Court Opinion

ID: 617231
Source: CourtListenerOpinion
Date Created: 2011-11-16 17:49:00+00
Date Added: 2024-06-11T12:14:14.642126
License: Public Domain

NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT
                                _______________

                      Nos. 10-4569, 10-4683, 11-1564 & 11-1742
                                 _______________

                     NATIONAL LABOR RELATIONS BOARD,
                                       Petitioner/Cross-Respondent

                                           v.

          GRAPETREE SHORES, INC. d/b/a DIVI CARINA BAY RESORT
                                       Respondent/Cross-Petitioner
                           _______________

                On Petition for Review and Application for Enforcement
                   of Orders of the National Labor Relations Board
                      (NLRB Nos. 24-CA-11101, 24-CA-10700)
                                   _______________

                      Submitted Under Third Circuit LAR 34.1(a)
                                  October 26, 2011
                                 _______________

               Before: SLOVITER, GREENAWAY, JR., Circuit Judges,
                           and POLLAK, District Judge*

                          (Opinion filed: November 16, 2011)
                                  _______________

                                      OPINION
                                   _______________

*
 Honorable Louis H. Pollak, Senior Judge of the United States District Court for the
Eastern District of Pennsylvania, sitting by designation.
POLLAK, District Judge.

       The National Labor Relations Board (“the Board”) petitions for enforcement of

two of its orders stemming from a representation election for employees of Grapetree

Shores, Inc., d/b/a Divi Carina Bay Resort (“the Company”), held at the behest of the

Virgin Islands Workers Union (“the Union”). The Company cross-petitions for review of

both orders. For the reasons that follow, we will grant the Board‟s petitions for

enforcement of both of its orders and will deny the Company‟s petitions for review.

                                              I.

       The representation election was held on July 13, 2007, pursuant to a stipulated

election agreement between the Union and the Company. The initial tally of ballots

favored the Union, 45 votes to 42 votes, but the outcome was contingent on the resolution

of several ballot challenges—including a challenge to the ballot cast by Felicia Dixon.

The Company‟s position was and is that Dixon was ineligible to vote because she had

been terminated pursuant to Company policy after being on sick or disability leave for

more than six months prior to the election.

       In addition to the ballot challenges, the Union and the Company each filed

objections to the election conditions. We limit our discussion to those challenges that

remain relevant to the current petitions. The Company claimed that Union supporter

Lucy Edward made public threats against opponents of the Union and that the Union‟s

designation of Edward as an observer of the election intimidated those voters who had

heard the threats or heard about them. The Union claimed that the Company had

interfered with the election conditions by announcing new retirement benefits two days

                                              2
before the election; the Union also filed a charge of unfair labor practice based on the

same announcement. The Union‟s charge, the Dixon ballot challenge, and the

Company‟s objection to Edward‟s conduct were all the subject of a November 6, 2007,

hearing before an administrative law judge of the Board.

       The ALJ issued a recommended decision and order on February 8, 2008, in which

he found that: (i) Dixon was eligible to vote because she was on leave and had not been

terminated; (ii) Edward did not make the alleged public threats and thus did nothing to

warrant overturning the election results; and (iii) the Company‟s announcement of new

retirement benefits was an unfair labor practice because the timing of the announcement

in the critical period before the election was coercive.

       Two sitting members of the Board severed the representation proceeding from the

unfair labor practice charge in an unpublished order dated July 30, 2008. As to the

former, the two members adopted the ALJ‟s recommendation to overrule the Company‟s

objections and to count Felicia Dixon‟s ballot. Dixon‟s ballot—together with three

others which had been withheld from the initial tally pending challenges—was

subsequently opened and mixed in with the other votes. A revised tally showed the

Union prevailing by a vote of 46 to 45 (rather than the initial margin of 45 to 42). So the

balance of the election may well have hung on Dixon‟s vote.

       The Union was certified as the exclusive collective-bargaining unit for covered

employees on August 18, 2008. In January 2009, the General Counsel of the Board filed

an unfair labor practice charge and complaint against the Company for refusing to

bargain with the certified Union. The Company admitted its refusal but continued to

                                              3
challenge the validity of the certification. Two sitting members of the Board determined

that the Company‟s refusal to bargain with the Union violated sections 8(a)(1) and (5) of

the National Labor Relations Act (“NLRA”), 29 U.S.C. § 158(a)(1), (5). Grapetree

Shores, Inc., 353 N.L.R.B. No. 131 (Apr. 10, 2009).

      The order of April 10, 2009, was the subject of a petition for enforcement and a

cross-petition for review in this court. While those petitions were pending, the Supreme

Court held in New Process Steel, L.P. v. NLRB, 130 S. Ct. 2635 (2010), that the NLRA

did not permit two members of the Board to function as a quorum of a three-member

group upon the expiration of the terms of the other Board members—as two members

had purported to do in this and many other cases. We remanded the pending petitions to

the Board (now with more than two members), which afforded the Company a second

opportunity to justify its refusal to bargain. Grapetree Shores, Inc., 355 N.L.R.B. No.

194 (Sept. 28, 2010). Ultimately, on December 7, 2010, a proper quorum of the Board

held that the Company‟s refusal to bargain violated sections 8(a)(1) and (5) of the NLRA,

29 U.S.C. § 158(a)(1), (5). Grapetree Shores, Inc., 356 N.L.R.B. No. 47 (Dec. 7, 2010).

      By separate order, the Board on December 29, 2010, also adopted the ALJ‟s

recommended finding that the Company‟s announcement of new retirement benefits prior

to the election had violated section 8(a)(1) of the NLRA, 29 U.S.C. § 158(a)(1).

Grapetree Shores, Inc., 356 N.L.R.B. No. 60 (Dec. 29, 2010).

      The Board subsequently petitioned this court for enforcement of both of its

December 2010 orders, and the Company cross-petitioned for review of each order. All

four matters were consolidated for our disposition.

                                            4
       Because the conduct at issue occurred in the U.S. Virgin Islands, jurisdiction is

proper in this court as to both the petitions and cross-petitions. NLRA § 10(e)-(f), 29

U.S.C. § 160(e)-(f). To the extent that the Board‟s decisions and orders are based on

findings of fact made in the underlying representation proceeding, the record of that

proceeding is also before the court. NLRA § 9(d), 29 U.S.C. § 159(d).

                                             II.

       All of the Company‟s challenges to the Board‟s orders sound in factual disputes,

for which our review is circumscribed. “[W]e must . . . accept the Board‟s factual

determinations and reasonable inferences derived from factual determinations if they are

supported by substantial evidence.” Stardyne, Inc. v. NLRB, 41 F.3d 141, 151 (3d Cir.

1994) (citing, inter alia, 29 U.S.C. § 160(e)). A decision of the Board rests on substantial

evidence if a reasonable jury could have come to the same conclusion. Citizens Pub’g &

Printing Co. v. NLRB, 263 F.3d 224, 232 (3d Cir. 2001).

                                            III.

       Having examined the record and the parties‟ submissions, we are persuaded that

both of the Board‟s orders rest on substantial evidence. We consider the three disputed

issues in turn. Because we write primarily for the parties, our discussion is brief.

       A.     Dixon’s Eligibility to Vote

       Felicia Dixon was a housekeeping employee who suffered a work-related injury

that required her to avoid certain physical exertions. In January 2007, the Company

placed Dixon on a leave of absence because it did not have any medically appropriate

“light duty” work for a person of Dixon‟s qualifications. Dixon performed no work for

                                              5
the Company between January 2007 and the July 2007 election. The Board nevertheless

concluded that Dixon was eligible to vote in the election, because an employee on sick or

disability leave “is presumed to continue in such [employment] status unless and until the

presumption is rebutted by an affirmative showing that the employee has been discharged

or has resigned.” Red Arrow Freight Lines, Inc., 278 N.L.R.B. 965, 965 (1986).

       The Company‟s objections are twofold. First, the Company argues the Board

should have applied not the presumption of Red Arrow but rather an alternate approach—

one which looks to an employee‟s reasonable expectation of being recalled to the job, as

advocated by a dissenting member of the Board in Home Care Networks, Inc., 347

N.L.R.B. 859, 860 (2006). Second, the Company claims that the Board‟s conclusion that

Dixon remained an employee was not supported by substantial evidence.

       The first argument is, in this court, foreclosed by our own precedent. We have

already decided that the Board‟s Red Arrow presumption is a reasonable, bright-line rule.

See Cavert Acquisition Co. v. NLRB, 83 F.3d 598, 603-07 (3d Cir. 1996). The Company

does not point to any intervening development that would permit us to revisit this

holding, let alone any reason to do so.

       The second argument also fails. There was substantial evidence to support the

Board‟s conclusion that Dixon had not been terminated because, among other things, the

Company never gave her any indication to the contrary and the Company continued to

list her name on weekly work schedules (which marked her as “OUT”), including the

schedule for the week of the election. The Board was not required to credit the testimony

of the Company‟s representative concerning a putative policy of automatically

                                            6
terminating employees who are on sick or disability leave for more than six months—

particularly in the absence of any credible documentation of such a policy.

      B.     Edward’s Pre-Election Conduct

      The Company also claims that the Board erred in certifying the Union because the

election was tainted by threats against Union opponents allegedly made by Lucy Edward,

an employee of the Company who served as an observer for the Union at the

representation election. Two other employees of the Company submitted sworn

affidavits to the ALJ in which they alleged that Edward had entered an employee dining

room the day before the election and had threatened anti-Union employees by

announcing: “I does thank God I don‟t come to work with a gun because I will kill a lot

of people and they will be sorry.” Edward flatly denied making any such statement.

      The Company relied on the testimony of employee Phyllis Blackman (not one of

the two affiants) to corroborate its claim that Edward threatened Union opponents. In

testimony before the ALJ, Blackman claimed that she and other employees in her

department were threatened by Union supporters. But while Blackman implied that

Edward was among the group of employees making threats and that Edward‟s later

presence at the election was threatening, she also denied having had any conversations

about the Union with Edward and denied even knowing prior to the election that Edward

was affiliated with the Union.

      It is a labor law axiom that “[a] representation election should be „a laboratory in

which an experiment may be conducted, under conditions as nearly ideal as possible, to

determine the uninhibited desires of the employees.‟” Zeiglers Refuse Collectors, Inc. v.

                                            7
NLRB, 639 F.2d 1000, 1004 (3d Cir. 1981) (quoting Gen. Shoe Corp., 77 N.L.R.B. 124,

127 (1948)). But we are persuaded in this instance that there was substantial evidence in

the record to support the Board‟s conclusion that Edward did not make the alleged threats

and thus did nothing to imperil the conditions of the election. The ALJ accurately

described key portions of Blackman‟s testimony as “a bit of a muddle,” and the choice to

credit Edward over both Blackman and the two affiants was a reasonable one. The

affiants did not take any steps consistent with their claim that Edward had threatened

violence; Blackman denied any specific conversations with Edward and attributed the

alleged threats to a group of unnamed employees.

       The Company further argues that the ALJ erred in treating Edward as a Union

supporter rather than a Union agent, but that distinction matters only if Edward in fact

made the objectionable statements. The ALJ considered the question as an alternative

holding, the Board declined to adopt that portion of his recommended decision, and we

decline to discuss the matter superfluously.

       C.     The Retirement Benefits Announcement

       Finally, the Company contends that there was not substantial evidence to support

the Board‟s finding that the Company violated section 8(a)(1) of the NLRA, 29 U.S.C.

§ 158(a)(1), by announcing new retirement benefits two days before the election.

       The Company had been party to an economic development agreement with the

U.S. Virgin Islands government that was set to expire in 2006. The prior agreement

required the Company to provide its employees with the opportunity to invest in 401(k)

retirement accounts, though the Company was not itself obligated to contribute anything

                                               8
to the plans. After public hearings on the Company‟s effort to renew the expiring

development agreement, the U.S. Virgin Islands government sought to require the

Company to match some portion of its employees‟ contributions to the plans.

       On July 10, 2007, the new economic development agreement—including a

provision requiring the Company to contribute to its employees‟ 401(k) plans—was

finally approved by the governor. The following day, July 11, the Company‟s general

manager announced the 401(k) changes to employees. The announcement was made in

two meetings convened specifically about the election. The election was held two days

later, on July 13.

       In its December 29, 2010 order, the Board adopted the ALJ‟s conclusion that the

timing of the announcement gave rise to a presumptive inference that the Company was

attempting to coerce employees—an inference which the Company failed to rebut. See

Mercy Hosp. Mercy Sw. Hosp., 338 N.L.R.B. 545, 545 (2002) (describing presumption);

see also NLRB v. Exch. Parts Co., 375 U.S. 405, 409 (1964) (“The danger inherent in

well-timed increases in benefits is the suggestion of a fist inside the velvet glove.

Employees are not likely to miss the inference that the source of benefits now conferred

is also the source from which future benefits must flow and which may dry up if it is not

obliged.”). The Board has been particularly skeptical of such announcements when it is

clear that the timing of the news lies within the employer‟s discretion, as appears to have

been the case here. See, e.g., Brown City Casting Co., 324 N.L.R.B. 848, 849 (1997);

Am. Red Cross, 324 N.L.R.B. 166, 171 (1997); Speco Corp., 298 N.L.R.B. 439, 443

(1990).

                                              9
       The Company argues that the governor‟s July 10, 2007, approval of the economic

development agreement—and not an intent to influence the election—was the reason the

Company announced the 401(k) benefits on July 11. It is true that the Board‟s precedents

permit an employer to announce new benefits in the critical period prior to an election

when the employer can establish some legitimate business reason for the timing of the

announcement. See Mercy Hosp. Mercy Sw. Hosp., 338 N.L.R.B. at 545 (citing STAR,

Inc., 337 N.L.R.B. 962, 962 (2002)). But the Board concluded here that the Company

had no legitimate business reason to announce the 401(k) changes on July 11 and not

some later date, and that conclusion was supported by substantial evidence. As the ALJ

noted, the record demonstrated that the governor‟s signature was but one of several

important steps on the route to the ratification and implementation of the development

agreement.

       Nor are we persuaded that a contrary outcome is required by Weather Shield of

Connecticut, 300 N.L.R.B. 93 (1990), the principal case on which the Company relies. In

Weather Shield, the Board reversed an ALJ‟s conclusion that the employer‟s election-eve

announcement of pension benefits was unlawful. Id. at 96. The employees were due to

receive the pension benefits as the result of an earlier merger, and the Board reasoned that

announcing future pension benefits to which the employees were already automatically

entitled was no different than publicizing current benefits. Id. at 96-97. The case at bar

is assuredly quite different: the details of the 401(k) benefits remained to be worked out

and its future implementation remained uncertain. It was thus reasonable for the Board to

                                            10
conclude that the 401(k) benefits announced on July 11 were not so firmly established as

to be treated as existing benefits.

                                           IV.

       For the preceding reasons, we grant the Board‟s petitions to enforce the Board‟s

orders of December 7, 2010, and December 29, 2010, and we deny the Company‟s cross-

petitions for review.

                                           11