Court Opinion

ID: 185173
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:28:40+00
Date Added: 2024-06-11T17:26:13.748181
License: Public Domain

219 F.3d 661 (D.C. Cir. 2000)
Pacific Micronesia Corporation, d/b/aDai-Ichi Hotel Saipan Beach, Petitionerv.National Labor Relations Board, Respondent
Hotel Employees and Restaurant Employees Local Union No. 5, AFL-CIO, and Commonwealth Labor Federation, Intervenor
No. 99-1078
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 14, 2000Decided June 27, 2000

On Petition for Review and Cross-Application for  Enforcement of an Order of the National  Labor Relations Board
Ronald B. Natalie argued the cause for petitioner.  With  him on the briefs was Douglas W. Hall.
David A. Fleischer, Senior Attorney, National Labor Relations Board, argued the cause for respondent.  With him on  the brief were Linda R. Sher, Associate General Counsel, and  Aileen A. Armstrong, Deputy Associate General Counsel.  Margaret A. Gaines, Supervisory Attorney, entered an appearance.
Intervenor Hotel Employees and Restaurant Employees  Local Union No. 5, AFL-CIO, joined in the brief filed by the  National Labor Relations Board.  David A. Rosenfeld and  Victor J. Van Bourg entered appearances.
Before:  Silberman, Williams and Ginsburg, Circuit  Judges.
Opinion for the Court filed by Circuit Judge Ginsburg.
Ginsburg, Circuit Judge:

1
The National Labor Relations  Board held that Pacific Micronesia Corporation, d/b/a DaiIchi Hotel Saipan Beach, violated  8(a)(1) & (5) of the  National Labor Relations Act, 29 U.S.C.  151 et seq., by  refusing to bargain with or provide information to the Commonwealth Labor Federation and the Hotel Employees &  Restaurant Employees, Local 5, AFL-CIO (collectively, the  Union).  Dai-Ichi claims it need not deal with the Union  because the Board improperly defined the bargaining unit for  which it was certified and because the election of the Union  as the employees' bargaining representative was invalid.  We  agree with Dai-Ichi that the representation election was  invalid.  Without resolving the unit determination issue,  therefore we grant the Company's petition for review and  deny the Board's cross-application for enforcement.

I. Background

2
Dai-Ichi operates a resort hotel located on the island of  Saipan in the Commonwealth of the Northern Mariana Islands (CNMI).  The Covenant to Establish a Commonwealth  of the Northern Mariana Islands in Political Union with the  United States of America, 48 U.S.C. § 1681 at 539 (West  1987), governs the relationship between the CNMI and the United States.  Section 502(a)(2) of the Covenant makes  certain federal laws, including the NLRA, effective in the  CNMI, see Micronesian Telecommunications Corp. v.  NLRB, 820 F.2d 1097, 1101 (9th Cir. 1987), while § 503(a) of  the Covenant provides that the "immigration and naturalization laws of the United States" generally do not apply in the  CNMI.  48 U.S.C. § 1681. Acting under its reserved authority to regulate immigration, the CNMI enacted the Nonresident Workers Act (NWA) which "provide[s] strict[ ] enforcement, control and regulation of nonresident workers," NWA  § 4411(b), by severely restricting the immigration of nonresidents and by limiting the "employment of nonresident workers ... to the duration of the specific job or employment for  which the alien was recruited."  NWA § 4411(a).  Among the  many restrictions the NWA places upon the employment of  nonresidents, the following are most noteworthy.

3
An employer in the CNMI may hire a nonresident worker  only if the Chief of Labor certifies that no resident is  available to fill the position.  See NWA  4433.  Upon such  certification, the employer and the Chief must enter into a  "nonresident employment agreement," which memorializes a  description of the position, the time at which the employer  must again seek to fill the position with a resident, the  employment contract to be offered to the nonresident, and  the employer's commitment to secure a bond or surety for the  employee.  See id.  The actual employment contract in turn  must specify the term and location of employment, work  schedule, wage scale for regular and overtime hours, and any  pay deductions required by law.  See NWA  4433(g).

4
The Chief of Labor may authorize a nonresident employee  to work for no more than one year at a time, but the  employer may annually apply to extend his employment for  an additional year.  See Alien Labor Rules and Regs.  II.D.A nonresident may not work for anyone other than the  employer specified in the employment contract and neither  the employer nor the nonresident may alter the terms of their  employment contract without approval from the Chief.  See  NWA § 4437(d).  Upon the completion of the term of employment or the end of the employment relationship, a nonresident must immediately depart from the CNMI unless he has  filed a breach of contract claim against the employer, in which  case he may remain in the CNMI for a short time.  See NWA  § 4434(g).

5
Approximately 77% of Dai-Ichi's employees are nonresidents, and Dai-Ichi's Personnel Manager testified before the  Board that the company routinely seeks to extend the employment of any nonresident worker who has performed well. Indeed, a significant portion of Dai-Ichi's nonresident workforce has been in Dai-Ichi's employ for five or more years.

6
In November 1995 the Union petitioned for an election in a  bargaining unit consisting of all Dai-Ichi's workers.  Dai-Ichi  objected to the election on various jurisdictional grounds; alternatively it contended that the nonresident employees  "lack a community of interest with the resident employees,"  and therefore should be in a separate bargaining unit.  The  Regional Director overruled Dai-Ichi's jurisdictional objections, established a single bargaining unit comprised of both  residents and nonresidents, and set the election for March 21,  1996.  The Board rejected Dai-Ichi's request for review.

7
A little more than one week prior to the election the press  in the CNMI began describing various legislative proposals  relating to nonresident workers.  (Although the record contains only newspaper articles, the Board found that similar  reports aired on television at about the same time.)  On  March 13, the Marianas Variety News & Views (Variety)  published a story entitled "Reyes to union:  Leave us alone,"  which contains a statement by Rep. Pete Reyes, the majority  leader in the CNMI House of Representatives, announcing  his intention to introduce a bill limiting to two years the time  a nonresident worker could lawfully remain in the CNMI.Reyes said he intended the bill to curtail "problems with  overstaying alien workers," and to "send[ ] a message to  union organizers that they cannot promise workers [an] indefinite stay in the [CNMI]."  Three days later, the Pacific Daily  News ran an article entitled "Torres opposes union," reporting that Rep. Stanley Torres had announced his intention to  "introduce legislation ... to limit aliens to two renewals of their employment contracts if they join labor unions."  The  article also mentions that the announcement came approximately one week prior to the election at the Dai-Ichi hotel.

8
In the ensuing days prior to the election, the news media  circulated several more reports related to the legislative  proposals of Reps. Reyes and Torres.  Variety published a  story on March 18 entitled "Reyes:  Send home displaced  workers," which reported that Rep. Reyes' proposal would  prevent a nonresident worker who had been discharged from  remaining in the CNMI pending the outcome of his grievance. Rep. Reyes is reported to have stated that he made the  proposal partially in response to a "recent demonstration  participated in by alien workers bearing placards calling  Saipan 'the island of the abusers.' "  That same day articles in  Variety and in the Saipan Tribune quoted Rep. Torres as  saying his proposal would "limit all nonresident workers who  have joined a labor union to only two contract renewals."Variety quoted Rep. Torres as saying that the bill "is not  about punishing those who will join the union [but rather]  about putting union organizers on notice that they could not  promise anything for these workers";  the paper also quoted  Elwood Mott Jr., a union organizer, as saying that the bill  would be inconsistent with "sections 7 and 8 of the National  Labor Relations Act."  The Tribune article, entitled "Joining  a union:  Hazardous to your health," mentioned that the  Union was attempting to organize Dai-Ichi's workforce, noted  that some U.S. government officials had accused the Union of  having connections to organized crime, and ended by pointing  out that Rep. Torres' bill "would allow non-union members to  continue to renew their employment contracts indefinitely."Dai-Ichi attached this article to a flyer and circulated it to the  employees.

9
In the final few days before the election, the news media  reported that the bills as introduced would in fact apply to all  nonresidents, not just union members, but the stories continued to portray Reps. Reyes and Torres as very much opposed  to unionization.  The March 19 Tribune, in an article entitled  "Torres:  Union lying about dues," reported that Rep. Torres  had accused the Union of collecting excessive dues from workers in Saipan and it quoted him as saying that "becoming  a union member will be a lifetime employment record and  may haunt you everywhere you go when looking for a new  job."  That same day Variety reported that the Saipan Chamber of Commerce strongly opposed Rep. Torres' bill and  quoted the president of the Chamber as stating that the bill  would "probably be unconstitutional" if applied only to nonresidents who join unions.  On March 20, the Tribune reported that Rep. Torres had introduced a bill "propos[ing] that  any 'nonresident' worker who has lived and worked in the  CNMI for two or more consecutive years be required to leave  the CNMI for at least 30 days before the worker may be  allowed to ... continue working."  The remainder of the  report contrasts Rep. Torres' bill with an earlier law that had  limited nonresidents to four years in the CNMI;  employers  had succeeded in having the four year limit repealed.  Variety also published on March 20 a two-page advertisement  paid for by Rep. Torres that contained clippings from newspaper articles and letters regarding the Union;  several of the  articles featured in the advertisement were among the ones  described above.

10
On the day of the election Variety ran an article reporting  the parties' predictions of victory, a statement by Dai-Ichi's  counsel accusing the Union of charging excessive dues, responses by Union supporters claiming the Union would reduce dues if it won, and a statement by Rep. Torres that the  Union has a history of striking and that strikes "would cause  civil unrest in the CNMI."  Variety also published an article  entitled "2-year, 4-year limits for workers opposed" in which  Diego Benavente, Speaker of the CNMI House of Representatives, stated that he intended to "lobby his colleagues in the  House against any legislation seeking to impose a limit on the  legal stay of non-resident workers in the CNMI."  Speaker  Benavente is quoted as stating that Rep. Torres' bill "is not  only for union members but for all non-resident workers" and  that federal law prevents the CNMI from "treat[ing] union  members differently."  Finally, the Tribune printed an article  in which Dai-Ichi's counsel is quoted as saying the Union lied  to employees when it told them it would charge reduced dues and that Dai-Ichi planned to file unfair labor practice charges  against the Union for deceptive advertising.

11
The election of March 21 resulted in a decisive defeat (157  to 91) for the Union.  The Union filed objections to the  election, including three objections claiming, as the Regional  Director characterized them, that "third parties interfered  with employee free choice ... by threatening the reinstatement of the four year limit on non-resident worker's [sic]  contract renewals and/or threatening to limit non-resident  worker's [sic] contracts to two years."  Finding that the  "remarks published in the barrage of newspaper articles"  described above "constitute third party conduct so aggravated  that they created a general atmosphere of fear, reprisal, and  confusion rendering a free election impossible," the Regional  Director recommended overturning the election results.  The  Board adopted the Regional Director's findings, rejected DaiIchi's objections, and directed that a second election be held.

12
The second election was held on February 5, 1998.  This  time the Union prevailed (131 to 121) and Dai-Ichi filed  objections to the election, including its claim that the Board  erred by overturning the results of the first election.  The  Regional Director rejected Dai-Ichi's objections and certified  the Union as the representative of the bargaining unit;  the  Board rejected Dai-Ichi's request for review.

13
In order to obtain judicial review, Dai-Ichi refused to  provide information to or to bargain with the Union.  Upon  the Union's filing an unfair labor practice charge, the General  Counsel issued a complaint claiming Dai-Ichi had violated   8(a)(1) & (5) of the NLRA.  Finding no issues of disputed  fact, the Board granted summary judgment in favor of the  General Counsel and directed Dai-Ichi to bargain with the  Union.  Dai-Ichi petitioned this court for review of the  Board's order, the Board cross-applied for enforcement, and  the Union intervened in support of the Board.

II. Analysis

14
Dai-Ichi argues that the Board erred by overturning the  first election and by including within a single bargaining unit both resident and nonresident employees.  We must uphold  the Board's decisions unless "upon reviewing the record as a  whole, we conclude that the Board's findings are not supported by substantial evidence or that the Board acted arbitrarily or otherwise erred in applying established law to the  facts of the case."  Micro Pacific Development Inc. v. NLRB,  178 F.3d 1325, 1328-29 (D.C. Cir. 1999).  To meet the requirement of "[s]ubstantial evidence," the Board must produce "more than a mere scintilla" of evidence;  it must  present on the record "such relevant evidence as a reasonable  mind might accept as adequate to support a conclusion,"  Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229 (1938),  taking into consideration the "record in its entirety ...  including the body of evidence opposed to the Board's view."Universal Camera Corp. v. NLRB, 340 U.S. 474, 488 (1951).Our review for substantial evidence also must ensure that the  Board has "draw[n] all those inferences that the evidence  fairly demands."  Allentown Mack Sales & Serv., Inc. v.  NLRB, 522 U.S. 359, 378-79 (1998).

15
We think there is serious reason to doubt the propriety of  the bargaining unit in this case because of the inherent  conflict of interest between resident and nonresident employees, but the matter is far from clear.  See Saipan Hotel Corp.  v. NLRB, 114 F.3d 994, 998 (9th Cir. 1997).  We need not  decide that issue, however, because we agree with Dai-Ichi  that the Board erred by overturning the results of the first  election.

16
The Board's precedents establish that it rarely overturns  the results of a representation election because of misconduct  not attributable to a party to the election, and then only if  that "misconduct was so aggravated as to create a general  atmosphere of fear and reprisal rendering a free election  impossible."  Westwood Horizons Hotel, 270 N.L.R.B. 802, 803  (1984).  In this case the Board found the statements made by  various members of the CNMI House of Representatives, as  reported by the news media, constituted "third party threats"  that made it impossible for the employees freely to decide  whether to vote for the Union.  We question seriously the  idea that statements made by lawmakers concerning legislative proposals designed to address political issues could ever  be grounds for overturning a representation election.  Cf.  NLRB v. Gissel Packing Co., 395 U.S. 575, 617-18 (1969)  (stating employer's comments about representation election  must be more limited than those regarding "the enactment of  legislation ... where the independent voter may be freer to  listen more objectively and employers as a class freer to  talk").  Nevertheless, we need not and do not decide that  question here because the Board's determination that the  reports "created an atmosphere of confusion, and fear of  reprisals so as to render impossible the rational, uncoerced  selection of a bargaining representative" is not supported by  substantial evidence.  Indeed, there are two major deficiencies with the evidence the Board relies upon to support its  determination:  Most of the news reports could not have  affected in any way the employees' ability to decide freely  whether to select the Union as their bargaining representative, and to the extent any of the reports conceivably could  have affected the employees' ability to choose freely, the  reports are too insignificant to have caused such fear and  confusion that free choice was impossible.

17
The Board overturned the results of the first election  because it determined that the reports in the media made it  impossible for the employees to vote freely.  In order to  support this determination, therefore, the Board needed at a  minimum to present evidence of events from which "it reasonably appears that the freedom of choice of the employees  could have been interfered with."  James Lees & Sons Co.,  130 N.L.R.B. 290, 291 n.1 (1961).  Although the type of evidence  required in this case seems self-evident, see, e.g., Westwood  Horizons Hotel, 270 N.L.R.B. at 803 (threats of physical violence if employees voted against Union);  James Lees & Sons  Co., 130 N.L.R.B. at 291 ("[N]umerous statements and conduct  by various responsible groups and individuals in the community ... reasonably conveyed the view to the employees that  in the event of unionization the Employer would shut down its  plant and other employers would not locate in the community"), the Board repeatedly attempts to justify its decision to  overturn the first election by relying upon evidence that  simply is not relevant to the employees' free choice.

18
For example, the Regional Director observed that passage  of the bills limiting the amount of time nonresidents could  remain in the CNMI would have meant immediate job loss  and deportation for a significant number of Dai-Ichi's longterm employees.  Noting that threats of deportation and job  loss are quite serious, he then opined that many of Dai-Ichi's  workers might have "reasonably conclud[ed] that it was better to stay and work without union representation, than to be  sent back to their homeland[s]."  The gap in this reasoning is  obvious:  Passage of the proposed legislation was not in any  way contingent upon the outcome of the election.  Therefore,  the pendency of the legislative issue (and the reports thereon)  had no bearing upon the employees' ability to choose freely in  the election.  Although it is quite possible that news of the  legislative proposals caused fear and confusion among DaiIchi's employees--perhaps causing some of them to worry  that they would not be able to remain in the CNMI--they  simply had no reason to fear the consequences of voting for  the Union.  Yet the Board overturned the first election on the  ground that the employees' fear and confusion "render[ed]  impossible" a "free expression of choice."  Westwood Horizons Hotel, 270 N.L.R.B. at 803.  From the evidence in the  record, that is a non sequitur.

19
In this court the Board highlights four aspects of the  record in support of its conclusion.  First, the Board points  out that some early reports had erroneously described the  bills as limiting the number of times nonresidents who joined  a union could renew their employment contracts while leaving  unaffected the renewals of nonresidents who did not join a  union.  Second, the Board notes that several articles about  the proposed legislation refer to the impending election at  Dai-Ichi.  Third, the Board points out that some of the  reports contain statements indicating that the proposals were  intended to deter the Union.  Finally, the Board relies upon  one of the articles that quotes Rep. Torres as stating that  joining a union "may haunt you everywhere you go when  looking for a new job."  We consider these four points both  seriatim and cumulatively, but are nonetheless constrained to conclude they do not, even in the aggregate, constitute substantial evidence supporting the Board's determination that  the employees were unable to vote freely in the first election.

20
First, although some of the early reports did refer to  (nonexistent) legislative proposals that would have adversely  affected only nonresidents who were union members, later  reports repeatedly corrected those early mis-descriptions.The last article to err in that regard appeared on March 18;all subsequent articles either expressed opposition to such a  proposal or stated that the actual proposals would apply to all  nonresident workers, union and non-union alike.  A report on  March 19 stated that the Chamber of Commerce believed a  bill targeting union members would be unconstitutional and  that it would strongly oppose a bill limiting the number of  times any nonresident's contract could be renewed.  Then, on  March 20, the Tribune reported that the bills actually introduced applied to all nonresidents regardless whether they  were members of a union, and Variety published an article on  March 21 reiterating that the bills applied to all nonresidents.The later reports clearly dispelled any notion that the proposed legislation affected only those nonresidents who joined  a union.  The Board's emphasis solely upon the earlier articles, therefore, is misplaced.

21
Second, mention of the election at Dai-Ichi in some articles  lends no support to the Board's determination.  To begin,  only three of the articles even mention the then-impending  first election in relation to the proposed legislation.  The rest  of the articles either do not mention the election at all or  mention it in a way that does not relate to the proposed  legislation.  For example, an article appearing in the Tribune  on March 19 begins by mentioning that "[w]ith an election set  this week at the Dai-Ichi Hotel ... Rep. Stanley T. Torres  has renewed his criticism" of the Union, but that article does  not mention any of the legislative proposals.  Even assuming,  however, that some of the articles did lead employees to  believe that the legislation was introduced because of the  Union's efforts to organize Dai-Ichi's workforce, those articles cannot reasonably be seen as constraining the employees'  ability to vote freely in the election.  Not one of the articles ever intimates that the results of the election could affect the  legislative outlook in any way.  Although it may have been  reasonable for an employee to speculate that the Union's  efforts to organize Dai-Ichi's workforce at least partially  precipitated the proposals, it would not have been reasonable  for an employee to conclude that the results of the election  could do anything to defeat or otherwise derail the proposals,  which dealt with larger issues of immigration and employment policy.

22
Nor does the Board's third point, that some news reports  indicated the legislative proposals were designed to deter the  Union's organizers, suggest that the employees were unable  to vote freely in the first election.  Only by quoting fragments  of the articles out of context can the Board argue otherwise. For example, the Board argues that several of the articles  "quoted the legislators as saying they wanted to 'send a  message to union organizers,' " implying that the proposals  were designed to deter unionization.  Read in context, however, the reports are much less ominous.  In fact, the articles  containing the phrase "send a message" state in substance  that Reps. Torres and Reyes "wanted to send a political  message to union organizers 'that they could not promise  alien workers permanent residency in the island.' "

23
Some of the articles cited by the Board do indicate that  some legislators were adverse to unionization in general and  to the Union in particular but those articles simply do not  support the Board's conclusion that the employees were  unable to vote freely.  The Supreme Court has held that in an  election contest even the employer, who has some direct  control over his employees' economic well-being, "is 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' " for voting respectively against or for unionization.  Gissel Packing Co., 395 U.S.  at 618.  Overturning an election based upon statements made  by legislators requires more reason to believe that employees'  freedom of choice was compromised:  The Board will overturn  an election if conduct attributable to the parties "created such an environment of tension and coercion as to have had a  probable effect upon the employees' actions at the polls," but  will overturn an election based upon third party conduct only  if the misconduct is "so aggravated as to create a general  atmosphere of fear and reprisal rendering a free election  impossible."  Overnite Transp. Co. v. NLRB, 140 F.3d 259,  264-65 (D.C. Cir. 1998).  Applying this standard, the statements made in the present case by various legislators opposed to unionization in general and accusing the Union in  particular of corruption cannot possibly be a ground for  overturning the first election.  If the rule were otherwise, the  electoral process would be subject to endless manipulation by  politicians and their allies in labor or management.

24
With respect to the Board's last point, the statement  attributed to Rep. Torres appeared in an article in which he  accused the Union of charging excessive dues and of engaging  in "sneaky" and potentially illegal campaigning.  The article  ends with the following passage:  "In closing his statement,  Torres said that although workers have a right to choose  whether or not to join a union, 'becoming a union member will  be a lifetime employment record and may haunt you everywhere you go when looking for a new job.' "  This statement,  like the statements just discussed, is nothing more than Rep.  Torres' expression of general dislike of unions and cannot be  a ground for overturning an election.  Therefore, this portion  of the record also fails to provide meaningful evidence for the  Board's finding that the employees were unable to vote freely  in the first election.

25
Considering the Board's evidence as a whole, we think it  falls well short of being substantial.  None of the individual  points is probative, and taken as a whole they do not add up  to any more than the sum of the parts.  We are therefore  constrained to conclude that the Board has failed to support  with substantial evidence its decision to overturn the first  election.

III. Conclusion

26
The Board's finding that news reports "created an atmosphere of confusion, and fear of reprisals so as to render impossible the rational, uncoerced selection of a bargaining  representative" in the first election is not supported by  substantial evidence.  Consequently, we grant Dai-Ichi's petition for review and deny the Board's cross-application for  enforcement.

27
It is so ordered.