Opinion ID: 712067
Heading Depth: 2
Heading Rank: 1

Heading: The Alleged Unfair Labor Practices.

Text: 44 The NLRB's July 12, 1994 bargaining order was based on the ALJ's finding that Kinney management had engaged in unfair labor practices so egregious as to foreclose irreparably the prospect of a fair second election. On appeal, Kinney argues (1) that the NLRB's findings of unfair labor practices were unsupported by substantial evidence and (2) that even if the NLRB's findings were supportable and the union's allegations were accepted as true, a bargaining order was an unwarranted and excessive remedy. 45
46 Section 7 of the National Labor Relations Act grants employees the right to self-organization, to form, join, or assist labor organizations ... and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.... 29 U.S.C. Sec. 157. Section 8(a)(1) of the Act deems it an unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of [their Section 7] rights.... 29 U.S.C. Sec. 158(a)(1). Under certain circumstances, explored in some detail below, serious violations of Sec. 8(a)(1) can justify an order requiring the employer to bargain with a union that did not win the organizing election. See NLRB v. Gissel Packing Co., 395 U.S. 575, 89 S.Ct. 1918, 23 L.Ed.2d 547 (1969). 47 Section 8(a)(1) is violated if the employer's conduct tends to be coercive or tends to interfere with the employees' exercise of their rights. NLRB v. Okun Brothers Shoe Store, 825 F.2d 102, 105 (6th Cir.1987), cert. denied, 485 U.S. 935, 108 S.Ct. 1109, 99 L.Ed.2d 270 (1988). A court making this assessment takes into account the economic dependence of the employees on their employers, and the necessary tendency of the former, because of that relationship, to pick up intended implications of the latter that might be more readily dismissed by a more disinterested ear. Gissel, 395 U.S. at 617, 89 S.Ct. at 1942. Among the many forms of misconduct that violate Sec. 8(a)(1) are threats of discharge in retaliation for union activity, Gordon, 792 F.2d at 32, grants or promises to grant benefits to discourage employee support for a union, NLRB v. J. Coty Messenger Serv., Inc., 763 F.2d 92, 96 (2d Cir.1985), the cultivated impression that employees' union activities are under surveillance, NLRB v. Long Island Airport Limousine Serv. Corp., 468 F.2d 292, 296-97 (2d Cir.1972), coercive interrogations of employees concerning their union activity, NLRB v. Solboro Knitting Mills, Inc., 572 F.2d 936, 939-40 (2d Cir.), cert. denied, 439 U.S. 864, 99 S.Ct. 188, 58 L.Ed.2d 174 (1978), and, in certain circumstances, threats of plant closure. J. Coty Messenger Serv., 763 F.2d at 97; NLRB v. General Stencils, Inc., 438 F.2d 894, 900 (2d Cir.1971). 48 Nevertheless, an employer's free speech right to communicate his views to his employees is firmly established and cannot be infringed by a union or the Board. Gissel, 95 U.S. at 617, 89 S.Ct. at 1941. Section 8(a)(1) leaves an employer ... free to communicate to his employees any of his general views about unionism or any of his specific views about a particular union, so long as the communications do not contain a 'threat of reprisal or force or promise of benefit.'  Id. at 618, 89 S.Ct. at 1942. Indeed, as we have previously acknowledged, [t]his First Amendment right is embodied in Sec. 8(c) [of the National Labor Relations Act], which allows the employer to express 'any views, argument, or opinion' in any media form without committing an unfair labor practice provided that 'such expression contains no threat of reprisal or force or promise of benefit.'  NLRB v. Pratt & Whitney Air Craft Div., United Technologies Corp., 789 F.2d 121, 134 (2d Cir.1986) (footnotes omitted). Granting an employer the opportunity to communicate with its employees does more than affirm its right to freedom of speech; it also aids the workers by allowing them to make informed decisions.... Id. 49
50 A bargaining order can be an acceptable response to a series of unfair labor practices which have made the holding of a fair election unlikely.... Gissel, 395 U.S. at 610, 89 S.Ct. at 1938. But such an order is only an appropriate remedy for those practices [that] ... are of 'such a nature that their coercive effects cannot be eliminated by the application of traditional remedies, with the result that a fair and reliable election cannot be had.'  Id. at 614, 89 S.Ct. at 1940 (quoting NLRB v. S.S. Logan Packing Co., 386 F.2d 562, 570 (4th Cir.1967)). 51 In this circuit, [a]n election, not a bargaining order remains the preferred remedy. J.L.M., Inc. v. NLRB, 31 F.3d 79, 83 (2d Cir.1994). [A] bargaining order is a rare remedy warranted only when it is clearly established that traditional remedies cannot eliminate the effects of the employer's past unfair labor practices. Id. Our review of a bargaining order is for abuse of discretion. America's Best Quality Coatings Corp. v. N.L.R.B., 44 F.3d 516, 520 (7th Cir.), cert. denied, --- U.S. ----, 115 S.Ct. 2609, 132 L.Ed.2d 853 (1995). 52 In NLRB v. Windsor Industries, Inc., 730 F.2d 860 (2d Cir.1984), we analyzed the framework erected by Gissel and concluded that bargaining orders are proper remedies in two kinds of cases: 53 The Court first identified those cases, described in Gissel as exceptional, which were marked by 'outrageous' and 'pervasive' unfair labor practices. In these cases an order to bargain might issue irrespective of whether the union had ever demonstrated majority support. 54 Gissel also recognized a second tier of less extraordinary cases marked by less pervasive practices which nonetheless still have the tendency to undermine majority strength and impede the election processes, and which might therefore call for the issuance by the Board of a bargaining order. In fashioning remedies in those cases, involving a lesser showing of employer misconduct, the Board can properly take into consideration the extensiveness of an employer's unfair practices in terms of their past effect on election conditions and the likelihood of their recurrence in the future. The Court then stated that if the Board finds the possibility of erasing the effects of past practices and of ensuring a fair election (or a fair rerun) by the use of traditional remedies, though present, is slight and that employee sentiment once expressed through cards would, on balance, be better protected by a bargaining order, then such an order should issue.... 55 Id. at 865 (quoting Gissel, 395 U.S. at 614-15, 89 S.Ct. at 1940-41). 56 The Gissel category of exceptional misconduct is limited to what are termed hallmark violations. NLRB v. Chester Valley, Inc., 652 F.2d 263, 272 (2d Cir.1981). Such violations include closing of a plant or threats of closure or loss of employment, granting of benefits to employees, or reassignment, demotion or discharge of union adherents. Id. The only violations by Kinney that potentially amount to exceptional misconduct are the threat of plant closure and the threat to discharge Woods and Les McClure. The second Gissel category applies to a group of more pallid unfair labor practices such as interrogation of employees, promises of benefits, expressions of anti-union resolve, or threats of decreased benefits.... Id. Such lesser misconduct will not support a bargaining order absent serious and long-lasting untoward effects on employees. Id. Most of the unfair labor practices cited by the NLRB in this case--from the interrogation of employees to the marginally more generous coffee policy--are of this lesser variety. 57
58 We consider in detail the two hallmark violations that arguably constitute exceptional misconduct under Gissel. 59 a. The threat to close the warehouse. The NLRB found that supervisor Dave McClure, in a one-on-one conversation, told employee Donald Bush that if the union won the election, the warehouse might be shut down. To make this finding, the NLRB had to credit the hearsay testimony of employee Donny Richards, who claims to have overheard the McClure-Bush conversation in the busy warehouse from a distance of 15 to 20 feet. Kinney challenges this finding and argues that it was not supported by substantial evidence. We need not rule on that objection because we hold that the statements found to have been made do not constitute an unfair labor practice. 60 An employer is entitled to tell its employees what it believes will be the likely economic consequences of unionization, even if these consequences include the possibility of plant closure: 61 [The employer] may ... make a prediction as to the precise effects he believes unionization will have on his company. In such a case, however, the prediction must be carefully phrased on the basis of objective fact to convey an employer's belief as to demonstrably probable consequences beyond his control or to convey a management decision already arrived at to close the plant in case of unionization. If there is any implication that an employer may or may not take action solely on his own initiative for reasons unrelated to economic necessities and known only to him, the statement is no longer a reasonable prediction based on available facts but a threat of retaliation based on misrepresentation and coercion, and as such without the protection of the First Amendment. 62 Gissel, 395 U.S. at 618, 89 S.Ct. at 1942 (citations omitted). 63 Kinney had decided, McClure allegedly told Woods, that it might be cheaper to replace the warehouse functions with an outside trucking firm if the warehouse employees formed a union. Such a statement is the type of reasonable prediction based on economic necessities envisioned by Gissel. Kinney had the right to spell out the possible economic consequences of unionization; and Kinney's employees, who could hardly rely on the union for a neutral view, had a profound interest in receiving that information. The labor laws do not suppress one side of the debate. The NLRB therefore erred in finding that the McClure-Bush conversation constituted a violation of Sec. 8(a)(1). 64 b. The threatened discharges. The other arguably hallmark violation committed by Kinney involved Cognetti's threat to fire Les McClure and Otis Woods unless they gave active support to management in the election. Kinney does not dispute that a threat to discharge an employee because of the employee's union activities constitutes a violation of Sec. 8(a)(1), see Gordon, 792 F.2d at 32, but Kinney does challenge the NLRB's factual finding: first, on the ground that the ALJ denied Kinney an adequate opportunity to cross-examine employee Woods and therefore should not have considered this testimony in rendering his findings; and, second, on the ground that the detrimental effect of any threat was alleviated by subsequent guarantees of job safety. 65 The NLRB credited testimony to the following effect: Cognetti spoke one-on-one with both Woods and Les McClure on November 13, accused them of aiding the union, ordered them to call an employee meeting to discourage their co-workers from voting for the union, and threatened both with discharge if they did not comply with his orders. A. at 102-08. 66 Kinney contends that the NLRB's findings should be disregarded because the NLRB curtailed Woods' testimony and limited Kinney's opportunity to cross-examine him. Woods had signed an affidavit in November 1991 concerning the threat of discharge. Between the November 1991 election and the June 1992 NLRB hearing, Woods was promoted to supervisor. At the ALJ hearing, Woods became hesitant when he was called upon to give testimony that might hurt Kinney. Recognizing that Woods' new role put him in a delicate position, the ALJ allowed the union to submit the November 1991 affidavit, and relied upon this affidavit in making findings of fact. Kinney argues that the ALJ essentially cut off Woods' testimony in such a manner so as to preclude Kinney from effectively cross-examining him. This challenge is meritless. Although the ALJ evidently accepted Woods' affidavit in lieu of his direct testimony, at no point did the ALJ prevent Kinney from cross-examining Woods concerning the substance of his November 13 meeting with Cognetti. Kinney simply elected not to do so. The NLRB did not err in relying on Woods' testimony and affidavit. 67 The union also sponsored testimony from several employees who attended a meeting on November 14, at which Woods and Les McClure told the gathering about the threats of discharge. Kinney contends that these threats (or rumors of threats, as Kinney claims) were effectively repudiated by subsequent management actions. According to Cognetti's testimony, he gave a speech on November 19 in which he pledged that nobody would be fired whatever the outcome of the election. A. at 475. This testimony was uncontradicted, but the NLRB specifically refused to credit it. The NLRB did find, however, that Cognetti sent a letter to all warehouse employees on November 19 which guarantee[d] that, as long as ... the ... employees who were the principal union organizers perform their job in a reasonably satisfactory manner, the Company will continue their employment as warehouse employees of this Company and will not take any steps to cause termination of the employment relationship. A. at 589. According to the letter, this assurance was effective only if the union lost the election. 68 In the past the NLRB has acknowledged that an employer can effectively repudiate unlawful conduct if the repudiation is timely, unambiguous, specific in nature to the coercive conduct and free from other proscribed illegal conduct. Passavant Memorial Area Hospital, 237 N.L.R.B. 138, 138, 1978 WL 7798 (1978) (citations and internal quotations omitted); see also Wilson Trophy Co. v. NLRB, 989 F.2d 1502, 1511 (8th Cir.1993). The NLRB found that the November 19 letter was an ineffective repudiation: 69 The November 19 document would have been taken by employees as the best evidence of Cognetti's intentions. Yet, it did not address the predictable concerns generated by his conduct of November 13, which he had not previously recanted, retracted, denied or even addressed in any prior communication with the work force as a whole or individually. The limited assurance that union supporters would be spared if the Union were defeated, in this context, by negative implication, reenforced the likelihood, in the eyes of employees, that the Respondent would take retaliatory action if the Union were designated. Accordingly, the November 19 message was drafted in terms likely to perpetuate and give continuing validity to the previously communicated threat that McClure and other union supporters were endangered by the possibility of a union victory. 70 A. at 109-10. The NLRB thus reads Cognetti's letter with a jaundiced eye. The letter disclaims any intent to retaliate in the event of a union defeat. It therefore responds to the fear that pro-union employees may become vulnerable to reprisal without union protection. But the NLRB reads this specific assurance as a negative pregnant that reinforces the original threat. However, because our inquiry is restricted to the question of whether the NLRB's findings are supported by substantial evidence, we accept the finding that Kinney engaged in the unfair labor practice of an unrepudiated threatened discharge. 71
72 At worst, Kinney committed one sustainable hallmark violation during the course of the 1991 election, plus an assortment of lesser infractions. 5 Given the facts of this case, the bargaining order issued by the NLRB was an abuse of discretion. 73 As discussed above, Gissel bargaining orders may be issued either (a) if an employer has engaged in exceptional misconduct, or (b) if the employer has engaged in lesser misconduct under Gissel, and the union can demonstrate that (1) the union was at some point supported by a majority of the bargaining unit employees; and (2) the employer's unfair labor practices undermined the union's majority strength and 'the possibility of erasing the effects of past practices and of ensuring a fair election (or a fair rerun) by the use of traditional remedies, though present, is slight.'  J.L.M., Inc. v. NLRB, 31 F.3d 79, 83 (2d Cir.1994) (quoting Gissel, 395 U.S. at 614-15, 89 S.Ct. at 1940-41). This case falls into neither of these categories. 74 a. Exceptional Misconduct. Not every hallmark violation amounts to exceptional misconduct under Gissel. In Windsor, for example, we found that the actual dismissal of two employees did not rise to that outrageous level: 75 While the unlawful layoffs violation, if not outrageous, is certainly a hallmark violation as that term has come to be used in this circuit, in no sense can the violation be said to be pervasive under Gissel; this was essentially one layoff, albeit of two men. This [is] not ... a class one case.... 76 Windsor, 730 F.2d at 865 (citations omitted). A fortiori, Kinney has engaged in no exceptional, pervasive, and outrageous behavior: a threat is by nature less outrageous than actual dismissal; actual dismissal is a management message calculated to reach all the members of the unit whereas Kinney's threat was made to two employees and disseminated to others by them, not by Kinney; and Kinney acted to limit its threat, whereas the employer in Windsor took no remedial action until after unfair labor charges had been filed. 77 b. Lesser Misconduct. If the Board's bargaining order is to be enforced, it must satisfy the requirements outlined by Gissel for cases marked by a lesser degree of misconduct than exceptional hallmark violations. The Board must first establish that there existed majority employee sentiment once expressed through cards in favor of the union. Gissel, 395 U.S. at 614, 89 S.Ct. at 1940. Twenty-five signature cards are included in the record. The unit contained 41 individuals, including the seven whose votes were contested. 6 We conclude below that the NLRB erred in rejecting Kinney's challenges to four of the seven contested ballots. Of these four employees, two had signed cards. Retrospectively, therefore, the original unit consisted of 37 individuals, a majority of 23 of whom signed cards. 78 Of these 23 cards, Kinney challenges five that were signed by employees who testified that they signed because they believed the only consequence of doing so would be the authorization of an election, and not necessarily because they wanted to vote in favor of a union. However, a review of the transcript pages cited by Kinney does not support this allegation. All five of the employees who signed these ballots indicated that they favored a union. 79 Kinney further contends that two additional signatures were induced by the false assertion that a majority of the other employees had already signed the cards. However, the NLRB deems this false statement to be within the range of puffery that solicitors are allowed. See Montgomery Ward & Co., 288 N.L.R.B. 126, 128-29, 1988 WL 213700 (1988). Finally, Kinney points out that three of the 23 cards were signed after the union made its formal demand for recognition on September 25. See A. at 604, 612, 636. 7 It is questionable whether these cards may be included in the final count, see Tall Pines Inn, Inc., 268 N.L.R.B. 1392, 1406, 1984 WL 36122 (1984), but the exclusion of these three cards would reduce the total number of valid cards to 20, which is still a majority of 37. 80 Nevertheless, even if the union had majority support in September 1991, the bargaining order was an excessive remedy. Absent exceptional misconduct (as defined in Gissel ), a bargaining order is justifiable only if the possibility of erasing the effects of past practices and of ensuring a fair election (or a fair rerun) by the use of traditional remedies ... is slight. Gissel, 395 U.S. at 614, 89 S.Ct. at 1940. The test is whether or not a fair and reliable election can be had. Id. (citations and internal quotations omitted). 81 The finding of a hallmark violation such as the threats to Woods and Les McClure, does not necessarily justify a bargaining order, even in the absence of mitigating factors. Windsor, 730 F.2d at 866. Here, however, Kinney's hallmark violation was substantially mitigated by Cognetti's November 19 letter, which disclaimed any reprisal in the event the union lost. The NLRB concluded that the November 19 letter was an ineffective repudiation because it was not categorical, but the NLRB erred in failing to consider the letter's substantial mitigating effect. A union victory would reduce management's ability to take reprisals with impunity, as any union supporter would assume. When Woods and Les McClure called a meeting to publicize the threat to their jobs, union adherent Drew Koerick stepped up to tell the audience that the only way to protect Woods and McClure from discharge was to vote for the union. Since union supporters would be (or feel) most vulnerable if the union lost, Cognetti's letter thus disclaimed management's most potent threat. 82 In considering whether to enforce a bargaining order in the absence of exceptional misconduct, courts may also consider whether the alleged violations involved acts or mere threats to act, see NLRB v. Jamaica Towing, Inc., 632 F.2d 208, 214 (2d Cir.1980), as well as lapse of time, employee turnover and other significant factors. Windsor, 730 F.2d at 867. The ultimate analysis must focus on whether a bargaining order is appropriate under the conditions facing the Board at the time of its decision. J.L.M., 31 F.3d at 84. Our preference not to enforce a bargaining order in all but the most extreme of circumstances reflects the important policy that employees not have union representation forced upon them when, by exercise of their free will, they might choose otherwise. NLRB v. Marion Rohr Corp., 714 F.2d 228, 230 (2d Cir.1983). It needs saying that, in a union representation election, the NLRB has no vote. 83 In J.L.M.--a case in which an employee was actually terminated as a reprisal for union organizing--we rejected the Board's bargaining order largely because the Board had failed to consider such circumstances as the intervening lapse of time, and turnover in the unit. Kinney's hallmark violation was far less egregious than that committed by the employer in J.L.M., and Kinney's other alleged labor practices are trivial even in the aggregate. Moreover, the bargaining order in this case was entered without consideration of other circumstances that bear upon fairness: the turn-over in the unit (as to which no inquiry was apparently made) and the thin margin of the vote. In short, the NLRB has failed to convince us that a bargaining order is warranted.... See J.L.M., 31 F.3d at 85. 84 We decline to enforce the NLRB's July 12, 1994 bargaining order insofar as it is based upon the unfair labor practices committed by Kinney in connection with the November 1991 election. 85