Opinion ID: 1009824
Heading Depth: 3
Heading Rank: 1

Heading: wage increase withholding

Text: Earthgrains contends that the Board erred in determining that its failure to grant the April wage increase to the employees involved in the Union election was an unfair labor practice. Earthrains argues that it was compelled to withhold the increase for fear of violating the NLRA. In determining whether an employer may grant or withhold a wage increase prior to a union election, the Board has explained that an employer must maintain the status quo. According to the Board, [a]n employer’s legal duty in deciding whether to grant benefits while a representation case is pending is to determine that question precisely as he would if a union were not in the picture. If the employer would have granted the benefits because of economic circumstances unrelated to union organization, the grant of those benefits will not violate the Act. On the other hand, if the employer’s course is altered by virtue of the union’s presence, then the employer has violated the Act . . . . SARA LEE BAKERY GROUP v. NLRB 9 McCormick Longmeadow Stone Co., Inc., 158 N.L.R.B. 1237, 1242 (1966). Thus, an employer has a duty during the election process not to change the status quo if the change may reasonably affect the outcome of the pending election. ATC/Vancom of California, L.P., No. 31-CA-24875, 2001 N.L.R.B. LEXIS 1003, at -12 (Dec. 14, 2001). This court specifically addressed the status quo standard in Southern Maryland Hosp. Center v. NLRB, 801 F.2d 666 (4th Cir. 1986). In that case, we articulated a two-part analysis for employers evaluating whether to withhold a wage increase: The initial determination . . . is whether an employer by promises or by a continuous course of conduct has made a particular benefit part of its established practice. The focus in such a situation should be upon the employer, who is confronted with the dilemma of deciding whether his past promises or grants of benefits have created a clear status quo that he must maintain during the pre-election period. The standard then is whether it would be clearly apparent to an objectively reasonable employer that his grant or denial of a benefit, at the time the action is taken, conforms to the status quo. Id. at 669 (emphasis in original) (internal citations omitted). Under Southern Maryland’s test, the first step is to determine whether the proposed wage increase has become part of an established practice. Id. While it is true that Earthgrains had only recently acquired Palmetto and therefore had no past history at the Orangeburg facility, the Southern Maryland test does not require a lengthy employer history. Under Southern Maryland, a particular benefit can become part of an established practice simply by promises. Id. In this case, repeated statements by Earthgrains’ management regarding a planned increase in the new fiscal year which begins in April would certainly constitute promises of a raise to listening employees. Accordingly, we find that the proposed wage increase was sufficiently promised to become part of the established practice. The second step of the Southern Maryland test requires determining whether it would be clearly apparent to an objectively reasonable employer that his grant or denial of a benefit, at the time the action 10 SARA LEE BAKERY GROUP v. NLRB is taken, conforms to the status quo. Id. Given Earthgrains’ repeated promises of an upcoming wage increase in April, it should have been apparent to Earthgrains that granting the wage increase to all of its employees, whether part of the Union drive or not, would have been in conformance with the status quo. Earthgrains’ withholding of the wage increase was therefore unreasonable and a violation of the NLRA. Even if the wage increase had not become part of the status quo, Earthgrains still violated the NLRA because the withholding was motivated by anti-union sentiment. Id. ([W]hen there is no established practice of granting benefits, the General Counsel must show that the employers’ withholding of particular benefits was motivated by anti-union sentiment to prove a violation of the Act. (internal quotations omitted)). The record reflects that anti-union animus directly motivated Earthgrains’ statements and actions. By public announcement, Earthgrains advised its maintenance employees that the Union was the cause of the wage withholding.5 Management clearly attempted to manipulate employee opinion against the Union, and the evidence of this anti-union sentiment is sufficient to support the Board’s ruling. 5 In NLRB v. Dorn’s Transportation Co., 405 F.2d 706 (2d Cir. 1969), the Second Circuit, in finding no NLRA violation in a wage withholding case, stated that it was not a situation where the employer has by public announcement specifically advised the employees that the union is causing them to lose a wage increase they would otherwise have received. Id. at 715. In this case, Plant Manager Maxwell did just that: Because of the Union election scheduled for our maintenance employees for April 21, 1999, we cannot give those employees a pay increase because the Union could accuse [Earthgrains] of trying to buy votes and could file charges against the company with the Labor Board. This is why we cannot give you a pay increase at this time. Once the election is over, if the Union is defeated we can give you a pay increase just like our other employees here. If the Union is voted in, however, your pay is something that would have to be negotiated. (J.A. 863-64). SARA LEE BAKERY GROUP v. NLRB 11