Court Opinion

ID: 4155280
Source: CourtListenerOpinion
Date Created: 2017-03-24 15:01:23.344614+00
Date Added: 2024-06-11T14:23:24.625044
License: Public Domain

United States Court of Appeals
        For the Eighth Circuit
    ___________________________

            No. 16-1565
    ___________________________

               Cargill, Inc.

        lllllllllllllllllllllPetitioner

                      v.

    National Labor Relations Board

       lllllllllllllllllllllRespondent
    ___________________________

            No. 16-1930
    ___________________________

               Cargill, Inc.

       lllllllllllllllllllllRespondent

                      v.

    National Labor Relations Board

        lllllllllllllllllllllPetitioner
               ____________

    National Labor Relations Board
            ____________

     Submitted: December 15, 2016
        Filed: March 24, 2017
            ____________
Before WOLLMAN and SMITH,1 Circuit Judges, and WRIGHT,2 District Judge.
                          ____________

WOLLMAN, Circuit Judge.

       Cargill, Inc., petitions for review of an order of the National Labor Relations
Board, which concluded that Cargill engaged in an unfair labor practice in violation
of sections 8(a)(1) and (5), 29 U.S.C. § 158(a)(1), (5), of the National Labor Relations
Act (Act), id. §§ 151-169, when it refused to bargain with the United Food and
Commercial Workers International Union, Local No. 324 (the Union). The Board
cross-petitions for enforcement of its order. We deny Cargill’s petition for review
and grant the Board’s cross-petition for enforcement.

       Cargill processes food-grade oil at its Fullerton plant, which is divided into two
distinct areas, which we will call Side A and Side B. On Side A of the plant, eight
terminal employees unload and store incoming oil that arrives at the plant by rail car
or truck. The terminal employees also deliver samples of the incoming oil to a lab
located on the Side A, and the oil is tested by four quality-control employees, who
work in the lab. The terminal employees do not leave Side A, but two of the quality-
control employees cross to Side B roughly once a week to retrieve paperwork, to
escort a rabbi during his inspection of Side B, and to themselves inspect a pipeline
that fills shipping containers with oil on Side B. The quality-control employees
generally do not interact with the employees who work on Side B. The four
employees in the maintenance department also work on Side A. Their primary
responsibility is to repair equipment on both sides of the plant and to schedule work

      1
       The Honorable Lavenski R. Smith became Chief Judge of the United States
Court of Appeals for the Eighth Circuit on March 11, 2017.
      2
       The Honorable Wilhelmina M. Wright, United States District Judge for the
District of Minnesota, sitting by designation.

                                          -2-
orders, but they do not interact with the employees who work on Side B except as
necessary to facilitate repairs.

        Side B of the plant is a single building called the packaging warehouse, which
is designated for packaging and shipping of processed oil. The twenty-two packaging
employees operate machines that adjust the viscosity of processed and unprocessed
oil, place empty containers on a conveyor to be filled with unprocessed oil, and
transport filled containers by forklift to a storage area for further handling by the
shipping employees. After the packaging employees complete their tasks, the nine
shipping employees load the packaged oil onto trucks, as well as schedule and
monitor trucks arriving at the packaging warehouse to pick up processed and
unprocessed oil. Four receiving employees also work in the packaging warehouse,
one of whom coordinates the purchase of materials used by packaging employees and
three of whom operate forklifts to unload packaging materials and store them in the
warehouse. The packaging and receiving employees frequently interact and
coordinate to accomplish their work tasks. In addition to sharing a single work
location, the packaging, shipping, and receiving employees all have similar wage
rates, earn the same benefits, and have a history of common supervision separate from
that of employees on Side A. The employees who work in the packaging warehouse
typically use the same break room, parking lot, and plant entrance, all of which are
separate from those used by employees on Side A.

       The Union filed a representation petition with the Board in July 2014, seeking
an election to become the bargaining representative of “all full-time and regular part-
time packaging, shipping, and receiving employees” at the Fullerton plant. The
Union’s petition sought to “exclud[e] all other employees, packaging leads, shipping
leads, office clerical employees, professional employees, staffing agency employees,
guards[,] and supervisors as defined in the [Act].” Packaging and shipping leads
were excluded from the petitioned-for bargaining unit on the theory that they were
“supervisors” under the Act. Cargill took a contrary position, arguing that the

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packaging and shipping leads were “employees” under the Act, not supervisors, and
thus were required to be included in the bargaining unit. Cargill also argued that the
maintenance, terminal, and quality-control employees shared a community of interest
with the petitioned-for unit and were required to be included for the unit to be
appropriate. At a hearing before the Regional Director, the Union stated that it would
not proceed to an election if its petitioned-for bargaining unit was altered in any way.
The Regional Director issued a decision on September 11, 2014, which held that the
packaging and shipping leads were employees, not supervisors, under the Act and that
the Union’s petitioned-for bargaining unit was inappropriate because it specifically
excluded these employees. Because the Union was unwilling to proceed to an
election if its petitioned-for bargaining unit was altered, the Regional Director
dismissed the Union’s representation petition, finding it unnecessary to decide
whether any alternate bargaining unit, i.e., one that included the packaging and
shipping leads and the maintenance, terminal, and quality-control employees, was
appropriate. Neither party requested reconsideration or Board review of the Regional
Director’s decision.

       Less than a week later, the Union filed another representation petition, this time
seeking an election to become the bargaining representative of “all full-time and
regular part-time packaging, shipping, and receiving employees” at the Fullerton
plant. The Union sought to exclude “all other employees, maintenance employees,
terminal employees, quality-control employees, staffing-agency employees, office
clerical employees, guards[,] and supervisors as defined in the [Act].” Cargill filed
a motion to dismiss the petition with prejudice, arguing that the petitioned-for
bargaining unit was identical to the unit sought by the Union in the earlier petition
and rejected by the Regional Director as inappropriate. Cargill also argued that the
new petition should be dismissed because it was an improper attempt to reopen the
proceedings in the first representation petition, to seek reconsideration of the
Regional Director’s decision in those proceedings, and to litigate issues in an
untimely or piecemeal fashion. The Regional Director denied Cargill’s motion to

                                          -4-
dismiss, finding that the bargaining unit petitioned for in the second representation
petition was not identical to that petitioned for in the first petition. The Director also
rejected Cargill’s other arguments.

       The Regional Director later issued a decision on the merits of the second
representation petition, finding that the petitioned-for bargaining unit was appropriate
and reaffirming that the shipping and packaging leads were employees and not
supervisors under the Act. Cargill requested Board review of the Director’s decision,
arguing that the bargaining unit was inappropriate and again asserting that the second
representation petition should have been dismissed for the reasons it had previously
cited. The Board denied Cargill’s request for review, concluding that the company
had not raised any substantial issues warranting review.

       A secret-ballot election by the approved bargaining unit was held at Cargill’s
Fullerton plant on December 4, 2014, which resulted in fourteen votes in favor of the
Union and fourteen votes against the Union. The ballots cast by three employees
were challenged. Cargill also filed five objections to the election, and requested a
hearing before the Regional Director. As relevant here, Objection 1 reiterated
Cargill’s argument that the Union’s second representation petition should have been
dismissed. Objection 5 alleged that pro-union employees waiting in line to vote
“engaged in a loud demonstration just outside the polling room” and that the Board
agent overseeing the election did not investigate or stop the conduct. The Regional
Director issued a Supplement Decision, summarily overruling Objection 1 as
“without merit,” noting that Cargill’s various arguments for dismissal had been “fully
litigated” and that Cargill “raise[d] nothing new that either was not or could not have
been previously litigated” earlier in the proceedings. The Director ordered a hearing
on Cargill’s other objections, including Objection 5.

      At the hearing, Cargill’s election observer testified about the circumstances
surrounding the election, as did two employees who voted in the election. After

                                           -5-
considering the evidence and testimony, the Hearing Officer issued a Report
recommending that Cargill’s objections be overruled and that the three challenged
ballots be opened and counted towards the final election result. With respect to
Objection 5, the Hearing Officer found that even if the testimony of Cargill’s
witnesses were credited, the alleged conduct did not warrant setting aside the election
results. The Hearing Officer found that there was no evidence that pro-union
employees waiting in line outside the polling place attempted to persuade other
employees to vote for the Union; that the loud and boisterous conduct lasted only
fifteen minutes; that the incidents of booing and chanting were brief, isolated, and
directed at a single employee; and that there was no evidence of threats or physical
violence. The Hearing Officer concluded that because the complained-of conduct
“was not so disruptive or coercive that it substantially impaired the employees’
exercise of free choice,” overturning the election results was not warranted. Because
the underlying employee conduct was not objectionable, it necessarily followed that
the Board agent’s determination not to investigate or stop that conduct was likewise
not objectionable.

       Cargill filed exceptions to the Hearing Officer’s findings and recommendation
regarding Objection 5. The Board adopted the Hearing Officer’s findings and
recommendations and overruled Objection 5, concluding that the complained-of
conduct did “not so substantially impair[] the employees’ exercise of free choice as
to require that the election be set aside.” The Board ordered the Regional Director
to open and count the three challenged ballots, which resulted in a revised vote tally
of sixteen votes in favor of the Union and fifteen votes against it. The Regional
Director then certified the Union as the collective-bargaining representative of a unit
of packaging, shipping, and receiving employees at Cargill’s Fullerton plant.

        Cargill refused to bargain with the Union in order to contest the Union’s
certification as the collective-bargaining representative, leading the General Counsel
to file an unfair-labor-practice complaint with the Board that alleged violations of

                                         -6-
sections 8(a)(1) and (5) of the Act. Cargill’s answer to the complaint again argued
that the Union’s second representation petition should have been dismissed. It also
argued in general that the election was invalid, that certification of the Union as the
bargaining representative was ineffective, and that Cargill had no duty to recognize
or bargain with the Union. The Board granted General Counsel’s motion for
summary judgment, concluding that Cargill’s complaints regarding the second
representation petition and the conduct of the election either were or should have
been raised in the representation proceedings and not in the unfair-labor-practice
proceeding. The Board further concluded that Cargill had not offered any newly
discovered or previously unavailable evidence or any special circumstances sufficient
to justify revisiting any of Cargill’s representation or election arguments. The Board
ordered Cargill to cease and desist from refusing to recognize and bargain with the
Union and from interfering with, restraining, or coercing employees in the exercise
of their rights under the Act. It is from that order that Cargill petitions for review.

       Cargill first argues that the Board violated its rules and regulations and
departed without explanation from its decisional law when it refused to dismiss the
Union’s second representation petition, which, Cargill asserts, sought a unit identical
to the unit sought in the Union’s first representation petition. “We review the Board’s
findings of fact for substantial evidence on the record as a whole, that is, for such
relevant evidence as ‘a reasonable mind might accept as adequate to support’ a
finding.” Cellular Sales of Mo., LLC v. NLRB, 824 F.3d 772, 775 (8th Cir. 2016)
(quoting NLRB v. Am. Firestop Sols., Inc., 673 F.3d 766, 767-68 (8th Cir. 2012)).
We review the Board’s conclusions of law de novo. Id. The Board has broad
discretion to establish and implement procedures required to ensure “the free and fair
choice of bargaining representatives by employees.” Warren Unilube, Inc. v. NLRB,
690 F.3d 969, 974 (8th Cir. 2012) (quoting NLRB v. A.J. Tower Co., 329 U.S. 324,
330 (1946)). We defer to the Board’s interpretation of its own rules and regulations,
so long as that interpretation is “reasonable and consistent with the Act.” NLRB v.
Ky. River Cmty. Care, Inc., 532 U.S. 706, 711-12 (2001) (“We find that the Board’s

                                         -7-
rule . . . is reasonable and consistent with the Act, and we therefore defer to it.”); see
also Alldata Corp. v. NLRB, 245 F.3d 803, 807 (D.C. Cir. 2001) (“We give
controlling weight to the Board’s interpretation of its own rule unless it is plainly
erroneous or inconsistent with the regulation itself.”).

       As set forth above, the Regional Director found that the Union’s first
representation petition inappropriately excluded shipping and packaging leads from
the petitioned-for unit. Because the Union was unwilling at that time to proceed with
an alternative unit, the Regional Director dismissed the first petition without ruling
on the ultimate appropriate-unit issue. The Union was then left to decide whether to
further litigate the issue of the shipping and packaging leads in a petition for Board
review of the Regional Director’s decision or in a motion for reconsideration or
rehearing by the Director, or whether to pursue representation of a different unit that
included the shipping and packaging leads. The Union elected to pursue the latter
course by filing a new petition that sought to represent a different unit—one that did
not specifically exclude shipping and packaging leads. By electing to file a new
petition, the Union did not, as asserted by Cargill, run afoul of 29 C.F.R.
§ 102.65(e)(1), which prohibits a motion for reconsideration, rehearing, or reopening
of the record on a matter that could have been raised in the earlier proceedings.

       Cargill also argues that because the unit proposed in the Union’s second
petition was identical to the unit proposed in the Union’s first representation petition,
the Board’s refusal to dismiss the second petition allowed the Union to improperly
relitigate this issue, reopen the record on the issue, and litigate the issue piecemeal
fashion. Although the Union may not have officially abandoned its original position
that the shipping and packaging leads were “supervisors” under the Act and not
“employees,” it did not pursue that position in the second proceeding. The Union did
not specifically exclude the shipping and packaging leads from the unit sought in the
second petition. Nor did it present any new evidence on the matter in the second
proceeding. Indeed, the Union declined to challenge the Regional Director’s original

                                           -8-
finding regarding the shipping and packaging leads, instead stipulating to the record
compiled in the first proceeding and agreeing with Cargill that the Regional Director
should “take administrative notice of the record in [the first petition] in determining
the appropriateness” of the unit sought in the second petition. As set forth above, the
Regional Director considered and rejected Cargill’s argument, finding that although
the units were “similar,” they were not identical because “the petitioned-for unit [in
the second representation petition] does not seek to specifically exclude the
classifications of ‘packaging leads’ or ‘shipping leads.’” This finding is supported
by substantial evidence on the record. See Cellular Sales, 824 F.3d at 775.
Moreover, the Board’s conclusion that the rules and regulations cited by Cargill were
inapposite is “reasonable and consistent with the Act,” and is thus entitled to
deference. Ky. River Cmty. Care, 532 U.S. at 711-12.

       Cargill also contends that the Board’s failure to dismiss the second petition
violated various provisions set forth in its Casehandling Manual. As Cargill
acknowledges, however, the provisions of the Casehandling Manual do “not bind[]
this court or the NLRB.” Sioux City Foundry Co. v. NLRB, 154 F.3d 832, 838 (8th
Cir. 1998).

       Cargill has not cited a controlling rule or regulation that required the dismissal
of the Union’s second representation petition, that prohibited the filing of a second
petition, or that required the Union to seek reconsideration or Board review of the
dismissal of the first petition in lieu of filing a second petition seeking a different
bargaining unit. Accordingly, we reject Cargill’s argument that the Board erred in
declining to dismiss the second petition.

      Cargill next argues that the bargaining unit approved by the Board was
inappropriate and that all of the employees at the Fullerton plant should have been
included in the unit, given the plant’s highly integrated operations. We disagree. The
Board is authorized under the Act to determine “the unit appropriate for the purposes

                                          -9-
of collective bargaining,” 29 U.S.C. § 159(b), and our review of that determination
“is limited to . . . whether the decision is arbitrary, capricious, an abuse of discretion,
or lacking in substantial evidentiary support,” FedEx Freight, Inc. v. NLRB, 816 F.3d
515, 521 (8th Cir. 2016) (quoting NLRB v. St. Clair Die Casting, LLC, 423 F.3d 843,
848 (8th Cir. 2005)). Because our “scope of review is narrow,” the Board’s
“determination as to the appropriateness of a bargaining unit will rarely be disturbed.”
Id. at 522 (quoting Cedar Valley Corp. v. NLRB, 977 F.2d 1211, 1218 (8th Cir.
1992)). The Board determines whether a unit is appropriate by considering whether
the unit is composed of employees who are “readily identifiable as a group (based on
job classifications, departments, functions, work locations, skills, or similar factors)”
and who “share a community of interest.” Specialty Healthcare, 357 N.L.R.B. 934,
945 (2011); see FedEx Freight, 816 F.3d at 522, 525 (adopting Specialty Healthcare
framework). A party contesting the Board’s determination that a petitioned-for unit
of employees meets these criteria must demonstrate that other employees who were
excluded from the unit “share an overwhelming community of interest” with those in
the petitioned-for unit and that “there is no legitimate basis for excluding” them.
FedEx Freight, 816 F.3d at 527 (quoting Specialty Healthcare, 357 N.L.R.B. at 945-
46).

       The Board reasonably determined that the packaging, shipping, and receiving
employees are readily identifiable as a group and share a community of interest. The
Board found that these employees work together in the packaging warehouse, which
stands apart from the rest of the plant; that they pursue a common goal related to the
packaging and shipping of processed oil; and that they share a single supervisor, as
well as a history of common supervision. The Board noted that the employees in the
petitioned-for unit know each other personally, frequently interact, and share a break
room and parking lot. The Board also found that they have similar wage rates and
receive the same benefits. The Board’s determination that the proposed unit of
packaging, shipping, and receiving employees was appropriate was thus not

                                           -10-
“arbitrary, capricious, an abuse of discretion, or lacking in substantial evidentiary
support.” See FedEx Freight, 816 F.3d at 521.

       The Board also reasonably determined that Cargill failed to show that the
terminal, quality-control, and maintenance employees, all of whom were excluded
from the bargaining unit, shared an “overwhelming community of interest” with the
bargaining-unit employees such that their exclusion from the unit rendered it
inappropriate. See Specialty Healthcare, 357 N.L.R.B. at 945-46.3 The Board found
that the excluded employees have minimal interaction with the bargaining-unit
employees, particularly given that they work on two separate sides of the plant and
rarely cross the divide. See FedEx Freight, 816 F.3d at 527 (recognizing significance
of “several common sense logical distinctions” that separated petitioned-for unit of
employees from excluded employees). Additionally, the Board found that the
packaging, shipping, and receiving employees share a common function—the
packaging and shipping of processed oil—one that is not shared with the terminal,
quality-control, and maintenance employees, whose principal responsibilities involve
the unloading and testing of incoming oil and the maintenance of machinery. The
Board acknowledged that two quality-control employees periodically cross over to
the packaging warehouse, but reasonably found that those employees primarily
worked in the separate on-site lab and rarely interacted with employees stationed in
the packaging warehouse. A bargaining unit must be “appropriate,” but it need “not
necessarily [be] the single most appropriate unit.” Am. Hosp. Ass’n v. NLRB, 499
U.S. 606, 610 (1991); see also FedEx Freight, 816 F.3d at 523 (“If the Board
concludes that the petitioned for unit is ‘an appropriate unit,’ it has fulfilled the
requirements of the Act and need not look to alternative units.”). Given our narrow
scope of review and the deference owed to the Board in the resolution of bargaining-

      3
       Cargill also argues that the standard applied by the Board in Specialty
Healthcare was a departure from Board precedent. We considered and rejected this
argument in FedEx Freight, Inc. v. NLRB, 816 F.3d 515, 523-25 (8th Cir. 2016),
rehearing and rehearing en banc denied (May 26, 2016).

                                        -11-
unit matters, we conclude that the Board did not err in finding that Cargill failed to
establish an overwhelming community of interest between the excluded employees
and those in the petitioned-for unit such that there was no legitimate basis for their
exclusion. We therefore reject Cargill’s challenge and decline to disturb the Board’s
determination that the petitioned-for unit composed of packaging, shipping, and
receiving employees was an appropriate collective-bargaining unit.

       Finally, Cargill argues that Objection 5 to the conduct of the election should
have been sustained and the election results set aside. The Board has broad discretion
to establish the “safeguards necessary” to ensure a “fair and free” representation
election, A.J. Tower Co., 329 U.S. at 330; see also Warren Unilube, 690 F.3d at 974,
and “[t]here is a strong presumption” that such an election “reflects the employees’
true desires regarding representation,” Deffenbaugh Indus., Inc. v. NLRB, 122 F.3d
582, 586 (8th Cir. 1997). Thus, “[r]epresentation elections are not to be set aside
lightly,” and the party seeking to overturn election results “carries a heavy burden.”
Millard Processing Servs., Inc. v. NLRB, 2 F.3d 258, 261 (8th Cir. 1993); see also
Warren Unilube, 690 F.3d at 974. To carry that burden, the party challenging the
election must “show by specific evidence not only that improprieties occurred, but
also that they interfered with employees’ exercise of free choice to such an extent that
they materially affected the election results.” Warren Unilube, 690 F.3d at 974
(quoting Beaird-Poulan Div. v. NLRB, 649 F.2d 589, 592 (8th Cir.1981)). Election
results will not be overturned on the basis of objectionable conduct by employees or
third parties unless that conduct created “an atmosphere of fear and reprisal such as
to render free expression of choice impossible.” Millard Processing, 2 F.3d at 261
(citations omitted).

      The Board found that, even accepting the testimony of Cargill’s witnesses, the
company had failed to establish that the complained-of conduct created the necessary
atmosphere of fear and reprisal that rendered a free election impossible. Cargill’s
witnesses testified that during the first ten or fifteen minutes of the voting session

                                         -12-
some employees engaged in loud, boisterous conversation and shouted profanities
while waiting in line to vote; briefly chanted, “Yes we can,” in Spanish; and booed
a coworker known to have voted against the Union. But “loud outburst[s] in the
polling area by nonagent[s of the Union], even involving a partisan message, do[] not
rise to the level of objectionable third-party conduct.” SNE Enterps., Inc., 344
N.L.R.B. 673, 681 (2005). Even the arguably more egregious booing incident was
insufficient to establish a general atmosphere of fear and reprisal, as the incident was
brief, directed at a single employee, and was not shown to have had an impact on any
other employee. See NLRB v. Hood Furniture Mfg. Co., 941 F.2d 325, 329-30 (5th
Cir. 1991) (affirming Board’s finding that third-party conduct did not justify setting
aside election results even when terminated employees told former coworkers waiting
in line to vote that they “kn[e]w damn well the way” they were “supposed to vote”).
These findings are supported by substantial evidence. See Cellular Sales, 824 F.3d
at 775.

       Cargill argues that the Board improperly relied upon the absence of threats or
physical violence in concluding that the complained-of conduct did not create the
requisite atmosphere of fear and reprisal. True, the Board pointed out that the
complained-of conduct did not include threats or physical violence, but it did not
conclude, or even suggest, that proof of such conduct was necessary in order to
establish the general atmosphere of fear and reprisal necessary to overturn election
results. Instead, the Board discussed the allegedly comparable cases involving threats
and physical violence and stated, “Contrary to [Cargill’s] claims, th[e complained-of]
conduct is distinguishable both from the coercive gauntlet that voters were forced to
pass in order to vote in Pepsi Cola Bottling Co., 291 N.L.R.B. 578, 579 (1988) . . . ,
and from the overtly threatening voting-line misconduct in Westwood Horizons
Hotel, 270 N.L.R.B. 802 (1984) . . . .” In sum, the Board did not err in concluding
that Cargill failed to carry its heavy burden of showing that the complained-of
conduct created a general atmosphere of fear and reprisal rendering a free election
impossible.

                                         -13-
       In a related argument, Cargill contends that the Board agent’s failure to
investigate and halt the complained-of employee conduct casts sufficient doubt on the
fairness and validity of the election such that the results should be overturned. See
NLRB v. Superior of Mo., Inc., 351 F.3d 805, 809 (8th Cir. 2003) (noting that
employer must show that Board agent’s conduct “tends to destroy confidence in the
Board’s election process, or . . . could reasonably be interpreted as impugning the
election standards” (citations omitted)). Because there was no employee conduct
sufficiently objectionable to require action by the Board’s agent, the Board did not
err in concluding that Cargill failed to establish that the Board agent’s conduct cast
a reasonable doubt on the Board’s neutrality or the integrity of the election.

      The petition for review is denied, and the Board’s Order is enforced in full.
                       ______________________________

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