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Report of the NLRB General Counsel
for July 1, 1998 to August 31, 1999



WASHINGTON, D.C.   20570


This report covers selected cases of interest that were decided during the period from July 1, 1998 through August 31, 1999. It discusses cases which were decided upon a request for advice from a Regional Director or on appeal from a Regional Director's dismissal of unfair labor practice charges. In addition, it summarizes cases in which the General Counsel sought and obtained Board authorization to institute injunction proceedings under Section 10(j) of the Act.

Fred Feinstein
General Counsel


New Jurisdictional Standard For Casino on Indian Tribal Land

In a case arising during this period, we decided to argue that the Board should change current jurisdictional standards and assert jurisdiction over a Native American gaming casino located on tribal land.

The charge alleged that the Casino, located on tribal land, violated Section 8(a)(2) of the Act by dominating and discriminatorily supporting Union A by allowing its representatives access to Casino property, while denying such access to Union B. The Casino was wholly owned and operated by the Tribe. It appeared that around 95 percent of the Casino's employees and 98 percent of its customers, were non-Indian. This case presented the issue of whether federal statutes of general applicability, such as the NLRA, presumptively apply to Indian employers operating on reservation land.

In Federal Power Comm'n v. Tuscarora Indian Nation, 362 U.S. 99 (1960), the Supreme Court stated that "it is now well settled by many decisions of this Court that a general statute in terms applying to all persons includes Indians and their property interests . . .. Whenever they and their interests have been the subject affected by legislation they have been named and their interests specifically dealt with." Id. In Tuscarora, the statute in question "named" Indians and specifically protected only Indian "reservation" lands from condemnation by the Federal Power Commission. Because the Tuscarora Indians' land was owned in fee simple, the statutory language did not apply and did not prevent the Federal Power Commission from condemning it under the Federal Power Act.

The Casino in our case was located in California, within the Ninth Circuit Court of Appeals. In Donovan v. Coeur d'Alene Tribal Farm, 751 F.2d 1113 (9th Cir. 1985), that Court, applying Tuscarora, fashioned its own test for determining whether a federal agency has jurisdiction over a tribal enterprise. Under Coeur d'Alene, if the statute is one of general applicability, the federal agency has jurisdiction over the Indian enterprise, unless it falls into one of three exceptions: 1) the Act touches exclusive rights of self-governance in purely intramural matters; 2) application of the Act would abrogate rights guaranteed by Indian treaties; or 3) there is proof by legislative history or some other means that Congress intended the Act not to apply to a tribal enterprise on a reservation.

In Coeur d'Alene, a commercial farm, wholly owned and operated by the Tribe and located on reservation land, argued that Congress did not intend OSHA to apply to it. The court disagreed, finding that OSHA was a general statute in terms applying to all persons, including Indians and their property interests. Id. at 1115. The court then found that none of the three exceptions to asserting jurisdiction applied to the farm. See also Dep't of Labor v. Occupational Safety & Health Review Comm’n, 935 F.2d 182, 187 (9th Cir. 1991), (OSHA had jurisdiction over a tribally owned and operated sawmill located on an Indian Reservation); Lumber Indus. Pension Fund v. Warm Springs Forest Prods., 939 F.2d 683 (9th Cir. 1991), (ERISA applied to a tribally owned and operated sawmill located on an Indian Reservation).

The Seventh and Second Circuits have adopted the Ninth Circuit Coeur d'Alene analysis for determining whether federal agencies have jurisdiction over tribal enterprises. See Smart v. State Farm Ins. Co., 868 F.2d 929, 932-37 (7th Cir. 1989) (ERISA governed a group health policy issued to an Indian tribal health center for the benefit of tribal employees located on the Indian reservation); In Reich v. Mashantucket Sand & Gravel, 95 F.3d 174 (2nd Cir. 1996) (OSHA applied to a tribally owned and operated construction business working exclusively on reservation projects). On the other hand, the Tenth and Eighth Circuits apply a different analysis which places a burden on the federal agency to demonstrate that Congress intended the regulatory scheme to apply to the tribe. See Donovan v. Navajo Forest Prods., 692 F.2d 709 (10th Cir. 1982); and EEOC v. Fond du Lac Heavy Equip. & Constr. Co., 986 F.2d 246 (8th Cir. 1993).

Until Sac & Fox Industries (SFI), 307 NLRB 241 (1992), the Board did not apply the Coeur d'Alene analysis for deciding whether to assert jurisdiction over Indian enterprises. Rather, the Board held that Indian tribes and their enterprises located on tribal reservations were implicitly exempt from the Board’s jurisdiction because they are governmental entities under Section 2(2) of the Act and thus exempt under NLRB v. Natural Gas Utility Dist. of Hawkins County, 402 U.S. 600 (1971). See Fort Apache Timber Co., 226 NLRB 503 (1976); Southern Indian Health Council, 290 NLRB 436, 437 (1988).

In SFI, the Board asserted jurisdiction over a non-profit corporation wholly owned by the Sac and Fox Indian Tribe of Oklahoma. The Board based its assertion of jurisdiction on the fact that SFI facilities were located "some distance" from the Tribal reservation. The Board distinguished SFI from Fort Apache and Southern Indian Health Council on the ground that those tribal enterprises were located on tribal land. We noted that the Board in SFI specifically left open the question of whether it would assert jurisdiction on a business located on Indian land. Id. at 242. In reaching its decision, the Board did not apply the Hawkins analysis and, for the first time, applied the Tuscarora rule, as interpreted by the Ninth Circuit in Coeur d'Alene.

More recently, in Yukon Kuskokwim Health Corporation, 328 NLRB No. 101 (June 18, 1999), the Board asserted jurisdiction over an off-reservation tribally controlled hospital. While the Yukon case addressed off-reservation Indian enterprises, the Board, in dicta, left open the question whether it would continue to apply the Hawkins test to enterprises on the reservation. Id. at slip op. 3-4.

We decided to argue that the Ninth Circuit Coeur d'Alene test should be applied by the Board in our case. In Tuscarora, the Supreme Court clearly indicated that statutes of general applicability, such as the NLRA, apply to Indians absent evidence of a contrary Congressional intent. No other Supreme Court case stands for a different proposition.

The Coeur d'Alene analysis is a comprehensive approach for analyzing whether a statute is an exception to the Tuscarora general rule of applicability. In SFI, the Board adopted the Ninth Circuit analysis for off-reservation Indian enterprises. The Coeur d'Alene analysis applies equally well to on-reservation Indian enterprises: applying the same SFI rationale to the instant case, there are no exemptions in the NLRA for on-reservation Indian enterprises, and no contention that the Casino land was protected by a treaty. Indeed, most of the Indian enterprises where the courts have asserted agency jurisdiction under Coeur d'Alene have been located on the reservation.

Further, the Hawkins test, which as applied in Fort Apache implicitly excludes all on-reservation Indian enterprises as political subdivisions, is inconsistent with the Tuscarora principle that statutes of general applicability, such as the NLRA, apply to Indian enterprises. In Smart, the Seventh Circuit explicitly rejected the use of provisions such as Section 2(2) to exempt Indian governments from federal statutes. Smart, above, at 935-936; see also Mashantucket Sand & Gravel, above. The courts have already applied OSHA and ERISA, which have similar exemptions for state and local governments, to on-reservation activities. See Occupational Safety and Health Act, 29 U.S.C. Section 652; Employee Retirement Income Security Act, 29 U.S.C. Section 1003(b). The courts neither discussed nor applied the Hawkins test.

For these reasons, we decided to issue complaint and argue that the Board should no longer follow those decisions which exempted Indian tribes as "political subdivisions" under Hawkins. We argued that Tuscarora and Coeur d'Alene offer a more reasoned approach for determining jurisdiction over all Native American enterprises.

Jurisdiction Over Racetrack Concessionaire

In another case, we considered whether the Board should assert jurisdiction over a food concession operator at a horse racing facility.

The Employer operated a restaurant and related food service concessions at a New York horseracing facility. The Employer's food services were only open during racetrack hours and all customers had to use the racetrack entrance and pay the racetrack's admission price. The Employer operated no food service concerns other than the racetrack restaurant and concessions. The Employer was required by the New York State Racing and Wagering Board to obtain a vendor's license, have each employee licensed (a process that included photographing and fingerprinting) and file weekly reports. However, neither the Racing and Wagering Board nor racetrack management was involved in the day-to-day operation of the Employer's business, and the Employer was not involved in the management of the racetrack.

We decided that the Board would assert jurisdiction over the Employer.

We noted that Section 14(c)(1) of the Act authorizes the Board to decline jurisdiction over employers when the Board deems their effect on interstate commerce "not sufficiently substantial to warrant the exercise of its jurisdiction," and that the Board has declined to assert jurisdiction under that provision over horseracing and dogracing industries and over employers whose operations are an integral part of the horseracing industry. For example, in Hotel & Restaurant Employees, Etc., Local 343 (Herman Turner and Resort Concessions), 148 NLRB 208 (1964), the Board declined to assert jurisdiction over an employer whose business consisted solely of food and beverage concession operations at a New York racetrack because the employer's food services, "while not absolutely essential to the functioning of the racetrack, are an integral attribute of a facility such as a racetrack . . ." The Board noted that the services were expected and demanded by racetrack patrons. The Board further noted that the employer had a close identification with the racing industry as it operated solely at the racetrack and was subject to regulation by the state racing commission.

However, the Board has not subsequently relied on Resort Concessions and, consistent with a more expansive view of its jurisdiction in recent years, has distinguished it in several cases. In Ogden Food Service Corporation, 234 NLRB 303 (1978), for example, the Board concluded that the employer's restaurant and concession operations were "not integrally related to the operations of the racetracks at which it is located," and distinguished Resort Concessions as involving a situation where the concessionaire barely met the Board's monetary jurisdiction standard, operated for only 4 months of the year, and operated exclusively at a single racetrack. In American Totalisator Co., 264 NLRB 1100 (l980), the Board held that an operation that manufactured and serviced equipment used in pari-mutuel betting at racetracks was not integrally related to the horseracing industry since the employer was an "independent entity with its own employees who are hired, supervised, assigned, and transferred without any input from the owners of the racetracks." Finally, in Prairie Meadows Racetrack & Casino, 324 NLRB No. 91, slip op. at 3 (1997), the Board exercised jurisdiction over a large casino that also operated an adjunct racetrack, and noted that the employees the union sought to represent -- including kitchen and banquet workers, bartenders, food servers, bussers, and concession attendants -- were employees "not traditionally associated with or functionally integrated with horseracing." The Board indicated that the horseracing exception applied only where racetrack employees such as jockeys, trainers, grooms, and pari-mutuel betting agents were involved.

We concluded, therefore, that the Board no longer considers retail services such as food concessions to be "integral" attributes of a racetrack, precluding assertion of jurisdiction, merely because those services are expected by racetrack patrons. In the case under consideration, the Employer operated an independent food concession business, without the racetrack's interference, and utilized a stable, almost year-round workforce of food service workers who were in no way involved in the racing industry. Under those circumstances, we decided that the Board should, and would, exercise jurisdiction to remedy the Employer’s unfair labor practices.


Employee Rule Prohibiting Disclosure of Confidential Information

In one case, we concluded that an employer's confidentiality provision found in the employees' handbook was unlawfully overly broad.

The handbook provision stated:

Employees are not to divulge confidential company or customer information to outsiders, including, but not limited to, the media, competitors and government representatives, without specific written approval from corporate management . . . . Confidential information includes but is not limited to: compensation data; customer lists; financial information; operations information; labor relations strategies; and marketing strategies.

We relied on Board law finding employer rules unlawful when they are overly broad. See e.g. Automatic Screw Products, 306 NLRB 1072 (1992), enfd. 142 LRRM 2232 (6th Cir. 1992). Thus, where the rules barred disclosure of employee names, addresses and wage rates, Certified Grocers of Illinois, Inc., 276 NLRB 133 (1985), or barred discussion of "employee problems", Pontiac Osteopathic Hospital, 284 NLRB 442 (1987), the Board found that the rules went beyond a lawful ban, e.g., on the disclosure of clearly confidential employer information, and instead unlawfully trenched upon Section 7 activity. See also Aroostook County Regional Ophthalmology Center, 317 NLRB 218 (1995)(unlawful rule against discussion of employee grievances where discussion occurred outside the earshot of patients).

In our case, we decided that the confidentiality provision was distinguishable from the provision found lawful in Lafayette Park, 326 NLRB No. 69 (August 27, 1998). In that case, the Board found lawful on its face an employee handbook rule barring employees from "divulging Hotel-private information" to employees or other individuals because "the rule is designed to protect that interest rather than to prohibit the discussion of their wages." 326 NLRB No. 69, slip op. at 3. The Board explained that it would apply the well-established standard that: "In determining whether the mere maintenance of rules such as those at issue here violates Section 8(a)(1), the appropriate inquiry is whether the rules would reasonably tend to chill employees in the exercise of their Section 7 right." Id. at 2.

Unlike the ambiguous rule in Lafayette Park, the confidentiality provision in our case was overly broad in at least two respects. First, the scope of information deemed confidential included information the Board has held not to be confidential, i.e., the employees' own wages. Second, the rule explicitly prohibited employees from divulging certain information to outsiders, including but not limited to, government representatives, without specific written approval from corporate management. Restricting employees from discussing information outlined in the rule limits information which can be given to the Board and would thus restrain employees in the exercise of Section 7 rights.

We distinguished the ambiguous rule in Lafayette Park because the confidentiality provision in our case was not ambiguously phrased in terms such as "hotel-private" or "employer-private", i.e., in terms that describe proprietary information that an employer would naturally seek to keep confidential. Instead, the confidentiality provision here explicitly prohibited employees from discussing wages as well as possible unfair labor practices with outsiders. Such a restriction violates Section 8(a)(1) because it interferes with, restrains and coerces employees in the exercise of Section 7 rights.

We noted that in Lafayette, the Board did not change established precedent holding that the mere maintenance of an ambiguous rule violates the Act because such a rule would chill employees in the exercise of activity protected by the Act. J.C. Penney, 266 NLRB 1223, 1224-5 (1983). Further, in Lafayette, the Board also reaffirmed the principle that if a rule is ambiguous, any ambiguity in the rule must be construed against the employer as the promulgator of the rule. 326 NLRB No. 69, slip op. at 5, citing Norris/O'Bannon, 307 NLRB 1236, 1245 (1992). We also noted that in Lafayette, the Board reaffirmed the principle that if a rule is ambiguous, any ambiguity in the rule must be construed against the employer as the promulgator of the rule; 326 NLRB No. 69, slip op. at 5, citing Norris/O'Bannon, supra. See also e.g. J.C. Penney Co., 266 NLRB at 1224; Taylor-Dunn Mfg. Co., 252 NLRB 799, 813 (1980); Paceco, 237 NLRB 399, 400 fn. 8 (1978), enfd. In pertinent part 601 F.2d 180 (5th Cir. 1979); and The Trustees of Colombia University; 225 NLRB 185, 192 fn. 7 (1976).

Finally, we decided that the "Conflicts of Interest" provision was neither overly broad nor ambiguous and was thus lawful. That provision stated, inter alia, that: "All employees must avoid activities or relationships that conflict with [the Employer's] interests or adversely affect [its] reputation." The provision listed the type of activities and relationships employees must avoid. The provision was not ambiguous because it set forth examples of the conflicts employees should avoid. None of these examples either specifically or by implication involved any Section 7 activity. Likewise, the specific examples of conflicts kept the provision from being overly broad. The examples showed that the Employer was seeking to prohibit employees from engaging in graft or competing businesses, which clearly encompassed a legitimate business interest. The mere maintenance of this rule would not reasonably tend to chill employees in the exercise of their Section 7 rights, since employees would understand that the rule was designed to protect the Employer from employee graft or conflict of interest, and was not meant to implicate Section 7 rights.

Discharge for Soliciting Support Against Pending Layoff

In another case, we considered whether the Employer had violated Section 8(a)(1) of the Act by discharging three employees for activities surrounding their efforts to reverse an impending layoff.

The three employees, A, B and C, were long-term employees of the Employer. They all worked in the same department, although employee C performed different work than the other two employees. In September 1996, the Employer met with its employees to inform them of an upcoming merger of its health care facility with another. In July or August 1997, employees A and B were told that the Company planned to contract out their work to another company, and that they would be laid off in December 1997. Employee C was not told that she would be laid off. Shortly after the meeting, employee A asked the employees' supervisor about the consequences of the layoff, namely what would happen to her health benefits. She told the supervisor that she wanted to speak with Human Resources regarding her concerns about the consequences of the layoff. The supervisor asked her to delay until she obtained more information about the layoff.

In an effort to prevent the layoff, the three employees decided to send letters to the staff physicians at the facility, asking for their opinion regarding the layoff. Employees A and B drafted and typed a letter on Company letterhead stationery, signed it, solicited employee C's signature, put copies in Company envelopes, and mailed approximately 150 letters to the physicians.

Shortly after the letters were mailed, several physicians came to the employees' work area to express their concerns about the upcoming layoff. The physicians told them that they would go to the facility's Administration and voice their concerns about the impending layoff.

Several days later, the employees' supervisor approached them with the letter in hand, and asked them who had typed the letter and why it had been typed. The three employees responded that they had done it in an attempt to save their jobs. The supervisor told the employees that she was disappointed with them, and that she felt betrayed, because she had tried to be honest with them. She then left the room. At no point during that conversation, did the supervisor say anything regarding use of the Company's letterhead stationery for personal business.

About one week later, the three employees were informed that they were being terminated as a result of inappropriate use of the Company's letterhead stationery. Specifically, the employees were terminated for violating the Company's rules as stated in the Employee Handbook, which each of the employees had received. That policy stated that official use of the facility's name, whether it be through the use of Company letterhead stationery or statements to the public or press, is only allowed for official facility business. In all other instances, prior authorization had to be obtained from the facility's Administration.

We decided that the reasons offered by the Employer for the discharges were pretextual, and that the employees were actually terminated because they engaged in protected concerted activities, viz., soliciting the support of staff physicians in order to protest their impending layoff. In particular, the supervisor's expressed feeling of betrayal and the discharge of three long-term and previously undisciplined employees, under a rule which did not clearly state that the use of Company letterhead stationery for internal communications was a disciplinable offense, lent support to the conclusion that the employees were fired not for the unauthorized use of the stationery, but for the contents of the letter.

We concluded preliminarily that the use of the Company letterhead stationery to write the letter to the physicians was concerted activity as it was defined in Meyers Industries, 268 NLRB 493 (1984). Additionally, we concluded that the employees' activity was also protected, and that it did not lose the protection of the Act, notwithstanding the rule regarding the use of Company letterhead stationery proffered by the Employer. See Timekeeping Systems, Inc., 323 NLRB 244 (1997); Thor Power Tool Co., 148 NLRB 1379 (1964), enfd. 351 F.2d 584, 587 (7th Cir. 1965).

Timekeeping Systems, Inc. involved an employee who sent an e-mail message to his co-workers expressing his opinion regarding the employer's proposed changes to the vacation policy. He challenged the employer's representations that the changes would result in an increase in days off per year. His message contained "some flippant and rather grating language." Id. at 3. The employee's e-mail generated negative responses by other employees concerning the policy changes. He was ultimately discharged after he failed to write a memorandum to the employees stating why his e-mail was inappropriate and how the matter should have been handled. He was discharged on two of the grounds for dismissal given in the employee manual: failure to treat others with courtesy and respect, and failure to follow instructions or to perform assigned work. involved an employee who sent an e-mail message to his co-workers expressing his opinion regarding the employer's proposed changes to the vacation policy. He challenged the employer's representations that the changes would result in an increase in days off per year. His message contained "some flippant and rather grating language." Id. at 3. The employee's e-mail generated negative responses by other employees concerning the policy changes. He was ultimately discharged after he failed to write a memorandum to the employees stating why his e-mail was inappropriate and how the matter should have been handled. He was discharged on two of the grounds for dismissal given in the employee manual: failure to treat others with courtesy and respect, and failure to follow instructions or to perform assigned work.

The Board affirmed the administrative law judge's findings that the employee's activity was protected, notwithstanding the employer's allegation that he had violated a company rule. The judge relied on Thor Power Tool Co., supra, holding that Section 7 activity may be accompanied by some "impropriety." 323 NLRB at 248. The test is whether the questioned activity is "of such serious character as to render the employee unfit for further service." Caterpillar, Inc., 321 NLRB 1178, 1180 (1996), citing Dreis & Krump Mfg. Co. v. NLRB, 544 F.2d 320, 329 (7th Cir. 1976). The concerted activity in the present case did not meet that standard.

We concluded that there was little support for the argument that the Employer had a legitimate business justification for terminating the employees. The letter was exclusively an internal communication and not disseminated to the public. Furthermore, the message within the letter did not publicly disparage the facility or its services, cf., NLRB v. Electrical Workers, IBEW, Local 1229 (Jefferson Standard), 346 U.S. 464 (1953), or breach any confidentiality with regard to the Employer's business.

In addition, the letters did not disrupt the facility's operations or cause unnecessary friction. Thus, the present case differed materially from Washington Adventist Hospital, 291 NLRB 95 (1988), where an employee, contrary to past practice and an established computer security agreement, used the e-mail system to send "break" messages to over 100 terminals in an acute care hospital, thus interrupting transmissions regarding the care of patients, confusing employees who did not know how to eliminate the "break message" from their terminals, and requiring the dispatch of four or five employees to "cleanse" the terminals that had received the break message. Id. In contrast, the letter sent by the three employees could not have taken the physicians more than a few minutes to digest. See, Timekeeping Systems, Inc., supra, at 6.

Moreover, we concluded that the rule regarding the use of the Company's letterhead stationery was ambiguous because it did not clearly state that use of the stationery, alone, was a disciplinable offense. The rule as written did not appear to apply to situations such as the one presented by this case. On the contrary, it appeared that its purpose was to prevent outside use of the facility's name by an employee for anything other than authorized facility business. In other words, the rule appeared to apply to a situation where an employee holds him or herself out to the public as acting on behalf of the Employer, and where individuals on the outside would be misled into believing that the employee was making a statement on behalf of the facility.

In the present case, the letters were only sent to staff physicians who, based on the context of the letter, could not possibly have thought that the three employees were speaking on behalf of the Employer. Thus, this case did not involve use of the facility's name as the rule intended it to be defined, but rather simply involved use of Company letterhead stationery, for which there was no provision of discipline. Although it was unclear whether the letters were mailed via U.S. mail, or by way of an internal mail forwarding system, it was clear that the recipients of the letters were co-workers of the three discharged employees. In that regard, it was essentially an internal document, and the use of the stationery was not for the purpose of using the facility's name, but for the purpose of communicating with staff physicians about a matter relating to the operation of the facility. Therefore, we concluded that the Employer's discharge of the three employees was prompted not by a legitimate business justification, but by the unlawful motive of penalizing employees for engaging in protected concerted activity.

Discharging Manager For Refusing Discriminatory Directive

In another case, we considered whether an Employer violated the Act by discharging a management employee for refusing to enforce a directive to discriminate against returning strikers.

The Union called several one and two day strikes at the Employer's various facilities. In anticipation of the strike, the Employer revised its guidelines applicable to its bargaining unit work schedules. The scheduling supervisors were directed to divide the bargaining unit into two groups. Group A included staff that were scheduled off for the time in question, as well as staff that worked during the strike. Other staff, including strikers, were included in Group B. Supervisors were directed to first recall by seniority those in Group A. Previously, all scheduling was done on the basis of seniority. The discriminatee, a management employee who was responsible for scheduling the night shift at one of the striking locations, refused to adhere to the new directive, reasoning that it was unlawful to discriminate against employees who went on strike. The Employer discharged the discriminatee for failure to adhere to the new directive.

We decided that Employer's discharge of the management employee for refusing to abide by the discriminatory directive violated Section 8(a)(1) of the Act because the directive itself was unlawful. While it is well established that an employer does not have to accommodate strikers seeking reinstatement following conclusion of an economic strike by displacing permanent replacements or less junior employees, the reinstatement rights of economic strikers and unfair labor practice strikers are identical where there are available openings. Teledyne Still-Man, 298 NLRB 982, 985 (1990), enf'd, 938 F.2d 627 (6th Cir. 1991). Accord, Harvey Mfg., 309 NLRB 465, 469-470 (1992).

In our case, because the job action would only last two days, the Employer did not hire any permanent replacements. In these circumstances, crossovers had no greater rights than strikers, and economic strikers who had not been replaced were entitled to immediate reinstatement. See George Banta Company Inc., 256 NLRB 1197, 1218-1220 (1981), enfd. In pertinent part, 686 F.2d 10, 19, fn. 11 (D.C. Cir. 1982); accord Waterbury Hospital, 300 NLRB 992, 1006-1007 (1990), enf'd, 950 F.2d 849 (2nd Cir. 1991). Further, we noted that once the Employer chose to recall the strikers, it was not free to condition recall on discriminatory reasons. See, Diamond Walnut Growers, 316 NLRB 36 (1995).

In concluding that the Employer violated the Act by terminating its supervisor for refusing to comply with an unlawfully discriminatory directive, we applied Board precedent holding that the discharge of an employee for refusing to commit an unfair labor practice, which is carried out or disclosed to the employees, interferes with the employees' Section 7 rights in violation of the Act. Parker Robb Chevrolet, 262 NLRB 402 (1982); Resistance Technology, 280 NLRB 1004, 1006 fn. 8 (1986).


Assistance to Union At Newly Acquired Plant

In another case involving an employer's recognition of a union as the employees' exclusive bargaining representative, we considered (1) whether the Employer violated the Act by lending support and assistance to the organizational efforts of the Union; and (2) whether the Union acted unlawfully by accepting recognition from the Employer when it did not represent an uncoerced majority of the bargaining unit.

For 30 years, the Employer was a party to a multi-plant agreement with Union A, which represented five of the Employer's plants. In April 1998, the Employer acquired a sixth plant, which employed 24 unrepresented employees. The Employer opposed the extension of the existing multi-plant agreement to the new plant. Before completing the purchase, the Employer contacted Union B to discuss the sixth plant and agreed to "stay in touch" with Union B pending the finalization of the purchase. The Employer did not publicize its acquisition of the sixth plant and Union A was not aware of the purchase prior to the commencement of operations on April 28, 1998.

On April 21, at an initial employee meeting at the sixth plant, the Employer announced that all employees would be retained subject to a probationary period. The Employer did not inform the employees of its multi-plant agreement with Union A, but did recommend that the employees consider union representation. The Employer left the meeting after introducing to the assembled employees two representatives of Union B. One of the Union B representatives initially informed the employees that the Employer had invited them to speak, but then corrected himself indicating that other, outside, employees had suggested the meeting. The Union B representatives, after promising the employees that their conditions would improve upon the signing of a contract between Union B and the Employer, distributed authorization cards, which were signed by all but one of the employees. The Employer immediately verified the authenticity of the employees' signatures and executed a recognition agreement with Union B that same day.

The next day, the sixth plant employees discovered that none of them had suggested meeting with Union B, and that Union A was the incumbent bargaining representative at the Employer's five other plants. An employee contacted Union A and shortly thereafter all 24 employees signed authorization cards for Union A. On April 27, Union A filed a representation petition seeking to represent the 24 employees at the Employer's newly acquired facility.

On May 8, the Employer held a meeting with the sixth plant's employees and stated its belief that the employees had freely selected Union B to represent them. The Employer's vice-president noted that Union A had not been engaged in any organizational efforts as of the date on which the Employer recognized Union B and asserted that Union A had never claimed to recognize a majority of the employees. He also emphasized that the Employer did not intend to implement the terms of the Union A multi-plant agreement at the sixth plant, as it was under no legal obligation to do so.

Union B and the Employer negotiated a collective bargaining agreement during one three-hour bargaining session, apparently without employee participation. Union B advised the employees of the terms of the collective bargaining agreement, which was subsequently finalized between the parties, but never ratified by the employees who wished to be represented by Union A. Subsequently, twenty-one of the 24 employees signed and submitted a petition to the Employer stating that they wanted to be represented by union A.

We decided that the Employer's unlawful assistance of and support to Union B, and union B's acceptance of said support, interfered with the employees' free selection of their bargaining representative as guaranteed by the Act.

"The burden is on the General Counsel to establish that the union does not represent a majority of the employees at the time of recognition. Circumstantial evidence amounting to nothing more than conjecture is not a substitute for proof of lack of majority . . . On the other hand, the General Counsel need not prove with mathematical certainty that the union lacked majority support at the time of recognition where there is evidence that the employer unlawfully assisted a union's organizational campaign." Fountain View Care Center, 317 NLRB 1286, 1289 (1995), enf’d, 88 F.3d 1278 (D.C. Cir. 1996); Longchamps, Inc., 205 NLRB 1025, 1031 (1973). As the Supreme Court noted, "[T]he conclusion that [employees'] choice was restrained by the employer's interference must of necessity be based on the existence of conditions or circumstances which the employer created or for which he was fairly responsible and as a result of which it may reasonably be inferred that the employees did not have that complete and unfettered choice which the Act contemplates." N.L.R.B. v. Link-Belt Company, 311 U.S. 584, 588 (1941), as cited in Mr. Glass, Inc., 220 NLRB 104, 114 (1975).

It is well settled that an Employer does not violate the Act by merely making its premises available on company time to a union seeking to organize its employees if it does so in a context that is free of unlawful assistance. Jolog Sportswear, Inc., 128 NLRB 886, 888 (1960); Klein's Golden Manor, 214 NLRB 807, 813 (1974). However, in our case we determined that the Employer had exceeded the permissible "benign cooperation" approved by the Board and had unlawfully interfered with employees' free choice of their bargaining representative. See Venitron, Inc., 221 NLRB 464 (1975), enf'd., 548 F.2d 24 (1st Cir. 1977)(8(a)(2) violation where employer directed employees to attend a series of organizational meetings, managers observed employees as they signed authorization cards, which were not verified by a neutral third party, and employer entered into a recognition agreement with the union within hours). Cf., Longchamps, Inc., supra, at 1029 n.6 (evidence that union had attempted to organize on its own prior to employer's grant of access and two and one-half week hiatus between singing of cards and employer’s extension of recognition). See also, Anaheim Town & Country Inn, 282 NLRB 224 (1986); Fountain View Care Center, supra, at 1290.

In our case, we particularly considered the Employer's long term collective bargaining relationship with Union A covering comparable employees at the Employer's other five plants in a single bargaining unit; the Employer's solicitation of Union B to organize the employees at the sixth plant, although Union B had never evinced any interest in the unit; the Employer sponsored meeting on its first day at the sixth plant where it encouraged the employees to designate a union representative and presented Union B as a likely candidate for that position; and, its immediate recognition of Union B. We concluded that all the above demonstrated that the Employer's goal was to unlawfully manipulate its new employees' selection of a bargaining representative and to interfere with their unfettered freedom of choice, as required by the Act. We also noted that the timing of the Employer's extension of recognition to, and hasty negotiations with, Union B, as well as the Employer's May 8 speech to employees, suggested that the Employer was attempting to establish a recognition bar as quickly as possible in order to forestall any opportunity by employees to undertake their own organization efforts or to demand the benefits of the Union A multi-plant agreement.


New Framework for Violations Involving an Unlawful "Refusal to Consider" or "Refusal to Hire"

In another case which was argued orally before the Board, we set forth a framework for analyzing the elements and remedies of two related Section 8(a)(3) allegations: an unlawful "refusal to hire" and "refusal to consider" for hire.

The Board specifically requested that we address the following issues for each of the two violations:

  • What is the appropriate remedy?
  • What must the General Counsel establish in the hearing on the merits to obtain such a remedy?
  • What may appropriately be left to compliance, and which party bears the burden of proof at each stage?

We proposed an orderly litigation procedure that would produce a full record showing, inter alia, the types of jobs applied for by the alleged discriminatees, the number of openings, and the employer's asserted reasons for making its hiring decisions.

We addressed the framework to factual settings similar to those in cases such as Starcon, Inc. v. NLRB, 176 F.3d 948 (7th Cir. 1999); NLRB v. Fluor Daniel, Inc., 161 F.3d 953 (6th Cir. 1998); Ultrasystems Western Constructors v. NLRB, 18 F.3d 251 (4th Cir. 1994); and BE & K Construction Co., 321 NLRB 561 (1996). These types of cases generally fall into one of three categories: (1) "refusal to hire" cases, typically involving situations where the number of job openings equals or exceeds the number of applicants who are alleged as discriminatees; (2) "refusal to consider" cases, including refusals for available openings as well as for future openings; and (3) hybrid "refusal to hire/consider" cases, in which there are fewer available job openings than the number of applicants.

1. With respect to "refusal to hire" cases, we contended that the traditional Board analysis should apply, i.e., the General Counsel (GC) bears the burden of establishing that the employer was hiring or had concrete plans to hire employees, and that anti-union animus contributed to the decision not to hire an applicant. The burden then shifts to the employer to demonstrate that the same hiring decisions would have been made even in the absence of the applicants' protected conduct. See Wright Line, 251 NLRB 1083, 1089 (1980), enfd. 662 F.2d 899 (1st Cir. 1981), cert. denied 455 U.S. 989 (1982). If the employer fails to so rebut the GC's prima facie case, the employer violated Section 8(a)(3) by refusing to hire the applicants. The appropriate remedy is an offer of employment and make whole relief. Only two types of issues would be involved in a subsequent compliance proceeding, i.e., the precise calculation of the make whole remedy and, in construction industry cases, the likelihood that the discriminatees would have been transferred to other work sites upon the completion of the project at which the unlawful discrimination occurred. Dean General Contractors, 285 NLRB 573 (1987).

2. In "refusal to consider" cases, we contended that the GC would not have to establish that the employer at the time of the discrimination was hiring or had concrete plans to hire employees. The GC would have to establish only that anti-union animus contributed to the decision not to consider or interview the applicants. The Wright Line burden would then shift to the employer. If the employer fails to rebut the GC's prima facie case, it violated Section 8(a)(3) by refusing to consider the applicants. We analyzed the following two types of "refusal to consider" cases, with different remedies.

(a) Where a causal nexus is established between the refusal to consider and a wrongful failure to hire for existing or future vacancies, the appropriate remedy for the "refusal to consider" violation would be an order to hire the discriminatees with a "make whole" order effective at the time that there were vacancies for which the discriminatees would have been hired had they been afforded nondiscriminatory consideration. That was the remedy that the Board provided for refusals to consider in the "original" refusal to consider cases, such as Swinerton and Walberg Co., 94 NLRB 1079, 1080 (1951), enfd. 202 F.2d 511 (9th Cir.), cert. denied 346 U.S. 814 (1953).

Some of the cases warranting such a "hire" remedy are those where the record shows that the employer rejects all applicants engaged in protected activities, and that this policy was applied to differentiate between the applicants discriminatorily denied consideration and those who were hired. E.g. Walz Masonry, 323 NLRB 1258, 1260-1261 (1997). Another type of "refusal to consider" case warranting a hiring remedy is where the employer's hiring is guided by relatively simple objective hiring criteria, such as hiring the most recent applicant or the first applicant who possesses a certain objective qualification. At the merits hearing in such cases, the GC would have to establish that the discriminatee would have been hired to fill a future job opening under those objective, nondiscriminatory criteria. The employer then would be ordered to hire the discriminatee for the next opening into which he or she should have been placed or, if such opening has already occurred, to offer the discriminatee employment and make-whole relief, as in a "refusal to hire" case. The compliance issues in such "refusal to consider" cases would be limited to whether the circumstances contemplated in the Board's order came to pass, whether the respondent complied with the Board's order by hiring the discriminatee, and the usual make-whole and Dean General issues. There would be no Wright Line analysis in compliance, since the violation will have been established, and the remedy specified, in the merits proceeding.

(b) In "refusal to consider" cases where it has not been established that the discriminatee would have been hired if considered, the current remedy is to consider the discriminatee for hire and to provide him with an employment offer and backpay if the GC shows in compliance that he would have been hired for a position that became available subsequent to his application but for the discrimination. See Modern Electric Co., 327 NLRB No. 25, slip op. 2-3 (1998). We argued that the appropriate remedy should instead require an employer to cease and desist any unlawful "refusal to consider" policy as well as the actual refusal to consider the named applicants and, if the applicants meet the employer's nondiscriminatory standards, to hire them. There would be no backpay remedy, because we would not be attempting to prove in compliance that the discriminatee would have been hired for a subsequent opening. Proving that issue is the very type of proof required in the liability phase of an alleged refusal to hire violation. Thus, we took the position before the Board that those issues should not be tried in a compliance proceeding for the first time, but rather should be the subject of a new charge alleging an actual refusal to hire the applicant.

3. In "hybrid refusal to hire/consider" cases, if an employer unlawfully fails to hire anyone from a group of applicants because of their protected activities, it is refusing to hire some of the applicants for the existing openings, and refusing to give consideration to the remaining applicants who would not be hired in any event because the number of openings is insufficient. We argued that the initial burdens and Wright Line burden-shifting set forth in the above analytical frameworks of the "refusal to hire" and "refusal to consider" cases should apply, so that the Board would find that the employer violated Section 8(a)(3) by refusing to hire the number of applicants that corresponds to the number of actual or planned hires, and further violated Section 8(a)(3) by refusing to consider for hire the number of applicants that exceeds the number of actual or planned hires.

The remedy we proposed would require the employer to offer employment to and make whole the number of discriminatees corresponding to the number of actual or planned hires. At the compliance proceeding, the GC would specify the individual discriminatees, by name, who would have been hired absent the respondent's unlawful refusal to hire them. Furthermore, the GC would be permitted to show at compliance that the number of positions filled was greater than that shown in the "merits" record, so that other named discriminatees would be entitled to employment offers and make-whole relief. See Pan American Electric, 328 NLRB No. 7, slip op. at 6, fns. 35-38 (1999). The employer would bear the burden of establishing that a different discriminatee would have been hired, rather than the individual specified. The employer would not be permitted to argue that none of the named discriminatees would have been hired because that issue would have been resolved at the merits hearing. As to the number of discriminatees who would not have been hired, i.e., the "refusal to consider" violation, we would seek the remedy set forth above in the appropriate subcategory of "refusal to consider" cases.

Refusal to Hire Based Upon Prior Earnings History

In a refusal to hire case, we considered whether the Employer violated Section 8(a)(1) and (3) of the Act when it refused to consider Union members for hire, assertedly because of their prior earnings history.

When the Employer was awarded a contract for a project within the geographical jurisdiction of the Union, it ran newspaper ads for journeymen and apprentice electricians. The ads did not indicate a wage rate; nor did the Employer's applications include a space for designating a desired wage rate. Three Union applicants submitted job applications to the Employer, openly indicating their connection with the Union on their applications. They also indicated prior earnings in excess of $16.00 an hour. None of the overt Union applicants were offered employment.

Although the Employer acknowledged that it had no formal hiring policy, it maintained that it rejected applicants who have a history of earning more than the Employer is willing to pay, in this case from $8.00 to $16.00 an hour. The investigation disclosed, however, that the Employer hired one applicant who had prior earnings in excess of $16.00 an hour. It also hired two applicants who had not completed the requested information concerning items such as past wages and dates of employment. Although the Employer maintained that these deficiencies were adequately explained by the applicants in person, it did not give the overt Union applicants the same opportunity to explain a possible willingness to accept a lower wage.

We decided that there was sufficient evidence to make a prima facie showing that the Employer's refusal to consider the Union applicants for hire was based on their Union affiliation. There was evidence that an agent of the Employer had interrogated another job applicant about his union affiliation in violation of Section 8(a)(1). In addition, an Employer representative had told two Union organizers that he could "guarantee" that they would never organize the Employer, thus indicating Union animus. We determined that the Employer had failed to establish that its refusal to consider the Union applicants was based on its alleged preference for hiring applicants whose work history indicated that they had not earned more than $16.00 an hour.

In Bay Control Services, 315 NLRB 30, note 2 (1994), the Board stated that it is lawful for an employer to have a policy, based on past experience, against hiring over-qualified employees such as journeymen electricians to fill low paying helper jobs. In Wireways, Inc., 309 NLRB 245 (1992), the Board affirmed an administrative law judge's determination that an employer, which had otherwise demonstrated union animus, nevertheless had not violated Section 8(a)(3) by refusing to hire union-affiliated electricians because the applicants had either sought or previously earned wages that exceeded the budgeted wages that the employer was offering. However, the employer in Wireways had stated that experience had shown him that if he hired employees for less than they had previously earned, they were either less productive or likely to leave for the first job that paid more. Id. at 250. After considering examples provided by the employer, the administrative law judge found that the employer's policy was "an acceptable business practice." Id. at 252.

We decided that the holdings in Bay Control Services, supra, and Wireways, Inc., supra, should be narrowly construed. We further concluded that the Employer had not established that its professed preference was based on past experience, even if the Employer could establish that it consistently applied such preference. We noted that the Employer had not considered past wages important enough to provide a space in its application for expected wages or to indicate a wage scale to be offered in its newspaper ads, which would appear to be more efficient ways to eliminate applicants who arguably would quit prematurely because of dissatisfaction with the Employer's wages. Thus, we concluded that the advent of the alleged "preference" coincided with, rather than preceded, the advent of the Union. We also noted that the Employer had not strictly adhered to its own policy, further warranting the inference that it was union animus, not the applicants' wage histories, that motivated the Employer to reject the applications of Union members.

Consistent with our position in Contractors Labor Pool, Case No. 21-CA-31326 (formerly 19-CA-23957), JD[SF]-73-97, we also determined that even assuming the Employer had a de facto policy of rejecting applicants based on their prior earnings history and its hiring was not driven by Union animus, we would argue that the impact of the policy was so inherently destructive of significant Section 7 rights as to constitute a violation of the Act.

The Supreme Court has held that if an employer's discriminatory conduct is "inherently destructive" of important employee rights, no proof of anti-union motivation is needed and the Board can find an unfair labor practice regardless of evidence that the conduct was motivated by business considerations. NLRB v. Great Dane Trailers, 388 U.S. 26, 34 (1967). In the case before us, the right at issue was the right of an applicant to be considered for employment without regard to union affiliation, even if the applicant had in the recent past chosen to work on a union job with typically higher wages. The Employer's preference, by its very nature, led to the foreseeable and known result that virtually all union-affiliated journeymen who would otherwise qualify as applicants would be automatically excluded, while very few workers from the non-union sector would be so affected. We also took into account the fact that the prevailing wage rate statues of the United States and the various states represent a coherent and consistent part of the structure of labor law such that a plan which excluded from employment all individuals who have lent their skills to the construction of public works in the recent past was also something which the law should not encourage or allow as a matter of public policy.

Finally, we determined that, even assuming that the impact of the Employer's preference on employee rights was comparatively slight, the preference was unlawful under the circumstances of this case. Where the disparate impact and effect are clear, the Board is justified in disbelieving the Employer's protestations of innocent purpose. American Shipbuilding Co. v. NLRB, 380 U.S. 300 (1965); International Paper Company, 319 NLRB 1253 (1995). Even where the impact is "comparatively slight," a finding of union animus is not required if the employer does not come forward with evidence of a "substantial" business justification. NLRB v. Great Dane Trailers, 388 U.S. at 34. In this case, there was no evidence of past experience in which the Employer's hiring of applicants with a high wage history, without more, resulted in heavier turnover. Thus, the Employer failed to provide a substantial business justification for its purported preference.

Refusal to Hire By Changing Hiring Policy

In another refusal to hire case, we considered whether the Employer violated Section 8(a)(1) and (3) of the Act by altering its hiring policy and refusing to consider or hire Union members for temporary positions.

The Union was engaged in a campaign to organize the Employer, a non-union electrical contractor. Over the course of several months, the Union sent a number of Union members to the Employer to apply for employment. The Union also filed unfair labor practices charges against the Employer; and the Regional Director determined that complaint was warranted with respect to numerous independent Section 8(a)(1) violations as well as several Section 8(a)(3) violations. The complaint included an allegation that the Employer had unlawfully informed applicants that it was not accepting applications and/or hiring employees because of the Union organizing activity.

Over a two-month period, the Employer had used a journeyman electrician and several laborers from a temporary agency to complete a project. The Employer had also "borrowed" electricians from another non-union contractor for the project. The Employer claimed that it had an unusual need for employees on the project and that, consistent with past practice, it used agency and borrowed employees because it knew it would not have enough work to keep the employees busy after the project was completed. It maintained that it does not hire employees unless it has enough work to keep them employed indefinitely. The Employer claimed in this regard that it had a past practice of using laborers from the temporary agency on an as needed basis and that it had also borrowed employees from the non-union contractor in the past.

With regard to the agency employees, the Union presented evidence that the Employer had sent the journeyman electrician to the temporary agency for referral back to the Employer. The investigation also disclosed that the Employer hired two employees directly during the time period in question, including an employee it had originally "borrowed" from the other contractor. The Employer acknowledged that it had hired the latter employee on a temporary basis, but did not explain why it departed from its purported policy of not hiring temporary employees directly.

We decided that there was sufficient evidence to establish a prima facie showing that the Employer also violated Sections 8(a)(1) and (3) by changing its hiring policy and using temporary employees, particularly electricians, to avoid hiring Union applicants. We noted that there was ample evidence of animus on the part of the Employer as demonstrated by the allegations in the outstanding complaint. Moreover, the Regional Director had found, and the complaint alleged, that the Employer had unlawfully refused to hire Union applicants for permanent positions on a number of occasions and had made other changes in its hiring procedures in violation of Section 8(a)(1) and (3). The Regional Director had also found that the Employer violated Section 8(a)(1) by informing two applicants that it was not accepting applications and/or hiring employees because of the Union organizing campaign.

While the Employer maintained that it had a past practice of using laborers from temporary employment agencies and electricians from the other contractor, it presented no documentary evidence to support this contention. Given the numerous violations in the outstanding complaint, the absence of any documentary evidence to substantiate the Employer's contention that it had used temporary employees, particularly electricians, from other sources prior to the Union organizing campaign, the fact that the Employer directly hired at least one temporary employee in contravention of its purported policy, and the fact that it allegedly sent another electrician to the temporary agency for referral while failing to accord similar treatment to Union applicants, it did not appear that the Employer would not be able to meet its burden of establishing a Wright Line defense. Wright Line, 251 NLRB 1083 (1980).

Employee Posting Of Management Memorandum On Union's Internet Web Site

In one case, we considered whether an employer violated Section 8(a)(3) by disciplining an employee for posting an internal management memorandum on the internet.

The Employer's Vice President had circulated a memorandum to the Employer's President setting forth projected terms and costs of a proposed special retirement program under consideration to secure salaried workforce reductions at one of the Employer's divisions. The memorandum clearly identified its intended audience, was printed on company letterhead, and bore an "Internal Correspondence" heading. An employee of another Employer division, who was also the President of the Union representing those employees, found the memorandum and posted it on the Union's web site.

The Employer issued the employee a formal written warning for the unauthorized posting of the memorandum, and informed him that he and the Union were prohibited from publicizing or distributing any internal Company document that was "self-evidently not intended for public dissemination."

We decided that the posting of the internal management memorandum on the internet was unprotected activity, and that the employee therefore was lawfully disciplined. We also concluded that the Employer’s rule prohibiting the publication of internal company documents "self-evidently not intended for publication" also was lawful under the Board's recent Decision and Order in Lafayette Park Hotel, 326 NLRB No. 69 (August 27, 1998).

In finding that the employee's conduct was unprotected, we relied on long-standing Board precedent holding that the disclosure of certain types of information, even if otherwise concerted and protected, may involve such disloyalty to an employer that the disclosure falls outside the protection of Section 7. In making these determinations, the Board examines whether the information passed on is information which, due to the nature of its content, the employer has a right to expect will be treated as confidential. For example, in Canyon Ranch, 321 NLRB 937, 937 (1996), the Board held that an employee's dissemination of a draft memorandum written by one management official to another was unprotected, noting that "management officials have the right to communicate in private with each other, even if (perhaps especially if) the subject of the communication is terms and conditions of employment."

In our case, the memorandum was a correspondence between two managers, and it was fairly obvious that its subject was confidential in nature. It was also apparent that the memorandum was part of management's deliberative process concerning an early retirement program for salaried employees, as to which there had not yet been a decision. Moreover, the words "Internal Correspondence" printed at the top of the memorandum indicated that the Employer had identified the document as one that should have only internal distribution. Under those circumstances, we concluded that the Employer had a right to expect that an employee who came into possession of the document would not place it in the public domain by posting it on the Internet. Thus, the employee's actions were a breach of trust and unprotected.

We also decided that the Employer's rule was lawful because it was directed at unprotected activities similar to the conduct of the subject employee. We noted that the rule was far more narrowly crafted than the lawful rule in Lafayette Park Hotel prohibiting dissemination of "Hotel-private information to employees or other individuals." Moreover, employees reasonably would understand that the rule was designed to protect against disclosure of documents as to which the employer had a legitimate confidentiality interest, rather than to prohibit discussions concerning wages, benefits and other terms and conditions of employment.

Discriminatory Bargaining Position

In another case, we considered whether the Employer violated the Act by providing a substantially lesser severance package to employees represented by the Union than that given to non-represented employees.

At issue in the case were the Employer's negotiating positions, as well as its final offer, during effects bargaining with the represented employees concerning the closure of its transport business. The Employer and Union had enjoyed a collective bargaining relationship for many years. The Union represented certain employees engaged in the Employer's transport business. Other employees involved in the same operations of the Employer, however, were unrepresented. Sometime in 1996 or early 1997, the Employer decided to discontinue its transport business. Notwithstanding this decision, beginning in late 1996 and continuing in 1997, the Employer and the Union engaged in negotiations over a new collective bargaining agreement. Simultaneously in March and April of 1997, and continuing through September, 1997, the Employer and the Union engaged in effects bargaining over the shutdown of the transport operations. In various draft effects bargaining agreements, the pending successor collective bargaining agreement was cited as consideration for the Employer's entering into severance package agreements.

In mid-September 1997, the Union and the Employer entered into an effects bargaining agreement calling for, among other things, one week of severance pay per year of service for all represented employees. This agreement appeared to be the best deal the Union could obtain from the Employer in bargaining. Thereafter, the Union learned that unrepresented employees affected by the shutdown, as well as supervisors and represented employees who had departed in the past, all received as a matter of course, two weeks of severance pay for each year of service. This prompted an inquiry from the Union as to why the best offer the Employer proposed to the Union was about 50% of the package offered to unrepresented employees and others.

In reply, the Employer explained that in making its determination regarding whether it is willing to offer severance packages to a given group of employees, the Company focuses on and analyzes the competitive position of the group or business unit for which it is negotiating. Part of that analysis involved a review of how responsive a particular group of employees had been to the Company's request for consideration of ideas and cost containments that would improve its competitive position in the industry. The Company stated that during the 1996-1997 negotiations, the Company had experienced high, noncompetitive costs, despite the fact that it had presented requests for improvements in the cost structure as defined by the labor agreement. In another letter, the Employer further explained that by cost containments, and without specifically tying it to its severance package offered to represented employees, it intended to convey the notion that its (contractual) expenses for wages and benefits were not competitive, and in fact, more than a third higher than those of its competition.

We decided that the severance package negotiated over and ultimately bargained for on behalf of the represented employees was designed by the Employer to be substantially inferior to that offered to all other individuals in retaliation for the union activities of the represented employees, specifically the positions taken by those employees during collective bargaining negotiations.

Thus, the Employer's reply was clearly couched in retaliatory terms. In that regard, it was only as a result of the Employer's review and analysis of the represented employees' lack of willingness to accept certain conditions in other negotiations, and lack of responsiveness to the Employer's requests regarding Employer concerns, that the severance package was adjusted accordingly. Finally, we concluded that there was no evidence to support the required Wright Line defense, Wright Line, 251 NLRB 1083 (1980), that the Employer would have offered the represented employees the same lower severance package even absent the represented employees' positions taken at other negotiations. In this regard, the Employer's reply was not deemed to support such a Wright Line defense. Not only was the cost containment explanation therein not directly tied to the severance negotiations, but such an explanation was clearly related to the issue of overall competitiveness with other employers.


Due Process Voting in Union Merger or Affiliation Cases

In one case, we took the position that the Board should adopt a new rule in union affiliation and merger cases that where there is substantial continuity between the collective bargaining representative before and after the affiliation or merger, it is not necessary to further examine whether the affected union members/employees were afforded due process regarding the affiliation or merger. This case thus implicates the Supreme Court's decision in NLRB v. Financial Institution Employees of America (Seattle-First National Bank), 475 U.S. 192 (1986)(Seattle-First).

Our case arose after one of six local unions, affiliated with an independent district council, won a Board representation election. The district council shortly thereafter affiliated with an international union, pursuant to a vote of delegates selected by members of the district council's six constituent unions. The Employer's unit members did not have the opportunity to select delegates and did not receive notice of the affiliation convention because of a local union policy denying membership eligibility to employees until their employer enters into a collective bargaining agreement. The local was then certified as the representative The "Union", which was identified as the local affiliated with the district council as affiliated with the international union, then demanded recognition and bargaining. The Employer refused, contending that the district council's affiliation with the international caused a break in continuity of the bargaining representative.

We issued complaint against the Employer's refusal to recognize the Union. An ALJ found that the Employer violated Section 8(a)(5), noting that there was substantial continuity of the representative before and after the affiliation. While the ALJ found that the unit employees did not receive any "minimal due process" in the affiliation decision, he also found "the law is not settled on whether or not the Board may apply due process standards to an affiliation vote, which is largely an internal Union matter." The Employer filed exceptions to the factual finding of substantial continuity and to the ALJ’s legal conclusion that the lack of even minimal due process was not relevant.

We filed a cross-exception to the ALJ's failure to find at least minimal standards of due process under extant Board law. We noted that the employees were not yet members of the local union and were not entitled to vote on affiliation, pursuant to Seattle-First. Due process has been found where newly represented employees not yet members of a union did not have a voice in selecting delegates to a convention deciding a union merger issue. See Potters Medical Center, Inc., 289 NLRB 201 (1988); see also, e.g., George Lithograph, 305 NLRB 1090 (1992) and Aurelia Osborn Fox Memorial Hospital, 247 NLRB 356, 357 (1980).

We also took the position, in response to the Employer's exception, that the Board should hold that it is unnecessary to examine whether there is "due process" in affiliation or merger cases where there is substantial continuity of representation before and after the affiliation or merger. We initially noted that on a number of occasions since Seattle-First, the Board had held that it was unnecessary to decide whether a lack of "due process" raised a "question concerning representation" (QCR), an issue left open by the Supreme Court. See, for example Sullivan Brothers Printers, Inc., 317 NLRB 561, 562 n. 2 (1995), enf'd. 99 F.3d 1217 (1st Cir. 1996). We argued that our position was supported by an examination of the development of "due process" as part of a two-part test for finding an employer obligation to bargain with an affiliated or merged union, by the Supreme Court's decision in Seattle-First, and by the Board's subsequent decision in Western Commercial Transport, 288 NLRB 214 (1988).

In early merger or affiliation cases, the Board emphasized evidence of employee support or approval of a change in the representative union in evaluating whether the affiliated or merged entity was a continuation of the certified or recognized union. See, e.g., Paramount Pictures, 42 NLRB 221, 222 (1942). Such an expression of employee sentiment was viewed as a necessary requirement for continuity of representative because the Board was giving effect to union-run affiliation or merger elections as an alternative to the statutory amendment of certification procedures under the Act. In Quemetco, Inc., 226 NLRB 1398, 1399 (1976), the Board expressed the view that it was "much more concerned with giving effect to the employees' free choice of bargaining representative than with the so-called 'continuity of representation' which might be disrupted by such election." However, the Board’s emphasis on "due process" was not entirely consistent, as noted in Insulfab Plastics, 274 NLRB 817, 822 (1985), enf'd. 789 F.2d 961 (1st Cir. 1986), where the ALJ went on to state that "in invoking 'due process' to justify asserting jurisdiction over the affiliation elections, the Board has been sensitive to the fact that it is skating on thin statutory ice." The Board’s pre-Seattle-First shifts on the importance of due process can be exemplified by its swings on whether non-member employees must be permitted to vote, as detailed in Amoco Production Company, 262 NLRB 1240 (1982), enf'd. 721 F.2d 150 (5th Cir. 1983)(Amoco IV).

The ebb and flow of Board cases prior to Seattle-First examining both continuity and "due process" in affiliation and merger situations does not provide a detailed rationale as to why there is a two-part test. While the Seattle-First Court noted that it was not passing on the propriety of the Board's due process requirement, it also indicated that in the absence of changes in the representative "sufficiently dramatic" to raise a QCR there was not authority to interfere at all with a union's decision to affiliate. 475 U.S. at 199 n. 6 and 206. Thus, after Seattle-First, it was unclear whether the Board should still apply a two-prong test. We therefore argued that there should be only the one "substantial continuity" test in determining whether an affiliation or merger raises a QCR. If the new organization is the same, then it is irrelevant to the existence of a QCR whether employee members had an opportunity to vote.

In Western Commercial Transport, 288 NLRB 214, 217 (1988), a post-Seattle First case, the Board significantly moved in the direction of abandoning the due process requirement altogether. The Board held that once a QCR is raised because of a lack of continuity, "an affiliation vote cannot be used as a substitute for a representation proceeding before the Board." 288 NLRB at 217, 218 n. 13. Thus, the expression of employee sentiment is no longer paramount and, in reality, after Western Commercial Transport, the underlying rationale for requiring due process no longer exists. Thus, we urged the Board to adopt the position that if there is substantial continuity in the representative after an affiliation or merger, there is no QCR raised and the Board need not examine the procedure; however, if there are "dramatic" changes resulting from the affiliation or merger, there is a QCR and no private election, not even one meeting the "due process" criteria, can substitute for, and thus prevent, a Board representation proceeding.

Transfer of Representational Jurisdiction Between Two Locals During The Bargaining Agreement

In another case, where an international union which was not the employees' Section 9(a) representative transferred jurisdiction from the local who was the representative to another local, we addressed the question of whether the second local succeeded to the representational rights under the existing bargaining agreement with the first local.

The Employer was party to a bargaining agreement with Local A covering two facilities. Because of the distance between the employees and Local A, employees had problems obtaining proper representation. Employees at both facilities were informally polled regarding transferring to sister Local B, and a majority at each facility were in favor of being transferred. The Employer did not oppose the transfer but specifically opposed Local B, with whom the Employer had a contentious past history.

The Employer refused to recognize Local B, contending it had a contract with Local A. Local B obtained signed authorization cards from a majority of the employees in the overall unit. There was no evidence that Local A took any overt action, which would have shown acceptance or rejection of the International's action.

We concluded that the Employer lawfully asserted the current contract as a bar to its recognition of Local B during the term of its extant contract with Local A and thus did not violate Section 8(a)(5) by refusing to recognize Local B.

We initially noted that there was no due process question, nor any question that a majority of the employees voted for the transfer of representation to Local B. Local B, however, was different from and not merely a continuation of Local A, even though they are both affiliated with the same International. The Board considers whether the unions have the same officers, books, records, location, and assets, in deciding if there is a continuity of representative. Yates Industries, Inc. 264 NLRB 1237, 1249-1250 (1982). In that case, the two locals did not have any of the mentioned factors in common. Each local, in fact, had its own officers, books, records and assets. In our case, Local B was located in St. Louis, Missouri, while Local A was located in Philadelphia. Thus, these cases are distinguishable from those cases involving union affiliations and/or mergers, where the arguably "new" union is merely a continuation of and therefore a successor to the predecessor union if there is "continuity of identity." NLRB v. Financial Institution Employees, Local 1182, Food & Commercial Workers Local, 475 U.S. 192, 199-200 (1986). See, e.g., Western Commercial Transport, 288 NLRB 214 (1988).

In Associated General Contractors of America, Evansville Chapter, 182 NLRB 224 (1970), the Board held that Local 1080 did not violate Section 8(b)(1)(A) by accepting recognition and executing a contract with the employers, where the international union had transferred representative status to Local 1080 from Local 90. In Grinnell Fire Protection Systems, 235 NLRB 1168 (1978), affd. sub nom. Dycus v. NLRB, 615 F.2d 820 (9th Cir. 1980), the Board held that an international union did not violate Section 8(b)(1)(A) by transferring representative jurisdiction from one local to another local so long as the transfer is motivated by legitimate reasons. We considered both those cases distinguishable, however, since neither addressed the issue of whether the employer would have been obligated, mid-contract and absent consent, to recognize the new local.

We relied instead on cases involving a union's request for amendment of certification following a transfer of jurisdiction. In Gulf Oil Corporation, 135 NLRB 184 (1962), the Board denied the union's motion to amend the union's certification and held that a question concerning representation requiring an election was raised, where a local union, mid-contract, sought to transfer its bargaining rights to a sister local. See also The Gas Service Company, 213 NLRB 932 (1974) and Independent Drug Store Owners of Santa Clara County, 211 NLRB 701 (1974).

We reasoned in our case that, as in Gas Service and Gulf Oil, the International was attempting, mid-contract and over the Employer's objection, to use the Board's resources to compel the Employer to recognize and bargain with Local B, instead of Local A, who was the Section 9(a) representative. Local A remained a functioning labor organization. The Employer, therefore, may insist that Local A abide by its contract and not assign its representational rights to a sister local. We noted that, if Local A validly disclaimed interest in representing the employees, the extant contract would be voided. Since Local A had not disclaimed interest, because it wanted the contract to continue, it must continue to represent Goad unit employees if it wants to enforce the current contract.

Successor Obligation Where Employees Quadrupled in Number Since Board Order

One case involved whether the Employer must continue to recognize the Union where, during the interim between Board Order and a court decision enforcing it, the Employer quadrupled the number of employees in the unit.

For many years, a predecessor employer operated a plant where it processed whole canned tomatoes, bulk tomato paste, canned peaches and prunes. In 1993, this predecessor employed some 1200 employees in a unit long represented by the Union. In July 1993, the predecessor ceased operations and sold its assets to a third party, who subsequently leased the premises to the Employer. The Employer resumed some of the operations, processing only bulk tomato paste, and used a reduced employee complement of only about 75 employees. The Employer also withdrew recognition from the Union which filed a Board charge.

On August 14, 1996, the Board ordered the Employer to bargain with the Union in a unit of employees "engaged in tomato processing and maintenance." The Employer however, refused to comply with the Board Order. In 1997 the Employer bought new equipment, built a diced tomato processing line in an existing building located 50 feet away from the building where it was processing tomato paste, and hired 225 new employees, none of whom had ever been employed by the predecessor employer.

In January 1998 a Court of Appeals enforced the Board Order. The Union again requested recognition and once again the Employer declined, contending that its expansion of operations so altered the unit as to have destroyed the vitality of the Board's Order. The Employer claimed that the diced tomato processing line, although somewhat different from the tomato paste operations, was highly integrated with that operation. The Employer also claimed that the dicing operation was arguably an accretion to the paste operation and that the bargaining order was no longer enforceable because the Board will not accrete a larger group of employees to a smaller group of employees.

We decided that, at the compliance hearing for the enforced Board Order, we would argue that (1) the appropriate unit for bargaining included employees who work in the diced tomato operations as well as the employees who processed bulk paste; (2) the Employer continued to owe a bargaining obligation under the Board's expanding unit doctrine; and (3) the Board's accretion jurisprudence was inapplicable.

Initially, we concluded that the Employer's diced tomato operations were encompassed by the Board's bargaining order, which ordered the Employer to bargain in a unit of employees "engaged in tomato processing and maintenance." Until 1993, the employing industry's tomato operations consisted of the manufacturing of bulk tomato paste and the canning of whole tomatoes. From 1993 to 1997, the tomato operations were limited to the manufacture of tomato paste. Since 1997, the tomato operations included the processing of diced tomatoes. In our view, the Board Order by its terms covered the whole tomato, tomato paste, and diced tomato operations. Next, we decided that the changes in the Employer's operations should be analyzed under the Board's "expanding unit" jurisprudence applicable to new hires, and not the Board's accretion jurisprudence which is applicable when a preexisting group of employees is added to the bargaining unit.

Under "expanding unit" jurisprudence, the Board Order maintained its vitality. In Meyer's Cafe & Konditorei, 282 NLRB 1, n. 1 (1986), the Board found, contrary to the ALJ, that the newly hired delicatessen employees were nothing more than an expansion or enlargement of an existing restaurant operation, which required the hiring of new employees to staff the facility. As the restaurant employees were union-represented, the new hires, even though they exceeded the number of represented employees, were merely additions to the existing contractual unit. See also Water's Edge, 293 NLRB 465, 470 (1989), modified on other grounds sub nom. NLRB v. Quinn's Restaurant, 14 F.3d 811 (2d Cir. 1994).

In concluding that the Employer now had an expanded single plant operation, we noted specifically that the dicing operation took place in a building only 50 feet from the paste operation; both buildings were on the same tract of land; and the dicing shed appeared to have been used in the past by the employing enterprise's unit employees. As to the work that those employees performed, we specifically noted first that the dicing operation was not shown to differ remarkably either from the tomato paste operation or from the former whole tomato operation. Second, the paste and dicing production employees engaged in some interchange, and this interchange contraindicated a separate community of interest for either group. Third, there was operational integration in that a single group of maintenance employees maintained both operations, and the output of both operations went to the same warehouse and shipping facility. In sum, there was nothing in our case indicating that either group had a separate community of interest warranting the establishment of a separate departmental unit.

Therefore, the resulting expansion of the unit by means of new hires no more relieved the Employer from the force of the bargaining order than would mere employee turnover. See, e.g., Franks Bros. Company v. NLRB, 321 U.S. 702 (1944), where the Supreme Court upheld the Board bargaining order despite the claim to the Board that employee turnover had resulted in loss of majority status. See also King Radio Corp., 208 NLRB 578 (1984) (neither expansion of unit nor employee turnover justified employer's withdrawal of recognition). Next, we rejected the Employer's contentions that this case raised accretion questions.

We noted that the Board's accretion doctrine is applied quite differently in different factual situations. First, the Board will perform an accretion analysis and then find there was no accretion where the employees sought to be accreted had formerly worked together as a group, see, e.g., Renaissance Center Partnership, 239 NLRB 1247 (1979); Hershey Foods Corp., 208 NLRB 452 (1974), because the new employees have acquired group interests based on their previous work experience together. Second, the Board will perform an accretion analysis and then find there was no accretion where the employees sought to be accreted by themselves could constitute an appropriate unit. Passavant Retirement & Health Center, 313 NLRB 1216, 1218 (1994). Finally, the Board will perform an accretion analysis, and then find there was no accretion in a two-union situation, because of the long-standing doctrine that employees who might constitute an accretion to each of two different units represented by different unions are an accretion to neither. Int'l Paper Co., Long-Bell Div., Gardiner Branch, 143 NLRB 1192 (1963).

However, in circumstances where both the represented employees and the group of employees to be added work at a single location, the second group is composed of new hires, and neither group could constitute a separate unit, as the Meyer's Cafe and Water's Edge cases indicate, the new employees are not treated as an accretion at all. Thus the Board's accretion doctrine was inapplicable to our case.

Successor Obligation Where Predecessor Agreement Contained Non-Binding Recognition Clause

Another interesting case involved whether the Employer, a successor under NLRB v. Burns Security Services, 406 U.S. 272 (1972), was privileged to refuse to recognize the Union because of the Union's alleged waiver in its bargaining agreement with the predecessor employer.

The Union had represented employees at a petroleum terminal for many years. The facility had been operated by other entities until, in 1992, the Predecessor purchased it. The Predecessor and the Union negotiated a contract, effective from 1992 to 1995, with a recognition providing:

In the event of a bona fide sale of the assets or change in ownership, or in the event COMPANY ceases operation of the facility any successor COMPANY which purchases, acquires or becomes the EMPLOYER of EMPLOYEES presently covered by the Recognition clause shall not be bound by the Recognition clause.

This language was intended to enhance the Predecessor's ability to sell the facility in the future by allowing the purchaser to avoid any duty to bargain with the Union. There was no evidence that this was understood by the Union or that the parties ever discussed this clause. The Predecessor's purchase of the terminal, however, was a minor part of a much larger sale. According to the Predecessor official who negotiated the recognition clause, the Union's acceptance or rejection of the recognition language would not have affected the sale.

The Predecessor and the Union negotiated a new agreement effective from December 1, 1995 to November 30, 1998, containing the same recognition clause. As of October 1998, there were two terminal operators in the unit.

On October 28, 1998, the Employer advised the Union that it had "entered into a formal definitive agreement" to acquire the Predecessor. The letter also stated that, pursuant to the recognition clause of the bargaining agreement, the Employer was not obligated, and did not intend, to recognize the Union. The Union protested and demanded recognition

The Employer hired the unit terminal operators and continued operations without significant changes. The Employer did not dispute that it would have been required to recognize and bargain with the Union as a Burns successor except for the recognition clause in Predecessor's bargaining agreement.

We decided to issue complaint alleging that the Employer violated Section 8(a)(5) of the Act by refusing to recognize and bargain with the Union.

Although the language in the expired bargaining agreement between the Union and the Predecessor appeared to privilege a refusal to bargain, we concluded that the Employer could rely on that language because it was a provision of the expired contract which a successor cannot enforce. We also decided to argue, in any event, that the provision was not an effective disclaimer.

The Supreme Court Burns upheld the Board's long held view that a successor employer must recognize and bargain with the incumbent union. The Court, however, reversed the Board's holding that the successor was bound by the substantive provisions of the collective bargaining agreement negotiated by the predecessor. The Court stated:

A potential employer may be willing to take over a moribund business only if he can make changes in corporate structure, composition of the labor force, work location, task assignment, and nature of supervision. . . On the other hand, a union may have made concessions to a small or failing employer that it would be unwilling to make to a large or economically successful firm. The congressional policy manifest in the Act is to enable the parties to negotiate for any protection either deems appropriate, but to allow the balance of bargaining advantage to be set by economic power realities. Id at 288

We decided in our case that the clause purporting to waive union recognition by a successor was a term of the expired contract, which was no longer effective upon the change of ownership of the terminal. Under the Supreme Court's decision and rationale in Burns that neither party is bound by the predecessor's contract with the union, the Employer may not rely on this provision in the expired agreement to abrogate its Burns obligations.

We further concluded that the Employer's assertion that the clause was a disclaimer of future representation by the Union also was without merit. The recognition clause merely stated that a successor is not bound by the recognition clause. As discussed above, that is true by operation of law. Moreover, this clause was not a disclaimer because

"a disclaimer to be effective must be unequivocal and must be made in good faith," and an assertion by a union that it has abandoned its claim to representation will be rejected, "if the surrounding circumstances justify an inference to the contrary," or if the union's conduct is "inconsistent" with its alleged disclaimer. Hartz Mountain Corporation, 260 NLRB 323, 325 (1982) (citations omitted).

In the instant case, the Union did not in any way act as if it disclaimed interest in this unit. The Union continued to represent the unit under a collective-bargaining agreement with the Predecessor, which by its terms was effective until November 30, 1998. Following the completion of the sale of the facility, the Union demanded recognition from the Employer. The Union never disclaimed the unit nor acted consistently with a disclaimer. Thus, there was no basis for the Employer to conclude that the Union disclaimed interest in this unit.

Good Faith Doubt Under Allentown Mack

In two cases, we applied the Supreme Court's recent decision in Allentown Mack Sales and Service v. NLRB, ___U.S.___, 118 S.Ct. 818, 157 LRRM 2557 (January 26, 1998), to situations in which employers claimed that they were privileged to withdraw recognition from the unions representing their employees.

In the first case, an administrative law judge found that the Employer had presented evidence sufficient to give the employer a good faith doubt and privilege its withdrawal of recognition. We decided to file exceptions to the ALJ's decision. We concluded that the Employer did not have a good faith doubt because it had initially relied on the expiration of the certification year, not a claim of doubt of loss of majority support, when it withdrew recognition.

The Employer's initial contention thus threw a shadow on its subsequent assertion of a good faith doubt. The Employer belatedly relied on statements by two employees that they thought the union would lose an election. However, it did not appear that those statements were based on employees' conversations with other employees. Indeed, since it was not clear on what these employees had based these statements, these statements had little probative value. Moreover, other employees who told Employer representatives that they did not desire union representation were only one-third of the bargaining unit, a percentage which we concluded was not enough to justify a withdrawal of recognition.

In the second case, we decided that an employer was privileged to withdraw recognition from the union based on petitions signed by a majority of the bargaining unit stating that they did not wish to be represented by the union and that they wanted the NLRB to hold an election.

The petitions stated dual purposes but their meaning was clear. There were pending unfair labor practice charges but the Region had concluded that these alleged violations had not tainted the petitions. Finally, we concluded that it was not appropriate to issue complaint consistent with our position in Chelsea Industries, Cases 7-CA-36846, et al, that a secret-ballot election should be the only means by which a Section 9(a) representative's presumption of majority status can be rebutted. In this second case, the Employer had actual knowledge of the union's loss of majority status, and the Board currently permits an employer to withdraw recognition on this basis. Thus, the Region could process the outstanding RD petition, consistent with its conclusion that the alleged unfair labor practices had not tainted the petition.

Successor Obligation Despite Predecessor's Laid Off Employees

Another Section 8(a)(5) case involved the novel question of whether laid off, resigned and/or discharged employees of a predecessor employer should be counted to establish a union's majority status as representative of a majority of a successor employer's employees.

We initially found that there was substantial continuity between operations of the predecessor and those of the successor. However, we also found that various employees whose employment relationships with the predecessor had been severed, and who had then been hired by the successor, should not be included in determining whether a majority of the bargaining unit had been union-represented predecessor employees at the time of the predecessor's cessation.

In our view, those employees had severed their employment relationships for reasons unrelated to the cessation of the predecessor's operations. We thus found distinguishable such cases as Derby Refining, 292 NLRB 1015 (1989), enfd. 915 F.2d 1448 (10th Cir. 1990), and Cincinnati Bronze, 286 NLRB 39 (1987), where employees who had previously terminated their relationship with the predecessor were counted in the successor's bargaining unit. In those cases, however, the employees had been terminated as a consequence of the shift in operations from the predecessor to the successor. In such circumstances, there was no reason to believe that the employees would have ceased their employment but for the predecessor's cessation of operations. In our case, the predecessor employees in question had terminated their employment or had been terminated for unrelated reasons. Therefore, they were not to be counted in determining the union's majority status. Absent those employees, the union lacked majority status, and we decided to dismiss the Section 8(a)(5) charge.


Union Fines Where Union Misinformed Employees About Resignation Rights

In another case, we considered whether a Union violated the Act by levying fines against seven employees for their conduct during a strike, under circumstances where the Union misled or misinformed them about their union membership obligations and their right to resign during a strike.

The Union represented 750 employees of the employer at a local facility. In the summer of 1997, more than six months before the filing of the unfair labor practice charge, the local facility participated in a nationwide economic strike against the Employer. At a pre-strike meeting on August 3, a Union business agent told members that anyone (without distinguishing members from non-members) who crossed the picket line would be fined $1000 a day and, when the employees went back to work, these crossovers' union cards would be pulled and they would be fired within 72 hours.

During the strike, an employee asked a Union representative if he could get a "withdrawal card," since he needed to go back to work to pay medical bills. The employee commented to the Union representative that he had heard that he could just rejoin the Union when the strike was over. Volunteering no information about resignation, the Union representative responded that the local members were working under the International by-laws, and "that it was not possible to withdraw from the union and cross the picket line without being fined and losing [his] job." This employee later learned that his union membership obligation under the union-security clause was limited to "financial core" status. He asked the Union representative how he could achieve such status in order to go back to work without being fined. The representative answered that the employee could still be fined and lose his job because he would not be a member in good standing. The representative also represented to the employee that he would have to go to the local Union hall to fill out the paperwork to become a financial core member, which would "take a week or two to process, [by which time] the strike would be over."

Also during the strike, three of the discriminatees gave interviews to a local TV station expressing their disagreement with the strike. Seven employees, including the three who gave interviews and the employee who inquired about resigning from the union, attended a demonstration at the State Capitol where they carried placards indicating their disagreement with the strike and proclaiming their desire to vote on the Employer's last contract offer which the Union had opposed. Shortly thereafter, six of the seven employees resigned their union membership, although only three crossed the picket line.

The applicable collective bargaining agreement contained a facially valid "members-in-good-standing" union security clause. The Union's January 1997 newsletter contained an appropriate General Motors and Beck notice, and the Union had taken objectively reasonable steps to send it to the last known address of all unit employees. The notice advised local members that "the Union's procedures regarding membership will be explained to you by your local if you decide to satisfy your union security obligations by paying a service fee."

Following the conclusion of the strike, within the Act's Section 10(b) statute of limitations period, the seven employees were fined for breaching the Union's by-laws and constitution while maintaining full membership status. None was subjected to union discipline for any post-resignation conduct or conduct unrelated to their misunderstanding of their union membership obligations.

We decided that the Union unlawfully assessed the fines against the employees because admitted agents of the Union misled or misinformed them about the legal parameters of their membership obligations during the strike. The agents' misrepresentations had the effect of nullifying, in fact, the Union's January publication notice, which had otherwise been adequate in law. In misinforming the seven employees of their General Motors rights during a critical period, when they were directly seeking to learn their rights, the Union impeded the employees' right to elect financial core status and to resign from full membership. Pattern Makers v. NLRB, 473 U.S. 95 (1985). This was inconsistent with the Union's prior publication notice and had the same effect as if such notice had never been given.

It is well settled that a union's refusal to allow resignation from membership is analogous to insistence on full membership. United Stanford Employees, Local 680, SEIU (Leland Stanford Jr. University), 232 NLRB 326 (1977), enf'd, 601 F.2d 980 (9th Cir. 1979). The Board, recognizing the potential that "without notice of General Motors rights, employees could be misled into believing that full union membership was required," determined that current members who have "not been informed" or who have been "misinformed" or "kept ignorant" of their Beck and General Motors rights are entitled to a nunc pro tunc remedy which permits them to exercise these rights retroactively. Rochester Manufacturing Co., 323 NLRB 260, 263 (1997). In this regard, we noted that employees need not use the word "resignation" to indicate their intention to resign from full union membership, Electrical Workers IBEW Local 3 (General Electric), 299 NLRB 995, 1002 (1990), "so long as the intent of the member to resign is made clear." Sheet Metal Workers, Local 28 (Rohde Bros.), 298 NLRB 50, 53 (1990). See also, Machinists Local 758 (Menasco, Inc.), 275 NLRB 755, 761 (1985),

In our case, we decided that the Union violated Section 8(b)(1)(A) by repeatedly threatening the employees that they could lose their jobs if they failed to maintain their full union membership, and by declaring that resignation would be futile due to an arbitrarily imposed requirement to personally appear at the union hall to resign and then wait two weeks. Sheet Metal Workers, Local 18 (Rohde Bros.), supra at 53-54. Moreover, the Union's misrepresentations occurred at a critical time during a strike, thereby intensifying their effectiveness to impede strikers' protected right to resign at any time. Accordingly, we determined that the Union violated the Board's Rochester standards by conduct calculated to "mislead," "misinform," or "keep [the employees] ignorant" of their rights to become financial core members. Supra at 263.

We also decided that an appropriate remedy for such violation should "recreate the relationships that would have been made had there been no unfair labor practice." Rochester Mfg. Co., supra at 263, quoting, Franks v. Bowman Transportation, 424 U.S. 747, 769 (1976). In this regard, we determined that there is no legal basis for restricting the remedy to an arbitrary six-month period prior to the filing of the charge where, as here, the operative event that triggered Section 10(b) was the union's imposition of the unlawful fine within the six-month period. Sheet Metal Workers, Local No. 75 (Owl Contractors), 290 NLRB 381, 384 (1988). In our case, inasmuch as no portion of the fines was for any actions by the discriminatees unrelated to the union’s breach of its notice obligations by its coercive conduct during the strike, the only appropriate remedy is recision of the fines.


Continuous Recognitional Picketing Seeking Section 10(l) Injunctive Relief

A Section 8(b)(7)(C) case arising during this period involved whether union organizational and recognitional picketing over several months amounted to continuous recognitional picketing and thus unlawful even after an untimely petition was filed, and whether Section 10(l) injunctive relief was appropriate.

The Employer operated two stone quarries employing around 16 employees. In June 1998, the Union requested recognition from the Employer who refused, stating it would agree only to a Board-conducted election.

On July 1, the Union commenced picketing at both of the Employer's quarries with signs that read: "[Union] On Strike Against [Employer] for Unfair Labor Practices." That same day, the Union filed a charge against the Employer alleging that it had violated Section 8(a)(1). On July 8, while the picketing continued at both quarries, the Union again requested recognition from the Employer. The Union continued picketing both quarries throughout the month of July, with a few interspersed days of no picketing, until the afternoon of July 31, when all picketing ceased.

On August 11, the Union resumed picketing with the same signs used during the July picketing. On August 17, a Union agent told an Employer driver that the pickets were there because some employees wanted the Union. That same day, the Employer filed a Section 8(b)(7)(C) charge. The Region found that the August picketing was a continuation of the picketing that had started on July 1; that the picketing from the beginning had an organizational/recognitional object within the meaning of Section 8(b)(7); and that the picketing was unlawful because it had continued for more than 30 days without the filing of an election petition.

On August 24, the Union stopped picketing and filed a petition for an election. The petition sought an election in a unit of a total of 9 the Employer's employees. However, on August 25 the Union requested, and the Region approved, withdrawal of that petition. On August 28, the Region approved an informal settlement agreement of the August 17 filed 8(b)(7)(C) charge.

On September 9, after approximately two weeks of no picketing activity, the Union again resumed picketing with signs that read: "On Strike Against [Employer]. For Recognition as Majority Bargaining Representative of Company's Operating Engineer Employees." That same day, the Union filed another petition for election, this time seeking representation of a smaller unit consisting only of only six employees.

We decided that the Union's continued picketing was unlawful under Section 8(b)(7)(C) even after the filing of the untimely election petition, and that Section 10(l) injunctive relief should be sought.

We initially concluded that the recognitional picketing resumed on September 9 was a continuation of the organizational/recognitional picketing that had commenced on July 1. The Board will find a continuous course of picketing, even after a hiatus in actual picketing activity, where there has been a continuing recognitional demand "during the period embraced by the picketing." See Butcher's Union, Local 120, Amalgamated Meat Cutters & Butcher Workmen (M. Moniz Portuguese Sausage Factory), 160 NLRB 1465, 1469 (1966), enfd. 67 LRRM 2768 (9th Cir. 1968)(ten days of intermittent picketing during a thirty-six day period). On the other hand, if after a hiatus, a union disclaims its recognitional object and its post-hiatus picketing is consistent with that disclaimer, the post-hiatus picketing will not be considered a continuation of prior recognitional picketing. Compare, e.g., Retail Clerks Local 1357 (Genuardi Super Markets), 252 NLRB 880, 887 (1980).

In our case, the Union first demanded recognition from the Employer in June and commenced picketing on July 1. A few days after that picketing commenced, the Union again requested recognition. During the month of August, the Union admitted its recognitional purpose because of the August 17 comments of a Union agent to a driver during picketing and also by virtue of its filing of a representation petition on August 24. Finally, the resumed picketing of September 9 was explicitly recognitional by virtue of the language on the picket signs. Consequently, notwithstanding the original picket signs, which claimed that the purpose of the picketing was to protest unfair labor practices, the evidence showed that the Union had a continuing recognitional objective during the entire period of intermittent picketing, from July through September.

We noted that the Union slightly altered its recognition demand by reducing the scope of the unit to fewer employees in its September 9 petition. However, that recognition demand still encompassed most of the employees included in the original demand. In our view, such a minimal change did not make the Union's current recognitional objective separate and distinct from its earlier recognitional objective in July.

Because the September 9 representation petition was filed more than 30 days after the July 1 start of all this recognitional picketing, the petition was no defense to the Section 8(b)(7)(C) charge. See Chicago Printing Pressmen's Union No. 3 (Moore Laminating, Inc.), 137 NLRB 729, 732 n. 6 (1962). Section 8(b)(7)(C) requires the filing of a timely petition. In the absence of such a petition, continued recognitional picketing is unlawful even if a late petition is eventually filed. See, e.g., UMW Pocket Local 7083 (Grundy Mining Co.), 145 NLRB 247, 252 (1963); Int'l Hod Carriers Bldg., etc., Local 840 (Blinne Construction Co.), 135 NLRB 1153, 1167 (1962).

We noted that, since recognitional picketing during the pendency of a late-filed petition is violative of 8(b)(7)(C), it is enjoinable under Section 10(l). See, e.g., Phillips v. United Mine Workers, District 19, 217 F. Supp. 552, 558-559, 53 LRRM 2237 (E.D. Tenn. 1963); Madden v. Chicago Printing Pressmen, 46 LRRM 2513, 2514-2515 (N.D. Ill. 1960). We therefore also decided to seek such a temporary injunction under Section 10(l), noting that injunctive relief would not unduly restrict the Union's statutory or constitutional rights.

Since the enactment of Section 8(b)(7)(C) in 1959, open-ended union picketing of employers for recognition or organizational purposes has been regulated by the Act. Congress made clear that by enacting Section 8(b)(7)(C), it was allowing such picketing "only under limited conditions." See II Leg. Hist. LMRDA of 1959 1377(3)(Sen. Kennedy's comments)(Government Printing Office 1985). These conditions include the filing of a petition within 30 days so that an expedited election can take place which would permit the question concerning representation underlying the picketing to be resolved promptly. Such limitations on picketing conduct clearly do not run afoul of the First Amendment. As recognized by the Supreme Court, "picketing is 'a mixture of conduct and communication,'" DeBartolo v. Fla. Gulf Coast Building & Construction Trades Council, 485 U.S. 568, 580, 128 LRRM 2001, 2006 (1988), quoting NLRB v. Retail Store Employees, 447 U.S. 607 (1980)(J. Stevens, concurring), and is not pure speech, and is thus subject to greater regulation. See also Miller v. United Food & Commercial Workers Union, 708 F.2d 467, 471-472, 113 LRRM 3107 (9th Cir. 1983)(courts "have uniformly upheld the section 8(b)(7) restriction against picketing for recognitional purposes").

In sum, we decided to issue a Section 8(b)(7)(C) complaint alleging that the Union's September 9 picketing had a recognitional object within the ambit of Section 8(b)(7), that the Union's September 9 election petition was untimely filed under 8(b)(7)(C), and absent immediate termination of the picketing, to institute Section 10(l) injunctive proceedings.


Bargaining Order For Threats To Summon The INS

In the last case being reported here, we considered whether a bargaining order was warranted under NLRB v. Gissel Packing Co., 395 U.S. 575 (1969), in light of unlawful threats concerning the Immigration and Naturalization Service (INS).

During an organizing campaign, the Union requested recognition from the Employer based on a petition signed by a majority of the Employer's employees. The Employer refused to recognize the Union, which then filed a petition for a representation election. The Union subsequently lost the election.

Prior to the election, the Employer conducted a vigorous campaign against the Union. The Union filed several charges against the Employer, and the Regional Director determined that complaint was warranted. That complaint alleged that the Employer had committed numerous Section 8(a)(1) violations, including soliciting employee complaints and impliedly promising better terms and conditions of employment, threatening to "spin off" its trucking division if the Union won the election, threatening to terminate Union supporters, threatening that Union supporters would be blacklisted, threatening that the Union would cause an INS raid if elected, and threatening that an INS raid would follow the election. The complaint also alleged a number of Section 8(a)(3) violations, including the layoff of three Union supporters and the awarding of prizes to certain employees. Some of the alleged violations were committed by high level management and the Employer's labor relations consultant, while others were committed by first line supervisors.

With regard to the INS threats, approximately 70% of the Employer's workforce was Hispanic. It also appeared that a large percentage of those employees were undocumented workers. The Employer raised the subject of the INS at many, if not most, of its numerous captive audience meetings with the Spanish-speaking employees. At a number of these meetings, the Employer's labor relations consultant and/or its general manager told employees that there was an agreement [purportedly between the Department of Labor and the Justice Department] that the INS would not conduct a raid prior to the election, but that after the election the INS could come in at any time. At several meetings, the labor relations consultant also brought up the subject of an INS raid at another company that had resulted in the deportation of a number of employees. In discussing that raid, the consultant told the employees that the Union's promises to help undocumented workers were untrue and that the Union actually benefited from INS raids by charging new initiation fees for every employee hired to replace a deported worker. The consultant also allegedly said that the Union would call in the INS if it won the election. Finally, the consultant brought in a colleague who described her experiences with the Union in another state and claimed that the INS came in right after the Union.

We decided that a Gissel bargaining order was warranted in this case, particularly in light of the threats of a possible INS raid should the Union win the election.

Absent prior Board certification or voluntary recognition, the Board will issue a Gissel bargaining order in two categories of cases. The first (Category I cases) are those "exceptional cases marked by outrageous and pervasive unfair labor practices." The second (Category II cases) are those "less exceptional cases marked by less pervasive practices which nonetheless still have a tendency to undermine majority strength and impede the election process." Id. at 613-614. A bargaining order is warranted in Category II cases if there is substantial evidence that (1) the union had majority status within the unit at some point; (2) the employer's unfair labor practices have had the tendency to undermine the union's majority support and impede the election process; and (3) the possibility of erasing the effect of past unfair labor practices and of ensuring a fair election (or rerun election) by the use of traditional remedies is slight, and the once-expressed sentiment in favor of the union would be better protected by a bargaining order. See M.J. Metal Products, Inc., 328 NLRB No. 170 (1999). We determined that this case fell within the parameters of Category II.

In Viracon, Inc., 256 NLRB 245 (1981), the Board determined that a Gissel bargaining order was warranted in part because of threats concerning the INS. The INS threats in Viracon encompassed both statements that the Employer would report illegal aliens to the INS if the Union won the election and statements that the Union would not allow undocumented aliens to work if it won. Id. at 246, n.7. The Board stated, in pertinent part, as follows:

"While the record contains no evidence that any of the Respondent's employees are illegal aliens, should any of them fall within that category, then [the production manager's] threats would undoubtedly evoke the most intense fear, not only of employment loss, but of removal from their very homes as well. Like the fears of job loss . . . fears of possible trouble with the Immigration Service or even of deportation must remain indelibly etched in the minds of any who would be affected by such actions on the [employer's] part. Such fears would, in our view, be extremely resistant to efficacious dissipation through the use of traditional remedies. Moreover, these threats - regardless of their applicability to any employee - signaled [the employer's] displeasure at union activity and the lengths to which it would go to impose retribution should employees thwart its will." Id. at 247.

In the case before us, it appeared that the Union had the support of a majority of employees in the bargaining unit at one time. It also appeared that a significant number of the bargaining unit employees were undocumented workers. "In the very uncertain world of undocumented workers," merely raising the "specter" of possible deportation would undoubtedly evoke a fear of loss of employment and deportation. Santa Nino Industries, 1994 NLRB Lexis 140, 33 n. 13 (1994). The INS threats in this case undoubtedly had a tendency to undermine the Union's majority status. That the Employer may have been responding to purported Union promises to protect workers from the INS was not viewed as a legitimate defense for the Employer went "beyond the boundaries of the cited union promise" and "deliberately exacerbat[ed]" the fear of certain deportation in the employees' minds." Great American Products, 312 NLRB 962, 966-967 (1993).

The specter of an INS raid following on the heels of a Union victory would very likely remain "indelibly etched in the minds of any who would be affected" and would be "extremely resistant to efficacious dissipation through the use of traditional remedies." Viracon, supra. The Employer had also engaged in a number of other unfair labor practices, including certain "hallmark" violations such as threats of job loss and the unlawful layoff of three Union supporters, that were likely to have a lasting effect on the work force. Be-Lo Stores, 318 NLRB at 12, n. 31. Moreover, some of the alleged violations, including the INS threats, emanated from the highest levels of management and from the Employer’s labor relations consultant.

Under these circumstances, we determined that the possibility of erasing the effect of the Employer's unfair labor practices and of ensuring a fair rerun election by traditional remedies would be slight and that a bargaining order should be sought. Gissel, 395 U.S. at 614. We also determined, in the alternative, that special notice and access remedies would be necessary to dissipate the coercive effects of the Employer's unfair labor practices should the Board determine that a bargaining order is not warranted. See, e.g., Fieldcrest Cannon, 318 NLRB 470, 473 (1995), enf’d., in pertinent part, 97 F.3d 65 (4th Cir. 1996).

Section 10(j) Authorizations

During the 14 month period from July 1, 1998 through August 31, 1999, the Board authorized a total of 57 Section 10(j) injunction proceedings. Most of the cases fell within factual patterns set forth in General Counsel Memoranda 98-10, 89-4, 84-7 and 79-77. As contemplated by those memoranda, these cases are set forth in the chart set forth below. For a fuller description of the case categories, the reader is directed to General Counsel Memoranda 98-10, 89-4, 84-7 and 79-77.(1)

Three cases were somewhat unusual and therefore warrant special discussion.

In the first case the union was attempting to organize an area hospital. It had filed a representation petition and an election was scheduled. Prior to the election the employer discharged a union activist allegedly based on her union activities in violation of Section 8(a)(3). The news of the discharge quickly spread among the hospital's employees. Because there was some evidence of a "chilling" impact upon other hospital employees' union support, the union refused to proceed with the election.

We concluded that 10(j) relief was necessary in this case both to remove the chilling impact of the discharge as well as to restore the laboratory conditions necessary to conduct a fair election.

The district court granted the requested injunctive relief and the union filed a request to proceed with the election.

In the second case the parties had an established collective-bargaining relationship and an existing labor agreement governing a single bargaining unit covering several facilities in a large industrial campus. The employer informed the union that it wished to effect a change at one of the facilities. The employer proposed either a relocation of certain unit work of this facility to another state or, in order to retain the work at this facility, certain changes had to be made to the parties' existing labor agreement. In the Region's view, these proposed changes in the parties' labor agreement in essence removed this facility from the scope of the contract's single bargaining unit. The Region's complaint alleged that the work relocation decision was a mandatory subject of bargaining under the Act and that the employer's insistence during negotiations upon removing this facility from the scope of the parties' historical multi-facility bargaining unit was violative of Section 8(a)(5).

We concluded that 10(j) proceedings were necessary in this case. Absent interim relief, the employer would implement its work relocation decision long before the Board could act and thus make a restoration of the proper status quo ante very difficult to achieve. Further, the employer's refusal to bargain could irreparably undermine the union's status as the representative in the bargaining unit. We thus sought 10(j) relief to maintain the status quo and to compel the employer to bargain in good faith over the work relocation decision.

The district court granted the requested relief in substantial part.

In the third case the union had just been certified to represent an employer's unit employees. The Region's complaint alleged that the employer was engaging in bad faith or "surface" bargaining in violation of Section 8(a)(5). Among the indicia of the employer's failure to bargain in good faith was its refusal to meet with the union at reasonable times, the employer president's statement that he personally did not recognize the union as the employees' representative, the employer's implementation of unilateral changes in working conditions and the employer's adamant insistence upon severely regressive economic proposals.

We concluded that 10(j) relief was warranted in this case. We believed that the employer's blatant bad faith bargaining would likely cause irreparable erosion of the union's employee support. We also noted that the union was particularly vulnerable to employer misconduct, given its recent certification and its attempt to negotiate its first collective-bargaining agreement.

The district court granted the requested injunctive relief in substantial part.

The 57 authorized cases fell within the following categories, as defined and described in General Counsel Memoranda 98-10, 89-4, 84-7 and 79-77:

Category Number of Cases In Category Results
1. Interference with organizational campaign (no majority) 13 Won five cases; five cases settled before petition; one case settled after petition; lost one case; one case is pending.
2. Interference with organizational campaign (majority) 10 Won two cases; three cases settled before petition; two cases settled after petition; lost one case; one case not litigated due to changed circumstances; one case is pending.
3. Subcontracting or other change to avoid bargaining obligation 1 Won case.
4. Withdrawal of recognition from incumbent 10 Won four cases; three cases settled before petition; two cases settled after petition; lost one case.
5. Undermining of bargaining representative 8 Won one case; four cases settled before petition; one case mooted by Board decision; two cases are pending.
6. Minority union recognition 1 Lost case.
7. Successor refusal to recognize and bargain 7 One case settled before petition; three case settled after petition; lost one case; two cases are pending.
8. Conduct during bargaining negotiations 5 Won two cases; two cases settled before petition; one case is pending.
9. Mass picketing and violence 1 Won case.
10. Notice requirements for strikes and picketing (8(d) and 8(g)) 0 - - - - -
11. Refusal to permit protected activity on property 0 - - - - -
12. Union coercion to achieve unlawful purpose 0 - - - - -
13. Interference with access to Board processes 0 - - - - -
14. Segregating assets 1 Case not litigated due to changed circumstances.
15. Miscellaneous 0 - - - - -

1 See also NLRB Section 10(j) Manual, Appendix A, "Training Monograph No. 7."

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