the job. Lasses replied that she was the best qualified, that he was assigning her to evening shift, and that her refusal to work that shift as a shift leader would be considered insubordination and a refusal to follow a direct order and she would be fired.
On May 6, Flower again asked Lasses if the Company’s decision was final. When Lasses said it was, Flower said “I cannot work that shift.” Lasses informed her she was terminated.
Meanwhile the election campaign continued, and on May 20, Bean telephoned Leek, and informed her that 37 of the 70 employees at Rotten had signed authorization cards, and asked her when she wanted to meet to bargain. Leek informed Bean that her employees would never support a union voluntarily, that they must have been forced to sign cards, and that she would fight this unionization attempt “all the way.” Bean responded, “I guess that means you are refusing to bargain.” Leek terminated the call.
On May 25, Lettuce, based on the 37 cards, filed a representation petition with the NLRB regional office in Detroit requesting an election among all production and maintenance employees at Bloated’s Rotten facility in Lansing. On that same day, Lettuce filed unfair labor practices charges with the Detroit regional office alleging that Bloated/Rotten had violated Sections 8(a)(1), 8(a)(3), and 8(a)(5) of the National Labor Relations Act. On June 2, the labor attorney for Bloated responded to the petition. Bloated objected to the representation petition on the grounds that: (1) the only appropriate unit consisted of all hourly production and maintenance and office and clerical employees at the Rotten and JailChow facilities in Lansing; and that (2), in any event, the shift leaders at the Rotten plant were supervisors and not covered by the Act. How should the NLRB rule on the objection and the unfair labor practice charges? If the Board should find that any unfair labor practices were committed, what remedies should be directed?
1
[1] Honesty requires the disclosure that this name is unashamedly stolen from Lettuce Entertain You Enterprises Inc., a firm that operates 31 restaurants in the Chicago area (see