FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

HEALTHCARE EMPLOYEES UNION, 

LOCAL 399, AFFILIATED WITH THE

SERVICE EMPLOYEES INTERNATIONAL

UNION, AFL-CIO,

No. 03-72029 Petitioner,

NLRB No. v.  31-CA-24325

NATIONAL LABOR RELATIONS

BOARD, OPINION

Respondent,

ST. VINCENT MEDICAL CENTER,

Respondent-Intervenor. 

On Petition for Review of an Order of the

National Labor Relations Board

Argued and Submitted

February 9, 2005—Pasadena, California

Filed March 17, 2006

Before: Harry Pregerson, William C. Canby, Jr., and

Robert R. Beezer, Circuit Judges.

Opinion by Judge Pregerson;

Dissent by Judge Beezer

2743
COUNSEL

David A. Rosenfeld (brief & argued) and M. Suzanne Murphy

(brief), Weinberg, Roger & Rosenfeld, Oakland, California,

attorneys for the petitioner.

Meredith L. Jason (argued) and David Habenstreit and Jill A.

Griffin (brief), National Labor Relations Board, Washington,

D.C., attorneys for the respondent.

Gordon A. Letter (brief and argued), Littler Mendelson, Los

Angeles, California, attorneys for the respondent-intervenor.

OPINION

PREGERSON, Circuit Judge: 

Healthcare Employees Union Local 399 (the “Union”) petitions this court to review a final order of the National Labor

HEALTHCARE EMPLOYEES UNION v. NLRB 2747
Relations Board (the “Board” or “NLRB”). The Board’s order

dismissed the Union’s unfair labor practice charge against St.

Vincent Medical Center (“St. Vincent”). 

In its unfair labor practice charge, the Union alleged that St.

Vincent subcontracted out the work of the hospital’s respiratory care department on the eve of a union election to prevent

employees in that department from voting in the election, in

violation of Sections 8(a)(1) and 8(a)(3) of the National Labor

Relations Act (“NLRA”), 29 U.S.C. §§ 158(a)(1), 158(a)(3).

After a hearing, an administrative law judge (“ALJ”) ruled

that the Union failed to carry its burden of persuasion that

anti-union animus was a motivating factor in St. Vincent’s

subcontracting decision and dismissed the complaint. That

ruling was affirmed by the Board. In addition, the Board ruled

that even if the Union had carried its burden of persuasion, St.

Vincent demonstrated that it would have subcontracted out

the work of the department in the absence of union organizing

activity. 

We have jurisdiction under 29 U.S.C. § 160(f). For the reasons stated below, we grant the Union’s petition for review

and remand for further proceedings. 

FACTUAL AND PROCEDURAL BACKGROUND

St. Vincent Medical Center is an acute care hospital located

in Los Angeles, California. Before subcontracting1 out the

work of the respiratory care (“RC”) department in February

2000, St. Vincent employed twenty-seven respiratory care

therapists. RC therapists are responsible for administering respiratory care treatment (i.e., administering intubations, venti1We use “subcontracting,” “subcontracting out,” and “outsourcing”

interchangeably in this opinion to refer to the arrangement whereby St.

Vincent contracted with a third party to operate the Respiratory Care

department at the hospital. 

2748 HEALTHCARE EMPLOYEES UNION v. NLRB
lators, or life support systems) throughout the hospital. In

addition to providing respiratory care treatment, RC therapists

are responsible for assessing each patient’s health and reporting each patient’s status to on-coming shift employees and

doctors. 

A. Management Problems in the Respiratory Care

Department

St. Vincent contends that it outsourced the work of its RC

department in February 2000 because it was unable to find

and train suitable managers. St. Vincent’s difficulty with management of the RC department had existed for a long time

before the work of that department was actually subcontracted

out. In fact, while the RC department’s problems became

more evident in the three years before the outsourcing decision, the hospital had comparable problems with its RC

department for nearly thirteen years. 

Despite the replacement of the RC department’s manager

in early 1999, the department’s productivity standards continued to remain lower than those of other departments. Several

RC employees testified that during 1999 they encountered

problems that hindered them from accomplishing their

assigned tasks. During that time they complained regularly to

management about a lack of proper billing codes, lack of

proper respiratory equipment, and general staffing problems.

The ongoing problems in the RC department did not go

unnoticed by upper-level management.2 In the summer and

fall of 1999 Ray Hancock and Ramon Suarez, both RC

department managers, met regularly with Zita Uy, assistant

2The hospital’s Charge Audit Committee (founded in April 1999 and

responsible for auditing charts, documentation, and billing in the various

departments), issued regular reports in summer and fall of 1999 scrutinizing the RC department’s problems with tracking treatments and with providing proper billing information. 

HEALTHCARE EMPLOYEES UNION v. NLRB 2749
administrator for the RC department, to discuss the problems

in the RC department. 

B. The Union Campaign

The Union began its campaign to organize the hospital’s

technical staff in July 1999, when it assigned between three

and four full-time organizers to St. Vincent.3 Union organizers, easily identified by their distinctive T-shirts, spoke openly

to employees at the hospital and passed out pro-union fliers

several times a week. In early July, the Union picketed in

front of the hospital as hospital managers stood by watching.4

Union organizers also stationed themselves in the hospital

cafeteria between ten and twenty times a month and spoke to

employees about the Union. As the campaign progressed,

Union organizers made regular home visits to hospital staff to

discuss the benefits of joining the Union. The Union’s efforts

proved successful, as the ALJ found that most of the Union’s

success in securing union authorization cards from employees

occurred after mid-1999.5

The ALJ concluded that St. Vincent “admittedly made a

studied effort to keep track of [the Union.]”

6

 Mary Hill, direc3

In early 1998, the Union first undertook to organize the hospital’s technical staff, which included the RC department. At that time, the Union

assigned one part-time organizer to the campaign. The ALJ found that

while the organizing activities were initially minimal, St. Vincent managers became aware of the organizing activities almost immediately. 

4

It is unclear from the record exactly who from management was watching and whether the Union picketed the hospital on several occasions or

on a single day. 

5An employee signs a union authorization card to demonstrate his or her

willingness to become a member of the union. A union will normally submit the signed authorization cards to the Board in support of its petition

for an election. See Patrick Hardin & John E. Higgins, Jr., The Developing

Labor Law 501 (4th ed. 2001). 

6The ALJ’s findings and rulings can be found with the Board’s decision

in St. Vincent Med. Ctr., 338 NLRB No. 130, 2003 WL 1785029 (Mar. 31,

2003). 

2750 HEALTHCARE EMPLOYEES UNION v. NLRB
tor of human resources for the hospital, testified that she

asked her supervisors and managers to “let [her] know of any

Union activity, whether that be leafletting or if employees are

informing them of home visits, presence in the cafeteria, that

sort of thing.” Several RC department managers and one

Union organizer testified about their open encounters with

each other in and around the hospital.7 Moreover, one RC

employee, Steven Rush, testified that during an RC department meeting in the fall of 1999, either Uy or Hill stated that

“unions were bad for the hospital” and that the RC department

could “work out problems on [its] own with staff and management.”8

 Another RC employee testified that during a meeting

in 1999, Hancock, an RC department manager, stated that the

Union only wanted money from the RC employees.9

The RC department, which made up twenty-five percent of

the technical staff at the hospital, overwhelmingly supported

the Union. The ALJ found that 

[St. Vincent] could not have failed to have identified

the RC employees as the core of the Union’s sup7On one occasion, Uy identified herself to a Union organizer as the head

administrator of the RC department and asked for leaflets. Hancock, the

manager of the RC department, testified that he also saw some of the

Union fliers during 1999. One union organizer, Terence Courtney, testified that he and Bill Parente, the hospital president, would see each other

regularly as Parente drove in and out of the hospital. Courtney testified

that Parente knew him on a first name basis. 

8The record does not reveal who exactly made the comments. 

9The Union also points out that Hancock stated in one meeting in 1999

that the hospital “didn’t like unions.” But the ALJ specifically credited

Hancock’s denial of this statement. “Credibility determinations by the ALJ

are given great deference, and are upheld unless they are inherently

incredible or patently unreasonable.” Retlaw Broadcasting Co. v. NLRB,

53 F.3d 1002, 1006 (9th Cir. 1995) (internal quotations marks and citation

omitted). The Union offers no reason why the ALJ’s determination of

Hancock’s credibility is incredible or patently unreasonable. We therefore

defer to the ALJ’s credibility determination and uphold his finding that

Hancock never stated that the hospital “didn’t like unions.” 

HEALTHCARE EMPLOYEES UNION v. NLRB 2751
porters among the hospital’s employees, and that [St.

Vincent] may well have deduced, and probably did

deduce, from such intelligence that the RC employees were the most likely proselytes of the Union’s

cause in other departments. 

A lead organizer for the union, Roberto De La Cruz, testified that the RC department was “one of the strongest units”

and that RC employees were “instrumental in pushing the

[organizing] drive.” De La Cruz testified that the RC employees comprised a majority of the organizing committee, which

helped “[the Union staff] strategize as to how to proceed in

the campaign and [identify] other workers.” Between nine and

twelve RC employees were openly pro-union. They discussed

the Union with co-workers at work, openly talked to Union

organizers, and passed out pro-union fliers in front of the hospital. De La Cruz testified that Union organizers held the RC

department out to other departments in the technical staff as

a strong pro-union department. About ninety-five percent of

the RC employees ultimately signed union authorization

cards. 

In a flier dated November 10, 1999, and distributed

throughout the hospital’s technical staff, the Union announced

that it was a “few weeks” away from filing an election petition with the Board. The flier also announced that once the

election petition was filed, the Board would set an election

within forty-five to sixty days.10

On January 5, 2000, the Union filed a petition for an election with the Board for the bargaining unit of one-hundred

technical staff employees, which included the twenty-seven

RC therapists. On January 21, 2000, the parties stipulated to

an election to be conducted by the Board on February 18,

2000. 

10St. Vincent produced the flier at the hearing pursuant to a subpoena.

2752 HEALTHCARE EMPLOYEES UNION v. NLRB
C. Subcontracting Discussions

In July 1999, the same month that the Union began its campaign to organize the technical staff, Uy met with Eleanor

Ramirez, the senior assistant administrator in charge of

patient services. During that meeting Uy and Ramirez first

discussed subcontracting out the work of the RC department.

Uy testified that she and Ramirez briefly discussed the successful use of subcontracting to alleviate “quality issues” in

other departments at St. Vincent. She further testified that she

and Ramirez agreed to reassess the situation “later on that

year.” They did not, however, speak to Bill Parente, the hospital president, or other St. Vincent managers about subcontracting out the work of the RC department. 

On November 18, 1999, eight days after the Union

announced it was close to filing an election petition with the

Board, Uy met with RC department managers Suarez and

Hancock to discuss the RC department. At that meeting, both

Hancock and Suarez raised the option of subcontracting out

the work of the RC department. Suarez stated that he was

unable to manage the department. He also stated that both he

and Hancock agreed that someone more experienced would

be a better department manager. The next day, Ramirez

authorized Uy to investigate potential subcontracting vendors.

On December 20, 1999, Uy and Ramirez met again to discuss subcontracting.11 Uy testified that she and Ramirez recognized that subcontracting would “be very expensive” and

financially infeasible. But she testified that neither she nor

Ramirez wanted to simply change managers. Uy stated that

she had tried unsuccessfully to replace managers before and

wanted to try a different approach. Both Uy and Ramirez tes11The ALJ found that in mid-December 1999, around the same time that

St. Vincent managers discussed outsourcing the RC department, RC

department employees engaged in concerted activity by collectively protesting the implementation of new overtime pay provisions. 

HEALTHCARE EMPLOYEES UNION v. NLRB 2753
tified that they believed one of the primary benefits to outsourcing was that the burden of finding good managers for the

department would fall on the subcontractor, not on St. Vincent. While Ramirez testified that she knew that the RC

employees would be disenfranchised by outsourcing the work

of the department, she also testified that this “was not what

[she] would call a big player role in our discussions.” 

On December 22, 1999, Uy, Ramirez, Hill, and Parente met

by phone to discuss subcontracting. Uy testified that no one

mentioned the Union during the conversation. Parente, the

ultimate decision maker, approved moving forward with finding a subcontractor. 

Five days later, Uy announced to RC employees management’s intent to investigate outsourcing the work of the RC

department. Uy told employees that it would take between

thirty and sixty days to investigate possible subcontractors.

According to Uy, she explained to the RC employees that the

decision was a “business decision” motivated by “concerns

about quality issues” and the various complaints received concerning the department. 

D. Implementing Subcontracting — January and

February 2000

On or around January 3, 2000, Uy contacted Total Rehab

Care and Interstate Rehab Care and solicited proposals for

taking over the RC department. Uy stated that the successful

bidder must provide an experienced respiratory manager and

agree to hire all current employees at similar wages and benefits. Theodore Weiner, the president and CEO of Total Rehab

Care, testified that his company was too small to handle a

subcontracting arrangement involving twenty-seven employees before February 15, 2000, the start-up date required by St.

Vincent. February 15, 2000, was three days before the scheduled Union election. 

2754 HEALTHCARE EMPLOYEES UNION v. NLRB
The two companies ultimately contacted each other and

submitted a combined proposal, which St. Vincent received

on January 26, 2000. The proposal was submitted under the

name of California Respiratory Services, a subsidiary of Interstate Rehab Care. Under the proposal, Weiner would work for

Total Rehab Care, which contracted with California Respiratory Services to provide management services. Though the

proposal was open until March 26, 2000, St. Vincent agreed

to the proposal on or about January 26, 2000 — the same day

it was received. 

On February 1, 2000, about three weeks after the Union

filed its election petition with the Board, St. Vincent management informed the RC department of the outsourcing decision. Ramirez announced that California Respiratory Services

would take over the RC department, and that, effective February 5, 2000, California Respiratory Services would directly

employ the RC employees. 

Parente, the hospital president, testified that he did not

decide to subcontract the work of the RC department to prevent the RC therapists from voting in the upcoming union

election. He did admit, however, that he was aware of the

union election scheduled for February 18, 2000 when he made

his final decision to subcontract a little over two weeks earlier. When pressed by the ALJ to explain the timing of the

subcontracting decision, Parente responded that it was not

precipitated by any “emergency” in patient care.12 Rather, Parente explained that “it was a reasonable management decision

within our prerogative at the time and we made the decision”

and that “there was a strong possibility that a serious error

could occur in a treatment of a patient.” 

12As the ALJ stated at the hearing, he was unable to find that “there was

any emergency of any sort, either in July 1999 or in December 1999, nor

in January or February of 2000.” One RC employee even testified that Uy

presented the RC department with the results of a patient survey from

December 1999 rating the RC department as the most appreciated among

the hospital staff. 

HEALTHCARE EMPLOYEES UNION v. NLRB 2755
Parente further testified that he did not want to outsource

the work of RC department managers while continuing to

directly employ RC therapists. He explained that such an

arrangement would create a “divided accountability” problem.

Parente stated that in his opinion, “the [RC] employees and

the manager [of the RC department] belong in the same organization.” He also explained that the subcontracting arrangement in another department of the hospital “was a workable

model that would have achieved [St. Vincent’s] goals.” Contrary to Parente’s goal of preventing divided accountability,

Weiner, the new RC manager, and the RC employees were

not employed by the same employer because the RC employees worked directly for California Respiratory Services while

Weiner and the department managers worked for Total Rehab

Care. This arrangement clearly resulted in divided accountability because the RC therapists were accountable to California Respiratory Services while the managers were

accountable to Total Rehab Care. 

The ALJ found that “[a]fter the subcontracting took effect,

the same employees continued to do largely the same work in

the same place,” and that “the same supervisors . . . were also

hired by the subcontractor.” Nevertheless, Weiner testified

that the RC department improved somewhat after the subcontracting. Fewer physicians complained about RC department

services and some hospital staff members even commented on

the improvement of the RC department. 

E. The Present Unfair Labor Practice Charges and the

NLRB’s Decision

On February 2, 2000, the Union filed an unfair labor practice charge against St. Vincent. The Union charged that St.

Vincent subcontracted out the work of the RC department to

prevent RC department employees from voting in the Union

election, in violation of Sections 8(a)(1) and 8(a)(3) of the

NLRA. 

2756 HEALTHCARE EMPLOYEES UNION v. NLRB
On March 22, 2000, the Board’s General Counsel issued a

complaint against St. Vincent and a notice of hearing. In its

answer to the complaint, St. Vincent denied the allegations

and alleged as an affirmative defense that its subcontracting

decision was based on valid business reasons unrelated to the

union organizing activities of the RC department. 

The matter was heard before an ALJ. See St. Vincent Med.

Ctr., 338 NLRB No. 130, 2003 WL 1785029, *1 (Mar. 31,

2003). The ALJ analyzed the General Counsel’s case under

Wright Line, 251 N.L.R.B. 1083, enforced, 662 F.2d 899 (1st

Cir. 1981), cert. denied, 455 U.S. 989 (1982). The ALJ credited the General Counsel’s “clear evidence” that St. Vincent

knew that the RC department was the “core” of the Union’s

organizing drive, and that the Union’s organizing campaign

burgeoned in July 1999. The ALJ also concluded that the timing of the terminations militated in favor of the General Counsel’s case: 

Announcing the change in the status of the employees, and subcontracting out their work, only about 3

weeks after the filing of the petition for an election

seems on its face so suspicious that if there were any

evidence of animus or direct intent to discriminate

that one would not hesitate to find the subcontracting

to have been violative of the [NLRA] . . . . 

In further support of the General Counsel’s case, the ALJ

found that the alleged motivation behind St. Vincent’s subcontracting decision “seem[ed] to lack plausibility” and noted

the “seeming lack of a clear rationale for the way in which

[the subcontracting decision] was carried out.” The ALJ noted

that St. Vincent’s asserted business justification was “almost

too much to believe” and that “[o]n its surface it appear[ed]

to be a fabrication, and not a very good one at that.” 

Notwithstanding these findings, the ALJ found that there

was no reason “to ignore or disbelieve the testimony of [St.

HEALTHCARE EMPLOYEES UNION v. NLRB 2757
Vincent’s] witnesses to the effect that since the subcontracting

the problems have largely vanished.” After crediting St. Vincent on this point, the ALJ concluded that the General Counsel failed to carry its burden of persuasion under Wright Line.

The ALJ stated that “no matter how improbable [St. Vincent’s] action, or its timing, in subcontracting may seem . . .

on the surface, there is no reasonable basis on this record . . .

causing me to doubt or challenge the very fact of its success

in, at long last, remedying the RC department’s longstanding,

seemingly intractable, problems.” After finding that changing

managers is a “time honored and frequently used solution to

management problems,” the ALJ concluded, “no matter how

reluctantly,” that St. Vincent’s decision “passe[d] muster.” 

The Union and the General Counsel appealed the ALJ’s

decision to the Board. In its brief boilerplate decision, the

Board affirmed the ALJ’s rulings and findings. Furthermore,

the Board concluded that

[a]ssuming arguendo that the General Counsel satisfied his initial burden under Wright Line, we find

that [St. Vincent] has proven its affirmative defense

under Wright Line of demonstrating that it would

have taken the same action even in the absence of

the employees’ protected activities. Specifically, [St.

Vincent] has established that it implemented its subcontracting decision within the 30-to-60 day timeframe it announced prior to the filing of the petition

for a representation election. 

St. Vincent Med. Ctr., 2003 WL 1785029, at *1 n.4 (internal

citation omitted). 

The Union filed this petition for review pursuant to Section

10(f) of the NLRA, 29 U.S.C. § 160(f). The Union challenges

both the Board’s conclusion that the General Counsel failed

to carry its burden of persuasion, and its conclusion that St.

Vincent established its affirmative defense under Wright Line.

2758 HEALTHCARE EMPLOYEES UNION v. NLRB
The Union argues that neither conclusion is supported by substantial evidence on the record as a whole. 

STANDARD OF REVIEW

“Courts of appeals may overturn Board decisions only if

the Board’s findings of fact are not supported by substantial

evidence, or if the Board has incorrectly applied the law.”

13

Cal. Pac. Med. Ctr. v. NLRB, 87 F.3d 304, 307 (9th Cir.

1996); see also NLRB v. Nevis Indus., Inc., 647 F.2d 905, 908

(9th Cir. 1981) (“The Board’s findings must be enforced if

supported by substantial evidence, even if this court might

reach a different conclusion based on the same evidence.”).

However, “[t]he substantial evidence test requires a case-bycase analysis and a review of the whole record,” Cal. Pac.

Med. Ctr., 87 F.3d at 307, and requires a reviewing court to

“take into account whatever in the record fairly detracts” from

the Board’s conclusions, Universal Camera Corp. v. NLRB,

340 U.S. 474, 488 (1951). 

Similarly, while we should be mindful that “the determination of motive is particularly within the purview of the

NLRB,” Lippincott Indus., Inc. v. NLRB, 661 F.2d 112, 116

(9th Cir. 1981), “we may set aside the Board’s determination

of motive if we find that it is not supported by substantial evidence,” Dash v. NLRB, 793 F.2d 1062, 1066 n.6 (9th Cir.

1986). 

13Counsel for the Board, relying on Chamber of Commerce v. NLRB,

574 F.2d 457, 463 (9th Cir. 1978), states in its brief that we must uphold

the Board’s decision unless it has no rational basis. The weight of authority, however, makes clear we review the Board’s conclusions for “substantial evidence in the record as a whole.” See Universal Camera Corp. v.

NLRB, 340 U.S. 474, 488 (1951); see also Dash v. NLRB, 793 F.2d 1062,

1065-66 (9th Cir. 1986); Gen. Teamsters Local 162 v. NLRB, 782 F.2d

839, 842 (9th Cir. 1986). 

HEALTHCARE EMPLOYEES UNION v. NLRB 2759
ANALYSIS

[1] Section 8(a)(3) of the NLRA prohibits an employer

from discriminating against employees “in regard to hire or

tenure of employment . . . to discourage membership in any

labor organization.” 29 U.S.C. § 158(a)(3). 

[2] Subcontracting decisions are not immune from the

reach of the NLRA. Thus, it is well-established that an

employer violates Section 8(a)(3) of the NLRA where it

“close[s] a part of [its] operations, discharge[s] the employees

involved, and subcontract[s] the work for anti-Union purposes.”14 Great Chinese Am. Sewing Co. v. NLRB, 578 F.2d

251, 255 (9th Cir. 1978); see also Textile Workers Union of

Am. v. Darlington Mfg. Co., 380 U.S. 263, 272 n.16 (1965);

Reno Hilton Resorts v. NLRB, 196 F.3d 1275, 1282-83 (D.C.

Cir. 1999); NLRB v. Joy Recovery Tech. Corp., 134 F.3d

1307, 1314-15 (7th Cir. 1998). 

In a Section 8(a)(3) case such as this, the Board uses the

burden-shifting scheme set forth in Wright Line to determine

whether an employer was motivated by anti-union animus.

See 251 N.L.R.B. at 1089; NLRB v. Transp. Mgmt. Corp., 462

U.S. 393, 399-403 (1983) (upholding Wright Line burden

shifting scheme under the NLRA), overruled on other

grounds by Office of Workers’ Comp. Program v. Greenwich

Collieries, 512 U.S. 267, 276-78 (1994); see also Dash, 793

F.2d at 1066. Under Wright Line, the Board requires that 

the General Counsel make a prima facie showing

sufficient to support the inference that protected con14The Union does not argue that St. Vincent violated Section 8(a)(1) of

the NLRA for reasons different from those it relies on to support its Section 8(a)(3) charge. Consequently, we treat the Union’s charge under Section 8(a)(1) as a derivative of its Section 8(a)(3) charge. See NLRB v.

Swedish Hosp. Med. Ctr., 619 F.2d 33, 35 (9th Cir. 1980) (“Any violation

of Section 8(a)(3) . . . necessarily includes a derivative violation of Section

8(a)(1).”). 

2760 HEALTHCARE EMPLOYEES UNION v. NLRB
duct was a ‘motivating factor’ in the employer’s

decision. Once this is established, the burden will

shift to the employer to demonstrate that the same

action would have taken place even in the absence of

protected conduct. 

251 N.L.R.B. at 1089. While the General Counsel retains the

ultimate burden of persuasion, “once the General Counsel

establishes that anti-union animus was a motivating factor, the

employer bears the burden of establishing any affirmative

defense such as the inevitability of termination.” Schaeff Inc.

v. NLRB, 113 F.3d 264, 267 n.5 (D.C. Cir. 1997). 

A. The General Counsel’s Case

[3] The Union challenges the Board’s conclusion that the

General Counsel failed to present sufficient evidence of antiunion animus to sustain its burden of persuasion. An

employer will seldom admit that it was motivated by antiunion animus when it made its adverse employment decision.

See Shattuck Denn Mining Corp. v. NLRB, 362 F.2d 466, 470

(9th Cir. 1966) (“Actual motive, a state of mind, being the

question, it is seldom that direct evidence will be available

that is not also self-serving.”). For that reason, circumstantial

evidence is sufficient to establish anti-union motive. See New

Breed Leasing Corp. v. NLRB, 111 F.3d 1460, 1465 (9th Cir.

1997); see also Folkins v. NLRB, 500 F.2d 52, 53 (9th Cir.

1974) (per curiam). 

“Motive is a question of fact, and the NLRB may rely on

both direct and circumstantial evidence to establish an

employer’s motive, considering such factors as the employer’s knowledge of the employee’s union activities, the

employer’s hostility toward the union, and the timing of the

employer’s action.” Power, Inc. v. NLRB, 40 F.3d 409, 418

(D.C. Cir. 1994); see also E.C. Waste, Inc. v. NLRB, 359 F.3d

36, 42 (1st Cir. 2004) (“To determine motive, the Board may

HEALTHCARE EMPLOYEES UNION v. NLRB 2761
rely on indirect evidence and inferences reasonably drawn

from the totality of the circumstances.”). 

1. Evidence of St. Vincent’s Motive

After carefully reviewing the record as a whole, we conclude that substantial evidence does not support the Board’s

finding that the General Counsel failed to show that antiunion animus was a motivating factor in St. Vincent’s decision to subcontract out the RC department. As discussed

below, in the face of strong circumstantial evidence of antiunion animus, the ALJ improperly credited evidence of postsubcontracting improvements in the RC department as a basis

for dismissing the General Counsel’s case. 

[4] Circumstantial evidence of anti-union animus is compelling in this case. First, there is ample evidence that St. Vincent knew about the union activity in the hospital in general,

and in the RC department in particular. The head of human

resources for the hospital specifically directed hospital managers to monitor all Union activity. Several RC department

managers also testified that they identified themselves to

Union organizers on various occasions during the second half

of 1999 and asked to see Union fliers. Finally, several hospital

managers, including the hospital president, testified that they

were aware of the impending Union election when the subcontracting decision was made. The testimony of St. Vincent’s managers regarding their awareness of the Union’s

campaign is consistent with the clear evidence that the Union

was openly and actively soliciting support in the hospital

throughout the second half of 1999. 

[5] Likewise, employee Rush testified that either Uy or Hill

stated during an RC department meeting that “unions were

bad for the hospital” and that the RC department’s problems

could be resolved without a union. Rush’s testimony further

establishes that RC department managers were aware of the

support for the Union among RC employees, and were critical

2762 HEALTHCARE EMPLOYEES UNION v. NLRB
of the Union’s efforts to organize technical staff employees.

Even if St. Vincent’s managers did not violate the NLRA by

making these comments, the Board should treat these comments as background evidence of anti-union animus. See, e.g.,

Tim Foley Plumbing Servs., 337 N.L.R.B. 328, 329 (2001)

(“[T]he Board has held that an employer’s antiunion comments, while themselves lawful, may nevertheless be considered as background evidence of animus toward employees’

union activities.”); see also NLRB v. Vemco, Inc., 989 F.2d

1468, 1473-75 (6th Cir. 1993) (concluding that an employer’s

anti-union speech, while lawful under the NLRA, may be

considered as background evidence of animus). 

[6] Second, the inference of anti-union animus raised by the

timing of St. Vincent’s decision to subcontract is “stunningly

obvious.” See NLRB v. Rubin, 424 F.2d 748, 750 (2d Cir.

1970). As the ALJ found, “[f]rom [St. Vincent’s] standpoint

the timing of the action could scarcely be imagined as worse.”

St. Vincent subcontracted out the department on February 5,

2000, less than a month after the Union filed its petition for

an election with the Board, and less than two weeks before the

scheduled election. The effect of St. Vincent’s decision to

outsource operation of the RC department, of course, was the

disenfranchisement of twenty-five percent of the employees

(ninety-five percent of whom had already expressed their

desire to join the Union) who were otherwise eligible to vote

in the representation election. 

[7] Courts have consistently treated an employer’s adverse

employment action occurring between the filing of a petition

for a representation election with the Board and the ensuing

election as raising a powerful inference of anti-union animus.

See, e.g., E.C. Waste, Inc., 359 F.3d at 43 (“[T]he probative

value of the timing of the Company’s action — firing [an

employee] in the critical interval between the time that the

Union filed its petition for recognition and the planned representation election — is obvious.”); Joy Recovery Tech. Corp.,

134 F.3d at 1314 (concluding that “[i]n this case, timing is

HEALTHCARE EMPLOYEES UNION v. NLRB 2763
everything,” where “[t]he closing of the department comes on

the heels of the union’s organizational activity,” including filing a petition for a representation election); Power, Inc., 40

F.3d at 418 (“The timing of the layoff, just two weeks before

the scheduled union election, gives further credence to the

charge of anti-union animus.”); NLRB v. Rain-Ware, Inc., 732

F.2d 1349, 1354 (7th Cir. 1984) (concluding that “[t]he timing

of the layoffs and warehouse closing provides the strongest

support for connecting anti-union sentiment with the layoffs,”

where the layoffs and warehouse closing closely followed a

demand for union recognition). Because St. Vincent subcontracted out its entire RC department less than two weeks

before the scheduled union election, the timing of its decision

raises an unmistakable inference of anti-union animus. 

[8] The timing of the decision to subcontract out the work

of the RC department is also suspicious because the management problems in the RC department existed for more than a

decade before St. Vincent decided to subcontract out the work

of the department. See Reno Hilton Resorts, 196 F.3d at 1283

(concluding that “[t]he timing of the decision to contract out

is suspect” where it “came on the heels of heavy union activity” and the employer knew of the purported rationale for its

subcontracting decision long before it implemented that decision); see also Joy Recovery Tech. Corp., 134 F.3d at 1314-15

(concluding that the timing of the employer’s subcontracting

decision based on financial concerns was suspicious where it

came “on the heels of the union’s organizational activity” and

employer had maintained the department unprofitably for “a

significant period of time”). Even in mid-1999, only a few

months before the Union announced that it was close to seeking a representation election, the ALJ found that St. Vincent

was in no hurry to remedy the RC department management

problems. Indeed, Parente testified that the decision to subcontract was not caused by an emergency in patient care in

the RC department. Thus, there was no obvious precipitating

event for the subcontracting decision other than the looming

union election. In essence, St. Vincent appears to have toler2764 HEALTHCARE EMPLOYEES UNION v. NLRB
ated its in-house management problems up until the very

moment that the Union sought to represent the technical staff

at the hospital. 

The Board attempts to diminish the strong inference of

anti-union animus raised by the timing of St. Vincent’s

actions. It notes that St. Vincent managers mentioned subcontracting out the work of the RC department in a July 1999

meeting, months before the union election was scheduled.15

Even so, this is the same month that the Union began its organizing drive at the hospital, thereby creating the inference that

Union activity triggered the subcontracting discussion. As discussed earlier, it is undisputed that St. Vincent managers were

aware of the Union’s activities and that those activities were

markedly heightened in July 1999. Thus, the mere fact that St.

Vincent managers mentioned subcontracting in July 1999

does little to defeat the inference of anti-union animus. Moreover, the issue was not brought up again until November 18,

1999, eight days after the union circulated its November 10,

1999 flier announcing the imminent union election. This

sequence of events strengthens, rather than diminishes, the

inference of anti-union animus. 

After making substantial findings in support of the General

Counsel, the ALJ focused part of his analysis on the testimony of St. Vincent’s witnesses establishing that after the

subcontracting took effect, productivity in the RC department

generally improved. Having credited this testimony, the ALJ

concluded that the General Counsel failed to carry its burden

of persuasion under Wright Line. 

15The Board also argues that there was no direct evidence that St. Vincent management paid particular attention to the Union’s November 10,

1999, flier announcing the imminent election. Nevertheless, as discussed

earlier, St. Vincent managers paid attention to all of the Union’s activities

in the hospital. For the reasons discussed above, there is no basis to conclude that the flier, which St. Vincent produced at the hearing before the

ALJ pursuant to a subpoena, went unnoticed by St. Vincent management.

HEALTHCARE EMPLOYEES UNION v. NLRB 2765
[9] Whether an employer’s decision was ultimately good or

bad, however, has no relevance in a Section 8(a)(3) case such

as this, where the critical issue is the employer’s motive. In

determining whether an employment decision violates Section

8(a)(3), the “crucial factor is not whether the business reasons

cited by [the employer] were good or bad, but whether they

were honestly invoked and were, in fact, the cause of the

change.” NLRB v. Savoy Laundry, 327 F.2d 370, 371 (2d Cir.

1964). The ALJ therefore erred in relying on evidence of the

RC department’s improved conditions to conclude that St.

Vincent was not motivated by anti-union animus in its decision to subcontract out the department. 

[10] In short, the highly suspect timing of St. Vincent’s

decision to subcontract out the RC department, when coupled

with St. Vincent’s knowledge of union activity, strongly

favored the General Counsel’s case. Contrary to the ALJ, we

conclude that the probative value of this evidence is not

diminished in any way by the evidence of improved conditions in the RC department after the subcontracting took

effect. 

However, we turn to the remaining evidence in the record

to determine whether the Board’s conclusions were supported

by substantial evidence on the record as a whole. 

2. Evidence of Pretext

The ALJ found that “[St. Vincent’s] reasons for proceeding

as it did seem[ed] to lack plausibility” and that there was a

“seeming lack of a clear rationale for the way in which [subcontracting] was carried out.” Furthermore, the ALJ found

that St. Vincent’s asserted reason for subcontracting “[o]n its

surface appear[ed] to be a fabrication, and not a very good

one at that.” 

These findings, which we may weigh along with other evidence opposing the Board’s ruling, further undermine the

2766 HEALTHCARE EMPLOYEES UNION v. NLRB
Board’s conclusion that anti-union animus was not a motivating factor in the subcontracting decision. See Dash, 793 F.2d

at 1066; see also NLRB v. Searle Auto Glass, Inc., 762 F.2d

769, 773 (9th Cir. 1985). “Where the employer’s asserted justification is shifting and unreliable, its case is weakened, and

the conclusion that the true reason was for union activity is

correspondingly strengthened.” Nevis Indus., Inc., 647 F.2d at

910; see also NLRB v. Dillon Stores, 643 F.2d 687, 693 (10th

Cir. 1981) (“[A] flimsy or unsupported explanation may affirmatively suggest that the employer has seized upon a pretext

to mask an anti-union motivation.”). 

St. Vincent asserted that it subcontracted out the work of its

RC department to remedy longstanding management problems. As both Uy and Ramirez testified, they wanted to subcontract out the work of the department to rid themselves of

the burden of finding reliable managers. They wanted that

burden to fall on an independent contractor. Nevertheless,

Ramirez, Hancock, and Weiner each testified that subcontracting out the work of the RC therapists was not needed to

achieve this result. Ramirez testified that “[t]he transfer of the

employees had nothing to do with [California Respiratory

Services] getting us a new manager.” Weiner also testified

that he could have achieved the same results in the RC department without requiring California Respiratory Services to

employ the RC employees directly. Hancock, too, testified

that he was not aware of any reason requiring St. Vincent to

outsource the RC employees in order to get a new manager

for the department. As each of these witnesses explained, they

were unaware of any reason why subcontracting out the RC

therapists would ameliorate the RC department’s longstanding

management problems. Thus, even if there was such a reason,

the management of the RC department failed to proffer one.

Several of St. Vincent’s witnesses testified that subcontracting out other departments in the hospital had proved successful in the past. On appeal, the Board contends that this

evidence of past practice helps to defeat any inference of antiHEALTHCARE EMPLOYEES UNION v. NLRB 2767
union animus. Nonetheless, St. Vincent failed to demonstrate

why those departments were subcontracted, other than vague

assertions about “quality issues.” Without evidence that the

past subcontracting decisions were prompted by the same type

of management concerns faced by the RC department, there

is no basis to conclude that St. Vincent acted consistently with

past practice when it outsourced the work of its RC department. 

[11] As explained earlier, Parente, the hospital president,

testified that outsourcing the RC management while continuing to directly employ the RC employees would create a “divided accountability” problem. But the divided accountability

problem was not alleviated by the ultimate subcontracting

arrangement. Contrary to Parente’s justification, RC department managers and employees were not directly employed by

the same employer. Total Rehab Care, Weiner’s company,

hired all the former St. Vincent managers. It then contracted

with California Respiratory Services to provide management

services to the RC department. The RC therapists, on the

other hand, worked directly for California Respiratory Services. This arrangement did not place the RC therapists and

the RC department managers in the same organization. Actually, the RC department arrangement would have been identical had St. Vincent simply contracted out its management

services to Total Rehab Care. In either case, RC managers and

the RC therapists would not have been employed directly by

the same employer. Because the divided accountability problem was not addressed by the subcontracting arrangement,

Parente’s testimony on this point raises the inference that this

reason was really a pretext for anti-union animus. 

3. Conclusion

[12] We conclude that substantial evidence in the record as

a whole does not support the Board’s ruling that the General

Counsel failed to meet its burden of persuasion under Wright

Line. We reach this conclusion because (1) the General Coun2768 HEALTHCARE EMPLOYEES UNION v. NLRB
sel presented unrebutted evidence concerning St. Vincent’s

knowledge of union activity, (2) the timing of St. Vincent’s

decision to subcontract raised a compelling inference of antiunion animus, (3) the ALJ mistakenly relied on postsubcontracting evidence to establish the cause of the subcontracting decision, and (4) St. Vincent’s business justification

was unreliable, therefore raising the inference that its justification was merely a pretext for anti-union animus. 

We therefore examine St. Vincent’s affirmative defense to

determine if the Board’s ultimate decision in favor of St. Vincent is supported by substantial evidence on the record as a

whole. 

B. St. Vincent’s Affirmative Defense

[13] “The pendency of a union representation election does

not prevent management from carrying on its business in the

normal fashion.” NLRB v. Anchorage Times Pub. Co., 637

F.2d 1359, 1366 (9th Cir. 1981). Thus, in a mixed-motive

case under Wright Line, an employer may avoid a Section

8(a)(3) violation where it can establish that it would have

taken the challenged action even in the absence of the protected activity. See Dash, 793 F.2d at 1066; see also RenoHilton Resorts, 196 F.3d at 1284-85; Wright Line, 251

N.L.R.B. at 1089. 

The Board concluded that St. Vincent established its affirmative defense under Wright Line. In sum, the Board concluded that St. Vincent “established that it implemented its

subcontracting decision within the 30-to-60 day timeframe it

announced prior to the filing of the petition for a representation election.” See St. Vincent Med. Ctr., 2003 WL 1785029,

at *1 n.4. The Board’s simple footnote, however, offers little

insight into this otherwise fact-intensive case. See NLRB v.

Special Mine Servs., Inc., 11 F.3d 88, 89 (7th Cir. 1993) (discussing the “depressing pattern” of Board decisions in which

HEALTHCARE EMPLOYEES UNION v. NLRB 2769
“[t]here is one serious issue, which the Board tucks into a

footnote”). 

The announcement to which the Board likely refers took

place on December 27, 1999. That announcement, however,

hardly reflects substantial evidence on the record as a whole

that St. Vincent would have subcontracted out the RC department, when and as it did, in the absence of union activity. See

Universal Camera Corp., 340 U.S. at 488; Wright Line, 251

NLRB at 1089. 

[14] While St. Vincent adhered to its intended timeline for

subcontracting out the work of the RC department, we would

need to ignore a powerful string of coincidences to conclude

that St. Vincent would have implemented subcontracting,

when and as it did, in the absence of union activity. First,

despite experiencing management problems for more than a

decade, St. Vincent first mentioned subcontracting the same

month that the Union began its full-scale campaign to organize the technical staff. Second, though St. Vincent first discussed outsourcing in July 1999, it did not decide to

investigate subcontractors until nine days after the Union circulated a flier at the hospital announcing its intent to seek a

representation election. Third, St. Vincent subcontracted the

department less than two weeks before the scheduled election,

thereby disenfranchising one quarter of the eligible voters. 

Moreover, as discussed above, the ALJ’s findings regarding St. Vincent’s purported business justification substantially

detract from the Board’s conclusion. St. Vincent’s witnesses

did not present a consistent or plausible explanation for why

it was necessary to subcontract out the work of the entire RC

department in order to obtain better managers. The ALJ found

that St. Vincent’s business justification “seem[ed] to lack

plausibility,” and noted the “seeming lack of a clear rationale

for the way in which [the subcontracting decision] was carried

out.” He further found the justification was “almost too much

to believe” and that “[o]n its surface it appear[ed] to be a fab2770 HEALTHCARE EMPLOYEES UNION v. NLRB
rication, and not a very good one at that.” These findings reinforce the inference that the true motive for the subcontracting

decision was anti-union animus. See Nevis Indus., Inc., 647

F.2d at 910; Shattuck Denn Mining Corp., 362 F.2d at 470.

[15] In light of the record as a whole, we “cannot conscientiously find that the evidence supporting [the Board’s] decision is substantial, when viewed in the light that the record in

its entirety furnishes.” Universal Camera Corp., 340 U.S. at

488.

CONCLUSION

Because we conclude that the Board’s conclusions are not

supported by substantial evidence on the record as a whole,

we grant the Union’s petition for review and remand this case

to the Board for further proceedings. 

PETITION FOR REVIEW GRANTED. 

BEEZER, Circuit Judge, dissenting: 

I am unable to join the opinion of the court. Our precedents

provide a consistent standard for the review of decisions by

the NLRB. Although the correct standards appear in the

Court’s opinion, a different standard is applied in the evaluation of the record made by the ALJ and NLRB. 

I respectfully dissent. 

I

The administrative law judge found that the General Counsel failed to meet his burden under Wright Line, Inc., 251

NLRB 1083 (1980). Wright Line requires the General Counsel prove that anti-union animus was a substantial or motivatHEALTHCARE EMPLOYEES UNION v. NLRB 2771
ing factor in the decision to subcontract the Respiratory Care

Department. The ALJ’s finding was affirmed by the National

Labor Relations Board. We review the NLRB determination

for substantial evidence and accord great deference to the ALJ

and NLRB’s motive and credibility determinations, as well as

any inferences they drew from the evidence. See New Breed

Leasing Corp. v. NLRB, 111 F.3d 1460, 1464-65 (9th Cir.

1997) (“[T]he [NLRB] is particularly capable of drawing

inferences from the facts of a labor dispute” and “the Board

is to be accorded special deference in drawing derivative

inferences from the evidence”) (internal citations omitted);

Retlaw Broadcasting Co. v. NLRB, 53 F.3d 1002, 1006 (9th

Cir. 1995) (“Credibility determination by the ALJ are given

great deference, and are upheld unless they are inherently

incredible or patently unreasonable.”) (internal citations omitted); Lippincott Ind., Inc. v. NLRB, 661 F.2d 112, 116 (9th

Cir. 1981) (“[W]e must be mindful that the determination of

motive is particularly within the purview of the NLRB.”). 

II

St. Vincent presented ample evidence that the Respiratory

Care Department was experiencing significant management

and performance problems. Likewise, St. Vincent presented

testimony and evidence that the decision to subcontract the

medical services performed by the Department was based on

these performance issues and unrelated to an increase in union

activity. The ALJ noted that there were no prior charges filed

against St. Vincent, no independent violations of Section

8(a)(1) of the Act, and no evidence that St. Vincent treated

employees interested in union organizing differently than

other employees. Analyzing the evidence as a whole and

weighing the asserted justification for subcontracting against

its suspicious timing, and in light of the lack of history of

anti-union activity, the ALJ found St. Vincent’s justification

credible. The ALJ observed that altering management is “a

time honored and frequently used solution to management

problems.” 

2772 HEALTHCARE EMPLOYEES UNION v. NLRB
The ALJ concluded that he could not infer that St. Vincent’s “asserted reason for the subcontracting, occurring when

and how it did, bespeaks falsity, and leads to the further inference that it constitutes a showing of animus.” This “derivative” inference is to be accorded “special deference,” and

cannot be overturned without a finding that the ALJ’s credibility determinations were “inherently incredible or patently

unreasonable.” New Breed, 111 F.3d at 1464-65. The evidence of the Respiratory Care Department’s quality problems

was undisputed as was the testimony that St. Vincent had

prior positive experience subcontracting other departments.

This undisputed testimony constitutes sufficient evidence to

support the ALJ’s decision. 

The opinion of the court rests in part upon inferences of

anti-union animus drawn from two anti-union statements

allegedly made by members of St. Vincent’s management.

These inferences are not discussed by either the ALJ or

NLRB in the record before us. 

There is disagreement amongst the circuits with regard to

the propriety of considering lawful protected anti-union

speech as evidence of anti-union animus. The opinion of the

court accepts the Sixth Circuit’s reasoning in NLRB v. Vemco,

989 F.2d 1468, 1474 (6th Cir. 1993) that such speech may be

considered as “background in a determination of animus,” but

does not comment on the conflicting cases from other circuits

or reference the controlling statutory language. See 29 U.S.C.

§ 158(c).1

1Section 8(c) of the Act provides that: 

The expressing of any views, argument, or opinion, or the dissemination thereof, whether in written printed, graphic, or visual

form, shall not constitute or be evidence of an unfair labor practice under any of the provisions of this subchapter, if such expression contains no threat of reprisal or force of promise of benefit.

29 U.S.C. § 158(c). 

HEALTHCARE EMPLOYEES UNION v. NLRB 2773
Contrary to the Sixth Circuit, the Seventh and Second Circuits hold that protected speech may not be used as evidence

of anti-union animus. See Lebow v. American Trans Air, 86

F.3d 661, 666-67 (7th Cir. 1996) (“We have stated that under

the NLRA, noncoercive expressions of opinion are not to be

used as evidence of an unfair labor practice.”); Holo-Krome

Co. v. NLRB, 907 F.2d 1343, 1346 (2d Cir. 1990) (protected

speech may not be considered in evaluating a claim of antiunion animus). The use of protected speech as evidence,

background or otherwise, of unlawful activity violates the

clear statutory command that noncoercive expressions of

views, argument, or opinion shall not be “evidence of an

unfair labor practice.” 29 U.S.C. § 158(c). 

Reasonable minds may disagree about whether the concurrent timing of the subcontracting decision and the increased

union activity is sufficient evidence that anti-union animus

was a substantial factor in the subcontracting decision. I do

not agree that ignoring the agency’s view of the facts and evidence is an adequate basis for us to reverse the ALJ and

NLRB’s decision. “A reviewing court may not displace the

NLRB’s choice between two fairly conflicting views, even

though the court would justifiably have made a different

choice had the matter been before it de novo.” Retlaw Broadcasting Co., 53 F.3d at 1005.

2774 HEALTHCARE EMPLOYEES UNION v. NLRB