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Report Of The General Counsel
September 1, 1999 through September 30, 2000

WASHINGTON, D.C.   20570


This report covers selected cases of interest that were decided during the period from September 1, 1999 through September 30, 2000. 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.


Leonard R. Page

General Counsel


Employer Rules Limiting Employee Use

of Company Computers and E-Mail

During this period, we considered several cases involving employer limitations on employee use of company computers and E-mail. Our first reported case in this area involved whether the Employer maintained a facially overbroad no-solicitation/no-distribution policy and whether the Employer unlawfully disciplined an employee for violating that and related policies because he sent other employees a Union-related message through the Employer's internal E-mail system.

The Employer employed a group of technicians who initially were not represented by any union. These employees used company E-mail to communicate with each other and management on a daily basis. The Company announced corporate policy through E-mail and placed employee required reading on the E-mail system. Although the technicians use other computer systems for their substantive duties, one employee estimated that he used the E-mail system for about an hour each day.

The Employer maintained a no solicitation/no distribution policy in its employee handbook. The Employer also maintained a "Company Assets" policy which limited employee use of company equipment "only for legitimate business reasons on behalf of the Company." Finally, the Employer also maintained a "Computers and Software" policy which further provided that, "computer software may be used only for Company business ...."

On January 21, 1999, an employee sent his fellow technicians an E-mail message announcing a Board-run election for representation by the Union. In his E-mail, the employee explained that the bargaining unit would be a "stand alone" unit of chemistry technicians, which he characterized as a victory for the Union, and encouraged employees to find out more about the Union before the election. The Union subsequently won the election and the parties later began negotiating an initial collective-bargaining agreement.

When the Employer discovered the employee's message, it verbally warned him that he had violated the Employer's no solicitation/no distribution, Company Assets and Computers and Software policies. The Employer also counseled the employee to not use the Company's E-mail system for union business in the future.

We decided to issue a Section 8(a)(1) complaint alleging that under the Board and the Supreme Court's long-standing rules, the Employer maintained a facially overbroad no solicitation/no distribution policy. We first assessed the facial validity of the Employer's no solicitation/no distribution policy within the well-recognized frameworks for analyzing policies limiting (1) employees' solicitation of fellow employees and (2) the distribution of written materials.

In Republic Aviation, 51 NLRB 1186 (1943), enfd. 142 F.2d 193 (2d Cir. 1944), affd. 324 U.S. 793 (1945), the employer discharged an employee for wearing a "union steward" button at work in violation of the employer's non-discriminatory rule prohibiting all solicitation in the plant. The Board held that the no-solicitation rule and the resulting discipline were inimical to the employees' Section 7 organizational rights. In striking a balance between employer and employee rights, the Board articulated several important principles in these cases, affirmed by the Supreme Court. First, the Board and Court made it clear that an employer's managerial or property rights are not, in themselves, dispositive of the lawfulness of even a non-discriminatory rule. Thus, "[i]nconvenience, or even some dislocation of property rights, may be necessary in order to safeguard the right to collective bargaining." 324 U.S. at 802 n.8 (noting the Board’s quotation from NLRB v. Cities Service Oil Co., 122 F.2d 149, 152 (2d Cir. 1941)).

Second, the Board decided that while an employer has a right to expect that employees’ working time be for work, an employee equally has a right to use non-working time for activities protected by Section 7, even on the Employer’s property. In affirming the Board’s analysis, the Supreme Court firmly established the rule that, while employers are rebuttably presumed to act lawfully when they limit employees’ rights to solicit other employees during working times, prohibitions on employee solicitation during non-working time, even in work areas, are presumed to be unlawful. 324 U.S. at 803 n.10. This presumption of unlawfulness may be overcome if the employer can demonstrate that the restrictions are necessary to maintain production or discipline. Ibid.

As to distribution, in Stoddard-Quirk Mfg. Co., 138 NLRB 615 (1962), the Board found that the employer unlawfully disciplined an employee for violating its policy prohibiting the "unauthorized distribution of literature of any description on company premises." The Board held that the rule was unlawful on its face because it was not limited to working time or to the working areas of the plant. In conformity with the Supreme Court's direction to carefully balance employers' property interests with employees' organizational rights, the Board concluded that the employees' purpose in distributing literature may be satisfied so long as the literature is received by other employees and reread at their leisure, even if the handbillers are stationed outside of the working areas of the plant. Id. at 620. Thus, an employer may lawfully prohibit the distribution of written materials in working areas of the plant at any time, the presumption being that such actions are reasonably designed to minimize potential interference with production brought about by litter. However, an employer may not lawfully interfere with distribution activities in nonworking areas of the plant on the employees' own time, absent an affirmative showing that the employer's actions actually were necessary for the maintenance of production or discipline. Id. at 621-22.

In a previous case set forth in an earlier General Counsel Report released on September 1, 1998, at p.1, we had already decided that, aside from questions of disparate treatment, an employer's complete ban on all non-business E-mail, including messages otherwise protected under Section 7, was overbroad and facially unlawful. The employees in that earlier reported case communicated with each other and with management primarily by E-mail and performed a significant amount of their work (one employee estimated up to 75-80%) on the computer network. The employer invited employees to access the network from outside the building through the use of laptop computers and facilitated access to the network from employees' home computers. In a very real sense, the employer's computer network in that case constituted the employees' "work area" within the meaning of Republic Aviation and Stoddard-Quirk because it was on this network that the employees were productive. We thus concluded that the employer's flat ban on personal E-mail, the sole method of communication through this computerized "work area," which effectively banned protected solicitations as defined in Republic Aviation, was unlawfully overbroad.

In the instant case, the technicians utilized their E-mail system to a lesser extent than the did employees in the earlier reported case. We nevertheless decided that the Employer's E-mail network here comprised a sufficiently significant aspect of employees' work life to constitute a "work area." One employee estimated that he worked on the E-mail system for about an hour each day, and he and his co-workers used E-mail to communicate with each other and management on a daily basis. The Company announced corporate policy through E-mail and placed employee required on the E-mail system. It thus seemed clear that the E-mail system comprised a significant aspect of the technicians' productive work life, and thus constituted a "work area", if not the employees' sole work area. under Republic Aviation.

We then decided that the Employer's no solicitation/no distribution policy was overbroad because it did not distinguish between working time and non-working time, nor working areas and non-working areas. Rather, the Employer flatly prohibited employees from soliciting other employees or distributing literature "on Company property" at any time. In this way, the Employer's policy was strikingly similar to the blanket prohibitions on solicitation and distribution which the Board and the Court struck down as facially unlawful in Republic Aviation and Stoddard-Quirk. Further, the Employer had not even attempted to satisfy its burden of establishing that its restrictions on employee statutory rights were necessary to maintain production or discipline.


E-Mail as Solicitation or Distribution

Our second reported case in this area again involved an Employer rule prohibiting all non-business use of E-mail, and also involved the Employer's ordering the Union's bargaining chair not to E-mail the Union’s "Bargaining Updates" to other members.

The Union represented a unit of approximately 900 employees employed at three separate locations of the Employer. For several years, the Employer had maintained an "Electronic Communications Policy" which states that: "E-mail and the Internet are to be used for business purposes only."

During negotiations for a new collective-bargaining agreement, a unit employee who was the Union's bargaining chair E-mailed to all Union members a "Bargaining Update" setting forth: (1) the Union's opposition to the Employer's contract proposals and its reasons for such opposition; (2) the Union's own proposals; and (3) the schedule and locations of upcoming meetings regarding the contract negotiations.

The following day, the Employer ordered the bargaining chair to stop using the E-mail system for sending the Union's "Bargaining Updates." The Employer, however, did not discipline the employee for this use of E-mail. The Employer based its directive to the bargaining chair upon the Employer's "Electronic Communications Policy." The Union filed the charge in this case alleging that the Employer's order to the bargaining chair, and the "Electronic Communications Policy" underlying it, violated Section 8(a)(1) of the Act.

Evidence revealed that most if not all bargaining unit employees used the Employer's computer network and E-mail system frequently during the workday, including using it as a common means of communication. Indeed, the Employer apparently did not dispute that a majority of unit employees spent most of their workday on the Employer’s computer network.

The Employer contended that its order to the bargaining chair was justified because of its potential for disrupting both the Employer's E-mail system, and also employees who receive messages during their work time. However, the Employer did not presented any evidence demonstrating any significant interference caused by the bargaining chair's E-mail, or likely to be caused by future E-mails.

We decided that (1) the Employer's rule prohibiting all non-business use of E-mail was facially overbroad; and (2) the Employer violated Section 8(a)(1) of the Act by ordering the bargaining chair not to E-mail the Union’s "Bargaining Updates" to other Union members.

In the case immediately above, which relied upon the case previously discussed in the General Counsel Report released on September 1, 1998, at p.1, we concluded that the employer's prohibition there of all non-business use of E-mail, including employees' messages otherwise protected by Section 7, was overbroad and facially unlawful. While the Board has not yet ruled upon the legality of a non-discriminatory prohibition of employees' use of E-mail for organizing or other Section 7 messages, our conclusion were based upon well-established principles set forth in the line of cases involving no-solicitation and no-distribution policies, exemplified by the Board's and the Supreme Court's decisions in Republic Aviation, discussed above.

In these cases, the balance between employee and employer rights is struck differently depending on whether the employee activity is solicitation of fellow employees, or distribution of printed literature. This distinction is elucidated in Stoddard-Quirk, which is generally cited for the simple proposition that an employer may limit the distribution of printed literature in work areas because the employer is presumed to have a legitimate concern regarding the potential for litter. However, the Board explicitly stated in that case that, "because [this consideration] presents only one side of the employer-employee equation, it does not wholly resolve the problem." Id. at 619. Instead, the Board also examined the employees' interests in distributing literature. The Board noted that, unlike oral solicitation, printed literature is permanent; it can be read and reread at the receiving employees' convenience. Thus, the Board concluded, the employees' purpose in distributing printed literature is satisfied as long as the literature is received by other employees, such as by distribution at plant entrances or in the parking lot; employees do not need to be able to distribute the literature throughout the employer's facility.

The clear implication of Stoddard-Quirk is that the distinction between solicitation and distribution is based on the employee interests and purpose inherent in the communication. Where the message can reasonably be expected to occasion a response or initiate reciprocal conversation, it is solicitation; where the message is intended to be limited to one-way communication and its entire purpose is achieved so long as it is received, it is distribution. If it is solicitation, Republic Aviation requires that it must be permitted in all areas in the absence of an overriding employer interest; if it is distribution, it may be prohibited in work areas unless the employees cannot effectively distribute the materials in non-work areas.

This helps explain the Board's characterization of the circulation of authorization cards and decertification petitions as solicitation, not distribution. See, e.g., Rose Co., 154 NLRB 228, 229 n.1 (1965); Southwire Co., 145 NLRB 1329 (1964). Cards and petitions are mass-produced and printed on paper. Yet the activity of collecting signatures requires more than mere receipt of documents, which characterizes distribution. Instead, the cards or petitions are only effective if the recipient considers and returns them. Such interchange exemplifies solicitation.

Based on this distinction, we had already decided that E-mail messages can be may be similar to oral solicitations because they may be expected to occasion a response. In explaining that conclusion, we noted that it has been widely recognized that many E-mail messages are not merely analogues of printed messages. Rather, they have been characterized as "a substitute for telephonic and printed communications, as well as a substitute for direct oral communications." In Re: Amendments to Rule of Judicial Administration, 651 So. 2d 1185 (Fla. Sup. Ct. 1995). There has even been Congressional recognition that E-mail "is interactive in nature and can involve virtually instantaneous 'conversations' more like a telephone call than mail." H.R. Rep. No. 647, 99th Cong., 2d Sess. at 22, discussing the Electronic Communications Privacy Act of 1986. One observer also has commented that:

even where an initial [E-mail] message is neither informal nor personalized, it is still not merely equivalent to a flyer because e-mail allows the reader to talk back. This ability to exchange ideas and discuss what action to take collectively is the key to the effective preservation of labor rights and the equalization of bargaining power. Conversation provides the opportunity to meet the listener’s resistance point by point as it develops, producing fuller deliberation about issues as well as a better chance of swaying the skeptic than does the more limited and formal medium of distribution. Likewise, electronic communication promotes responsive interchanges, not just an exchange of position papers. . . . Thus, electronic communications promote a multiplicity of interchanges and, on the level of values, resemble speech more than distribution of literature.

Elena N. Broder, Note, "(Net)workers' Rights: The NLRA and Employee Electronic Communications," 105 Yale Law Journal 1639, 1662 (1996).

Given our conclusion that E-mail often warrants the same treatment as oral solicitation, along with the determination in the previously reported cases that the employees at issue there used the employer's computers and computer network in such a way as to make them "work areas" within the meaning of Republic Aviation and Stoddard-Quirk, it followed that the Employer's rule here prohibiting such solicitation was unlawful, because there was no evidence that special circumstances made the rule necessary in order to maintain production or discipline. Electronic traffic such as E-mail presents a minimal burden upon an employer's computer network. This ordinarily would not constitute special circumstances making the rule necessary to maintain production or discipline, and it thus should not outweigh the employees' Section 7 interests.

In the instant case, as in the above reported cases, the Employer's "Electronic Communications Policy" contained a rule prohibiting all non-business use of E-mail, including solicitation messages protected by Section 7. And here as well, most if not all of the bargaining unit employees used the Employer's computer network and E-mail system frequently during the workday, including as a common means of communication. This evidence was sufficient to demonstrate that, for these employees, the Employer's computer network and E-mail system was a work area since that was where these employees are productive. The computers and E-mail were inextricably intertwined with the physical space these employees occupy and provide the virtual space in which they perform their jobs; as such, that virtual space is a "work area" within the meaning of Republic Aviation and Stoddard-Quirk. Finally, the Employer did not present any evidence that would demonstrate that a prohibition against E-mail otherwise protected by Section 7 was necessary for production, efficiency, or disciplinary reasons. Thus, as in the previously reported cases, we decided that the Employer's prohibition of all non-business use of E-mail would include a ban on employees’ solicitations otherwise protected by Section 7 was therefore overbroad and facially unlawful.

In addition, we decided that the Employer's order to the bargaining chair also violated Section 8(a)(1) of the Act, as the Union's "Bargaining Updates" warrant the same treatment as oral solicitation. We noted the Employer's defensive assertion that the bargaining chair had sent the "Bargaining Update" during working time. However, neither the Employer's order, nor its "Electronic Communications Policy" underlying it, were limited to working time. Instead, the prohibitions were based solely upon message content. Defensive issues relating to the use of E-mail during working time may be significant in other contexts. Since they were not raised in the instant case, however, we did not address them.

After Stoddard-Quirk, the distinction between solicitation and distribution is based upon whether the message can reasonably be expected to occasion a response or initiate reciprocal conversation; if so, it is solicitation. Where the message is intended to be limited to one-way communication and its entire purpose is achieved so long as it is received, it is distribution.

The "Bargaining Update" forcefully set forth the Union's opposition to the Employer's contract proposals and its reasons for such opposition; the Union's own proposals; and the schedule and locations of upcoming Union meetings. With regard to each of these points, the bargaining chair could reasonably have expected unit members' immediate responses. Such responses could have entailed, e.g., agreement or disagreement with the bargaining committee's positions, suggestions for alternative proposals or ways of pursuing particular points, questions concerning the course of the negotiations or the Union's strategy, or even the seeking of further information or offering suggestions as to the agenda for the next unit meeting. Here, as with the circulation of authorization cards or decertification petitions, the bargaining chair was asserting Union positions, implicitly inviting the E-mails' recipients to consider and respond. The "Bargaining Update" in effect attempted to rally support and counter objections; such attempts at interchange exemplify solicitation.

By using the medium of E-mail rather than distributing a printed version of the "Bargaining Update," the bargaining chair invoked the widely recognized tendency of E-mail, as discussed above, to be "interactive in nature" and to "promote a multiplicity of interchanges and, on the level of values, resemble speech more than distribution of literature." In particular, the reader's ability to send any response with a mere click of a button further strengthens the basis for characterizing messages such the "Bargaining Update" as reasonably likely to engender a reply from the recipient to the sender and, therefore, as solicitation. We thus decided that the "Bargaining Updates" could not have been banned from employee work areas because they should be considered as solicitations. In addition, we also decided that the Employer's order was unlawful even if the "Bargaining Updates" were to be considered distributions.

The unique nature of E-mail supports an argument that the balance of employer and employee interests discussed in Stoddard-Quirk should be struck differently here than in the case of distribution of printed literature in a facility with available non-work areas. In Stoddard-Quirk, the Board indicated that, in the absence of non-work areas where the distribution can take place, the usual presumption permitting an employer to bar distribution in work areas may not apply. 138 NLRB at 621. The ease of reply inherent in E-mail, as well as the incomparable abilities to forward an E-mail message to another recipient effortlessly and also to incorporate its text into another message quickly and conveniently, make a printed version of a message inferior and less effective than the version sent by E-mail. If employees were not permitted to send these "Bargaining Updates" via E-mail, but were instead required to rely exclusively on the distribution of printed copies thereof, an essential component of the employee communication would be lost. Therefore, unlike the distribution of printed literature discussed in Stoddard-Quirk, there are no non-work-areas where the same kind of distribution could take place. Under the Stoddard-Quirk framework, the E-mail "distribution" must be allowed even in a work area.

Accordingly, we decided to issue complaint alleging that the Employer violated Section 8(a)(1) by maintaining a facially overbroad rule prohibiting all non-business use of E-mail, and also by ordering the bargaining chair not to E-mail the Union's "Bargaining Updates" to other Union members, regardless of whether the "Bargaining Updates" were viewed as solicitation or distribution.


Lawful Application of E-Mail Rule

Our third case in this area concerned an Employer rule restricting the company E-mail system to business only; the discipline of a steward for using company E-mail for Union business; and whether to defer further proceedings regarding that discipline pending arbitration of a Union grievance.

The Union represented, among other employees, over 50 instrument technicians. Although the Employer had a long-standing rule restricting use of its company E-mail system for business only, the technicians regularly used the Employer's E-mail system as part of their work. The Employer often communicated with employees concerning terms and conditions of employment via E-mail, and required employees to regularly check for E-mail messages. The Employer also sent information such as changes in work rules to the steward via E-mail, and the steward himself spent from one-half to one hour per day on work related E-mail.

Our case arose when the steward sent an E-mail to the technicians concerning a rumor that the Employer was about to solicit volunteers among the technicians to train other employees. In this E-mail, the steward stated that instrument technicians were not certified trainers, and the other employees were not instrument apprentices. The steward thus advised the technicians that if the Employer approached them about performing the training, they should relate these facts to the Employer but they also should not disobey a direct supervisory order. Instead, the employees should bring to the attention of a steward any Employer order to perform this training.

The following day, the steward received a request from a joint union committee to solicit volunteers among the technicians to train other employees. The steward forwarded that request to the technicians, adding a comment that he hoped there would be no interest in volunteering. In fact, no technicians volunteered for the training.

The Employer thereafter advised the steward that it believed his E-mails constituted a serious offense against the E-mail system, because the steward had told the technicians not to do something which the Employer had told them to do. The steward pointed out that he had affirmatively told employees to not disobey a supervisory order. The Employer nevertheless reprimanded the steward for his initial E-mail, labeling it "illegal" because it had advised technicians to violate the parties' bargaining agreement. The Union filed a grievance over this discipline; when the instant charge was filed, that grievance was pending arbitration. The parties' bargaining agreement contained no provision concerning E-mail but did contain a provision barring discrimination based upon union activities.

We decided (1) to dismiss the allegation against the Employer's allegedly over broad rule restricting E-mail use for business only; and (2) to defer further proceedings against the steward's discipline pending arbitration of that discipline.

Regarding the Employer's rule, we had already concluded in the previously reported cases that the employees there used the employer's computers and computer network in such a way as to make them "work areas" within the meaning of Republic Aviation Corp. and Stoddard-Quirk, supra. It therefore followed that the Employer's rule in those cases, limiting E-mail to business only, i.e., prohibiting solicitation, was over broad and thus unlawful. In the instant case, we initially decided that the employees' regular work use of E-mail made the company's E-mail system a "work area" with the meaning of those cases. Although the Employer's E-mail use rule here therefore arguably also was unlawful as over broad, we decided to not proceed on that allegation.

First, the Employer here apparently was not enforcing its E-mail rule against union communications. Rather, the Employer admitted that it allowed the unions at its facility to use E-mail for communications. Second, the Employer stated that although it had disciplined other employees for E-mail use, such discipline typically involved sending sexual materials. The Union adduced no examples of Employer discipline of employees for having used E-mail for solicitation or other protected Section 7 activity. Third and consistent with the above, the Employer did not generally enforce its E-mail rule against the steward here. The Employer instead disciplined the steward because of the content of his initial E-mail, and not because he simply had violated the rule. Since the Employer's rule apparently was not enforced in this case, was not generally enforced against union or Section 7 communications, and there was no current Board law governing the matter, we decided that it was unnecessary to proceed against this rule on the novel theory set forth in the above cases.

Regarding the Employer's discipline of the steward, we decided that to defer further proceedings to the parties' grievance-arbitration procedure. See Collyer Insulated Wire, 192 NLRB 837 (1971). The Employer alleged that it disciplined the steward for sending an "illegal" E-mail advising technicians to violate the bargaining agreement. Since the discipline was based upon the content of that email as a contract violation, and not simply based upon a violation of the E-mail rule, an arbitrator could either uphold or overturn the discipline without passing upon the general validity of the Employer's E-mail rule. For the Union's part, it could argue that the steward's E-mail did not urge employees to violate the parties' bargaining agreement. Thus the Union could argue for the overturning of the discipline without regard to the validity in general of the Employer's E-mail rule. Since the dispute over the steward's discipline was not inextricably intertwined with the arguably unlawful overbreadth of the Employer's E-mail rule, we could separately defer the allegation against that discipline.

Lawful Discipline Despite Unlawful Rule

Our fourth and final case in this area concerned an Employer's discipline of an employee in violation of a portion of an unlawfully over broad rule against the non-business use of company computers, E-mail and internet systems.

The Employer provided computer solutions to its domestic and international organization customers. The Employer's employees spent the majority of their time on their computers and also constantly used the Employer's email system and its access to the internet.

The Employer had the following work rule: "Computer resources, including electronic mail and Internet access, are Company assets are [sic] to be used for Company business only." The Employer's Employee Handbook also stated, in pertinent part, "E-mail is a communication tool that should be used solely for the purpose of business communication."

Our case arose when the Employer disciplined an employee pursuant to an audit of his computer. The audit had been prompted when the employee requested permission to post four papers inside his cubicle wall. Three of these papers appeared to be published articles concerned Union matters. The fourth paper was a document created by the employee on the Employer's computer and printer. This document was a rebuttal to the Employer's anti-union videos. It requested employees to keep an open mind and also informed them about a Union meeting.

The Employer gave the employee a written warning for misuse of Company property, stating in pertinent part:

MIS discovered a file that had been recently created and printed on company property with company equipment on company time, which is in clear violation of the handbook.

The Employer defended the above warning by stating that it observed the employee posting a personal document which it reasonably suspected had been created on the Company's computer workstation. The Employer therefore audited the employee's computer, finding four non-business related documents that had been created or downloaded from the Internet, and also a Word document that had been created on the Employer's workstation during the employee's work time.

Although we decided to issue complaint alleging that the above cited Employer rule was unlawfully overbroad, we also decided to not argue that the Employer's discipline of the employee for violation of that rule was unlawful, because the Employer’s asserted business justification for the discipline was independent of the rule.

First, concerning the Employer's rule, we noted that the employees in the instant case were situated similarly to the employees in the above reported cases, i.e., they spent a significant amount of their work time on their computers, using the Employer's email and internet communication systems. Thus in the instant case, as there, these employees used the employer's computers and computer network in such a way as to make them "work areas" within the meaning of Republic Aviation and Stoddard-Quirk. The Employer's rule here, as there, also prohibited all non-business use of its computer equipment, email and internet communications, which necessarily includes solicitation messages protected by Section 7. Thus, under the rationale of the previously reported cases, this rule was an over broad and unlawful restriction on protected solicitation.

Regarding the discipline, we noted that the Employer disciplined the employee for having violated the above unlawful rule. The fact that the employee was disciplined pursuant to an unlawful rule would make his discipline also unlawful unless the Employer could independently justify that discipline. Daylin, Inc., 198 NLRB 281 (1972). In Daylin, the Board stated that a rule that unlawfully restricts employee solicitation:

can provide no justification for the discharge of an employee who violated it. Therefore, if an employee is discharged for soliciting in violation of an unlawful rule, the discharge also is unlawful unless the employer can establish that the solicitation interfered with the employees' own work or that of other employees, and that this rather than violation of the rule was the reason for the discharge.

Thus, where an employer can adduce a separate reason for discipline, not implicating Section 7 and apart from the unlawful rule, such discipline is lawful.

The Employer imposed the discipline here because the employee had misused "computer resources", i.e., he "created and printed [a file] on company property with company equipment . . ." during a time he should have been working. The asserted grounds for this discipline thus were not for engaging in protected communications in the employee's computer "work area." Rather, the Employer imposed discipline for "creating and printing" the document on company owned equipment. We decided that this reason did not implicate a Section 7 right, and could form a lawful basis for the discipline, separate and apart from the unlawfully overbroad aspect of the rule.

The Board has long held that an employer may control employee use of certain company owned equipment, even where that equipment is used for purposes of communication. For example, the Board has long stated that employees do not have an absolute right of access to employer bulletin boards. See, e.g., J. C. Penney, Inc., 322 NLRB 238 (1996); Honeywell, Inc., 262 NLRB 1402 (1982), and cases cited therein. This jurisprudence arguably also extends to employer owned copier equipment and telephones. See Champion International Corp., 303 NLRB 102 (1991) (in finding unlawful disparate treatment of an employee for copying a union newsletter on the employer's copier machine, the ALJ stated in dictum that the employer did have "a basic right to regulate and restrict employee use of company property . . ."); Churchill's Supermarkets, Inc., 285 NLRB 138, 139 (1987) (in finding unlawful disparate treatment of an employee for using the company telephone, the ALJ, adopted by the Board, stated in dictum that the employer "had every right to restrict the use of company telephones to business-related conversations and to forbid employees from using company phones for personal reasons.")

While in certain circumstances computer systems can be a work area, they are also the employer's property which, like employer bulletin boards, can in other circumstances be regulated. We therefore concluded that an employer may lawfully limit the use of computer equipment when that equipment is not being used as a work area. This conclusion is fully consistent with the finding of violations in the above reported cases. Those cases did not concern the non-communicative use of company equipment, and instead only concerned an overly broad ban on protected E-mail communications.

In the instant case, the Employer did not impose the discipline for communicating via the computer equipment. Rather, the Employer gave the employee a narrowly written warning for using company computer equipment to create the document. Since the Employer thus had adduced this lawful basis for its discipline, a basis separate and apart from the employee's violation of the over broad rule, the discipline did not implicate Section 7 rights and according was not unlawful.

Unlawful Video Manufacturer

An interesting case arising during this period involved how to proceed against a company which made and sold a videotape containing Section 8(a)(1) threats, where that company did not itself show the video to employees but rather another company, who bought the video, showed the video to its employees.

During a union organizing campaign, the Purchaser Employer showed its employees a videotape. Certain statements made in that video, depicting a union organizing campaign in a generic workplace, constituted Section 8(a)(1) violations including unlawful threats of plant closure and loss of employment. The Purchaser bought the video from the Maker Employer, which advertised and offered for sale a range of "labor relations" videos. The Maker's advertising stated that it had "helped thousands of companies give their employees a company to vote for rather than a union to vote against ... [i]f your company doesn't have a union, and doesn't want one, don't wait until there’s a union organizer at the door." Videos made by the Maker had been implicated in several other Board proceedings, including apparently "custom" videos found to constitute objectionable conduct. Other Maker videos were alleged in another pending proceeding to constitute Section 8(a)(1) threats by the employer who had purchased and showed them.

We decided to issue a Section 8(a)(1) complaint against the Maker itself under two theories. We first decided to allege that the Maker was an agent of the Purchaser and, as such, was itself liable as a named respondent for the unlawful video threats. Section 2(2) of the Act includes within the definition of employer "any person acting as an agent of an employer, directly or indirectly . . . ." Thus, labor consultants may be held liable as separate respondent employers for their unfair labor practices as agents of the employers employing them. See, e.g., Wire Products Mfg. Corp., 326 NLRB No. 62 (1998); Blankenship and Associates, Inc., 306 NLRB 994 (1992), enfd. 999 F.2d 248 (7th Cir. 1993); Chalk Metal Co., Inc., 197 NLRB 1133, 1152-54 (1972); Alliance Rubber Co., 286 NLRB 645, 645-46, 668-69 (1987).

Had the Maker in our case sent an individual to personally threaten the Purchaser's employees, instead of making the threats via videotape, there is no question that the Maker would be the agent of the Purchaser. Instead of sending an individual to convey unlawful threats, the Maker here had sent a videotaped message. In our view, it would be an artificial distinction to hold that the Maker was not the Purchaser's agent solely because the threats were made through a video instead of in person.

The Board has found that parties unaffiliated with an employer, who made threats via videotape or other media instead of in person to the employer's employees, were agents of the employer. Wallace International de Puerto Rico, Inc., 328 NLRB No. 3, slip op. 1 at n. 2 (1999)(local mayor deemed agent where employer showed employees videotape of mayor threatening plant closure); Fieldcrest Cannon, Inc., 318 NLRB 470, 472 (1995)(public relations firm hired to produce and circulate posters and newspaper advertisements predicting plant closure and loss of jobs deemed agent of employer), enf. granted in pertinent part, 97 F.3d 65 (4th Cir. 1996).

We recognized that a sales transaction for an item is arguably insufficient by itself to create an agency relationship. See generally, Restatement 2d, Agency 14J, 14K (1958). However, the "product" in our case was not so much a manufactured good as it was a communication. In the above cited labor consultant cases, the employers essentially were purchasing a service from the labor consultants: the effective communication of a desired message. Similarly, what was purchased here was an effective means of conveying a desired message to employees. Thus the video here was the equivalent of a labor consultant.

The Board has also held that individuals, unaffiliated with an employer, who on their own initiative restrain or interfere with employees' exercise of Section 7 rights, were agents of the employer as long as the employer had knowledge of the activity, reaped the benefits of the activity, and failed to disavow the activity. See, e.g., In re Southern Pride Catfish, 331 NLRB No. 81, slip op. 2-3 (2000). The Board not only found such unaffiliated persons to have been agents, but also found them individually liable as respondents for such acts. See, e.g., Henry I. Siegel Co., 172 NLRB 825 (1968), enfd. 417 F.2d 1206 (6th Cir. 1969), cert. denied 398 U.S. 959 (1970); Dean Industries, Inc., 162 NLRB 1078, 1101 (1967). Thus, although the Maker produced the video independent of any relationship with the Purchaser, and the Purchaser had no control over the contents of the video prior to production, the Maker may still be deemed the Purchaser's agent with respect to the message contained in the video shown by the Purchaser to its employees.

In addition to the above agency theory, we also decided that the Maker was liable as an "employer" within the meaning of the Act. It is clear that an employer can violate Section 8(a)(1) by directly threatening the employees of another employer. See, e.g., Fabric Services, Inc., 190 NLRB 540, 542 (1971); A.M. Steigerwald Co., 236 NLRB 1512, 1515 (1978), affd. 605 F.2d 560 (7th Cir. 1979).

We noted that there was no evidence that the Maker had any power to affect the terms and conditions of Purchaser employees' employment. However, the underlying issue in Fabric Services and Steigerwald was the level of coercion, interference or restraint that the threatening employers' conduct engendered. Several factors in our case compensated for the Maker's lack of power or control over the threatened employees, making its communication sufficiently coercive to constitute an 8(a)(1) violation. These factors included the content of the communication itself, threatening plant closure and loss of employment, as well as the fact that the threats were compelling transmitted to the employees through their direct employer.

Finally, it was clearly foreseeable that a purchaser of one of the Maker's videos would put the video to its advertised use, i.e., that the purchaser would show the video with the unlawful threats to its employees. In this respect, we drew an analogy to the tort defamation theory of liability, under which a publisher of a libel is liable for the republication of the libel by a third party if that republication was reasonably foreseeable. See Restatement 2d, Torts 576(c)(1977)(liability if "the repetition was reasonably to be expected"), cited in Tavoulareas v. Piro, 759 F.2d 90, 136 n. 56 (D.C. Cir. 1985), cert. denied 484 U.S. 870. Thus, in showing the video to its employees and giving its imprimatur to its content, the Purchaser was acting as the foreseeable facilitator or mechanism through which the Maker's threats were conveyed to employees.

Concerted Refusal to Work

In one case considered during this period, we concluded that employees were engaged in protected activity when they concertedly withheld their services in protest of the implementation of reduced work schedules, notwithstanding the Employer’s characterization of the employees’ actions as "insubordination."

An Employer that had been experiencing cash-flow difficulties decided to lay off five professional employees and two clerical employees for one month. At a meeting with employees to announce the decision, possible alternatives to the Employer’s plan were discussed. The Employer adopted a suggestion that would allow employees to work part time rather than be laid off. When the employees were informed that as part-time employees they would be unable to collect unemployment insurance, they told the Employer that they would rather take the one-month layoff than work part time. They were informed that a layoff was no longer an option, and that they would have to accept the part-time schedules or look for other employment.

Thereafter the employees met informally a few times in order to discuss whether there was anything they could do to prevent the imposition of the part-time schedules. However, the Employer announced that the changes would be implemented and that individual employees would have their hours cut from 40 hours per week to 18 to 20 hours a week. The employees continued to discuss the cuts and sent a representative to speak with the Employer about them. In particular, they noted their concern that they would lose benefits listed in the employee handbook if they only worked part time. After being notified of the effective date of the changes, the employees met and agreed to send a memorandum to the Employer protesting the cuts and demanding a meeting.

A meeting was subsequently held during which the Employer individually asked each of the employees present if he or she would accept the new schedule. Each of the professional employees responded that they would not. The Employer then told the employees that they were fired. Following the meeting, the Employer called the two professional employees who missed the meeting and informed them that their colleagues had refused to accept the new schedules and had walked out. Each was asked if they were going to accept the new schedule. One of the two informed the Employer that she would respond in an hour and the other stated that she needed time to consult with her associates. Although neither of them verbally informed the Employer of their decision, they did not show up for work when the new schedules took effect.

We decided that the Employer violated Section 8(a)(1) of the Act by firing employees because they refused to work the reduced schedules. We further concluded that although the Employer never formally discharged the two employees who missed the meeting, their subsequent failure to report to work was in solidarity with their fellow employees’ protest over the changes in working conditions, and was likewise protected.

The Board and courts have long been protective of the rights of employees who band together to protest employer policies or conduct. In the lead case of NLRB v. Washington Aluminum Co., 370 U.S. 9 (1962), the Supreme Court enforced a Board order reinstating with back pay several unorganized employees who had left work concertedly to protest the low temperature in the plant. The Court found the discharges to be unlawful and rejected the argument that the conduct was not protected because the employees had not given the employer an opportunity to avoid the stoppage by granting concessions. The Board has generally considered minimal interaction between even two employees as concerted. See Meyers Industries, 281 NLRB 882, 887 (1986), affd. 835 F.2d 1481 (D.C. Dir. 1987).

There is no dispute that the events herein involved concerted protected activity prior to the final meeting that led to the employee discharges. The employees had met to discuss their reaction to the Employer's plans to reduce their hours several times prior to that last meeting. These meetings culminated in a joint memorandum signed by the affected employees protesting the reduced hours and demanding a meeting to discuss the matter. At that meeting held in response to the demand, the Employer individually confronted each employee and demanded a commitment that he or she accept the reduced schedules. Each professional employee refused to work the new schedule and the Employer then announced that they were fired.

We decided that the employees' refusals to work were the logical outgrowth of their concerted protest over the reduction of their hours, and that their concerted withdrawal of their services constituted protected concerted conduct. See Mike Yurosek & Son, Inc., 306 NLRB 1037 (1992)(Yurosek I), and 310 NLRB 831 (1993)(Yurosek II), enf’d. 53 F.3d 261 (9th Cir. 1995). In Yurosek I, the Board found that the General Counsel had made a prima facie showing of protected concerted activity where several employees had refused to work overtime on one occasion, even though there had been no discussion among themselves about the overtime. The employees had protested as a group, and their identical actions in refusing to work overtime were a logical outgrowth of that concerted protest. Yurosek II, supra at 831. In Yurosek II, the Board adopted the ALJ’s findings that the employees were discharged for their concerted protected activity of refusing to work the overtime demanded of them by the employer. The Board found that that the fact that employees were interviewed and discharged separately did not negate the fact that the employees were otherwise treated as a group throughout the incident, and that the employer therein inferentially believed that the employees were engaged in concerted activity.

In Smithfield Packing Co., 258 NLRLB 261, 263 (1981), a case involving comparable circumstances to those present in our case, six employees left work together after having worked nine hours of a special Sunday workday even though the employer had not ended the shift. The next day, the employer interviewed the employees separately, and later decided to fire them. The Board found that the fact that the employees gave individual excuses at individual meetings did not detract from the concerted nature of their response. The Board has also found in similar situations that employees had engaged in protected activity when they concertedly left their jobs, even though their employers had specifically told them that they would be considered to have quit their jobs if they left. See, e.g., Modern Iron Works, 281 NLRB 1119 (1986) and cases cited therein.

We distinguished John S. Swift Co., 124 NLRB 394 (1959). In that case, employees refused to work any overtime, even though they continued to work their regular schedule. In our case, the employees did not attempt to engage in any intermittent activity, but rather refused to work the entire schedule assigned to them. Such conduct has been considered by the Board to be protected.

We thus concluded that the Employer acted unlawfully by considering the affected employees as "voluntary quits" rather than employees who had decided to withhold their services in protest over the Employer’s demand that they work reduced hours.

Lawsuit Against Project Labor Agreement

In another case, we considered whether a company violated Section 8(a)(1) of the Act by filing a lawsuit against unions challenging a negotiated project labor agreement (PLA).

Because of the existence of a PLA in the bid documents on a school project, a non-union subcontractor was unable to bid on the project. (The PLA required successful subcontractor bidders to enter into contacts with various trade unions as a condition to performing work on the project.) The subcontractor instituted a federal court action seeking injunctive relief against the project manager and the various trade unions He claimed that the PLA violated the Sherman Antitrust Act, Section 8(e) of the National Labor Relations Act and the Donnelly Act by depriving him of the opportunity to bid on the project unless he agreed to hire only union employees. After the court declined to issue an injunction or enter a declaratory judgement in his favor the subcontractor indicated he would not pursue the matter further. The union Trades Council then filed the instant 8(a)(1) charge alleging a violation under Bill Johnson’s Restaurants v. NLRB, 461 U.S. 731 (1983).

In Bill Johnson’s, recognizing that the First Amendment protects the filing and prosecution of a reasonably based lawsuit, the Supreme Court stated, that as a general rule, a lawsuit could be condemned as an unfair labor practice only if two conditions were met: (1) the lawsuit lacked a reasonable basis in fact or law; and (2) the suit had a retaliatory motive, i.e., it was motivated by a desire to retaliate against the exercise of a Section 7 right. Further, the Court explained, the fact that the lawsuit was dismissed, thus rendering it unmeritorious, "is a factor that the Board may take into account into determining whether the suit was filed in retaliation for the exercise of Section 7 rights." 471 U.S. at 747.

Initially, we decided that the fact that the lawsuit was aimed at the union rather than employee conduct does not preclude finding the conduct at issue constituted Section 7 activity. See BE & K Construction Company, 329 NLRB No. 68 (1999), slip op. p. 9. As to the issue of Section 7 activity, the issue of the PLA, as protected activity, is intertwined with the issue of whether a PLA is lawful under state laws. Clearly, collective bargaining is conduct protected by the Act, and PLAs, which have resulted therefrom, have been found lawful. Bldg. & Constr. Trades Council of the Metro Dist. v Assoc. Builders and Contractors of Massachusetts, Rhode Island, Inc., 507 U.S. 218, 229 [142 LRRM 2649]( 1993). On the other hand, there are PLAs which include clauses that may conflict with state law or have been found to violate Section 8(e) because they have a secondary objective. See, e.g. Asbestos Workers Local 3, 8-E-38-58 (Advice Memo dated July 26, 1999). In the instant matter in which the Company decided not to pursue its court action further, the district court specifically held that the challenged PLA was lawful and was apparently the result of negotiations between the project manager and the various craft unions. As the Supreme Court indicated in Bill Johnson’s, once the Court dismissed the Company’s lawsuit and the Company declined to pursue the matter, the suit must be deemed meritless. Moreover, the Board in Roundout Electric, 329 NLRB No. 87 (1999) noted that the Supreme Court in Bill Johnson’s alluded not only to adverse judgements "but also to suit withdrawals and occurrences that ‘otherwise’ manifest the lack of merit." Thus, the company in the instant matter acted at its peril by pursuing the lawsuit to determine the legality of the PLA, and such suit was meritless once the court dismissed the matter and the company did not pursue further recourse.

In addition, since the lawsuit was aimed directly at protected activity, namely the PLA, it was retaliatory within the meaning of Bill Johnson’s. See BE & K Construction Company, supra 329 NLRB No. 68, where the Board held that "Since the suit was aimed directly at protected activity, and necessarily tended to discourage similar protected activity, it was, by definition, retaliatory within the meaning of Bill Johnson’s." Id, slip op. p. 10.

In that case, the respondent filed a lawsuit challenging the legality of a union campaign against the respondent which included (1) picketing at its premises; (2) advocating the adoption and enforcement of a toxic waste ordinance; (3) filing a lawsuit in state court alleging violations of California’s health and safety code; and (4) filing grievances. The Ninth Circuit concluded that the unions’ litigation activity was protected because more than half of the actions filed by the unions had proved successful. The unions then filed an unfair labor practice charge alleging that the Respondent’s filing and maintaining the lawsuit had violated the Act. The Board concluded that the Respondent’s lawsuit against the unions was unmeritorious and that it was filed in retaliation against the Unions’ protected activities. See also Petrochem Insulation, Inc., 330 NLRB No. 10 (1999). Based on this precedent, we decided the instant lawsuit lacked a reasonable basis and was retaliatory.


Employer-Union Neutrality Agreements

In two cases arising during this period, we considered whether employer-union neutrality agreements amounted to unlawful employer assistance under Section 8(a)(2) of the Act. Our first reported case involved an employer agreement providing the union with access to the employer's property and its employees for organizing purposes.

The Employer was an Indian tribe that operated a gambling casino on its reservation in California. The tribe negotiated and entered into a compact with the State of California, pursuant to the federal Indian Gaming Regulatory Act. That Act obligates states to extend to Native American tribes the same opportunity to run gaming casinos on tribal land as the state extends to non-Native American casino operators on non-tribal land.

Section 13.7 of the parties' compact, "Concerted Activity and Representation of Employees by Employee Organizations," recognized the right of the casino's service employees to organize, to bargain collectively and to engage in other concerted activities. Section 13.7.3 provided that if any labor organization seeking to organize these casino employees offered in writing that it would not engage in strikes, picketing or other economic activity, the casino must enter into an agreement with the union granting the union access to its facility as well as recognition based on a card majority. Alternatively, the compact permitted the casino to negotiate a different procedure for determining union recognition so long as it offered the same arrangement to any other union seeking to organize its employees which similarly agreed not to engage in strikes, picketing, or other economic activity.

Pursuant to these provisions of the compact, the Employer and Union A entered into a "Voluntary Election Agreement." Union A promised not to picket the casino. In return, the Employer agreed that it would grant Union A access to casino employees on non-work time in non-work areas; would provide Union A with employees' names, addresses, telephone numbers and work classifications; and would hold a secret-ballot, non-Board representation election supervised by a neutral third party upon receipt of authorization cards signed by 30% of the casino's service employees.

Pursuant to that agreement, the Employer allowed Union A to park a trailer, emblazoned with a banner, in the casino's employee parking lot, and also to meet with employees in this trailer as well as at a nearby hotel. The casino further allowed Union A access to speak to casino employees in employee break rooms. The Employer and Union A notified employees of the terms of this agreement "which will allow the service employees to decide whether to be represented by a union through a democratic process."

Union B, the Charging Party in our case, represented units of service employees at many casinos throughout Nevada and California. Union B was aware of both the state-tribal compact and the voluntary election agreement with Union A, but never offered to enter into a similar agreement with the Employer or otherwise offered to agree not to picket in return for access to employees. Instead, Union B contacted employees at their homes.

Despite the Employer's assurance of neutrality, Union A complained that the Employer impeded access to employees and discouraged them from supporting the Union. In response, the Employer distributed a statement to its employees in which it restated their right "to join, or to refrain from joining" Union 1 and stated that it was neutral as to Union 1's organizing campaign.

When Union A presented cards to the arbitrator establishing at least 30% employee support, the arbitrator scheduled an election. Learning of the upcoming election, Union B sent organizers to the casino to pass out organizational leaflets and talk to employees. On each occasion, security guards told the organizers that they did not have the right to distribute leaflets and escorted them off the property.

Shortly before the scheduled election, a tribal official distributed a letter to all employees regarding the upcoming election, stating the Employer's position of neutrality.

The election took place as scheduled, inside Union A's trailer located in the casino's employee parking lot. The Employer had previously distributed notices to unit employees explaining that the balloting would be attended by one Employer representative and one Union A representative, as well as a neutral party. Union A won the election and was recognized as the employees' representative.

We decided that the Employer did not unlawfully dominate or assist Union A by entering into or implementing the voluntary election agreement. We noted that an employer may not render "unlawful assistance" to the formation of a union by its employees; however, a certain amount of employer "cooperation" with the efforts of a union to organize is lawful. The Board and courts evaluate the totality of the employer's conduct to determine whether its support would tend to inhibit employees in their free choice regarding a bargaining representative and/or interfere with the representative's maintenance of an arms-length relationship with it. In its seminal decision in Chicago Rawhide Mfg. Co. v. NLRB, 221 F.2d 165, 167-68 (7th Cir. 1955), the Seventh Circuit stressed that "actual domination," and not just the potential means for interference, is a requisite element for a Section 8(a)(2) violation.

The use of company time and property by an otherwise independent union does not in itself constitute unlawful employer support and assistance. For example, in Jolog Sportswear, 128 NLRB 886 (1960), aff'd 290 F.2d 799 (4th Cir. 1961), a union representative met with employees in the plant cafeteria in the presence of the company's labor representative and the plant manager. After the company representative introduced the union representative to the employees, the union representative led an hour-long discussion about the advantages of supporting the union. At the conclusion of the meeting, the plant manager informed employees that they would be paid for the time spent at the meeting. Although a group of employees waged a vigorous anti-union campaign, the employer subsequently assured employees by letter that it would not discharge or otherwise interfere with any person who engaged in union or nonunion activities. After state officials performed a card check that established a union majority, the employer recognized the union and negotiated a collective-bargaining agreement. On these facts, the Board held that the employer did not render unlawful assistance to the union despite its grant of access and the employer's own presence at the organizing meeting in circumstances where the company maintained its neutrality throughout the subsequent organizing drive.

In contrast, the Board more harshly views employer discrimination against one union in the face of a competing organizational campaign. Thus, in Steak and Brew, 213 NLRB 450 (1974), in the midst of a highly contested organizational campaign between Teamsters' and Bartenders' unions, the employer entered into an agreement with the Teamsters. In return for a no-picketing pledge, the employer granted that union visitation rights with employees, a private non-Board election, and beneficial contract terms conditioned upon an election victory. The employer did not notify the competing Bartenders union of this agreement nor give the Bartenders an opportunity to enter into a similar arrangement. Although the Employer placed the Bartenders union on the ballot in the ensuing non-Board election, it did not offer the union a right to participate. Instead, the employer appointed an observer, paid by the company, to attend on that union's behalf and told employees that the election was being conducted jointly by management and the Teamsters. The Board invalidated the Teamsters' election victory.

We concluded that the instant case was closer to Jolog Sportswear than Steak and Brew and similar cases. Although the Employer granted Union A access to speak with its employees in non-work areas during non-work times, there was no evidence that the Employer put direct pressure on employees. The Employer never required employees to attend union meetings, nor paid them for their attendance, nor threatened employees for their union support or lack of support. Cf. Monfort of Colorado, 256 NLRB 612 (1981), enfd. 683 F.2d 305 (9th Cir. 1982). Rather, the Employer here repeatedly advised employees that it would protect their right to freely choose whether to support or not to support the union. Moreover, the Employer did not immediately recognize Union A upon receiving evidence that the union had a card majority, but participated in a private election administered by a neutral third party who certified the results. Cf. Vernitron Electrical Components, 221 NLRB 464 (1985), enf'd 548 F.2d 24 (1st Cir. 1977).

Most importantly, in our view, there was no evidence that the Employer discriminated against Union B in any way. The Employer specifically agreed to waive its right to limit union access to its facility and to provide employees' names and addresses because Union A pledged not to disrupt the facility by engaging in picketing or other economic activity. Each of these provisions constituted a lawful bargaining subject which parties may freely trade as best they see fit. Union B learned of this bargained-for arrangement with Union A almost as soon as it was signed. Union B nevertheless did not ask the Employer for a similar agreement. Nor did the Employer ever refuse to strike the same bargain with Union B. Thus, the Employer did not discriminate against Union B by rejecting its one-sided demand for a waiver of the Employer's access rights without a contemporaneous commitment, as Union B had given, to refrain from disruptive picketing.

Agreement Providing Names and Access

In our second case, we considered the legality of an Employer-Union neutrality agreement governing the Union's effort to organize unrepresented employees at a newly acquired facility.

The Employer purchased a steel plant from another employer, agreeing not to change benefits or working conditions during its first year of operation. Although the predecessor employer had not had a bargaining history with any union, the Employer had long been party to a national collective-bargaining agreement with the Union. Both the Employer's expiring agreement and its successor agreement contained neutrality provisions governing Union efforts to represent previously unrepresented employees at new and existing Employer facilities.

Both neutrality provisions stated that the Employer agreed to recognize the Union if, at any point during a 90-day campaign, the Union presented authorization cards signed by a majority of the designated unit, subject to a card check by a neutral third party. The Employer agreed to maintain a neutral position during the Union's organizing campaign; the Union agreed that it would not undertake more than one organizing campaign at a facility in a 12 month period. The neutrality agreements required the Employer to furnish the Union with employee names and addresses and to grant the Union reasonable access to the plant for the distribution of literature and employee meetings.

The Union decided to organize the approximately 360 hourly employees at the Employer's newly purchased facility. At that time, a unit employee had begun speaking with employees in opposition to the Union, believing that the Union was conveying inaccurate information. He began soliciting employees to sign forms revoking their cards or declaring that they had never signed cards.

Although the Union eventually believed it had a card majority, it cancelled a plan to present the cards to the parties' jointly selected neutral. The Union asserted that the Employer had violated the parties' neutrality agreement. The parties agreed to an extension of the campaign for an additional 90-day period. The Employer agreed to permit the Union to hold informational meetings with the employees inside the plant and to distribute campaign information at the employee entrance.

The opposing employee organized an informal group of 10 to 20 members. The employee wrote a letter to the Employer requesting a meeting room where employees could meet with the group's supporters during their non-work time. He also requested to have the group's representatives attend all meetings connected with the Union campaign.

Over the next three days, the Employer held employee meetings where Employer representatives explained why the Union's campaign had been extended. The representatives iterated the Employer's neutral position and assured the employees that they were free to decide whether they wanted Union representation. The Employer representatives then introduced the Union's representatives and left the room. These meetings then became open debates between members of the anti-Union group and the Union representatives.

Later in the month, the Union began soliciting employees and distributing literature on a daily basis at an agreed-upon location near the employee parking lot. The Employer provided the Union with a small shed and a portable toilet for these activities.

At about the same time, the Employer's vice president for labor relations met with the employee leader of the anti-Union group. The employee asked that the group be allowed to use the in-plant meeting room, where the Union meetings had occurred, to meet with employees during their non-work time. The Employer denied the request stating that the group was not a union and that, as employees, its members already had superior access to the employees. The employee asked whether the Employer's answer would be different if the group were a union. The Employer's representative replied that the Employer had a neutrality agreement with the Union, and no other union had sought a similar agreement. However, the Employer agreed to allow the group to attend the card check as well as other meetings pertaining to the neutrality agreement.

The employee later unsuccessfully requested that the Employer give the group a shed like the Union's at the parking lot entrance or to be allowed to share the Union's shed. The group did not attempt to distribute literature at the employee entrance.

In the fall, the Employer held meetings with salaried employees explaining certain benefits changes to be implemented in January. These changes involved shifting from the predecessor employer's benefits package, which had covered both salaried and hourly employees, to the benefits package available to the Employer's unrepresented employees. The Union protested the timing of the announcement, but apparently accepted the Employer's explanation that the benefits changes would affect only non-unit salaried employees.

Shortly thereafter, the Union presented signed authorization cards to the jointly selected arbitrator. The anti-Union's group's representatives attended that meeting and presented card revocations and form letters from employees stating they had not signed cards. The arbitrator ultimately concluded that a majority of the unit employees had designated the Union. The Employer then recognized the Union; the parties entered into contract negotiations.

We decided to dismiss the charges. Initially, we noted that unions and employers may lawfully agree to limit their conduct during organizing campaigns. Houston Division of the Kroger Company (Kroger II), 219 NLRB 388 (1975), on remand from Retail Clerks International Association Local No. 455 v. NLRB, 510 F.2d 802 (D.C. Cir. 1975) (upholding employer agreement to grant recognition to a union at a future facility; condition that union must in fact obtain majority status at the new facility read into contractual after-acquired clause); United Automobile Workers v. Dana Corp., 679 F.2d 634 (6th Cir. 1982) (Sec. 301 court properly found valid an employer waiver of its 8(c)/first amendment rights from neutrality agreement requiring employer to refrain from anti-union remarks during union organizing drive); Hotel & Restaurant Employees Union Local 217 v. J.P. Morgan, 996 F.2d 561, 566 (2d Cir. 1993). Therefore, the appropriate inquiry in our case was whether in implementing this neutrality agreement, the Employer had crossed the line between lawful cooperation and unlawful assistance under Section 8(a)(2). Longchamps, 205 NLRB 1025 (1973).

The Board and the courts evaluate the totality of the employer's conduct to determine whether its support would tend to inhibit employees in their free choice regarding a bargaining representative and/or interfere with the representative's maintenance of an arms-length relationship with the employer. For example, the Board has held that the use of company time and property by an otherwise independent union does not in itself constitute unlawful employer support and assistance. Jolog Sportswear, 128 NLRB 886 (1960). Rather, the Board considers whether the quantum of "indirect pressure," such as directing and paying employees to attend union meetings during work time, and "direct pressure," such as permitting the union to solicit authorization cards in front of management representatives, would "reasonably tend[ ] to coerce employees in the exercise of their free choice in selecting a bargaining representative." Vernitron Electrical Components, 221 NLRB 464, 465 (1975), Where both kinds of pressures exist, especially when coupled with a rapid and unverified grant of recognition by the employer, the Board finds unlawful assistance in violation of Section 8(a)(2). On the other hand, the Board has dismissed complaints that presented something less than this combination of coercive factors. See, e.g., Longchamps, supra; 99 Stores, 320 NLRB 878 (1996).

Applying these principles, we decided that there was nothing per se unlawful in the manner in which the parties implemented their neutrality agreement. The Employer did not unlawfully assist the Union by providing the roster of employee names and addresses or by making favorable comments about the Union to the unrepresented employees. Nor was the display of blank authorization cards at one employee meeting a Section 8(a)(2) violation, because there was no evidence that any card signing occurred at the meeting. See 99 Stores at 878, n.2, distinguishing Vernitron Electrical Components; Jolog Sportswear, supra (no 8(a)(2) violation, although employer permitted union to address employees on company time, where management personnel not present when cards signed); Coamo Knitting Mills, Inc., 150 NLRB 579 (1964) (no 8(a)(2) where employer representatives present at card-signing on company property but could not see which employees executed cards).

The special access granted to the Union raised a more difficult issue in light of the Employer's denial of similar access to the anti-Union group. The Board harshly views employer discrimination against one union in the face of a competing organizational campaign. See Steak and Brew, 213 NLRB 450 (1974); Regal Recycling, Inc., 329 NLRB No. 38 (1999); Ella Industries, 295 NLRB 976, 979 (1989); and Monfort of Colorado, 256 NLRB 612 (1981), enfd. 683 F.2d 305 (9th Cir. 1982).

We noted that the above cases dealt with two competing unions, whereas the anti-Union group in our case did not appear to be a 2(5) labor organization. We decided, however, that it was unnecessary either to rely upon this distinction, nor to decide whether denying equal access to a non-labor organization would constitute unlawful assistance, because the anti-Union group here had not been treated disparately. The group did not request the same access granted to the Union. The group instead sought to use the Employer's meeting room as a kind of campaign office where employees could come on their own time to speak with the group's representatives. Moreover, the group had the opportunity to be heard at the scheduled Union meetings, and presented its views most effectively at the Union's expense. Nor did providing the Union the shed and portable toilet outside the plant create such an appearance of favoritism, where the anti-Union group's representatives could have handbilled outside the plant on their own time, but chose not to do so.

Finally, we decided that the Employer's citation of the neutrality agreement as its reason for maintaining existing terms and conditions of employment during the Union campaign was lawful. The Employer did not link improvements or changes in benefits to the Union campaign. Accordingly, the Employer's statements could not be viewed as tending to coerce employees to select the Union in order to obtain new benefits generally or the newly announced corporate benefits in particular. Indeed, had the Employer attempted to change benefits during the campaign, it could have invited allegations that it was unlawfully attempting to demonstrate to the employees that they did not need the Union and could do as well dealing directly with the Employer. Cf. General Electric Co., 150 NLRB 192, 195 (1964), enfd. 418 F.2d 736 (2d Cir. 1969), cert. denied 397 U.S. 965 (1970).

Entering into a Bargaining Agreement

After Second Union Filed Election Petition

In another case, we considered Section 8(a)(1), (2) and (3) and Section 8(b)(1)(A) and (2) allegations filed when the Employer and Union A entered into a collective-bargaining agreement at a time when Union B had already filed a representation petition.

Union A and the predecessor employer were parties to a collective-bargaining relationship covering a unit of employees at various airport terminals. Shortly before the expiration of that bargaining agreement, Union B timely filed a representation petition. While that petition was pending, another employer, the successor Employer, was awarded a contract for operating a portion of the predecessor employer's terminals. The successor Employer took over that portion of the predecessor's operations and its employees, contacted Union A, and negotiated a collective-bargaining agreement covering those terminals.

When the contract between Union A and the predecessor employer expired, the Region conducted an election in a unit of the predecessor employees at the predecessor's remaining terminals. The employees of the successor Employer did not participate in that election, which Union B won. Shortly thereafter, Union B filed a second petition to represent the successor Employer's employees at the predecessor's former terminals.

Union B submitted a declaration signed by 17 of those 24 employees stating their desire to be represented by Union B. Union B also filed charges alleging that Union A and the successor Employer had violated Sections 8(a)(1), (2) and (3) and Section 8(b)(1)(A) and (2) respectively by entering into a collective-bargaining agreement during a time when a Union B had filed a representation petition covering the predecessor's unit of employees.

We decided to dismiss the charges and to process Union B's second petition, notwithstanding the fact that it was filed during the term of the newly-reached collective-bargaining agreement.

In RCA Del Caribe, 262 NLRB 963 (1982), the Board held that the mere filing of a representation petition by an outside challenging union does not require or permit an employer to withdraw from bargaining or executing a contract with an incumbent union. Under this rule, an employer will not violate Section 8(a)(2) by postpetition negotiations, or by the execution of a contract with an incumbent, but will violate Section 8(a)(5) by withdrawing from bargaining based solely on the fact that a petition has been filed by an outside union. If the challenging union wins the Board conducted election, any contract between the employer and the incumbent union "will be null and void." Id. at 966.

The Board has also held that RCA Del Caribe requires a successor employer to recognize and bargain with the incumbent union of its predecessor's employees, even though a petition challenging the incumbent union's representation status is pending before the Board. Castaways Management, 285 NLRB 954, 959 (1987); Unit Train Coal Sales, 234 NLRB 1265 (1978). In this regard, the successor employer inherits the question concerning representation that was raised by the filing of the petition. Finally, Weather Vane Outerwear Corp., 233 NLRB 414 (1977), stands for the proposition that when a second representation petition is filed during the pendency of an unresolved question concerning representation raised by an earlier, timely filed petition, the Board's contract-bar doctrine is rendered inoperative as to the later petition.

Applying those principles, we first decided that (1) the successor Employer had been required to recognize and bargain with Union A, despite the pending question concerning representation raised by Union B's timely filed first representation petition; and (2) the successor Employer and Union A had lawfully entered into a collective bargaining agreement at that time. However, we also decided that that collective-bargaining agreement did not bar the processing of Union B's second petition, even though that second petition was filed outside the 60-90 day contract bar window period.

The successor Employer and Union A entered into their bargaining agreement at a time when there was a pending question concerning representation raised by Union B's first petition. That question concerning representation remained unresolved when Union B filed its second petition, because the Board had not yet certified the results of the election resulting from the first petition until after that time. Therefore, Union B's second petition was filed during the pendency of an unresolved question concerning representation raised by the earlier petition. Under Weather Vane Outerwear, above, the Board's contract-bar doctrine was rendered inoperative as to the later petition. We therefore decided to dismiss the charges and to invite the Region to conduct an election. We noted, if Union B were certified as the winner of that election, the contract between the successor Employer and Union A would become null and void.


Discriminatory Hiring Policies

In a salting case we considered whwether an employer who maintained facially neutral hiring policies applied them in a discriminatory manner.

The policies included, inter alia, accepting applications only when hiring was taking place; keeping applications on file for only 30 days; conducting interviews only at set times of day, not allowing group applications, confining applications to a limited pool of candidates such as former employees, friends and relatives of employees, and so forth. However, notwithstanding signage that the employer was not accepting applications or hiring, the employer actively solicited new hires from non-union sources throughout the entire construction season. Further, it hired some employees with questionable skills or transferred them from other jobs, while, at the same time, it refused to consider two additional applicants with undisputed qualifications who were recommended by an incumbent employee at the behest of the employer but who were known to be union supporters. Finally, there were statements by supervisors that the employer was not accepting applications or hiring because of the union’s salting campaign

Under these circumstances, we decided that we could establish a prima facie case under FES (A Division of Thermopower), 331 NLRB No. 20 (2000), to establish that an employer violated Sections 8(a)(1) and (3) by refusing to consider and/or hire union applicants. Specifically, it could be shown that the employer entertained concrete plans to hire, that the union applicant who was not hired as well as the two who were not considered were qualified, that anti-union animus contributed to the decision not to hire/consider and, finally, that at least one available opening existed even if it was not filled. Thus, the inference was deemed warranted that the employer’s hiring policies were applied as a pretext to avoid hiring or considering qualified union applicants.

With respect to the single union applicant who was permitted to fill out an application but who was not hired, the General Counsel could establish the existence of at least one opening at the hearing on the merits so as to warrant an "instatement" and make-whole remedy. In this regard, there was no evidence that the Employer invoked the 30-day requirement regarding the length of time an application remained active to reject any other new hire. The Employer’s contention that it refused to hire the applicant based on its policy of limiting new hires to a distinct class to which he did not belong (friends, relatives and former employees) was deemed indefensible inasmuch as the policy was not applied in a uniform manner.

With respect to the refusal to consider the two additional union applicants who were not hired even though they were recommended by an incumbent employee under the hiring policy, the General Counsel could meet its burden under FES, at the hearing on the merits, to show that the employer excluded qualified applicants from the hiring process and that anti-union animus contributed to the decision so as to warrant a cease and desist order requiring the employer to consider them in accord with non-discriminatory criteria. We determined that the employer could not meet its burden under FES to show that the two applicants would not have been considered even in the absence of their union affiliation. Alternatively, it was concluded that the employer refused to hire them or ceased hiring altogether for discriminatory reasons so that an "instatement" and backpay remedy as to one of them would be appropriate.


Repudiation of Unlawfully Executed

Collective-Bargaining Agreement

We next considered a case whether, following an internal Local Union election, the Local unlawfully withdrew recognition from another Union which had been representing the Local's Business Agents.

At an internal Local election, the slate of incumbent officials lost their offices with the exception of the Local President. The Local's appointed Business Agents and organizers heard rumors that they would be discharged by the newly elected officials, who were scheduled to soon take office. The employees therefore formed the Union, electing two Local Business Agents as officers. Around one week later, the Union filed a Board election petition and requested voluntary recognition from the Local. The Local's Executive Board, comprised of its then "lame duck" officers, voted to extend recognition to the Union.

The Local and the Union then quickly entered into a bargaining agreement which was executed on behalf of the Local by two of the "lame duck" officers. This bargaining agreement contained a "just cause" for discharge provision, requiring that employees would not be discharged except for dishonesty without prior progressive discipline. The Local did not obtain either the approval of the membership or the approval of the newly elected officials for this agreement.

The newly elected Secretary-Treasurer wrote to the International President asking for help in resolving the pending internal power struggle over the Business Agents and organizers. In this letter, the Secretary-Treasurer stated that the current officers had apparently recognized a staff union, and signed a collective-bargaining agreement with that staff union, to attempt to protect the business agents from any hiring or firing decisions which the new Secretary-Treasurer might make. The International President replied that the current Business Agents were appointed, and such appointments expired with the term of the current officers. The International President then stated that these employees could not have an expectation that they would automatically remain employed under the Local's new administration.

When the newly elected Local officials assumed office, they immediately convened an emergency Executive Board session and discharged all six Business Agents and organizers. The employees protested the discharges, and also attempted to file a grievance under their bargaining agreement. The new Local Secretary-Treasurer replied that he didn't recognize the bargaining agreement, and later stated that he also would not recognize the Union.

The Business Agents filed Section 8(a)(3) charges attacking their discharge as unlawful. We dismissed those charges because it is well settled that newly elected Union officials can lawfully remove Business Agents who had been appointed by the outgoing Union regime. See Shenango Inc., 237 NLRB 1355 (1978), (union did not violate Section 8(b)(1)(A) by removing safety committee chairman from appointed position because of his support of particular candidate in internal union election; union has legitimate interest in appointing to office those individuals it considered can best serve the union).

Regarding the Local's withdrawal of recognition from the Union, the Local argued that the "lame duck" officials had violated the International Union's Constitution when they had recognized the Union and executed a bargaining agreement. In that regard, the Local furnished two recent decisions of the International Union General Executive Board (GEB). In those decisions, the GEB imposed discipline upon "lame duck" local officers who had executed a bargaining agreement covering employees of their local without consulting the newly elected officers and obtaining membership approval.

The GEB decisions in turn relied upon International Union Constitutional provisions which provided that (1) only a local's Executive Board, and not its officers, may enter into a bargaining agreement covering local employees; and (2) a bargaining agreement entered into during an interregnum period, i.e., after the date of an internal local election but before the newly elected officials assume office, constitutes an "extraordinary expenditure", which requires the approval of both the newly elected officers and also the local membership. In these GEB decisions, "lame duck" officers were disciplined for having failed to meet one or more of these requirements when they agreed to a bargaining agreement covering local employees during an interregnum period.

We decided that (1) the Local did not unlawfully repudiate the Union bargaining agreement, because its execution by the "lame duck" officers was an ultra vires act under the International Constitution; (2) the discharges not only did not violate Section 8(a)(3) but also did not violate Section 8(a)(5) because they did not constitute a unilateral change from the established Local past practice of removing appointed officials after an internal election; and finally (3) although the Local arguably had unlawfully withdrawn recognition from the Union, further proceedings on this allegation would not effectuate the purposes and policies of the Act absent evidence that the current Business Agents and organizers wished to be represented by the Union.

The Board has held that when union officers agree to self-serving agreements contrary to their fiduciary duty and contrary to the union's constitution or bylaws, such agreements exceed the scope of the union officers' authority and are entered "ultra vires." Dominick's Finer Foods, Inc., 308 NLRB 935, 947 (1992), enfd. 146 LRRM 2784 (7th Cir. 1994) ("Because such actions on their part were ultra vires, they were void ab initio"). In enforcing the Board's order in Dominick's Finer Foods, Inc., the Seventh Circuit specifically noted that the union officers there "acted ultra vires . . . and thus the memoranda of agreement, disclaimer of interest, and dues check-offs were all void." 146 LRRM at 2788. When the other parties to an such agreement are aware or should have been aware of this overstepping of authority, there is no basis for finding agency based upon the apparent authority of the union officers. The Board therefore will find that such agreements are "void ab initio." Id., 308 NLRB at 947-948.

In our case, the "lame duck" officials had entered into the Union bargaining agreement in clear violation of the authority accorded them under the International Union's Constitution. The agreement was thus void unless the Union could have relied upon the apparent authority of the "lame duck" officials to enter into such agreement. We decided that the Union here could not rely upon any apparent authority of the "lame duck" officials.

First, the Union was not an outside organization wholly unfamiliar with the Local and the International Constitution. To the contrary, the Union was comprised of Local Business Agents and organizers who either knew or should have known about the International Constitution provisions stating that the Local officers did not have authority to enter into an interregnum bargaining agreement without obtaining approval from both the Local membership and also the newly elected officers. In addition, the bargaining agreement itself was intended to circumvent the authority of the newly elected officials. In that regard, the bargaining agreement contained a "just cause" provision apparently designed to prevent the newly elected officials from discharging the appointed employees whose term of office had expired. In sum, the Union knew or should have known that the "lame duck" officials not only were acting without proper authority, but had agreed to a collective bargaining agreement designed to circumvent proper authority. Thus we decided that this bargaining agreement was void.

Next we decided that the discharges did not otherwise violate Section 8(a)(5) because they did not constitute a unilateral change from established past practice. As noted, supra, the Business Agents and organizers formed the Union in anticipation of being summarily discharged from their appointed offices. The International President also confirmed that, since the appointments of the business Agents and organizers expired with the term of the current officers, they could not have had an expectation that they would automatically remained employed under the Local's new administration. Thus it appeared that the Local had acted in accord with established Union past practice in terminating these appointed employees, and had not effected any unilateral change.

Finally, we noted that the Local's withdrawal of recognition from the Union arguably violated Section 8(a)(5). It appeared that the Local's initial recognition of the Union was wholly lawful under both the Act and the International constitution. The Union had demonstrated majority support, and recognition was accorded pursuant to a vote by the Local's Executive board. Thus the Local could not demonstrate that this recognition was void as an "ultra vires" act. The GEB decisions furnished by the Local merely imposed discipline upon outgoing officials who executed bargaining agreements in derogation of their authority under the International Constitution. These decisions had not vitiated those collective bargaining agreements; they had not even addressed the underlying union recognition granted by the "lame duck" officials. Hence these GEB decisions provided no support for the Local's argument that the Union's initial recognition was unlawful.

We noted, however, that the Local had lawfully discharged the employees initially represented by the Union. Thus the Union would only represent the replacement Business Agents and organizers, and these employees presumably were loyal to the newly elected officials. We therefore decided that, although the Local had unlawfully withdrawn recognition from the Union, further proceedings on this allegation would effectuate the purposes and policies of the Act only if the present Business Agents and organizers wished to be represented by the Union. Absent such evidence, we decided to also dismiss this charge.

Absenteeism Rates At Other Facilities

In one case, we considered whether the Employer violated Section 8(a)(1) and (5) when it failed and refused to provide the Union at one of its facilities with the absenteeism percentage rates for employees at eleven other facilities which it owned.

The Employer is a corporation with facilities in several locations nationwide. The Union represents production employees at one location only. In February 1999, the Employer advised the Union that it was going to implement a no-fault absenteeism policy at the local facility, and the parties commenced negotiations concerning the policy. The Employer’s Human Resources manager claimed that the local facility had the worst attendance rate of all its facilities and that the other facilities had some form of no-fault attendance policy. She also specifically compared the local facility with two of the other facilities, including one which purportedly had a no-fault policy similar to the policy the Employer was proposing. During negotiations, the Union made a written request for the "absentee percentage" for each of the Employer’s other facilities. The Employer refused to provide the requested information, claiming that the local facility had no documentation regarding the absenteeism percentages at the other facilities.

We decided that the Employer’s failure and refusal to provide the Union with the absenteeism rates for its other eleven facilities violated Section 8(a)(1) and (5) of the Act.

An employer’s duty to bargain includes the duty to provide relevant information needed by a union for the performance of its duties as the employees’ collective-bargaining representative. Information concerning employees in the bargaining unit is presumptively relevant to collective-bargaining. By contrast, information about non-unit employees is not presumptively relevant, and the burden is on the union to demonstrate the relevance of the requested information. However, the standard for determining relevance is a liberal, discovery-type standard. It is necessary only to establish the probability that the desired information is relevant.

We decided that the Union had demonstrated the relevance of the absenteeism percentages requested. In this regard, the Employer raised the issue of the absenteeism rates at its other facilities during negotiations over the attendance policy. The accuracy of its claims could have influenced the Union’s position with respect to the Employer’s proposals as well as the bargaining proposals it presented to the Employer. Thus, the Union was entitled to verify the accuracy of the Employer’s claims in the same manner as it would be entitled to verify financial claims upon which an employer based bargaining proposals.

In reaching this conclusion, we distinguished United States Postal Service, 303 NLRB 502 (1991). In United States Postal Service, an American Postal Workers Union (APWU) steward had been given a warning for excessive tardiness. Alleging disparate treatment, the APWU requested time and attendance records for all employees at the steward’s location in order to insure that attendance rules were being applied uniformly. The Postal Service refused to provide information for employees who were represented by other unions. The Board adopted, without comment, the ALJ’s determination that the Employer was required to provide attendance records for letter carriers but not for rural carriers. Although both groups of employees were represented by unions other than APWU, the letter carriers worked under the same collective-bargaining agreement as the APWU employees and, like the APWU employees, punched a time clock. The rural carriers did not work under the APWU agreement; nor did they punch a time clock.

Like the rural carriers in United States Postal Service, the production workers at the Employer’s other facilities are represented by different unions and work under different collective-bargaining agreements than employees in the local bargaining unit. However, the Employer itself deemed the non-unit employees to be comparable to the unit employees when it used their example to buttress its argument for the attendance policy. Thus, we concluded that United States Postal Service was distinguishable.

Refusal to Recognize Outside

Statute of Limitations Period

In one case, we considered whether the six-month limitations period set forth in Section 10(b) barred issuance of complaint where a successor employer failed to give the Union clear notice of its intentions concerning recognition outside the 10(b) period, engaged in negotiations for a collective-bargaining agreement, reached impasse over a change in the scope of the unit, and then refused to recognize the Union. We also considered whether the Employer had a good-faith doubt of the Union’s majority status under Allentown Mack Sales & Service v. NLRB, 522 U.S. 359 (1998), at the time it declared impasse and refused to recognize the Union.

The Union was certified as the exclusive bargaining representative of a unit of full and part-time employees at the predecessor employer’s facility in 1994. In July 1997, the Employer bought the processor’s assets and commenced operations without any hiatus. It also hired the predecessor’s workforce, including all four bargaining unit employees.

The Union initially assumed, incorrectly, that the Employer was abiding by the Union’s collective-bargaining agreement with the predecessor employer, which was to expire by its terms in December 1997. When it requested bargaining over a successor agreement in November 1997, the Union learned for the first time that the Employer had not adopted the predecessor’s contract. After the Union requested bargaining, representatives of the Employer told the Union that they were not sure, or did not think, that the Employer had a duty to bargain with the Union. However, they also told the Union that the Employer was willing to try to negotiate a collective-bargaining agreement using the predecessor’s contract as a framework.

Negotiations commenced in March 1998. By September 10, 1998, the parties had reached agreement on all terms of a contract except for the Employer’s proposal to remove part-time employees from the bargaining unit, a non-mandatory subject of bargaining. On September 10, the Employer declared impasse and notified the Union that it was unwilling to "voluntarily recognize" the Union. On November 6, 1998, the Union filed an unfair labor practice charge alleging, in pertinent part, that the Employer had violated the Act by insisting to impasse on a non-mandatory subject of bargaining and by refusing to recognize the Union.

During the Regional Office investigation, the Employer claimed for the first time that it had a good-faith doubt as to the Union’s majority status. It relied on statements by two part-time employees to the effect that that they did not want to pay Union dues or fees as a condition of working for the Employer. It also relied on the statement of a full-time employee that he did not care one way or the other whether he was represented by the Union. At the time the Employer refused to recognize the Union, there were only three or four employees in the bargaining unit.

We decided that the Employer, a successor to the predecessor’s duty to bargain under NLRB v. Burns Security Services, 406 U.S. 272 (1972), violated Section 8(a)(1) and (5) of the Act by insisting to impasse on a non-mandatory subject of bargaining and by refusing to recognize and bargain with the Union thereafter.

We decided that the six-month limitations period in Section 10(b) did not preclude issuance of complaint. While the Employer expressed doubts about its bargaining obligation outside the 10(b) period, it also informed the Union that it was willing to attempt to negotiate a collective-bargaining agreement and, in fact, entered into such negotiations. The Employer did not give the Union clear and unequivocal notice that it was refusing to recognize the Union until September 10, 1998. We determined that the 10(b) period did not commence to run until the Union received such clear and unequivocal notice. See Stanford Realty Associates, Inc., 306 NLRB 1061 (1992), Christopher Street Owners Corp., 286 NLRB 253 (1987), enfd. 847 F.2d 835 (2d Cir. 1989).

We also decided that the Employer had failed to establish a good-faith doubt, based on objective considerations, concerning the Union’s continued majority support. In Allentown Mack, supra, the Supreme Court held that the test for determining good-faith doubt of a union’s majority status is whether the employer had "a genuine, reasonable uncertainty about whether [the union] enjoyed the continuing support of a majority of unit employees." In The Henry Bierce Company, 328 NLRB No. 85, slip op. at 4-5 (May 28, 1999), affd. in pertinent part, 2000 WL 1681019 (6th Cir. 2000), the Board rejected an employer’s contention that it had a good-faith doubt based, in pertinent part, on the number of employees who were not members of the union. The Board noted that it is well settled that employees’ non-membership in a union does not establish that those employees do not want the union as their collective-bargaining representative and that employees can have many reasons for desiring not to be union members. We concluded that the statements of two part-time employees to the effect that they did not want to pay Union dues or fees as a condition of employment and the statement of a full-time employee expressing indifference toward Union representation would not be sufficient, without more, to establish that the Employer had a good-faith doubt of the Union’s majority status. This conclusion was buttressed by the fact that the Employer did not assert its purported good-faith doubt of the Union’s majority support at the time it ceased all dealings with the Union, but rather relied on other reasons for refusing to recognize the Union.

Finally, we decided that it should be argued in the alternative that Celanese Corp., 95 NLRB 664 (1951), should be overruled to the extent that it permits an employer to withdraw recognition from a certified union based on a good-faith doubt of majority status. See Chelsea Industries, 331 NLRB No. 184, slip op. at n.2 (August 31, 2000). Rather, a Board-conducted election should be required before an employer can withdraw recognition. See Memorandum OM 98-52 (July 7, 1998).

Unlawful Lockout

In another case, we considered the legality of an Employer’s lockout in support of its bargaining proposals which effectively altered the scope of the collective bargaining unit and lacked sufficient specificity to make them capable of acceptance by the Union.

The International Union (Union) represented a large unit of production and maintenance employees at five of the Employer’s manufacturing plants. Since 1985 the parties have entered into a master collective bargaining agreement which covered the core terms and conditions of employment for the multi-plant unit. In addition, the five local unions had separate labor agreements with the Employer which set forth various terms of employment applicable to their respective locations. The most recent contract between the parties expired on September 30, 1998. When the parties were unable to reach the terms of a new contract by September 30, the Union called a strike. Although the Union made an unconditional offer to return to work in January 1999, the Employer rejected the Union’s offer and locked out the unit employees in support of its recent bargaining proposals.

We decided that the Employer’s proposal altered the scope of the bargaining unit, a permissive subject of bargaining, and the Employer violated Section 8(a)(1), (3) and (5) of the Act by applying coercive economic means (the lockout) to pressure the Union to accept the proposed change in the scope of the bargaining unit. In this regard, the Employer’s proposal moved subjects which were traditionally the subject of the master agreement (such as wages and seniority provisions) into the local agreements, effectively placing core bargaining subjects within the scope of local negotiation. Further, the evidence indicated that the Employer’s proposal undermined the authority of the International Union (the designated Section 9(a) representative) by adding supremacy language which gives the local agreements preference over the master agreement, and which provided the local unions with the ability to negotiate mid-term modifications to the local agreements without the agreement or participation of the International Union.

In Reichhold Chemicals, Inc., 301 NLRB 1228 (1991), enf’d. sub. nom. Reichhold Chemicals, Inc., v. NLRB, 953 F. 2d 594 (11th Cir. 1992), the Board discussed whether an employer’s proposal unlawfully altered the scope of a collective bargaining unit. In Reichhold, the prior contract had consisted of a multi-plant master agreement covering four plants, with only two appendices that applied separately to the individual facilities. At the onset of negotiations for a new collective bargaining agreement, the employer proposed a master agreement and four separate local agreements. In its proposal prior to declaring impasse, the employer moved 12 core employment issues from the master to the local agreements. The Board found that the employer’s proposal altered the scope of the bargaining unit by requiring separate plant negotiations on a wide range of employment terms which traditionally had been negotiated on a multi-unit basis. The Board affirmed the ALJ’s finding that the employer’s proposal alters the scope of the unit by undermining the integrity of the unit, disrupting bargaining power, and disintegrating the unit from within.

Similar to the circumstances in Reichhold Chemicals, Inc., supra, the Employer’s proposal in the instant case which moved core bargaining subjects to the local negotiations and added supremacy language which gave local agreements preference over the master agreement constituted an attempt to alter the scope of the bargaining unit. Thus, the Employer’s proposal effectively ended the commonality of terms and conditions of employment, so that the employees at individual plants would have had significantly varying working conditions, thereby diminishing the bonds establishing a community of interest between the plants. As in Reichhold, such a proposal serveed to demarcate each of the plants as a single unit rather than the established single multi-plant bargaining unit.

It is well established that the Employer’s attempt to change the scope of the unit is a permissive rather than a mandatory subject of bargaining. Idaho Statesman, 281 NLRB 272 (1986). The Board has held that a lockout in support of a proposal to alter the scope of the unit is unlawful. See Branch International Services, 310 NLRB 1092 (1993). However, it must be determined whether the permissive subject was a central feature of the proposal significant enough to make the lockout unlawful. See Detroit Newspaper Agency, 327 NLRB No. 146, slip op. at p. 2 (March 4, 1999). In the instant case, we decided that although the parties were apart on many issues, there was little doubt that local autonomy was a major issue in the parties’ negotiations. Therefore, we concluded that complaint should issue alleging that the Employer unlawfully locked out employees in furtherance of a permissive bargaining proposal.

In addition, further support for the conclusion that the lockout was unlawful was found in the lack of specificity in the Employer’s proposal. The Employer’s proposal, which failed to list the wage rates for approximately 55% of the unit, was not capable of acceptance because it was not specific enough. In I.T.T. Rayonier, Inc., 305 NLRB 445 (1991), the Board found that an employer violated the Act by failing to make specific contract proposals concerning an incentive pay plan. Significantly, in Rayonier, the employer failed to provide the union with requested information concerning the pay plan, and then unilaterally implemented the same. In finding a violation, the Board noted that the employer is required to "put meat on the bone" and submit proposals which are specific enough so the union can take a position on them.

Here the Employer made a contract proposal which omitted wages for proposed new job classifications covering approximately 55% of the unit. Then, although the Union had no basis for costing out this proposal, the Employer locked out in support of its bargaining proposal and failed to provide information to the Union concerning wage rates in a timely manner. The lack of specificity in the Employer’s proposal coupled with the lockout in support of the proposal supported our overall argument that the Employer’s conduct in locking out unit employees was violative of the Act.

Union Threat During Organizing Campaign

In another case, we considered whether during an organizing campaign a Union organizer had unlawfully threatened one particular employee who then passed on the unlawful remarks to at least four other employees.

The Employer manufactured parts for the airline industry. In June 1999, the Union filed an election petition to represent a unit of production and maintenance employees. Following the election which was apparently won by the Union, the Employer filed timely objections, several of which paralleled allegations on appeal. The Board concluded that certain objections "raise(d) substantial and material facts warranting a hearing" surrounding a single telephone conversation that occurred in June prior to the election.

An employee who was not favorably disposed to the Union's organizing campaign agreed to talk to the Union's non-employee organizer over the telephone. This employee stated that after he told the Union representative that "(he) didn't have to join (the Union) and pay union dues and they would still have to represent me", the Union representative allegedly responded, "they have a name for that, 'free riders.'" The employee replied that "by law . . .they had to support me", to which the Union organizer allegedly said, "bad things happen to people who don't support us." The employee further claimed that the Union organizer spoke of instances where he personally did not help a non-union employee retain his job after being accused of stealing but in another instance fought to help a union employee who supported the UPS strike keep his job. Finally, the employee stated that he told the Union representative that "(he) could not support his family on strike pay if we were to go on strike." According to the employee, the Union representative replied that "bad things happen to people who don't support us . . . we had a guy up north get killed who crossed the picket line." The employee stated that he told at least five or six other employees about the comments made to him by the Union organizer.

The Union organizer stated that the employee in question had asked him several questions about strikes and violence and that he, the Union organizer, had replied that he "told this employee that things happened to people that were out of the union's control" but that the Union would not condone any violence on "my" picket line. Further, the Union organizer stated that the only death he had talked about to this employee was that he knew of a supervisor killed in an accident while driving a semi during a strike but denied stating that someone was killed up north for crossing a picket line. Finally, the Union organizer stated that he told this employee in response to the employee's inquiry as to the Union representative's thoughts on scabs,

"I did not like scabs . . . we turned our backs on the scabs that worked during the (strike) . . .(I) had not nothing to do with them but still represented them as the law requires. I told (the employee) about an employee that stole a turkey. (The employer) was not going to fire the man, but another employee told management that it would be open season on stealing if the employee was not fired. The employee resigned . . . I would have went (sic) into the office and represented this scab . . . but I would not go out of my way or do anything not required by law or the contract."

We decided that the remarks attributed to the Union organizer violated Section 8(b)(1)(A) of the Act. The general standard for evaluating Union conduct relating to a threat, coercion or intimidation by a union agent is "whether a remark can reasonably be interpreted by an employee as a threat. The test is not the actual intent of the speaker or the actual effect on the listener." Smithers Tire and Automotive Testing of Texas, 308 NLRB 72 (1992). Stated differently, the Board judges whether a statement is violative of Section 8(b)(1)(A) of the Act "if the alleged offender engaged in conduct which tends to restrain or coerce employees in the rights guaranteed them in the Act." United Steelworkers of America, Local 1397 (United States Steel Corp., Homestead Works), 240 NLRB 848, 849 (1979).

The Board in Smithers Tire, supra, concluded that a single statement during an organizing campaign made by an employee deemed an agent of the union to another employee with a black eye, "(t)hat is what happens when you cross us," constituted a threat of retaliation. The Board explained that it was reasonable for an employee to conclude that the word "us" was a reference to the union, and therefore "suffice it to say that it could reasonably be regarded as a threat." Smithers Tire, supra at 72. The Board applied the "reasonable" interpretation test in United Steelworkers of America Local 1397, supra, and concluded that an acting union president's remarks to a dissident union member that "he would file charges and seek to have him fired, and also (sic) that neither he nor other union officials would represent the employee should he thereafter file any grievance against the Company," constituted a threat violative of Section 8(b)(1)(A) and Section 7 in "(clear) contravention of the duties incumbent upon any union by virtue of its status as exclusive agent of the employees it represents." United Steelworkers of America Local 1397, supra at 849. The Board explained that "union threats to employees that the union would represent them also violate Section 7, particularly when made by a union officer with apparent capability of effectuating the actions threatened." Id.

We decided that it would be reasonable for the employee in the instant matter to regard the Union organizer's statements as a threat The statement that "bad things happen to people who don't support us" followed by the remark that someone who crossed the picket line was killed can be characterized as "intimat(ing) a substantial harm." Smithers Tire, supra at 73. These remarks are clearly in contravention of a union's statutory duty of fair representation and would tend to restrain or coerce employees in violation of Section 8(b)(1)(A) of the Act. United Steelworkers of America Local 1397, supra at 849.


Causing Layoff of Non-Member

In another case, we considered whether the Union violated the Act by requesting and causing the layoff of a union traveler because he was not a member of the local Union.

The union traveler was a journeyman electrician who was a member of the Washington, D.C. local of the Union. In 1997, the traveler sought work out of the Lansing, Michigan local of the Union. The traveler was referred to several jobs in 1997, and then on July 1, 1998 he was referred by the Michigan local to the service department of the Employer. Three other travelers were also referred by the local to the Employer.

In the Fall of 1998, the traveler had several conversations with the Employer’s representatives which foreshadowed his layoff. In this regard, he was told by the Employer’s superintendent that the Michigan local’s business representative was pressuring him to lay off all travelers since the local’s members were out of work. Shortly thereafter, the service manager told the traveler that he should get ready for layoff since he was a traveler and that the company was doing him a favor by keeping him employed. After being informed by Employer officials that on several additional occasions the local Union pressured the Employer to lay off the travelers, the traveler contacted the local Union about the situation. The business representative told the traveler that local members "were his constituents and they were applying pressure for him to remove travelers."

The Employer subsequently laid off the travelers. The Employer’s superintendent told the traveler that he was not happy with the situation because he was not pleased with the names at the top of the local’s referral book. During the investigation, the Employer alleged that the layoff was due to a downturn in work. However, the evidence indicated that within two weeks of its layoff of the travelers, the Employer hired three journeymen electricians from the Michigan local.

We decided that the Union violated Sections 8(b)(1)(A) and 8(b)(2) of the Act by requesting and causing the layoff of the traveler because he was not a member of the local union. In this regard, the Board has held that a union violates the Act by requesting and causing the discharge or layoff of a traveler in preference of local union members who are out of work. IBEW Local 43 (Sachs Electric et al.), 248 NLRB 669 (1980), modified on other grounds, 668 F.2d 991 (8th Cir. 1982). In Sachs, the Board found that even an uncoerced request made to travelers for them to quit their employment because local members were out of work violates Section 8(b)(1)(A) of the Act. Further, it was concluded that the Employer’s conduct in complying with the local Union’s request to lay off the traveler because of his non-membership status was violative of Section 8(a)(1) and (3) of the Act.


Sound System as Unlawful Coercion

In one case, we considered whether the Union's use of a portable sound system, broadcasting at excessive decibel levels to the public and tenants of the neutral employer, constituted restraint or coercion within the meaning of Section 8(b)(4)(ii) of the Act.

The employer was the owner of a residential facility leasing living and commercial space to tenants. When the Employer contracted with an out-of state corporation to replace windows at the facility, the Union contended that this work should go to their members. The Union therefore distributed handbills to passers-by and anyone going into or out of the building. The handbills claimed that the out-of state window contractor had "a record of unsafe and careless working habits." The Union also set up a portable sound system across the street and played a continuous repetitive message tracking the language of the handbill. The volume of the Union's system was excessively high; the union operated the sound system twice a day, from 7:00 a.m. to 9:00 a.m. and from 6:30 p.m. to 8:30 p.m.

Several tenants complained directly to the Union and the police, claiming that the noise had awakened them. One commercial tenant attacked the Union's sound system and pulled several wires out of it. That tenant claimed that the Union's speakers were aimed at the upper floor of the building, often at times when there were no workers on the site. The police eventually arrested the Union's business agent for disorderly conduct after he refused to comply with an officer's request that the sound system be turned down. The Union also received a noise pollution violation citation from the City.

At another location, a condominium complex, the Union used its sound system several days a month for several months to broadcast a taped message protesting that Employer's use of a nonunion interior finishing contractor. The sound system was used principally in the early morning hours or the later evening hours and on weekends. More often than not, the non-union employer was not present on the site when the sound system was in use.

Numerous complaints were called into "911" because of the excessive noise of that sound system. The City issued citations to the Union for emitting sound well above the permissible level. There also was evidence that tenants threatened to move if the noise was not abated, and that tenants had terminated their leases and were moving out due to the excessive noise.

The Board has defined "coercion" under 8(b)(4)(ii) as: "non-judicial acts of a compelling or restraining nature, applied by way of concerted self-help consisting of a strike, picketing, or other economic retaliation or pressure in a background of a labor dispute." Sheet Metal Workers Local 91 (The Schebler Co.), 294 NLRB 766, 775 (1989) (quoting ETS-Hokin Corp., 154 NLRB 839 (1965), enf'd 405 F.2d 159 (9th Cir. 1968), cert. denied 395 U.S. 921 (1969)). Coercion has been found under 8(b)(4)(ii) in a variety of forms other than picketing or striking. In UMWA (New Beckley Mining Corp.), 304 NLRB 71, 73 (1991), enfd. 977 F.2d 1470 (D.C. Cir. 1992), the union had a crowd of 50 to 140 come at 4 a.m. to a motel where the employees of an ally (Mahon) of a struck employer were staying. The Union crowd yelled "How you doing, scabs." And "Why don't you go home." The Board found the activity was the equivalent of picketing, even in the absence of placards or picket signs, based on the crowd's large size, the yelled messages, and "by the timing of the crowd's arrival at the inn in the predawn, when the latter's guest likely were sleeping and the general public was not astir." Id. 72.

We decided in this case that the Union's use of excessive noise at both locations, which resulted in several citations by the city, constituted "coercion" within the Section 8(b)(4)(ii). Such excessive noise was analogous to coercive blocking or to the mass activity in New Beckley Mining in that the neutral employers, as well as tenants, owners and potential tenants, were prevented from using property in the manner to which it was meant to be used. The Union's use of excessive noise also was not sporadic. Rather, the union blasted its message, over and over again, in the early morning and at night regardless of whether the primary's employees were at work. This suggested that the real target of this coercive conduct was the neutrals, who were more likely to be at home during those hours.

This activity, combined with the Union's threat to one employer that there might be trouble if the employer continued to do business with the out-of state contractor, led to the conclusion that an object of the Union's conduct was to coerce tenants of the neutral employer to cease doing business with the neutral in order to force the neutral to cease doing business with the primary, and similarly to coerce tenants at the condominium complex to cancel their leases in order to force the condominium owner to cease doing business with the primary interior finishing contractor.

The Board has held that "the involvement of neutral employers in primary disputes not their own must be kept to an absolute minimum." Electrical Workers IBEW Local 970 (Interox America), 306 NLRB 54, 58 (1992). The union's use of excessive noise in early morning and at night, when the primaries' employees were not present, demonstrated that this form of protest activity was not designed to minimize impact upon neutrals, but rather was designed at least in part to accomplish the contrary. Accordingly, we decided to argue that this conduct violated Section 8(b)(4)(B)(ii) of the Act.

Local Union Steward's Threat

Attributable to International

In one Appeals case we considered whether alleged 8(b)(4)(ii)(B) threats and/or coercive statements made by a Local Union shop steward and dispatcher while the Local was under the trusteeship of an International union were attributable to the International.

During the time material to the charge allegations, the International union had placed the Local under trusteeship. The trustee was appointed by the International president and was responsible for the day-to-day operations and affairs of the Local. The International’s constitution indicated that the International union was not responsible for any activities of a Local under trusteeship unless such actions or activities had been directed or authorized by the trustee. The constitution also provided that the trustee was authorized and empowered to take full charge of the affairs of the Local.

Employer A had contracted to perform various transportation and set up tasks at a convention center. It in turn subcontracted with Employer B to carry freight to the center, where it would be unloaded and set up by workers employed by Employer A. Employer A’s employees were represented by the Local union. Employer B’s employees were unrepresented.

A Local shop steward informed a convention center official that the Union would not let Employer B trucks in, and would put up a picket line if Employer B trucks tried to get through. The shop steward later indicated to an Employer B representative that "a union guy" would have to make deliveries to the convention center dock. The shop steward and the Employer B representative worked out an arrangement whereby a unionized carrier would bring the freight from an Employer B marshalling area to the convention center. The shop steward subsequently introduced the Employer B representative to the Local’s dispatcher, who was hired by and reported to the International trustee, and who admittedly told the Employer B representative that he "assigned all the workers." The Employer B representative told the dispatcher of the arrangement that he and the shop steward had worked out. The dispatcher replied, "as long as [the shop steward] is happy everything is okay" and that he "doesn’t like to close down the convention center but sometimes the union has to and people put us in the position to have to do so." The dispatcher added that he "could have 100 people here in five minutes."

We had already concluded that the remarks made by the Local shop steward and the dispatcher constituted threats within the meaning of Section 8(b)(4)(ii)(B). We decided additionally that inasmuch as an International trustee was in full and complete control of the daily operations of the Local's affairs, the International was jointly and severally liable for the violative conduct engaged in by the Local shop steward and dispatcher.

It is a long established Board principle that liability for a local's unfair labor practices may be imposed on a trustee where the violations occurred during the trusteeship period. International Brotherhood of Teamsters, 201 NLRB 787, 791 (1973); Local 542, IUE, 141 NLRB 53, 55, 68-71(1963), enf’d 329 F.2d 512 (3rd Cir. 1964). The Board has found a trustee of an International union to be liable for the unlawful conduct of the local, where the trustee had "full and complete control over the Local’s activities." Local 542, IUE, supra at 55. Likewise, the Board will find the unfair labor practices of the local attributable to both the International and the trustee even absent a showing that either of the latter parties directly participated in the local's unlawful conduct. Local 612, International Brotherhood of Teamsters, et al. (Avery Freight Lines, Inc.), 121 NLRB 1571, 1585 (1958). Joint liability is established by a showing that during the time material to the unlawful conduct, the international trustee was in full charge of the affairs of the local pursuant to an appointment by the international with the power to designate and remove officers of the local. Id. The Board has applied this principle in Section 8(b)(4)(B) situations holding both the international and the local under trusteeship liable for the local's unfair labor practice. See, International Brotherhood of Teamsters, etc., and Local Union No. 294, et al. (E.G. Delia & Sons Construction Corp.), 117 NLRB 1401, 1415 (1957).

We noted that the Board in Local 542, supra at 55, declined to pass on the question of whether an International was liable because of its constitutional provisions. Instead, it based its finding of liability on evidence establishing that the International placed its local under a trusteeship, "which act…squarely vested the International with full and complete control over the Local’s activities." Id. Thus, notwithstanding the provision of the international constitution that purported to limit the international’s responsibilities for unauthorized activities of the local under trusteeship, we reasoned that in circumstances where a local functions under a trusteeship established by the general president and his appointment of a trustee, the trustee's full charge of the local's affairs is the determinative factor as to the international's liability for the local's unlawful conduct.

In our case it was undisputed that the Local was under trusteeship during the times material to the allegations under the charge. The trustee, by appointment of the general president in accordance with the International constitution, had full charge of the affairs of the Local and its subordinate officers. By virtue of this direct control over the policies and operations of the Local, we decided that the International shared the responsibility for the unlawful misconduct of both the Local shop steward and dispatcher in threatening, coercing and/or restraining the secondary employers to cease doing business with Employer B in violation of Section 8(b)(4)(ii)(B) of the Act.

Violation For 10 Days of Picketing

In one case, we considered whether complaint should issue where the Union engaged in picketing for more than 10 calendar days in an area other than at the reserved gate established for picketing at a common situs.

The Union, instead of locating its picket line at the entrance of the work site where the employer had set up a reserved gate, conducted its picketing at a location some 200 to 300 feet away on a public road leading to the construction site. During the investigation of the charge, the Union claimed that it had a First Amendment right to picket on public property away from the reserved gate. When the Region advised the Union that the law did not support this assertion, citing International Brotherhood of Electrical Workers, Local 970 and Interox America 306 NLRB 54 (1992), the Union promptly withdrew its pickets on that day. Thereupon, the primary employer, who had withdrawn its workers from the worksite during the picketing, resumed work thereafter without further incident.

Although the picketing was promptly withdrawn by the Union when apprised of its illegality by the Region, we nonetheless decided that issuance of complaint was warranted since the picketing had lasted 10 days and the Union had given no written assurances that it would refrain from engaging in similar unlawful conduct in the future.


Owner Acting as General Contractor

Becoming an Employer in the Construction Industry

In a pending case this year, we decided not to file exceptions to an ALJ's supplemental decision to dismiss the Section 8(e) complaint, 3-CE-55, JD(NY)14-00, because we agreed with her conclusion that Charging Party Indeck was an employer in the construction industry within the meaning of the Section 8(e) proviso.

In 1998, the Board remanded Section 8(e) allegations in Glen Falls Building & Construction Trades Council (Indeck Energy), 325 NLRB 1084, for additional evidence following a hearing before and decision by another ALJ. The original issuance of complaint in this case was based on evidence raising a triable issue that Indeck was not privileged to enter into the secondary agreement in a February 20, 1992 letter to the Respondent Unions because (1) it was not an employer covered by the construction industry proviso to Section 8(e); and (2) since Indeck did not act as a general contractor, the agreement was not negotiated within a collective-bargaining relationship under Connell. We argued that the mere supplying of a suggested project labor agreement to a project manager (Sirrine), the silent presence of an Indeck official at one negotiating session between Sirrine and the Unions, and the award of subcontracts worth about $80,000 for construction of a cogeneration plant during the interval between the time Sirrine defaulted and another company (CNF) received the turnkey contract and about $30,000 for surveying, soil testing and waste removal, all were insufficient to make Indeck a construction industry employer under existing Board cases addressing the 8(e) proviso. See Longs Drugs, 278 NLRB 440 (1986).

We recognized that unlike a typical owner, Indeck did not limit its control over the project to a final inspection, but had agents at the jobsite monitoring various aspects of the construction. Moreover, if Sirrine, CNF, or one of their subcontractors failed to conform to Indeck's requirements or governmental regulations, Indeck had the power to intervene in the construction. Therefore, we sought Board clarification of whether, even though an owner employing a minimal number of craft employees on a jobsite was not in the construction industry, Indeck's kind and amount of involvement in the construction would render it an employer in the construction industry.

After we reexamined Indeck's status in light of the entire record developed before both ALJs, we decided that Indeck had acted much more like a general contractor than the Longs Drugs owner who performed some construction work during a brief and discrete phase of the project. The second ALJ correctly analyzed this case by not limiting the inquiry to the Corinth cogen construction. Consistent with Indeck's own self-description in its brochures as developer, owner & operator of cogeneration plants offering "full scope project development & execution" and undertaking construction risks, the second ALJ examined Indeck's conduct over the entire project as a continuum. From this perspective, Indeck was extensively involved in controlling labor relations during the construction of the gas pipeline and electrical transmission line as well as the cogen plant at Corinth.

Significantly, the Unions' support of Indeck's permit applications before government agencies (and refraining from opposing them) was in the context of Indeck promising that all phases of four cogens it wanted to build and operate in New York, including Olean and Corinth, would be constructed using Union contractors. In fact, after Sirrine was awarded the turnkey contract at Olean, Indeck's president participated in the negotiations for a project agreement between Sirrine and the Unions to "smooth out" any problems and ensure that an agreement was reached. 325 NLRB at 1092. Indeck did not simply instruct bidders at Corinth to use a similar contract and then forward a model agreement to Sirrine as a framework for negotiations. Instead, it faxed Sirrine a copy of the Olean agreement on May 18, 1992 and directed that "Olean must be done according to this Union contract. Similar contracts must be negotiated at Kirkwood and Corinth."

After Sirrine defaulted on the Corinth project contract, an Indeck vice-president suggested to Indeck's owner in an inter-office memorandum that Indeck commit to the Unions that the offsite construction at Corinth (the gas pipeline and electrical transmission line) would still be done with Union labor. This "carrot" was intended to dissuade the Unions from seeking an injunction or stopping construction progress during financing after Indeck breached the February 20 agreement by hiring CNF, a non-union turnkey contractor, to replace Sirrine. Indeck's conduct was clearly distinguishable from an owner who wanted construction done with union labor but then hired a general contractor and remained uninvolved in controlling labor relations.

Moreover, Indeck actually performed work a general contractor would do during all phases of the Corinth project. Indeck directly awarded about 25 contracts at the beginning of the project, during the interval between Sirrine leaving and CNF arriving, and at the end. For the actual construction of the Corinth cogen, Indeck also subcontracted with various firms to survey; assist negotiating a lease; obtain title insurance; secure permits; demolish any houses on acquired land; perform grading; remove tree stumps and railroad ties; erect a fence; and treat and remove contaminated soil. During the construction of the gas pipeline and electrical transmission line, Indeck clearly acted as the general contractor for gas and electric utilities until it contracted with two separate companies to be construction managers. Indeck contracted with various firms to perform engineering and secure permits; obtain easements; perform radiography inspection; purchase transmission poles; witness pipe fabrication; purchase control systems and materials; survey properties; and provide field inspection services.

Although Indeck arguably took all these actions in order to ensure all necessary deadlines for the project were met, we noted that Indeck's motive was irrelevant. A general contractor would have performed this same work; an owner acting as a general contractor has always been found to be an employer in the construction industry by the Board. Moreover, Indeck did more than periodically have its engineers check to ensure that work was being done according to specifications. It had one or two employees at the jobsite daily to meet with CNF, assess the construction work, witness tests, examine drawings submitted to the general contractor and discuss any concerns they had with the contractor. Indeck also placed employees, who would ultimately operate the plant, on site and used them as inspectors during the last year of construction.

In sum, since Indeck did not merely check the construction work sporadically and inject itself into labor relations only on a small, discrete phase of the Corinth project, Indeck was not analogous to the owner in Longs Drugs. Rather, it checked work on a daily basis, awarded a wide variety of subcontracts during all phases of the contract (gas pipeline, cogen plant, electrical transmission line), and played an active role in specifying the contractual construction employment conditions and attempting to minimize potential problems with the Unions when it decided that the cogen construction would be done on a non-Union basis.

For all these reasons, we decided that Indeck was essentially an owner acting as its own general contractor. Therefore, we did not to file exceptions to ALJ MacDonald's recommended dismissal of the 8(e) complaint. In that regard, we knew that Indeck was planned on filing its own exceptions, and in fact did file exceptions. We therefore need not have been concerned that our decision to not file exceptions would have precluded the Board from being able to make its own determination on this issue.

In this regard, Indeck had the power to intervene in construction matters on the Corinth project to enforce compliance by contractors and subcontractors with its requirements and also maintained significant control over their job-site labor relations. While Indeck’s performance of work as its own general contractor represented only a small percentage of the total cost of the Corinth project and was arguably based on purely entrepreneurial concerns such as meeting contract deadlines, Indeck’s involvement in construction and labor relations was, nevertheless, more than sporadic or de minimis. To the contrary, Indeck played a vital role in specifying labor conditions and attempting to minimize potential problems with the unions when it ultimately decided to hire a general contractor that contracted with non-union firms. As noted above, we agreed with the evidentiary findings of the ALJ that Indeck performed a sufficient amount of on-site construction work in its capacity as its own general contractor so to warrant the conclusion that Indeck was covered by the construction industry proviso of Section 8(e) even though Indeck’s primary function was that of the owner-operator of the Corinth cogeneration facility. Consequently, we not only declined to file exceptions to the decision, but also applied its holding to the instant case.

"Construction Industry" Employer

In another recent case, we considered whether a union lawfully sought to require the owner of a restaurant chain to comply with a project labor agreement during construction at a mall because the employer met the definition of an "employer in the construction industry" within the meaning of the proviso to Section 8(e) of the Act.

The owner of a restaurant chain had a construction division in charge of building new facilities. The employer entered into a tenant’s lease with the developer of a regional shopping mall to build a new restaurant inside the mall. The terms of the tenant’s lease also required the employer to comply with a project labor agreement between the mall’s general contractor and various construction unions to use them as the sole source of labor on the mall project. The employer was thus obligated to instruct its general contractor to subcontract on-site construction work to the appropriate craft union in accordance with the project labor agreement. The employer acted as its own general contractor with respect to the installation of an alarm system that it subcontracted to a firm whose employees were represented by a union that was not party to the project labor agreement. A union that was party to the agreement claimed that the alarm system work should have been awarded to it and filed a grievance to require the mall’s general contractor to enforce the PLA against the restaurant owner. We determined that the alarm system work constituted construction work and that the employer, to the extent that it acted as the general contractor in contracting out the alarm installation work came within the ambit of the construction industry proviso of Section 8(e). Thus, the charged party union’s secondary conduct in attempting to enforce the project labor agreement against the restaurant was not deemed to violate Sections 8(b)(4)(B) and (e). That two unions were competing for the alarm system work rather than union and non-union labor was not deemed to be a dispositive consideration in resolving the issue regarding the interpretation of the construction industry proviso of Section 8(e) in view of the legislative history.

In reaching this decision, we relied upon the above reported decision of the ALJ in Glen Falls Building and Construction Trades Council et al (Indeck Energy Services, Inc.), 3-CE-55. JD(NY)–14-00, on remand from 325 NLRB 1084 (1998), wherein the ALJ dismissed the complaint because she determined that Indeck was an "employer in the construction industry" within the meaning of the construction industry proviso of Section 8(e) of the Act. Indeck was the owner-operator of a cogeneration facility under construction at Corinth, New York, but, for a time, due to unforeseen circumstances, acted as the general contractor as well. The ALJ concluded that the construction industry proviso of Section 8(e) was applicable to Indeck even though the kind and amount of Indeck’s involvement in actual construction and in the negotiation of the secondary agreement with the unions alleged to violate Section 8(e) was limited. She determined that Indeck’s involvement was sufficient to render the secondary agreement one that was negotiated within the scope of a collective bargaining relationship under Connell Construction Company, Inc. v. Plumbers & Steamfitters Local 100, 421 U.S. 616 (1975), and was readily distinguishable from that of the employers in the very few Board decisions addressing the reach of the construction industry proviso. See e.g., Carpenters Local 743 (Long Drugs), 278 NLRB 440 (1986); Church’s Fried Chicken, 183 NLRB 1032 (1970).


Retroactive Effect to Board's Decision In

St. Elizabeth Manor

In another recent case, we considered whether the Board's decision in St. Elizabeth Manor, Inc., 329 NLRB No. 36 (1999), should be given retroactive application.

In St. Elizabeth Manor, the Board held for the first time that, once a successor employer's obligation to recognize an incumbent union attaches, the union is entitled to a reasonable period of time for bargaining without challenge to its majority status. The Board's "customary practice is to apply new policies and standards to "'all pending cases at whatever stage.'" Electrical Workers IUE Local 444 (Paramax Systems), 311 NLRB 1031, 1042 (1993), enf. den., IUE v. NLRB, 41 F.3d 1532 (D.C. Cir. 1994) quoting Deluxe Metal Furniture Co., 121 NLRB 995, 1006-1007 (1958). See e.g. Certain-Teed Corp., 271 NLRB 76 (1984). and John Deklewa & Sons, 282 NLRB 1375 (1985), enfd. 843 F.2d 770 (3rd Cir. 1988); Deluxe Metal Furniture Co., 121 NLRB 995, 1006-1007 (1958). On the other hand in Dresser Industries, Inc., 264 NLRB 1088 (1982) the Board concluded that application of retroactivity "would work a 'manifest injustice.'" Paramax Systems, 311 NLRB at 1042 quoting Pattern Makers (Rite Industrial Model), 310 NLRB 929 (1993). In determining whether manifest injustice would result, the Board applies the model formulated by the Supreme Court in SEC v. Chenery Corp., which requires a balancing of: "the ill effects it might produce with the 'mischief of producing a result which is contrary to a statutory design of the legal and equitable principles.'" 311 NLRB at 4012, quoting SEC v. Chenery, 332 U.S. 194, 203 (1947).

More recently, in determining whether retroactive application would work a manifest injustice the Board has balanced the three factors derived from the Supreme Court's test enunciated in Chevron Oil Company v. Huson (Chevron Oil), 404 U.S. 97, 106-07 (1971): the reliance of the parties on preexisting law; the effect of retroactivity on accomplishment of the purposes of the underlying law which the decision refines; and any particular injustice to the losing party under retroactive application of the change of law. Pattern Makers (Michigan Model Mfrs.), 310 NLRB at 931, quoting from NLRB v. Bufco, 899 F.2d 608, 609 (7th Cir. 1990); Electrical Workers IUE Local 444 (Paramax Systems), 311 NLRB 1031, 1042, enf. den., IUE v. NLRB, 41 F.3d 1532 (D.C. Cir. 1994). North Macon Health Care Facility, 315 NLRB 359 (1994).

We noted that the Board has had mixed results in applying its retroactive determinations in the Circuit Courts. Retail, Wholesale & Department Store Union v. NLRB, 466 F.2d 380 (D.C. Cir. 1972)(Retail Union)(court denied retroactive application of Board’s Laidlaw doctrine); Local 900, IUE v. NLRB (Gulton Electro-Voice),727 F.2d 1184 (D.C. Cir. 1984) (retroactive application of Board's new superseniority rule); Laborers' International Union v. Foster Wheeler Corp., 26 F.3d 375, 391-92 (3rd Cir. 1994) (retroactive application of new Deklewa rule); ARA Services, Inc. v. NLRB, 71 F.3d 129 (4th Cir. 1995) (court denied retroactive application of Board’s new jurisdiction rule). In making that determination, courts including the D.C., Third and Fourth Circuits have generally applied the five-factor test enunciated by the D.C. Circuit in Retail Union. 466 F. 2d 380 (1972).

We also addressed the issue of whether Harper v. Virginia Dep't. of Taxation, 509 U.S. 86 (1993), requires an agency to apply its own rules retroactively. In Harper, the Supreme Court held that when a court applies a rule of federal law to parties before it, that rule is the controlling interpretation of federal law and must be given full retroactive effect in all cases still open on direct review and as to all events, regardless of whether such events predate or postdate the announcement of the rule. The effect of Harper's ruling was that it "abolished exceptions to the retroactive application of judicial rulings in civil cases and rejected the traditional case-by-case balancing process for determining retroactivity in court adjudications." Dubuque Packing Co., 1 F.2d at 35.

The Third and Fourth Circuit Courts of Appeal have both specifically indicated that Harper does not replace multi-factor case-by-case analysis. See e.g. Laborers' Int'l Union v. Foster Wheeler Corp., 26 F.3d at 375 (3d Cir); ARA Services, 71 F.3d at 135 (4th Cir.). Thus far, the D.C. Circuit has not determined the effect of Harper on agency adjudications. However, in cases since Harper, the D.C. Circuit has continued to apply its multi-factor, case by case analysis, and it appears unlikely that it would abandon Chenery on the ground that Harper requires retroactive application of administrative decisions. Moreover, since Harper, the Board has not raised Harper or indicated that Harper precludes its traditional "manifest injustice" analysis. See, for example, North Macon Health Care Facility, 315 NLRB 359 (1994).

In our particular case, the successor Employer had withdrawn recognition from the Union after an initial bargaining session, when it received a petition from a majority of employees stating that they no longer desired to be represented by the union. Based on all of the above law, we applied the Board's balancing test, and decided that retroactive application of St. Elizabeth Manor was not appropriate for the following reasons.

First, the Employer withdrew recognition at a time when to do so was a lawful response to a petition by a majority of employees indicating that they no longer wanted to be represented by the Union. Accordingly, the Chevron Oil "reliance" factor arguably weighed against retroactivity here. Second, we noted that retroactive application of the successor bar in the instant case would arguably further the "purposes of the underlying law which the decision refines." By the time the Employer began its operations, a majority of its workforce was comprised of predecessor employees. The Union had represented these employees for over 30 years, since about 1964. Although the Employer initially agreed to recognize the Union, it did not assume the predecessor contract. Rather, it established its own terms and conditions of employment. The employees had hardly made the transition to the new Employer before the Union's majority status was attacked and the Employer withdrew recognition.

Third, we considered the particular injustice to losing party under retroactive application. The Board, in deciding whether there will be a particular injustice to the losing party under retroactive application, expects that the losing party may have relied to some extent on the old rule; and further, that retroactivity may result in some additional burden on the affected party. See John Deklewa & Sons, 282 NLRB at 1389; North Macon Health Care Facility, 315 NLRB at 361; Paramax Systems, 311 NLRB at 1042; Pattern Makers, 310 NLRB at 931. In our case, the additional burden to the Employer that would result from retroactive application of St Elizabeth Manor was arguably present. The Employer had lawfully established its own terms and conditions of employment before it hired the predecessor employees and prior to bargaining with the Union. Thus, there was no danger that a Board bargaining order would entail monetary damages or other contractual liability as to those changes. Further, as the Board in St. Elizabeth Manor noted, the new successor bar rule extends "for a 'reasonable period,' not in perpetuity." Slip. op at 6. After that, "in a proper proceeding and upon a proper showing, "the Board might "take steps in recognition of changed situations that might make appropriate changed bargaining relationships."

We noted that the Employer's contention that it had installed "numerous operational innovations" in work practices and benefits (new job descriptions, job shifts; benefits, layoff and recall procedures etc.) after withdrawing recognition, so that a requirement to "undo all or some of these" changes would "severely disrupt operations." Thus, there was the potential of significant disruption to the Employer's enterprise.

Balancing the three Chevron factors, the primary obstacles to retroactive application were the "reliance of parties on preexisting law" and the potential burden to the Employer of retroactive application. The law permitting the Employer to withdraw recognition was clear, and the Employer reasonably relied on that law when it withdrew recognition. Further, although the law prohibiting the Employer from continuing to recognize the Union here was less clear-cut than was the case in Dresser, 271 NLRB 329 (1984), the Employer could argue that under Point Blank Armor, 312 NLRB 1097 (1993), its failure to withdraw recognition left it vulnerable to a Section 8(a)(2) charge.

On the other hand, the significance to be placed on a party's reliance rests, in part, on the particular injustice that retroactive application would work on the party who relied on the rule. Retroactive application would not expose the Employer here to contractual liability. Rather, the Employer would merely be required to bargain with the Union until agreement were reached, or for a "reasonable period, not in perpetuity." St. Elizabeth Manor, 329 NLRB at slip op. 6. While the Employer alleged that it had implemented new terms and conditions of employment at the facility, the actual extent of the burden that a requirement to bargain would impose on the Employer was unclear, and to a certain disagree speculative.

In sum we decided, based upon the above rationale, that retroactive application of St. Elizabeth Manor was not appropriate in this case.


Compensatory Damages

In four reported cases, we considered whether to seek various compensatory damages as extraordinary relief.

Our first case involved whether to amend an outstanding complaint to seek a remedy for compensatory damages which the discriminatee incurred as a result of his having lost his home because of his unlawful discharge.

The Region had already issued a Section 8(a)(3) complaint alleging that the Employer had unlawfully discharged a Union supporter because of his union activities. Since his discharge, the discriminatee had been unable to obtain steady employment. As a result, his interim earnings totaled only about $3,000. The discriminatee also had been unable to receive any unemployment compensation because the Employer challenged his entitlement to those benefits.

Since his discharge, the discriminatee, his wife, and their children had to move in with relatives because he could not afford to maintain utilities at the family home. The discriminatee also was unable to make regular mortgage payments on the family home, which caused the loan to go into default. Before his discharge, the discriminatee's work with the Employer had provided him with sufficient income to remain current on his mortgage.

We decided to amend the outstanding complaint to seek a remedy for the expenses incurred as a result of the unlawful discharge, which included: damage to credit, foreclosure charges, closing costs, and the amount necessary to obtain a similar home with the same mortgage terms and outstanding balance.

The language of both Section 10(c) of the Act, 29 U.S.C. 160(c)(1964), and its legislative history is broad enough to conclude that the Board may order a remedy for the economic consequences directly resulting from an employer's unfair labor practice. Section 10(c) states that upon a finding by the Board that an unfair labor practice has been committed, the Board shall issue "an order requiring such person to cease and desist from such unfair labor practice, and to take such affirmative action including reinstatement of employees with or without backpay, as will effectuate the policies of the Act." The Board is not limited to an order of reinstatement and/or backpay as a remedy simply because they are the only forms of affirmative action expressly provided for in the Act. Thus, in reference to Section 10(c) the Supreme Court has noted:

[I]n the nature of things Congress could not catalogue all the devices and stratagems for circumventing the policies of the Act. Nor could it define the whole gamut of remedies to effectuate these policies in an infinite variety of specific situations. Congress met these difficulties by leaving the adaptation of means to end to the empiric process of administration.

Phelps Dodge Corp. v. NLRB, 313 U.S. 177, 194 (1941).

In addition, the legislative history of Section 10(c) fails to indicate an intent by Congress to limit Board remedies in a discriminatory discharge case to reinstatement and backpay. The draft of the first bill containing the provisions that later became Section 10(c) provided that the Board "may require such person . . . to take affirmative action, or to pay damages, or to reinstate employees, or to perform any other acts that will achieve substantial justice." 1 Leg. Hist. 7 (NLRA 1934). S. 2926, 73d Cong., 78 Cong. Rec. 3444 (1934). The following year the bill was reintroduced and modified in relevant part to read "and to take such affirmative action, including restitution, as will effectuate the policies of the Act." 1 Leg. Hist. 1302 (NLRA 1935). S. 1958, 74th Cong., 79 Cong. Rec. 2368 (1935).

A Congressional memorandum comparing the two bills stated that the "objective of the term restitution is desirable, but it would be better to state specifically that the Board may order an employer to reinstate a discharged worker and to give him compensation for the time that he has lost through unlawful discharge." Memorandum of March 11, 1935, prepared for Senate Committee on Education and Labor comparing S. 1958 (74th Cong., 1st Sess.), with S. 2926 (73d Cong., 2d Sess.).


The same memorandum also compared the language of the second bill to a committee report that said the Board shall "take such affirmative action or . . . perform any other acts that will achieve substantial justice." Referring to the committee report, the drafters of the memorandum stated that the "broad term 'restitution' is used in [the second bill] to take in a host of varied forms of reparation . . . to suit the needs of every individual case." The drafters of the memorandum rejected the "substitution of express language such as reinstatement, backpay, etc." because it "necessarily results in narrowing the definition of restitution, which may include many other forms of action."

Although the second bill was amended, replacing the word "restitution" with the phrase "including reinstatement of employees with or without backpay", S. 1958, 74th Cong., 79 Cong. Rec. 6749 (1935), no comments accompany this change. Without further explanation in the legislative history, Congress did not clearly depart from a position of favoring various forms of reparation in an effort to narrow the definition of restitution; Congress may well have intended the insertion of the phrase "including reinstatement and backpay" to merely illustrate the available remedies. Moreover, even if Congress did intend to narrow the definition of restitution, there is nothing in the history to suggest it intended to remove from the Board's remedial arsenal reimbursement for the economic consequences directly resulting from an unfair labor practice. Accordingly, the language of both Section 10(c) and the legislative history is broad enough to conclude that in order to restore the status quo, the Board may order a remedy for the economic consequences directly resulting from an employee's unlawful discharge.

We also noted the Board has ordered an employer to compensate a discriminatee for the economic consequences resulting from an unlawful discharge. In Freeman Decorating Co., 288 NLRB 1235 (1988), the employer violated Section 8(a)(1) and (3) by forcibly removing from the workplace, and causing injury, to employee Pruitt when it discharged Pruitt because of his union activities. The ALJ ordered the employer to offer Pruitt reinstatement and backpay. In addition, the ALJ noted that if Pruitt showed that he suffered loss because of his injuries, the employer should offer Pruitt backpay for periods of his disability and "costs for medical and rehabilitation treatment." Id. at 1241. The Board affirmed the remedy ordered by the ALJ, but stated that the employer is only required to reimburse Pruitt for medical and rehabilitative expenses "that were incurred due to lack of insurance coverage resulting from Pruitt’s unlawful discharge." Id. at 1235 n. 2.

In our case, the discriminatee similarly incurred expenses that he would not have incurred if he had not been unlawfully discharged. Thus, just as in Freeman, the discriminatee should be compensated for those expenses incurred due to a lack of income resulting from his unlawful discharge.

We recognized that in other cases the Board has refused to order certain types of compensation for expenses incurred to remedy an unfair labor practice. For example, in Operating Engineers Local 513 (Long Const. Co.), 145 NLRB 554 (1963), the Board found that the union violated Section 8(b)(1)(A) by causing several employees injury and rendering them unable to work, thereby interfering with the employees' right of ingress to the workplace. The Board decided, however, that it would not effectuate the policies of the Act to award backpay or other compensatory relief in such situations. In reaching that decision, the Board noted that it is within the power of the State to enjoin and remedy the consequences of such conduct. The Board reasoned, therefore, that the lack of a Board order would "not leave such employees without redress against those responsible for their injuries." Id. at 556. Accord: Graves Trucking, 246 NLRB 344, 345 n.8 (1979), enfd. as modified 692 F.2d 470 (7th Cir. 1982).

Although the Board found it appropriate to deny monetary relief in Operating Engineers Local 513 and Graves Trucking, we decided that those decisions were clearly distinguishable from the issue here. The Board noted in both those decisions that it was denying certain monetary relief because the employees could obtain compensation for their injuries through a tort suit in state court. However, the discriminatee here did not have a cause of action in state court that could compensate him for the economic injury resulting from the Employer's unfair labor practice. Moreover, the damages suffered here directly resulted from the unlawful termination of the discriminatee's employment and income, and thus were analogous to the damages suffered from the unlawful discharge and termination of health insurance in Freeman.

We therefore decided to amend the outstanding complaint to include a remedy for the expenses the discriminatee incurred as a result of the unlawful discharge. Both the language of Section 10(c) and its history are broad enough to permit such a remedy, and an order requiring the Employer to compensate the discriminatee for the economic injury resulting from his unlawful discharge is consistent with extant Board law.

Life Insurance Premiums and

Lost Interest Income

Our second case involving compensatory damages concerned whether to seek 1) reimbursement for premiums paid on a life insurance policy which the discriminatee purchased after her discharge; 2) reimbursement for an early withdrawal penalty incurred when the discriminatee withdrew funds from her pension account; and 3) reimbursement for interest income lost when the discriminatee withdrew funds from her IRA.

The Employer had provided fringe benefits to its employees as part of their compensation. The benefits relevant to the instant case were: 1) life insurance coverage in which the Employer paid the premiums on behalf of the employees; 2) Employer contributions to a pension account; and 3) participation in a 401(k) plan in which the Employer contributed matching funds.

When the Employer discharged the discriminatee, it discontinued premium payments on her life insurance coverage, and ceased contributions to her pension and 401(k) plans. The discriminatee not only purchased a private life insurance policy, but also withdrew her entire pension account in order to pay living expenses. As a result of this early withdrawal from her pension, the discriminatee incurred a 58% early withdrawal penalty. The discriminatee also withdrew the money in her 401(k) plan and rolled it over into an IRA. The discriminatee then withdrew approximately $10,000 from her IRA in order to make mortgage payments.

We decided to seek a remedy including reimbursement for the following economic consequences directly resulting from the unlawful discharge of the discriminatee: 1) the premiums she paid for a private life insurance policy; 2) early withdrawal penalty incurred for withdrawing the pension funds; and 3) the lost Employer contributions to the 401(k) and interest income on the money withdrawn from the IRA.

As noted in our report of the above case, the language of both Section 10(c) of the Act and its legislative history is broad enough to conclude that the Board may order a remedy for the economic consequences directly resulting from an employer’s unfair labor practice.

In Sioux Falls Stock Yards Co., 236 NLRB 543 (1978), an employer who had provided its employees with life insurance discontinued the premium payments when the employees went out on strike. The union advanced the premium payments to the employees for a period of six months so that the employees could maintain the insurance protection. The Board ordered the employer to make retroactive life insurance premium payments, as part of the unreinstated employees' backpay, for the period of time in which the employees were obligated to repay the premiums to the union. We decided that the Employer in our case should similarly be required to reimburse the discriminatee for the premium payments she made in order to maintain her life insurance coverage.

In the case discussed above, the discriminatee there incurred mortgage foreclosure costs and other expenses directly because he was unable to remain current on his mortgage due to the unlawful discharge. Similarly, the discriminatee in our case incurred a monetary penalty when she was required to withdraw money from her pension fund in order to pay living expenses because she lacked an adequate income as a result of her unlawful discharge. We therefore decided that the discriminatee here also should be compensated for the early withdrawal penalty.

Since the Employer had offered the 401(k) plan as part of the employees' compensation, the discriminatee clearly was entitled to the matching contributions the Employer ceased making to her 401(k) plan because of the unlawful discharge. See Alaska Pulp Corp., 326 NLRB No. 59 (1998). Accordingly, we decided to require the Employer to reestablish the 401(k) plan and to require the Employer to make the necessary contributions, with interest.

In addition, we decided that the discriminatee also was entitled to the interest income she would have earned if she had not withdrawn some of the funds (originally in the 401(k) plan) from the IRA. The discriminatee had only withdrawn those funds to make mortgage payments, because of a lack of income due to her unlawful discharge. This remedy of lost interest was in complete accordance with the previously reported case, where we concluded that an employer should compensate a discriminatee for the economic consequences directly resulting from the unlawful discharge.

Tax Penalty for Early Withdrawal

Our third case involved whether to seek reimbursement for the discriminatee's tax penalty incurred when the discriminatee was compelled to make an early withdrawal of funds from his 401(k) plan.

During the ten years the discriminatee worked for the Employer, he contributed $20.00 weekly to his 401(k) plan, and the Employer contributed matching funds. About four months after his unlawful discharge, the discriminatee withdrew the funds from his 401(k) in order to pay his mortgage and other living expenses. The discriminatee reported the total gross distribution as income on his 1995 Federal tax return. As a result of the early withdrawal, the discriminatee incurred a 10% tax penalty on the gross distribution of the 401(k) funds.

On September 30, 1998, the Board issued a decision finding that the Employer discharged the discriminatee and several other employees in violation of Section 8(a)(1) and (3) of the Act. 326 NLRB No. 153 (1998). The Board ordered the Employer to offer reinstatement to the discriminatees and to make them "whole for any loss of earnings and other benefits." On January 24, 2000, the Court issued a decision enforcing the order. 203 F.3d 819 (4th Cir.). On March 17, 2000, the Court issued its mandate and the Employer sent the discriminatee a letter offering reinstatement, but the discriminatee declined.

For the same reasons set forth in the previously reported cases above, we decided that the tax penalty incurred for the discriminatee's early withdrawal of the 401(k) funds should be included in the computation of his backpay award. As in those cases, the discriminatee here incurred a penalty when he withdrew his 401(k) funds in order to pay living expenses because he lacked an adequate income as a result of his unlawful discharge.

We also decided that the fact we were requesting this remedy for the first time in a supplemental proceeding is irrelevant, because the remedy is already included in the Board’s existing order. The Board has found that a party is not precluded from requesting a specific remedy in a supplemental proceeding, so long as the order contemplated such remedy. In Amoco Production Co., 233 NLRB 158, 161 (1977), the Board affirmed ALJ's rejection of employer argument that it should not be ordered, in a supplemental proceeding, to reimburse the union for all membership dues that it unlawfully withheld because the existing Board order did not explicitly direct it to do so. The ALJ reasoned that the Board's order directing the employer to "reinstitute the contract . . . and comply with its provisions" clearly contemplated that the employer reimburse the Union for the dues it failed to withhold as provided in the contract.

The order in our case directed the Employer to make the discriminatee "whole for any loss of earnings and other benefits suffered as a result of the discrimination. . . " In our view, this broad make-whole order clearly included reimbursement for the penalty incurred when the discriminatee had to use his 401(k) funds to pay living expenses because he was deprived of his earnings.

Board Order Precluding Compensatory Relief

Our last reported case in this area involved whether the outstanding Board order in this case precluded the seeking of compensatory damages.

In Alwin I, the Board found that the Employer made unlawful unilateral mid-contract changes in working conditions. Alwin Manufacturing Company (Alwin I), 314 NLRB 564 (1994), enfd. 78 F.3d 1159 (7th Cir. 1996). In Alwin II, the Board found that: the unilateral changes found to be unlawful in Alwin I had not been remedied; the Employer's bargaining through the contract's February 1994 expiration had been unlawful; the Employer unlawfully implemented the terms and conditions of employment contained in its final offer; the Union's ensuing strike was an unfair labor practice strike from its inception; and the Employer unlawfully failed to immediately offer reinstatement to the strikers upon their unconditional offer to return to work. Alwin Manufacturing Company (Alwin II), 326 NLRB No. 63 (1998), enfd. 192 F.3d 133 (D.C. Cir. 1999). In addition to its standard restoration, bargaining and make-whole remedies, the Board ordered the Employer to reimburse the Union for its litigation, bargaining and strike conduct expenses and to reimburse the NLRB for its litigation expenses. The case was currently in the compliance stage.

The additional remedies in this case would have included the seeking of home sale expenses, withdrawal penalties, income tax liabilities due to withdrawal of IRA funds, increased day care expenses, and credit card interest payments and finance charges. We decided not to pursue the additional compensatory relief at this time, however, because these additional remedies did not come under the outstanding Board order requiring the Employer to make the unfair labor practice strikers whole for any "loss of earnings and other benefits" suffered as a result of the Employer's failure to reinstate them.

But for the limited nature of the relief ordered by the Board in this case, such compensatory damages might be fairly claimable as economic consequences of the Employer's unfair labor practices as argued in the above reported cases. However, the Board has held that lost earnings ("backpay") do not include collateral losses such as those resulting from distress sales of a home, automobile or other personal assets. Minette Mills, Inc., 316 NLRB 1009, 1011 (1995). Moreover, it is generally preferable to request special types of remedies at the complaint stage rather than compliance stage. Thus, because of the limited outstanding Board order here, we decided to not pursue additional compensatory remedies in this particular case.

Awarding Excess Taxes Incurred

From Lump-Sum Backpay Award

In one case, we considered whether the remedy for an unlawful discharge should include reimbursement of excess state and federal taxes which the discriminatee would owe as a result of receiving his backpay in a lump-sum backpay award.

The Employer had unlawfully discharged an economic striker, and the Board had ordered a traditional make-whole remedy of backpay to cover the three year period the discriminatee was out of work. The Internal Revenue Service considers back pay awards to be taxable income earned in the year the award is paid, rather than over the previous years in which a discriminatee would have earned the wages but for the unlawful discrimination. Thus, the discriminatee would incur substantially increased tax liability due to the Board ordered three-year lump sum backpay award.

Until 1986, federal and state tax codes had incorporated "income averaging" for large year-to-year differences in earned income, including lump sum backpay awards. The ability to "income average" under these provisions drove down a discriminatee's total tax liability despite his or her receipt of a large lump sum. Based on the availability of "income averaging", the Board in the past has rejected proposed tax components to backpay awards. See Hendrickson Bros., Inc., 272 NLRB 438 (1985), enf'd 762 F.2d 990 (2nd Cir. 1985) and Laborers Local 282 (Austin Co.), 271 NLRB 878 (1984) In 1986, however, Congress (and the state in which the discriminatee lived) repealed the income averaging provision. We noted that the Board apparently has not had the opportunity to consider a tax reimbursement remedy in light of the elimination of income averaging.

In our case, a lump-sum payment would bump the discriminatee into a higher tax bracket, and significantly increase his total tax bill over what he would have paid over the years had he not been discriminated against. We therefor decided to seek, as part of the compliance specification, reimbursement of the discriminatee's extra state and federal taxes that would result from a lump-sum backpay award.

In reaching that conclusion, we relied on the fact that Congress granted the Board broad power under Section 10(c) of the Act to determine the proper scope of its remedial orders, particularly with respect to affirmative relief. See, e.g., Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 898-99 (1984) (Congress vested in Board "the primary responsibility and broad discretion to devise remedies that effectuate the policies of the Act, subject only to limited judicial review"). This wide discretion is necessary insofar as Congress, in enacting the National Labor Relations Act, could not "define the whole gamut of remedies to effectuate these [statutory] policies in an infinite variety of specific situations." Phelps Dodge Corp. v. NLRB, 313 U.S. 177, 194 (1941). Thus, by its plain meaning, Section 10(c) is a grant of authority to the Board to devise remedies for various unfair labor practices, so long as such remedies "effectuate the policies of the Act." Frontier Hotel & Casino, 318 NLRB 857, 863 (1995), enf'd in pert. part sub nom. Unbelievable, Inc. v. NLRB, 118 F.3d 795 (D.C. Cir. 1997)

We also noted that for many years, federal courts have awarded plaintiffs in discrimination cases a "tax component" to a lump-sum backpay award designed to reimburse them for excess taxes they would owe as a result of receiving years of compensation in a lump sum. See, e.g., Sears v. Atchison, Topeka & Santa Fe Railway Co., 749 F.2d 1451 (10th Cir. 1984), cert. den. sub nom. United Transp. Union v. Sears, 471 U.S. 1099 (1985)( tax component to a lump-sum backpay award in racial discrimination lawsuit under Title VII); Gelof v. Papineau, 648 F.Supp. 912, 930 (D.C.Del 1987), remanded 829 F.2d 452 (3d Cir. 1987) (tax component to ADEA backpay award in light of repeal of income averaging provision). The Equal Employment Opportunity Commission has similarly sought tax components to backpay awards both in federal district court, e.g., EEOC v. Joe's Stone Crabs, supra) and in its own administrative hearings. Kalra v. Pena, EEOC Appeal No. 01924002, slip op. at 8 (February 25, 1994).

In reaching our decision, we noted that the purpose of backpay under the National Labor Relations Act is to "make whole everything but what employees failed without excuse to earn." Phelps Dodge Corp. v. NLRB, 313 U.S. at 198-99. In our case, the discriminatee would have been subject to a sizable increase in income taxes solely because he would have received his lost earnings in the form of a lump-sum payment, rather than over the years in which he would have earned it, but for the unlawful discrimination. Without a tax component to the backpay award, the Board would be denied its ultimate goal of returning the parties to the status quo ante, leaving the discriminatee significantly worse off than had he not been unlawfully terminated. The remedy is particularly appropriate here because, as in O'Neill v. Sears, supra, litigation over the discriminatee's 1996 termination was protracted, and "income averaging" is no longer available.

However, a proper tax component would comprise only the extra taxes owed by the discriminatee because of the award of backpay, plus interest in a single tax year. A reimbursement of all of the increased tax liability, including taxes which the discriminatee would have owed each year on his wages had the Employer not unlawfully discharged him, would constitute an inappropriate windfall. Thus, we decided to seek a tax component equal to the difference in taxes owed under the lump-sump payment and the taxes the discriminatee would have owed had he not been unlawfully terminated. We recognized that this additional tax component to the backpay award similarly constituted further income, taxable in its own right. However, in the absence of any indication that other agencies have sought to offset such "secondary" taxable liabilities, or that judicial or administrative courts have ordered such a remedy (known as an income tax "gross-up"), we decided that the tax component here should comprise only the excess taxes that stem from the receipt of backpay and interest income alone.

Remedial Bargaining Order

In our next reported case, where the Union achieved majority employee support after "hallmark" employer unfair labor practices, but ultimately lost a representation election, we considered whether that the alleged unlawful conduct, although serious, warranted a remedial bargaining order under NLRB v. Gissel Packing Co., 395 U.S. 575 (1969) as an alternative to holding a second election.

In May, the Union began an organizing drive among a unit of approximately 95 employees. We noted that the Employer's conduct during this organizing drive violated the Act in a variety of ways, included "hallmark" as well as serious unfair labor practices. In June, the Employer violated Section 8(a)(3) when it caused another employer in the area to refuse to hire two of the Employer's employees who were known union activists. The Employer also unlawfully interrogated two union supporters. In July, the Employer unlawfully terminated a manager for refusing to stop the Union drive, and refusing to terminate three employees. The new manager terminated two of the employees, both known Union supporters, the next day. The third employee quit. Prior to July, only three employees had signed Union authorization cards.

Approximately two 1/2 months later, the Union filed a representation petition, and demanded recognition. At that time, the Union had a bare majority, including the two discriminatees. In the following three days, however, the Union gathered 5 more authorization cards. The Employer refused to recognize the Union.

Thereafter, the Employer renewed its opposition to unionization by committing numerous Section 8(a)(1) violations, some of which affected nearly the entire bargaining unit. Employer managers repeatedly surveilled employee conversations, and there were several one-on-one interrogations about employees' Union activities. In late October and early November, the Employer conducted of captive audience meetings with some number of employees. During these meetings, middle and upper management unlawfully solicited grievances and promised to resolve them; warned about the futility of organizing; threatened the employees that the Employer would not give the Union anything; threatened that the Employer would not hire more employees; threatened loss of benefits and wages; and indicated opposition to good faith bargaining by stating that the parties would negotiate from scratch In mid-November, a manager issued a threat of discharge to one employee, stating that the Employer was weeding out people.

On November 23, the Union lost the election, with an equal number of votes cast evenly for and against the Union. No ballots were challenged; the discriminatees did not vote; and the Union filed timely objections. After the election, the Employer violated Section 8(a)(2) of the Act by creating employee committees to solicit and remedy grievances. Although the Employer disbanded these unlawful committees after a 90-day trial period, the committees had already implemented some minor changes in terms and conditions of employment.

We initially decided that a remedial Gissel bargaining order was not appropriate in this case. Although the Union's demonstrable loss of majority status occurred after the Employer's "hallmark" and serious violations, the Union did not lose that support immediately after the early hallmark discharge violations. Instead the Union gained the vast majority of its support, as evidenced by its having 3 authorization cards in July and more than 50 cards in October.

In Weldun International, 321 NLRB 733, 736 (1996), the Board granted a Gissel bargaining order even though the union gained some support after "hallmark" violations had occurred. In that case, however, the increase in support was much less significant than here. The union in Weldun gathered a small proportion, or only 8 of the 78 cards obtained, after hallmark violations occurred. By contrast, the Union here gathered most of its cards after the "hallmark" discharge violations. We also decided that the discharges of the two union activists, occurring nearly three months before the Union had requested recognition, also did not warrant a Gissel remedy, because the significant unfair labor practices at the beginning of the organizing drive had no immediate effect on the Union's support.

We noted that the Sixth Circuit, in which this case arose, denied enforcement of the Gissel order in Weldun in part because of the union's continued success in gaining support after the Employer committed 8(a)(1) violations. NLRB v. Weldun Int'l, Inc., 165 F.3d 28 (6th Cir. 1998)(unpublished opinion). Although the Employer in our case had issued a threat to discharge to a single employee about a week before the election, this threat would not be sufficient to support a bargaining order. There was no direct evidence that this threat was widely disseminated, and the unit was not so small that it could be assumed that most employees learned of the threat. Compare Yoshi's Japanese Restaurant, Inc., 330 NLRB No. 174 (April 27, 2000) (no warrant for Gissel bargaining order where, inter alia, employer made a specific threat to close that was not widely disseminated).

We also decided, however, that the Employer's unlawful interference with the Union's organizing drive was effective and thus merited seeking special remedies. The unfair labor practices in our case were serious enough and affected enough employees to undermine the Union's status among the bargaining unit employees. See, e.g., Fieldcrest Cannon, Inc., 318 NLRB 470, 473 (1995), enf'd in relevant part, 97 F.3d 65, 74 (4th Cir. 1996); Three Sisters Sportswear Co., 312 NLRB 853 (1993), enf'd mem. 55 F.3d 684 (D.C. Cir 1995), cert. denied, 516 U.S. 1093 (1996); Monfort, Inc., 298 NLRB 73 (1990), enf'd in relevant part, 965 F.2d 1538, 1548 (10th Cir. 1992). See also United States Service Industries, Inc., 319 NLRB 231 (1995), enf'd mem. 107 F.3d 923 (D.C. Cir. 1997); S.E. Nichols, 284 NLRB 556 (1987), enf'd in rel. part, 862 F.2d 952, 960-963 (2d Cir. 1988)(notice reading remedy modified), cert. denied, 490 U.S. 1108 (1989); Wallace Int'l de Puerto Rico, 328 NLRB No. 3 (April 12, 1999).

Special Remedies

In another case, we considered whether special remedies were justified in view of the Employer’s extensive violations of Section 8(a)(1) and (3) of the Act, particularly in the context that such additional relief might jeopardize an outstanding proposed settlement agreement.

The Employer, a commercial laundry, was engaged in the business of cleaning and pressing laundry from various hospitals and hotels in a large metropolitan area. It had a workforce of about 225 employees. The Employer moved its operations to its current location shortly before the Union organizing campaign began in April 1999. At the end of April, after hosting a series of meetings, soliciting signatures for authorization cards and handing out leaflets and other literature, the Union filed a representation petition. An election was held on June 17 and June 19, 1999. The tally of ballots showed 59 votes for the Union, 84 against the Union and 47 determinative ballots. Both parties filed objections.

We had already issued a voluminous complaint, which was to be amended following the appeal, that included numerous Section 8(a)(1) and (3) allegations. These alleged violations included, inter alia, interference, restraint and coercion, creating impression of surveillance, implementation of overly broad rules, solicitation of grievances and promises to remedy same, promises of benefits, threats of job loss, interrogations, unspecified and specified threats of reprisal, asserting futility of supporting the Union, conditioning benefits on opposition to the Union, threats to close the facility if the employees chose the Union, and blaming the Union for the company’s inability to grant benefits. The amended complaint also was to allege the unlawful discharge or constructive discharge of nearly a dozen named employees. The alleged violations were widespread and committed by high management, including both the owner and the president of the company.

We decided that, while the Employer was not a recidivist violator, the extensive and egregious nature of the violations warranted special remedies such as those found in Fieldcrest Cannon, 318 NLRB 470 (1995). With regard to those remedies, it was concluded that the following special remedies were indeed warranted:

a broad cease and desist order

posting the notice in Spanish.

requiring that the notice be read by a Board Agent

mailing the notice to all employees employed since April 30, 1999

publishing the notice in newspapers two times a week for four weeks, including a Spanish newspaper

supplying the names and addresses of employees, updated every six months, to the Union for a time period to be determined, up to two years, or until a certification after fair election

providing reasonable access for the Union to bulletin board for a time period to be determined, up to two years, or until certification after fair election

holding the election at a site off the Employer’s premises

providing reasonable access for the Union to non-work areas for a time period to be determined, up to two years, or until a certification after fair election

providing notice of and equal time for captive audience speeches for a time period to be determined, up to two years, or until a certification after fair election

allowing the Union to have a one hour captive audience meeting in work time at a time period to be determined, not more than ten days and not less than two days before an election

the Union having the right to set the date for a rerun election at any time for a time period to be determined, up to two years following the Board’s decision, on 30 days notice

While we noted that Fieldcrest Cannon could be distinguished on the basis that it involved a large, publicly owned, multi-site company which had engaged in a corporate wide-assault on Section 7 rights, we also noted that the Board did not cite "size" as a necessary element to the granting of special remedies. Instead, the Board stated, "that the Respondent’s unfair labor practices [were] so numerous, pervasive, and outrageous, that special notice and access remedies [were] necessary to dissipate fully the coercive effects of the unfair labor practices found." 318 NLRB at 473. Therefore it was reasoned that to limit such remedies either to large or recidivist employers, would constitute bad public policy. Such a limitation would not only provide overtly anti-union Employers, being organized for the first time, with what would essentially amount to "one free bite," and smaller employers with carte blanche privileges with respect to their anti-union campaign conduct, but also would inevitably create holes in the protective cloak that the Act intended. This is confirmed by the fact that the Board has granted special remedies in several cases involving considerably smaller units. See, e.g., Sambo’s Restaurant, 247 NLRB 777 (1980); Crystal Lake Broom Works, 159 NLRB 429 (1966). In addition, it is noteworthy that in Fieldcrest Cannon, where the unit consisted of over 5,000 workers and where there were only 13 unlawful discharges, the Board still ordered special remedies. In the present case, it was noted that there were almost as many discharges in a unit approximately 1/20 the size.

In that regard, we concluded that the Employer’s conduct in the present case would clearly warrant a bargaining order if the Union had obtained a card majority. To afford a just remedy in these type of situations, the Board has granted special access and notice remedies in cases where a bargaining order would have issued, but for the union’s lack of majority support. Comcast Cablevision of Philadelphia, 328 NLRB No. 74, slip. op. p. 2.

In Comcast Cablevision of Philadelphia, supra, the Board found that an additional remedy was warranted "to dissipate as much as possible any lingering effects of the Respondent’s unfair labor practices, and to ensure that a fair election [could] be held." Id. slip op. p. 1. The purpose of the Board’s order was to "afford the Union 'an opportunity to participate in [the] restoration and reassurance of employee rights by engaging in further organizational efforts…in an atmosphere free of further restraint and coercion.'" Id.

While the Employer in the present case was not a recidivist violator, the unlawful conduct in which it engaged in this matter was as egregious, if not more so, than that in Texas Super Foods, Inc., 303 NLRB 209 (1991), especially in light of the Employer’s overt anti-Union animus and extensive Section 8(a)(1) conduct, and its discharge of 11 employees who were either known or suspected union supporters. And while the Employer was not guilty of repeated unlawful conduct, as in Texas Super Foods, both its owner and its plant manager gave several speeches to employees replete with threats of job loss and promises of benefits, including wage increases and basic disease prevention measures. It was as a result of the speeches given by the Company president and owner that the Board in Texas Super Foods affirmed the administrative law judge's order that the president personally sign and read the notices to small groups of employees, that the Company grant the Union access to the bulletin boards; and that the Company grant the Union’s representatives access to the employees during non-working time in non-work areas; and that the Company grant the Union and its representatives, on request, reasonable notice of and access to attend group meetings held before the next election; and finally, that the Company grant the Union, on request, access to its facilities to deliver a 30-minute speech on issues pertaining to the next election.

With regard to the Union’s specific request for a broad cease and desist order, the Board has held that such an order is warranted only when a "respondent is shown to have a proclivity to violate the Act, or has engaged in such egregious or widespread misconduct as to demonstrate a general disregard for the employees’ fundamental rights." See, Sambo’s Restaurant, Inc., supra. Upon consideration of the numerous Section 8(a)(1) violations, coupled with the discharge of union supporters, we determined that the Employer’s conduct demanded a finding that the Employer showed a remarkable proclivity to violate the Act. In addition, given the Employer’s exhibited lack of regard for its employees’ Section 7 rights, it was concluded that special access remedies were necessary, not only to erase any lingering effects of its conduct during the Spring 1999 campaign, but also to prevent a repeat performance.

Finally, the special remedies were directed even though seeking the extraordinary remedies would require setting aside a proposed settlement agreement that included the offer of reinstatement of twelve of the discharged employees and remedied much of the conduct deemed violative of the Act. While settling the matter and avoiding potentially prolonged resolution due to protracted litigation was an exceedingly attractive prospect, it was noted that there was going to be a second election in this case and that the Union needed access to the hostile and potentially fear-stricken environment that the Employer had created. Furthermore, while the Employer experienced a high turnover rate among its employees, we determined that based on its history and demonstrated union animus, the Employer should be not be given the benefit of the doubt that it would respect its workers rights "the second time around."

Extension of Bargaining Period

In another case of note we considered whether an informal settlement agreement adequately remedied alleged violations found by the Regional Director and, thus, effectuated the purposes and policies of the Act.

In our case, the Union had won a decertification election held in 1999. Thereafter, the parties engaged in negotiations for a successor collective bargaining agreement. During the year following the election, the Union filed numerous meritorious charges against the Employer. Because of such pending unfair labor practice charges, a second, timely-filed, decertification petition was dismissed.

We had already issued a complaint containing over 40 alleged unfair labor practices, including allegations that the Employer orally maintained a rule prohibiting employees from placing union literature in employee break rooms in response to the employees' union activity; promulgated a rule in response to employees' union activities prohibiting employees from talking to other employees during work time; harassed employees in connection with their union activities; engaged in surveillance of employees; ordered employees to remove signs supporting the Union from their personal vehicles; refused to promote an employee because of the employee’s union activities; refused to bargain with the Union; failed to bargain in good faith; bypassed the Union and dealt directly with employees; and refused to furnish relevant information necessary for bargaining. Over the objections of the charging party Union, the Regional Director approved an informal settlement agreement, with a non-admissions clause, that provided for a 60-day posting of a two page "Notice to Employees," which encompassed the complaint allegations and assured employees that the Employer would not violate the Act in regard to such allegations. The agreement also provided substantive remedies for the alleged violations found, including an extension of the bargaining period, but for less than the full period that would be afforded under the Board’s Mar-Jac (Mar-Jac Poultry Co., 136 NLRB 785 (1962)) policy.

In connection with an appeal from the Regional Director’s approval of the settlement we considered the Union’s arguments that in the circumstances presented a settlement with a non-admissions clause was inappropriate, as was an agreement that provided for less than a full Mar-Jac remedy. After carefully considering the nature and breadth of the alleged violations against the Employer we decided that only a formal settlement or a settlement that included a full Mar-Jac remedy would effectuate the purposes and policies of the Act.

Thus, the alleged unfair labor practices found meritorious are the type that attack a union as an institution and have an effect of undermining a union’s status with employees. We considered that the Employer’s conduct damaged the Union’s ability to communicate with unit employees during negotiations for a successor contract and likely furthered efforts to seek its decertification as the employee’s collective bargaining representative. In such circumstances, an informal settlement with a non-admissions clause and less than a full Mar-Jac remedy would not restore the Union to its status quo ante. While the appeal was pending, the Employer posted a letter stating that the settlement occurred only to avoid expensive and time consuming litigation.

Accordingly, we decided that such an agreement should not be accepted over the objections of the Charging Party Union.

Settlement Agreement Including

Section 8(a)(3) Violations

In another case, we considered whether it was appropriate to accept a proposed settlement agreement which remedied numerous violations of the Act, but severed for trial other significant Section 8(a)(3) allegations against the Employer arising from the same labor dispute.

In August 1996, the Union was certified as the collective bargaining representative of the 900 unit employees of the Employer’s hotel. While the parties were bargaining for a contract, anti-union employees distributed leaflets blaming the Union for withheld wage increases. A decertification petition was filed with the Board in December 1997. The parties bargained until January 1998, when the Union informed the Employer that they saw no point in continuing to meet in the face of the Employer’s unfair labor practice campaign, as described below.

The Regional Director found that the Employer had violated the National Labor Relations Act in 72 instances from June 1, 1997, through April of 1999. The Employer had violated Section 8(a)(1) of the Act on 41 occasions by, in part: creating the impression of surveillance of Union activity; preventing employees from distributing Union literature and from talking about the Union with other employees; telling employees that the Employer would not sign a contract with the Union because it was against its policy; threatening discipline for Union activity; telling employees that there would be no benefit or wage increases until the Union was not there; disparately enforcing rules against wearing buttons and hats; promising a retroactive wage increase whether the Union was there or not; telling employees that a department would be reorganized whether or not a Union contract was signed; suggesting that support for the Union may be an impediment to promotion; telling employees that they gave up the right to speak to management when they chose the Union; threatening reprisals against employees on the Union’s negotiation committee if they discussed the negotiations with their supervisors; and telling part-time employees that they will get benefits only if there is a contract or the Union is voted out.

The Regional Director also found 12 Section 8(a)(3) violations, including: the withholding of wage increases from unit employees in 1997 and 1998; withholding the medical benefit improvements from unit employees during 1997; and disparately disciplining Union supporters, including discharging two employees.

Further, the Regional Director found 25 Section 8(a)(5) violations, including: the unilateral implementations of the wage increases and aspects of the medical benefits improvements; many instances of direct dealing with employees and bypassing the Union regarding mandatory subjects of bargaining; and soliciting employee complaints.

The proposed informal settlement included a non-admissions clause and would settle most of the Section 8(a)(1), (3) and (5) allegations. The two Section 8(a)(3) discharge allegations and the withholding of the medical benefits improvements were excluded from the settlement agreement and would be tried separately. The proposed settlement would also provide for a 10-month extension of the certification year, to commence upon compliance with the settlement agreement rather than upon completion of the litigation of the Section 8(a)(3) allegations.

In light of the nature and number of unfair labor practices found and the time period during which the violations were committed, it was determined that the proposed settlement agreement did not sufficiently remedy the unfair labor practices of the Employer. In this regard, it was concluded that the settlement agreement failed to restore the Union to the position it held before the onset of the Employer’s numerous unfair labor practices. The pervasive nature of the Employer’s unlawful conduct which occurred over an extended period of time had the effect of giving employees the impression that the Union was the reason for the lack of benefits and that it was futile to have the Union as the employees’ representative. The proposed settlement agreement which severs from the settlement significant Section 8(a)(3) allegations does not adequately remedy the atmosphere created by the Employer’s unfair labor practices. Additionally, it would not appreciably reduce the litigation burden on the Regional Office which would still have to present much of the evidence underlying the settled allegations in order to prove the Employer’s animus toward union activities in the 8(a)(3) hearing.

Accordingly, we decided that the Employer should be offered a choice of either the informal settlement that would also include retroactive payment for withheld medical benefit improvements, or a formal settlement agreement that would sever for trial the benefit improvement allegations as well as the two alleged unlawful discharges. A formal settlement agreement may include a non-admissions clause, but must provide for a court judgement. See, NLRB Casehandling Manual (Part One) Unfair Labor Practice Proceedings, Section 10130.7. If the Employer rejects both of these options, it was concluded that the appropriate complaint should issue alleging all of the outstanding violations of the Act.


Section 10(j) Authorizations

During the 13 month period from September 1, 1999 through September 30, 2000, the Board authorized a total of 71 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.

Three cases were somewhat unusual and therefore warrant special discussion.

In the first case, shortly after the Union was certified to represent the Employer's employees, the parties engaged in collective-bargaining negotiations. After a while, it became apparent that the Employer was engaged in an overall pattern of bargaining in bad faith with no intention of reaching an agreement with the Union. The Employer's failure to bargain in good faith and the Employer's unlawful solicitations of employees to resign from the Union triggered an unfair labor practice strike. After four months the employees made an unconditional offer to return to work. The Employer unlawfully refused to grant the strikers reinstatement to their former positions. Throughout all of these events, the Employer was attempting to sell its facility. The Region's complaint alleged as violative of Section 8(a)(5) and 8(a)(3) the employer's bad faith bargaining and its refusal to reinstate the unfair labor practice strikers.

The Employer's failure to reinstate the strikers caused documented hardship for numerous employees. Many employees were forced to consider resigning or retiring in order to apply for health benefits under COBRA or seek interim employment elsewhere.

We decided that 10(j) proceedings were necessary in this case to prevent irreparable harm to the parties' collective-bargaining process, further erosion of employee support for the Union and impairment of the Board's ultimate remedial authority. Interim relief was particularly warranted since the Union was attempting to negotiate its first collective-bargaining agreement following its certification and was more vulnerable to employer misconduct.

In addition, we concluded that the imminent need to obtain an alternative source of health insurance increased the pressure on the unreinstated former strikers to find other employment and therefore made it more likely that, absent interim reinstatement, they would find substantial employment elsewhere and be unavailable to accept reinstatement under a final Board order. For this reason, interim reinstatement was needed to prevent the permanent "scattering" of the discriminatees and enable the unit to be properly reconstituted under a final Board order.

Finally, we concluded that injunctive relief was necessary in light of the Employer's efforts to sell its facility. We recognized that if a sale was completed, the employees still working would have a much better chance of keeping their jobs with the new owner. Thus, in order to protect the ultimate right of the former strikers to return to their jobs, we viewed injunctive relief as necessary to return the former strikers to their facility.

The district court granted the requested relief in full, including the interim reinstatement of over 500 unfair labor practice strikers.

The second case involved a unique factual scenario. The Employer consisted of five different subsidiary companies which all constituted a single employer. The largest company, with the largest workforce, had a bona fide long-term collective-bargaining relationship with a local of one of the major international unions. The Employer made a business decision to consolidate the job functions of all of its subsidiaries, which included the cross-training of each subsidiary's employees. Prior to the actual consolidation, however, the largest company entered into negotiations with its union regarding the consolidation of job functions. Negotiations for a successor collective-bargaining agreement were held on a parallel track.

About one year and a half later, while those negotiations continued and the merger was still not implemented, a smaller independent union began organizing one of the Employer's smaller companies which was unrepresented. Within one month, the large company and its union reached agreement on all of the issues relating to the consolidation of job functions, and this agreement was incorporated into the parties' new collective-bargaining agreement. Almost simultaneously, the small union won the right to represent the employees of the smaller company in a Board-conducted election. The Region issued a Board certification to this independent union.

Shortly thereafter, the Employer recognized the large union as the exclusive collective-bargaining representative of the employees of the small company and extended the terms of the new contract to those employees. The contract included numerous and significant changes in the employees' existing terms and conditions of employment. The Employer then met with the employees of the small company and informed them of the plan to consolidate job functions and of the employer's intent to move all employees into the bargaining unit of the larger company. The Employer also informed those employees that they were required under the contract with the large union to sign dues checkoff forms in favor of the larger union. Throughout this period, the Employer had not yet implemented its plan of consolidation. The employees had not received cross-training, their job functions were not merged and the various subsidiaries continued to operate from separate facilities.

The Region's unfair labor practice complaint alleged that the Employer had violated Sections 8(a)(1),(2),(3) and (5) by rendering unlawful assistance and support to the large union, discouraging membership in the small union, making unilateral changes in working conditions and failing and refusing to bargain collectively with the smaller union. The complaint was based, in part, on the theory that an accretion cannot take place until job functions are actually consolidated.

We decided that injunctive relief was necessary to protect the status of the newly certified union. There was a good chance that the newly certified unit would no longer be appropriate after the Employer actually completed its plan to consolidate employee job functions. In the interim, however, the employees of the smaller company were entitled to have their certified union bargain with the employer over their wages, hours and other working conditions, including the "effects" of a lawful, prospective accretion into the larger unit. Because the employees were prematurely and improperly accreted into the larger unit, the smaller union was deprived of timely and meaningful "effects" bargaining.

We also concluded that interim rescission of the unilateral changes upon the union's request was necessary so that the newly certified union would not be forced to bargain from an unlawfully disadvantaged position.

The district court granted the requested relief in substantial part.

In the third case, one month after winning a Board election, the Union was certified to represent a bargaining unit of employees. One day after the certification was issued by the Board, the Employer informed the Union that the company was going to relocate a substantial portion of the bargaining unit work to Mexico. Employees followed trucks that were moving equipment across the border to the Employer's new location. There was evidence in the case that the Employer's decision to relocate unit work was not based upon legitimate economic considerations, but was based the employees having selected the Union to be their collective-bargaining representative. The Region's complaint alleged that the Employer's work relocation decision violated both Section 8(a)(3) and 8(a)(5) of the Act.

We decided that 10(j) relief was necessary both to remove the chilling impact of the work relocation upon all unit employees, as well as to protect the status of the newly certified Union. Due to the imminence of the Employer's implementation of its work removal plans, we also decided to seek a temporary restraining order to halt the ongoing removal of unit work and equipment.

The district court first granted the temporary restraining order and then temporarily enjoined the Employer from relocating its bargaining unit work for a discriminatory purpose while the Board proceeding was pending. The court also granted an affirmative bargaining order in favor of the Union, which requires the Employer to negotiate over the wages, hours and other terms and conditions of employment of the unit employees, including any legitimate decision to relocate unit work which is a mandatory subject of collective bargaining. Although the Board has successfully enjoined under Section 10(j) other employers from unlawfully relocating their bargaining unit work, this is the first time the Agency has successfully prevented an employer from unlawfully moving its work out of the country.

The 71 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 Results

In Category

1. Interference with



(no majority)


Won four cases; four cases settled before petition; one case settled after petition; one case was mooted by court order after filing; lost two cases; two cases were not litigated based upon changed circumstances; one case is pending.

2. Interference with





Won one case; two cases settled before petition; two cases settled after petition; one case was won in part and lost in part; lost two cases; two cases not litigated due to changed circumstances; three cases are pending.

3. Subcontracting or

other change to

avoid bargaining



One case not litigated due to changed circumstances; one case is pending

4. Withdrawal of

recognition from



Won four cases; five cases settled before petition; one case settled after petition; one case not litigated due to changed circumstances.




Category Number of Cases Results

In Category

5. Undermining of




Won one case; one case was won in substantial part; five cases settled before petition; one case not litigated due to changed circumstances.

6. Minority union



Case settled before petition.

7. Successor refusal

to recognize and



Won one case; won two cases in substantial part; three cases settled before petition; two cases settled after petition; lost four cases; one case is pending.

8. Conduct during




Won two cases; two cases settled before petition; lost one case.

9. Mass picketing and



- - - - -

10. Notice

requirements for

strikes and


(8(d) and 8(g))


- - - - -

11. Refusal to permit

protected activity

on property


- - - - -

12. Union coercion to

achieve unlawful



- - - -

13. Interference with

access to Board



Won case.

14. Segregating assets


Won one case; one case settled after petition.

15. Miscellaneous


- - - - -

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