# United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 1, 2017 Decided August 10, 2018

No. 16

- 1320

C APITAL M EDICAL C ENTER
, P ETITIONER

v.

N ATIONAL L ABOR R ELATIONS B OARD
, R ESPONDENT

U NITED F OOD AND C OMMERCIAL W ORKERS L OCAL 21,
I NTERVENOR

Consolidated with 16

- 1369

On Petition for Review and Cross

- Application
for Enforcement of an Order
of the National Labor Relations Board

Charles P. Roberts III argued the cause and filed the briefs for petitioner.

Kellie J. Isbell , Attorney, National Labor Relations Board, argued the cause for respondent. On the brief were Richard F. Griffin

, Jr ., General Counsel, John H. Ferguson , Associate General Counsel, Linda Dreeben , Deputy Associate General2

Counsel, Elizabeth A. He aney , Supervisory Attorney, and
Heather S. Beard , Attorney.

Matthew J. Ginsburg argued the cause for intervenor.
With him on the brief was James B. Coppess

.

Before: G ARLAND
, Chief Judge , and R OGERS and
S RINIVASAN
, Circuit Judges

.

Opinion for the Court filed by Circuit Judge S RINIVASAN

.

S RINIVASAN
, Circuit Judge : In this case, a small number
of off

- duty hospital employees, seeking to inform visitors to the facility about an ongoing labor dispute, peacefully
distributed leaflets an d held picket signs on hospital property next to an entrance. It is undisputed that the employees’ distribution of leaflets was protected under the National Labor Relations Act. The question we face is whether the emp loyees’ holding of picket signs

— witho ut any chanting, marching, or obstructing of passage

— necessarily took their conduct beyond the NLRA’s protections. The hospital tried to stop the employees’ stationary display of picket signs, believing that the employees had no right to engage in that co nduct on the facility’s premises.

The National Labor Relations Board disagreed. The Board examined the employees’ form of picketing under a framework traditionally applied to assess off

- duty employees’ distribution of union literature on hospital propert y. That framework asks whether prohibiting the employees’ conduct is necessary to avoid disrupting patient care. The Board concluded that, here, the hospital failed to make that showing with regard to the employees’ holding of picket signs . As a result, the Board determined, the hospital had violated the employees’ rights under the NLRA by attempting to bar their protected conduct.3

We sustain the Board’s interpretation of the NLRA as
reasonable . In our view, the Board’s approach permissibly balances emp loyees’ rights to organize against an employer’s interests in controlling its property. And the Board was not compelled to adopt a categorical rule that picketing of any
kind

— including the stationary, non obstructive holding of a picket sign at issue here

— is necessarily more disruptive, and less entitled to the NLRA’s protections, than distribution of union literature. We thus deny the hospital’s petition for review and grant the Board’s cross

- application for
enforcement.

I.

A.

Under Section 7 of the National Labor Relations Act, employees “have the right to self

- organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other
concerted activ ities for the purpose of collective bargaining or other mutual aid or protection.” 29 U.S.C. § 157. Section 7’s protections encompass the “rights to discuss organization and the terms and conditions of their employment, to criticize or complain about the ir employer or their conditions of employment, and to enlist the assistance of others in addressing employment matters.” Quicken Loans, Inc. v. NLRB , 830 F.3d 542, 545 (D.C. Cir. 2016). Those rights include soliciting support not only from fellow employe es but also from nonemployees such as customers and the general public. E.g.

, St anford Hosp. & Clinics v. NLRB , 325 F.3d 334, 343 (D.C. Cir. 2003). Employers commit an “unfair labor practice” in
violation of the Act when they “interfere with, restrain, o r coerce employees in the exercise of” their Section 7 rights. 29
U.S.C. § 158(a)(1).4

When employees seek to exercise Section 7 rights on their employer’s property, the employees’ rights are balanced against the employer’s property interests and management prerogatives. In administering that balance, the Board has adopted various presumptions. In Republic Aviation Corp. v.
NLRB , the Supreme Court approved the Board’s application of a presumption that an employer cannot prohibit off

- duty empl oyees’ solicitation of union support on company property. 324 U.S. 793, 803 (1945). To overcome the presumption, an employer must present “evidence that special circumstances make” a prohibition on solicitation “necessary in order to maintain production or discipline.” Id

. at 803 n.10 (citation omitted) ; see id. at 803

- 04 . The Board later applied the Republic Aviation presumption to the distribution of union
literature on company property by off

- duty employees

. Eastex,
Inc. v. NLRB , 437 U.S. 556, 572

- 7 4 & n.23 (1978).

The Board has also recognized that employer interests can
vary based on the nature of the workplace. Of particular
relevance , the Board has modified the Republic Aviation presumption in the hospital context to account for the importance of administering patient care without disturbance

. In immediate patient

- care areas, the Board does not consider a ban on employee solicitation of union support to be presumptively invalid. See Beth Israel Hosp. v. NLRB , 437 U.S. 483, 495 (1978); NLRB v. Baptist Hosp., Inc. , 442 U.S. 773, 778 & n.8 (1979). But outside of immediate patient

- care areas, such as in hospital lounges and cafeterias, a prohibition

on employee solicitation of union support is presumptively invalid unless the hospital can demonstr ate the need for the
restriction “to avoid disruption of health

- care operations or disturbance of patients.” Beth Israel Hosp. , 437 U.S. at 50 7

.

The Republic Aviation presumption, including its tailored application to hospitals, has been applied predomin ant ly in the5

contexts of oral solicitation of union support or distribution of
union

- related literature . In 2004, however, the Board applied
the Republic Aviation presumption in a case involving both distribution of handbills and picketing on company prop erty

. Town & Country Supermarkets , 340 N.L.R.B. 1410 (2004)

. Because the employer had failed to demonstrate special
circumstances justifying its ban on that activity, the Board held
that the employer committed an unfair labor practice by attempting to ba r the “employees from engaging in picketing and handbilling

. ” Id

. at 1414.

B.

With that backdrop in mind, we turn to the dispute in this case. Petitioner Capital Medical Center is an acute

- care hospital in Olympia, Washington. United Food and Commercial Workers (the Union) represents a unit of Capital’s technical employees. Their collective bargaining agreement expired in September 2012 . As of May 2013, the parties had yet to reach a new agreement.

On May 9, 2013, the Union notified Capita l that it intended to engage in picketing and handbilling outside the hospital on May 20, to advocate for a new agreement before the next bargaining session. At 6 :00 a

. m

. on May 20, 2013, twenty to twenty

- five employees began picketing and chanting on the public sidewalks around the hospital. The picketing and handbilling activities continued throughout the day, with fifty to sixty employees picketing and handbilling on the public
sidewalks in the afternoon

. A few employees, w ith Capital’s permission

, we nt onto the hospital’s property to hand out
leaflets alongside two non emergency entrances.

Around 4 :00 p

. m

. , two to four employees took leaflets and picket signs from the sidewalk and walked onto hospital6

property. They stood next to a nonemergency en trance to the building while holding the signs, with some also handing out leaflets while holding the signs. The signs contained the messages “Respect Our Care” and “Fair Contract Now.” Multiple hospital personnel told the employees that they could
conti nue distributing leaflets but could not stand on hospital property with their picket signs . T he employees , though,
declined to leave.

Union representatives then met with Capital’s labor relations counsel and human resources manager . The company’s counsel informed the Union representatives that the picketing employees would face discipline if they remained on hospital property. The representatives maintained that the employees had a right to remain on hospital property with their picket signs. Cap ital’s counsel th en called the Union’s attorney
and threatened to discipline the employees or call the police. One picketing employee, c oncerned about potential discipline or arrest, returned to the sidewalk. Another employee took his picket sign and rep laced him near the entrance.

A t around 5:00 p.m. , roughly an hour after the employees began holding picket signs on hospital property, a hospital security officer called the police. A police officer arrived, and informed Capital personnel that he could not remove the employees because they were not being disruptive or blocking the entry doors. The picketers opted to leave a short time later because their picketing was scheduled to end soon in any event (at 6:00 p.m. )

. Few people entered or exited the hospital during the time the employees held picket signs near the entrance, and there were no confrontations between the employees and anyone who came into or out of the hospital.

The Union filed a charge with the NLRB’s regional director, alleging that Cap ital’s reaction to the employees’7

holding picket signs on hospital property unlawfully interfered with employees’ exercise of their Section 7 rights. T he Board issued a complaint, alleging that Capital’s interference in the picketing violated the Act. In July 2014, an administrative law judge found that Capital had committed an unfair labor practice by telling employees they could not picket by the entrances, threatening disciplinary action, and calling the police.

On August 12, 2016, the Board affirmed the ALJ ’s findings and conclusions. Capital Med. Ctr. & UFCW Local
21 , 364 N.L.R.B. No. 69, 2016 WL 4362367, at *1 (Aug. 12, 2016)

. The Board “assume[d] arguendo” that the employees’ stationary holding of picket sig ns amounted to “picketing within the meaning of the Act.” Id. at *1 n.4. The Board then
assessed whether the presumption recognized in Republic
Aviation , 324 U.S. 793, as tailored to the hospital context, Beth
Israel Hosp

. , 437 U.S. 483, applies to employee picketing just as it applies to employee handbilling and other protected Section 7 activity.

The Board decided that the Republic Aviation framework should govern in cases involving picketing on company property. That conclusion, the Board noted, found support in
its prior decision in Town & Country , 340 N.L.R.B. at 1414, which had applied the Republic Aviation presumption to off

- duty employee picketing on the employer’s premises . The Board rejected the notion that pi cketing is inherently more disruptive than the other Section 7 activity covered by Republic
Aviation , such that the presumption should be categorically inapplicable in the context of picketing

.
Applying the modified Republic Aviation presumption that

gov erns in the hospital context , the Board examined the employees’ conduct at issue, which the Board described as “holding signs near a nonemergency entrance without any8

patrolling, chanting or obstruction of the entrance.” Capital
Med. Ctr.

, 2016 WL 4362367

, at *3 n.9

. The Board agreed
with the ALJ ’s finding that the employees’ stationary, peaceful picketing was un likely to interfere with patient care . Capital
thus failed to meet its burden to show that it needed to bar the picketing to “prevent patient disturbance or disruption of health care operations.” Id. at *5

. One Board member dissented, disagreeing with the Board’s conclusion that the Republic
Aviation presumption should apply to off

- duty picketing on employer property.

Ca pital now petitions this court for review, and the Board

cross

- applies for enforcement of its order. 29 U.S.C. § 160(e)

- (f). The Union has intervened in support of the
Board’s decision.

II.

Capital principally challenges the Board’s decision on the ground that the Republic Aviation framework should be inapplicable in the context of employee picketing on company property. We disagree. The Board permissibly declined to conclude that picketing inherently is so disruptive as to be categorically ineligi ble for protection under the Republic
Aviation presumption. We also reject Capital’s contention that, in applying the Republic Aviation framework, the Board should have found the picketing in this case sufficiently likely to disrupt patient care such that Capital could validly bar it.

A

.

We first address whether the Board could apply the Republic Area framework to employee picketing on company premises, or whether the Board instead was obligated to confine that framework to the exercise of Section 7 rig hts in9

other ways such as orally soliciting support or distributing leaflets. In deciding to apply Republic Aviation to employee picketing, the Board construed the scope of Section 7’s protections. We defer to the Board’s reasonable interpretation
of amb iguous NLRA provisions, as we generally do when an agency construes a statute it administers. E.g.

, ITT Indus., Inc.
v. NLRB

, 251 F.3d 995, 999

- 1000 (D.C. Cir. 2001); see Chevron U.S.A. Inc. v. N at’l R es. D ef. C ouncil , 467 U.S. 837,
842

- 43 (1984). We sustain the Board’s application of the Republic Aviation framework here on that basis.

At the outset, it is undisputed that Section 7 does not directly resolve the rights of off

- duty employees to picket on company propert y. See ITT Indus. , 251 F.3d at 1000 (“Section 7 does not itself speak of access rights [

. ] ”). The Board’s interpretation of those rights, then, would ordinarily call for our deference if reasonable. But Capital contends that the Board’s interpretation no netheless is ineligible for deference because, Capital argues, the Board failed to balance the hospital’s property rights against the employees’ Section 7 rights, as it was required to do. See id. at 1005 ; NLRB v. Babcock & Wilcox
Co. , 351 U.S. 105, 112 ( 1956).

Capital’s argument is misconceived. The Board accounted for (and balanced) the employer’s property rights and management prerogatives by invoking the Republic Aviation
framework. See DHL Express, Inc. v. NLRB , 813 F.3d 365, 376 (D.C. Cir. 2016)

. As the Board explained, “ Republic
Aviation itself explicitly required a balance between protection of employees’ Section 7 rights and employers’ property rights and business interests”; and the Republic Aviation framework gives effect to an employer’s i nterests in the hospital setting on

a case

- by

- case basis by enabling a hospital to “prohibit Section
7 activities in non

- patient care areas if it shows that the prohibition is needed to prevent patient disturbance or10

disruption of health care operations.” Capital Med. Ctr.

, 2016 WL 4362367, at *4; see also id. at *4 nn. 10

- 11.

We therefore must sustain the Board’s interpretation if it is reasonable. Capital advances two strands of arguments in contending that the Board could not permissibly apply the Republic Aviation presumption to employee picketing on company property. First, Capital asserts that picketing of any kind is inherently more disruptive than other forms of Section 7 activity. Second, Capital submits the Board did not adequately explain its departure from agency precedents under which an employer could bar picketing on its property if there
were reasonable alternative means of communication available to the employees. We find Capital’s arguments unpersuasive,
and we sustain the Board’s a pproach as reasonable.

1

.

There is no dispute that the tailored Republic Aviation presumption protects off

- duty employees’ distribution of union literature on hospital property in non

- patient care areas (unless the hospital can show it needs to bar the conduct to avoid disrupting health care operations ). Capital therefore did not attempt to stop its employees from handing out leaflets outside the entrance to its facility

. Is employee picketing categori cally different, such that the Republic Aviation framework should have no application to picketing as a blanket matter?

The Board permissibly answered that question no. The Board explained that “[t]here is nothing in the nature of picketing per se that w ould support a conclusion that Republic
Aviation is inapplicable to that activity.” Capital Med. Ctr.

, 2016 WL 4362367, at *3 n.9. “In fact,” the Board determined, “picketing is often neither coercive nor disruptive.” Id. The
Board said that it needed to “ look no further for an example11

than the peaceful display of picket signs

. . . that occurred in
this case.” Id. “Indeed,” the Board reasoned, “the quiet, stationary” picketing at issue “was even less confrontational than the permitted handbilling in an important respect: it involved no direct contact with the recipient of the handbill.”
Id. at *5 n.14. And wherea s the employees “stationed themselves outside the main pathways to the doors,” they “only stepped into the entryway

. . . when handbilling,” not when they merely held picket signs. Id. at *4 n.13

.

The Board’s interpretation of Section 7, so as to apply the same framework to picketing as to other protected employee conduct, is reasonable. In contending otherwise, Capital relies on the Supreme Court’s observation that “picketing is qualitatively different from other forms of communication.”
Edward J. DeB artolo Corp. v. Fla

. Gulf Coast Bldg. & Const.
Trades Council

, 485 U.S. 568, 580 (1988 ). The Board, though, addressed that observation directly, explaining that the Court “did not state that [picketing] is necessarily or inherently ‘coercive’ or ‘disrupti ve.’” Capital Med. Ctr. , 2016 WL 4362367, at *3 n.9 . And the Court in DeBartolo , when referring to “picketing,” appeared to have in mind “those patrolling a picket line,” 485 U.S. at 580, as opposed to the stationary holding of picket signs by two to fou r employees without any patrolling (or even chanting), at issue here.

The Board, moreover, specifically rejected any notion that it was “holding that on

- premises picketing must be permitted to the same degree as on

- premises solicitation and handbilling.” Capital Med. Ctr. , 2016 WL 4362367, at *3 n.9 (internal quotation marks omitted) . Rather, the Board could

“ easily envision circumstances, not present here, where picketing on hospital property would disrupt operations or interfere with patient care while solicitation and distribution
would not.” Id. The Republic Aviation framework would12

enable a hospital to bar picketing in those situations. Id. And
the Board presumably will develop principles on a

case

- by

- case basis that will guide employers about the
circumstances in which they can prohibit picketing on company premises. It also bears recalling that the Republic
Aviation framework’s presumption applies only in

“ non

- patient care areas.” Id. at *4 . In patient

- care areas, a hospital is generally fr ee to prohibit Section 7 activity including any holding of picket signs. See Stanford Hosp. , 325
F.3d at 338

- 39.

Capital argues that the Board erred in relying on its previous decision in Town & Country Supermarkets , which, in Capital’s view, was inadequ ately reasoned and materially distinguishable in its treatment of picketing. The Board, though, invoked Town & Country Supermarkets here primarily (and correctly) to show that it had previously applied the Republic Aviation framework to picketing by off

- d uty employees on company property. Id. at *3. The Board hardly relied solely on Town & Country Supermarket to justify its decision to apply Republic Aviation in the context of this case. Rather, as discussed, the Board separately set out why it would
be appropriate to bring employee p icketing within that
framework

— including by reasoning that picketing can be

non coercive and non disruptive , as the Board found was true of
the peaceful, stationary holdi ng of picket signs in this case

.

Finally, Capital argues that the Board erred in relying on Section 8(g) of the NLRA. That provision requires employees of health care facilities to provide 10

- day s’ advance notice
before engaging in picketing or striking. 29 U.S.C. § 158(g).
The Board i nvoked Section 8(g) to demonstrate that Congress contemplated the picketing of health care facilities by employees, and Congress allowed for picketing of hospitals
without excluding picketing on hospital property. Capital13

Med. Ctr. , 2016 WL 4362367, at *3 n.9. Capital emphasizes that Section 8(g) does not speak to whether picketing of hospitals necessarily would occur on a hospital’s private grounds. The Board understood as much, but permissibly relied on Section 8(g) t o support the general idea that pic keting of hospitals need not be subjected to different standard s than other Section 7 activity.

In short, the Board reasonably interpreted Section 7 in concluding that the Republic Aviation presumption could

encompass not only solicitation and distributio n on employer property, but also picketing

.

2

.

Capital next contends that the Board applied the Republic
Aviation framework without account ing for and sufficiently explain ing its departure from its prior precedents. “[A] n unexplained divergence from its precedent would render a Board decision arbitrary and capricious.” Fort Dearborn Co.
v. NLRB , 827 F.3d 1067, 10 74 (D.C. Cir. 2016). The Board, though, gave an adequate explanation here

.

Capital points primarily to the Board’s decision in Providence Hospital

, 285 N.L.R.B. 320 (1987). There, a hospital prohibited off

- duty employees from engaging in informational p icketing on hospital property. In administering
the balance “between propert y rights and Section 7 rights, ” the Board applied its then

- applicable Fairmont Hotel test. Id . at 321 (citing Fairmont Hotel , 282 N.L.R.B. 139 (1986)) . That

test addressed whether an employer must allow access to its property for the exercise of Section 7 rights by off

- duty employees or nonemployee union organizers . Under the test, if the employer’s property interests and the off

- duty employees’ (or nonemployee organizers’) Section 7 interests14

were relat ively equal in weight, the Board considered whether there was a “reasonable alternative means for communicating
with [ the ] intended audience

. ” Id

. at 322

. Applying that inquiry in Providence Hospital , the Board upheld the hospital’s ban on picketing on i ts property, concluding that the employees could effectively communicate with the public by engaging in informational picketing on adjacent public property. Id.

The Board subsequently determined that the availability of
“reasonable alternative means” wou ld be relevant in every case involving access to company property for exercising Section 7 rights , not just cases in which the competing interests were roughly equal in strength. See Jean Country

, 291 N.L.R.B. 11, 11 (1988). The Supreme Court then invali dated the Jean Country framework’s balancing of interests, “[a]t least as applied to nonemployees.” Lechmere, Inc. v. NLRB , 502 U.S. 527, 538 (1992) . The Court held that, under its precedents, nonemployee union organizers had no cognizable interest in accessing the employer’s premises as long as they had reasonable access to employees elsewhere. Id. at 537

- 38. The Court did not directly speak to whether the Jean Country
framework

— including the consideration of “reasonable
alternative means”

— continued to govern in cases involving
off

- duty employees.

Capital argues that the Board was obligated by its precedents to continue considering the availability of reasonable alternative means in cases involving off

- duty employees, unless it adequately explained why it would no longer do so

. The Board, however, adequately accounted for its precedents in its decision. It specifically referenced Providence Hospital , explaining that the decision no longer governed “[f]or the reasons set forth by the [administrativ e law] judge.” Capital Med. Ctr. , 2016 WL 4362367, at *4 n.12. And the ALJ in turn thoroughly explained her decision not to15

apply the Providence Hospital/Jean Country line of
decisions

— and instead to apply the Republic Aviation
framework

— in the circumsta nces of this case.

The ALJ acknowledged that the “case that weighs most strongly in [Capital’s] favor is Providence Hospital .” Capital
Med. Ctr. & UFCW Local 2 1

, ALJ Decision

, 2014 WL
3548159 , at 10 (July 17, 2014) ( J.A. 359 )

. But the Providence Hospital/Jean Country line of decisions, the ALJ observed, had been rejected by the Supreme Court as applied to

non employees. Id. at 8, 10

- 1 1 ( J.A. 357, 359

- 60 ). And the Board had since “declined to apply the Jean Country test to cases involving off

- dut y employee access to the work premises.” Id. at 8 (J.A. 357)

. Rather, the Board’s decisions
had evolved to draw distinctions based on certain “primary
considerations

, ” one of which the ALJ found especially salient
here : whether the circumstances involve d a blanket prohibition against off

- duty employees accessing company property, or
instead involved selective permission for off

- duty employees to come onto the premises for some purposes but not to engage in certain forms of Section 7 activity. I d. at 8, 10

- 1 1 (J.A. 357,
3 59

- 60 )

.

This case falls into the latter category, the ALJ explained.
It “does not involve a no

- access rule or policy.” Id. at 8 (J.A. 357)

. Instead , “off

- duty employees were permitted to be on the Hospital’s premises . . . so long as they did not carry picket signs.” Id. ; see id. at 11 (J.A. 360) . In that setting, the ALJ determined, the Republic Aviation framework, rather than the Providence Hospital/Jean Country line of decisions, was controlling. Id. at 8, 11 (J.A. 357, 360)

.

The Board expressly incorporated the ALJ’s reasoning. Capital Med. Ctr. , 2016 WL 4362367, at *4 n.12. The Board thus determined that, “consistent with

. . . [its] treatment of16

other Sec. 7 activity in a hospital setting, it is appropriate to place on the employer the burden of showing a likelihood of disturbance or disruption in a particular case.” Id. T he Board adequately explained why it adopted that approach rather than
the one set out in Providence Hospital/Jean Country , including by adopting the ALJ’s reasoning on the issue

.

B

.

Capital briefly challenges the Board’s finding that, under
the Republic Aviation framework, the informational picketing
at issue here was unlike ly to disrupt health operations or cause patient disturbance

. We assess whether the Board’s finding in that regard is supported by substantial evidence, Brockton Hosp. v. NLRB , 294 F.3d 100, 104 (D.C. Cir. 2002) , and
conclude that it is.

In order to over come the Republic Aviation presumption, “the Hospital had to show only a likelihood of, not actual, disruption or disturbance.” Id. Capital asserts that the Board impermissibly required it to show an actual disruption rather
than the likelihood of a disr uption. The Board , however,
examined whether Capital had adduced evidence of “any potential disruption” and the “ likely impact” of the picketing. Capital Med. Ctr.

, 2016 WL 4362367

, at * 4 ( emphases added)

. Capital failed to rebut the presumption

, not because it was made to prove an actual disruption, but because its allegation
of a “ potential disruption ” was based on “speculative and exaggerated contentions” that were “not supported by the
record.” Id

. at * 4

- 5.

T he Board’s finding that Capital had failed to demonstrate a likelihood of patient disturbance or disruption of health care operations is supported by substantial evidence. Undisputed
record evidence establishes that there were only two to four17

employees who held picket signs on the hos pital’s property

, standing stationary by a nonemergency entrance. They did not chant, march, or obstruct visitors from entering or leaving the hospital, and Capital offered no evidence demonstrating that the peaceful holding of picket signs nonetheless could disrupt patient care. We therefore uphold the Board’s finding that the picketing at issue here presented no likelihood of disruption or disturbance , and we sustain the Board’s resulting conclusion that Capital violated the NLRA by attempting to stop the employees from holding picket signs

.

* * * * *

For the foregoing reasons, we deny the petition for review and grant the Board’s cross

- application for enforcement of its
order.

So ordered.