Court Opinion

ID: 3052045
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:38:47.064138+00
Date Added: 2024-06-11T12:45:06.173416
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FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

WASHINGTON STATE NURSES             
ASSOCIATION,
                                          No. 06-74917
                      Petitioner,
              v.                          NRLB No.
                                          19-CA-29150
NATIONAL LABOR RELATIONS
                                            OPINION
BOARD,
                    Respondent.
                                    
        On Petition for Review of an Order of the
            National Labor Relations Board

                 Argued and Submitted
          March 10, 2008—Seattle, Washington

                   Filed May 20, 2008

      Before: Betty B. Fletcher, Richard A. Paez, and
             N. Randy Smith, Circuit Judges.

                 Opinion by Judge Paez

                           5813
                WASHINGTON STATE NURSES v. NRLB                     5815

                             COUNSEL

Timothy Sears, Washington State Nurses Association, Seattle,
Washington, for the petitioner.

David A. Seid, National Labor Relations Board, Washington,
D.C., for the respondent.

Michael B. Love, Paine Hamblen LLP, Spokane, Washington,
for the amicus.

                              OPINION

PAEZ, Circuit Judge:

   Petitioner Washington State Nurses Association (“WSNA”)
seeks review of the National Labor Relations Board’s
(“NLRB” or “Board”) decision that Sacred Heart Medical
Center’s (“Sacred Heart”) ban on union buttons bearing the
message “RNs Demand Safe Staffing,” did not constitute an
unfair labor practice in violation of the National Labor Rela-
tions Act (“NLRA” or “Act”).1 This case calls on us to reaf-

  1
   We granted leave to Sacred Heart to file an amicus curiae brief in sup-
port of the Board’s decision.
5816           WASHINGTON STATE NURSES v. NRLB
firm the cardinal principle of agency review: an agency’s
decision must be supported by substantial evidence in the
record. Because the Board’s decision here was not, we grant
WSNA’s petition and remand to the Board with directions to
reinstate the Administrative Law Judge’s (“ALJ”) Decision
and Order.

I.    FACTS

  Sacred Heart is an acute care hospital in Spokane, Wash-
ington; WSNA is a union that represents approximately 1200
registered nurses employed there. In the fall of 2003, WSNA
and Sacred Heart began negotiations for a new collective bar-
gaining agreement (“CBA”) to replace the then-existing
agreement, set to expire in January 2004. Negotiations contin-
ued past the agreement’s expiration, well into 2004.

  During the CBA negotiations that fall and winter, nurses at
Sacred Heart wore a number of union buttons without inci-
dent. The buttons read: “Together Everyone Achieves More”;
“WSNA SHMC RNs Remember 98”; “Staffing Crisis —
Nursing Shortage — Medical Errors — Real Solutions”; and
“RNs Demand Safe Staffing.” See Sacred Heart Med. Ctr.
and Washington State Nurses Ass’n, ___ N.L.R.B. ___, 347
NLRB No. 48, 2006 WL 1875747, at *1 (June 30, 2006). On
February 27, 2004, Sacred Heart issued a memorandum ban-
ning the nurses from wearing the “RNs Demand Safe Staff-
ing” buttons “in any areas on our campus where they may
encounter patients or family members.” Id. at *2.

     The memorandum explained:

      We know that staff have worn a variety of buttons
      over the years for different purposes, and we have no
      objection to most messages. This message, however,
      disparages Sacred Heart by giving the impression
      that we do not have safe staffing. We cannot permit
      the wearing of these buttons, because patients and
                WASHINGTON STATE NURSES v. NRLB                5817
    family members may fear that the Medical Center is
    not able to provide adequate care.

    It is difficult for us to understand why nurses would
    wear these pins at the risk of upsetting their patients,
    particularly since we have come to agreement with
    [the Union] at the bargaining table on issues related
    to staffing and how staff will be involved when staff-
    ing issues arise.

    To assure that patients do not become alarmed or
    fearful about patient care at Sacred Heart, effective
    immediately, it is our expectation that no staff mem-
    ber will wear these buttons in any area on our cam-
    pus where they may encounter patients or family
    members.

Id. at *1-*2.

   After the hospital issued the ban, several nurses were told
to remove their buttons; no nurse was disciplined for wearing
the button. Id. at *2.

   On March 2, 2004, WSNA filed an unfair labor practice
charge with the NLRB. An ALJ conducted an evidentiary
hearing, and on March 24, 2005, issued a decision concluding
that Sacred Heart engaged in an unfair labor practice under
Section 8(a)(1) by “promulgating, maintaining, and enforc-
ing” the button prohibition. Id. at *13. In a June 30, 2006
decision and order, a divided three-member panel of the
Board (with member Liebman dissenting) reversed, finding
that although the button prohibition was presumptively
invalid because it extended beyond immediate patient care
areas, it was justified by “special circumstances” because
Sacred Heart had demonstrated that the button’s message
would disturb patients. Id. at *1. On October 10, 2006,
WSNA timely filed a petition for review of the Board’s deci-
sion and order.
5818          WASHINGTON STATE NURSES v. NRLB
II.    ANALYSIS

  A.    Standard of Review

   We may overturn the Board’s findings of fact only when
they are not supported by substantial evidence in the record,
or the Board has not correctly applied the law. Cal. Pac. Med.
Ctr. v. NLRB, 87 F.3d 304, 307 (9th Cir. 1996). “ ‘[T]he sub-
stantial evidence test requires a case-by-case analysis and a
review of the whole record,’ and requires a reviewing court
to ‘take into account whatever in the record fairly detracts’
from the Board’s conclusions.” Healthcare Employees Union
v. NLRB, 463 F.3d 909, 918 (9th Cir. 2006) (internal citations
omitted). Findings that are not supported by “substantial evi-
dence on the record considered as a whole,” must be set aside.
NLRB v. Baptist Hosp., 442 U.S. 773, 782 (1979) (quoting 29
U.S.C. § 160(e)). We defer to the Board’s interpretation of the
NLRA where that interpretation is “reasonably defensible.”
Cal. Pac. Med. Ctr., 87 F.3d at 307.

  B.    Unfair Labor Practice

   [1] Section 8(a)(1) of the National Labor Relations Act
makes it “an unfair labor practice for an employer . . . to inter-
fere with, restrain, or coerce employees in the exercise of the
rights guaranteed in [Section 7 of the Act].” 29 U.S.C.
§ 158(a)(1). Section 7, in turn, provides that employees have
“the right to self-organization, to form, join, or assist labor
organizations, to bargain collectively through representatives
of their own choosing, and to engage in other concerted activ-
ities for the purpose of collective bargaining or other mutual
aid or protection.” 29 U.S.C. § 157.

   [2] The Board has long recognized that under Section 7,
union members have a protected right to wear union insignia
in the workplace. London Mem’l Hosp., 238 N.L.R.B. 704,
708 (1978); see also Republic Aviation Corp. v. NLRB, 324
U.S. 793 (1945); Pay’n Save Corp. v. NLRB, 641 F.2d 697,
              WASHINGTON STATE NURSES v. NRLB                5819
700 (9th Cir. 1981). In the healthcare context, restrictions on
the wearing of union insignia in “immediate patient care”
areas are presumptively valid; by contrast, restrictions on
union insignia in other areas of a hospital are presumptively
invalid. Casa San Miguel, 320 N.L.R.B. 534, 540 (1995);
Mesa Vista Hosp., 280 N.L.R.B. 298, 299 (1986). An
employer may rebut the presumption of invalidity by showing
that “special circumstances” justify the restriction. Special cir-
cumstances exist where the restriction is “necessary to avoid
disruption of health-care operations or disturbance of
patients.” Beth Israel Hosp. v. NLRB, 437 U.S. 483, 507
(1978); see also NLRB v. Los Angeles New Hosp., 640 F.2d
1017, 1020 (9th Cir. 1981). The employer bears the burden of
proving an adverse impact on patient care. Baptist Hosp., 442
U.S. at 781; Mesa Vista Hosp., 280 N.L.R.B. at 298-99.

   [3] The Board’s determination that special circumstances
justified Sacred Heart’s “RNs Demand Safe Staffing” button
ban is not supported by substantial evidence in the record. In
fact, it is not supported by any evidence. The record reveals
that the buttons were worn for several months without inci-
dent. Sacred Heart claims that the button’s message would
disturb patients. That assertion is speculative at best. More-
over, Sacred Heart’s speculative concern is contradicted by
actual evidence in the record that there was never any distur-
bance involving the button. There is no evidence in the record
that supports the Board’s special circumstances finding.

  Sacred Heart hangs its hat on an “offer of proof” that it
presented during the hearing:

    [I]f called as a witness, the vice president of human
    resources, Diana Eickhoff would testify that hospital
    administration was approached by certain nurse
    managers expressing their concern as to the impact
    of the demand safe staffing button on patients and
    their families; and thereby inquired as to how to
    respond.
5820            WASHINGTON STATE NURSES v. NRLB
   The ALJ accepted the offer of proof, contingent on the par-
ties’ rights to later brief the relevance and weight that should
be accorded to it. On the basis of the offer of proof, the ALJ
made the following finding: “The parties also agreed that
Respondent’s human resources personnel were approached by
certain nurse managers expressing their concern as to the
impact of the ‘Safe Staffing’ button on patients and their fam-
ilies.” Sacred Heart Med. Ctr., 2006 WL 1875747, at *11.2
The ALJ further found that the offer of proof did not amount
to evidence that “any of Respondent’s patients were actually
disturbed.” Id. at *12.

   In reversing the ALJ’s decision, the Board explained that
an employer need not show actual disturbance of patients
before prohibiting union activities. Id. at *3. The Board con-
cluded that the button’s “inherently disturb[ing]” message
was enough to support a special circumstances finding. The
Board also pointed to the offer of proof, establishing that
nurse supervisors “expressed concern over the impact the but-
ton may have on patients.” Id.

  The Board’s approach was contrary to its established prece-
dent, to our sister circuit’s precedent, and to the basic adjudi-
catory principle that conjecture is no substitute for evidence.

  Mt. Clemens General Hospital v. NLRB, 328 F.3d 837 (6th
Cir. 2003), is on point and persuasive. In that case, the nurses
union and the Hospital were engaged in a dispute over “staff-
ing levels at the Hospital. The RN’s [sic] assert[ed] that not
enough full-time nurses [were] hired which force[d] incum-
bent staff to work inordinate amounts of forced overtime.”
Mt. Clemens Gen. Hosp., 335 N.L.R.B. 48, 49 (2001). The
union distributed buttons reading “FOT” with a line drawn
  2
   The ALJ may have overstated the parties’ positions, in that the parties
did not stipulate to the factual basis of the offer of proof. Neither party,
however, has disputed the ALJ’s characterization of that evidence before
the Board or this court.
                  WASHINGTON STATE NURSES v. NRLB                       5821
through the letters, which was meant as a “silent protest of ‘no
forced overtime.’ ” Id. The Hospital ordered the nurses not to
wear these buttons anywhere in the Hospital, including non-
patient care areas. Mt. Clemens Gen. Hosp., 328 F.3d at 847.
The Hospital argued that special circumstances justified the
ban, because the buttons would lead patients to “be concerned
about the quality of care at the Hospital.” Id.

   [4] Both the Board and the Sixth Circuit rejected the Hospi-
tal’s argument because “[t]he Hospital’s efforts to justify [the]
ban . . . depend[ed] primarily on speculation about the possi-
ble effect of the buttons.” Id. To meet its burden, the Hospital
was required to “produc[e] evidence pertaining to each non-
patient care area affected by the [ban]” that established “either
that the buttons cause problems or that they were more likely
to cause problems than any other Union buttons worn by RNs
at the Hospital.” Id. According to the Sixth Circuit, the testi-
mony of two doctors and an administrator that the buttons
might cause concern among patients did not constitute sub-
stantial evidence of special circumstances justifying a
Hospital-wide ban on the buttons.3
  3
   In its opinion on review, the Board methodically listed the types of evi-
dence that could have established special circumstances—all missing from
the record in Mt. Clemens, as well as from the record in this case:
      [The testifying administrator] did not know of any complaints
      from patients or their families that the wearing of the FOT button
      was disruptive or caused a dialogue to take place with the RN’s
      [sic]. Moreover, [he] admitted that no hospital administrator
      made an official report that the wearing of the FOT button caused
      any disruption or interfered with patient care or safety . . . .
      [Another administrator] admitted that the wearing of the FOT
      button did not cause a work stoppage or sit-down strike and she
      did not have any evidence that the RN’s [sic] discussed the FOT
      button with patients. Likewise, she acknowledged that the
      Respondent did not conduct a survey or make any inquiries of
      patients or their families that the wearing of the FOT button inter-
      fered with patient care or safety.
Mt. Clemens Gen. Hosp., 335 N.L.R.B. at 50-51
5822          WASHINGTON STATE NURSES v. NRLB
   The Board’s attempt to distinguish Mt. Clemens from the
instant case is unavailing. In its decision, the Board explained
that the “RNs Demand Safe Staffing” button conveys a drasti-
cally different message than the button in Mt. Clemens. In
fact, the messages conveyed by the buttons are almost
identical—they advocate for adequate staffing levels. We
agree with dissenting member Liebman’s observation that
“[w]hether a button protests ‘forced overtime’ or demands
‘safe staffing,’ both messages obviously relate to the impact
of inadequate staffing levels on the hours RN’s [sic] are
required to work and the conditions they labor under.” Sacred
Heart Med. Ctr., 2006 WL 1875747, at *8 (Liebman, dissent-
ing) (“Anyone viewing the ‘RNs Demand Safe Staffing’ but-
ton, which bears the union’s insignia, would likely identify it
for what it really is: a garden-variety union button, with a slo-
gan related to staffing concerns, worn by RNs during the
course of labor negotiations with management over the terms
and conditions of their employment.”). Consistent with this
view, both the courts and the Board have long recognized that
nurses’ working conditions are directly related to patient care
and safety. Indeed, in Beth Israel, the seminal healthcare-
sector labor case, the Supreme Court focused its analysis of
the National Labor Relations Act in hospital settings on the
close correlation between hospital working conditions and
patient safety. Beth Israel Hosp., 437 U.S. at 497-98
(“Congress determined that the extension of organizational
and collective-bargaining rights would ameliorate [poor
healthcare-industry working] conditions and elevate the stan-
dard of patient care.”); see also Misericordia Hosp. Med. Ctr.
v. NLRB, 623 F.2d 808, 813 (2d Cir. 1980) (noting the rela-
tionship between hospital staffing levels, nurses’ working
conditions, and patient care); Waters of Orchard Park, 341
N.L.R.B. 642, 644 (2004) (acknowledging that “nurses’
concerns—staffing levels and the number of patients to be
cared for—[are] directly related to . . . nurses’ working condi-
tions”).

   Mt. Clemens simply reaffirms the uncontroversial principle
that special circumstances justifying a restriction on union
              WASHINGTON STATE NURSES v. NRLB                5823
insignia must be established by substantial evidence in the
record. Similarly, in St. Luke’s Hospital, 314 N.L.R.B. 434
(1994), the Board rejected the ALJ’s special circumstances
finding because it was based on mere conjecture: “Although
the judge found that some patients might be upset by the [but-
ton’s message], the record is devoid of any evidence to sup-
port this supposition . . . . [T]here is no evidence that any
patient complained of, or even noticed, the stickers and but-
tons at issue in this case.” Id. at 435; see also Mesa Vista
Hosp., 280 N.L.R.B. at 299 (holding that Respondent must
introduce evidence demonstrating an adverse impact); London
Mem’l Hosp., 238 N.L.R.B. at 708 n.11 (“Respondent con-
ceded that there had been no complaints by patients concern-
ing Erickson’s wearing of the button on September 24 and
there is no evidence that any patient was affected adversely
by, or had even taken note of, her button.”); cf. Beth Israel
Hosp., 437 U.S. at 502 (“Especially telling is the fact that . . .
petitioner, who logically is in the best position to offer evi-
dence on . . . point, was unable to introduce any evidence to
show that solicitation or distribution was or would be harm-
ful.”) (emphasis in original).

   NLRB v. Baptist Hospital, 442 U.S. 773 (1979), upon
which the Board relies, is not to the contrary. At issue in Bap-
tist Hospital was a rule adopted by the hospital, in response
to a union campaign to organize its employees, that prohibited
“solicitation by employees at all times in any area of the Hos-
pital which is accessible to or utilized by the public.” Id. at
775 (internal quotations marks omitted). The Hospital
attempted to justify this broad prohibition with testimony that
the patients’ recovery is more successful in a tranquil environ-
ment, and that solicitation disturbed that tranquility. Id. at
783. Applying its set of presumptions—that restrictions on
union activities in immediate patient care areas were pre-
sumptively valid, whereas restrictions outside those areas
were presumptively invalid—the Board issued an order pro-
hibiting the Hospital from applying the solicitation ban in
areas other than immediate patient care areas. Id. at 777. The
5824           WASHINGTON STATE NURSES v. NRLB
Sixth Circuit refused to enforce the Board’s order, finding that
the Hospital had justified the ban with respect to all areas of
the Hospital accessible to the public. Id.

   The Supreme Court concluded that the evidence called for
a resolution in between the Court of Appeals’ and Board’s
decisions. The Court first noted that the Board’s definition of
“immediate patient care areas” was limited to “patients’
rooms, operating rooms, and places where patients receive
treatment, such as x-ray and therapy areas.” Id. at 780 (quot-
ing St. John’s Hosp. & Sch. of Nursing, Inc., 222 N.L.R.B.
1150, 1150 (1976), enf. granted in part and denied in part,
557 F.2d 1368 (10th Cir. 1977)). The Court then went on to
conclude that the extensive testimony presented by the Hospi-
tal established that solicitation in the corridors and sitting
rooms on patients’ floors also might have an adverse effect on
patients’ recovery because “[p]atients in the most critical and
fragile conditions” can often be found in them. Id. at 784.
Substantial evidence therefore justified the Hospital’s ban on
solicitation in these areas. Id. at 785-86. The same could not
be said for “the cafeteria, gift shop, and [first-floor] lobbies,”
however, as the Hospital had failed to present “clear evidence
of the frequency with which patients” visited those areas. Id.
at 786. Special circumstances did not justify the ban on solici-
tation in those areas. See id. at 786-87.

   Despite the Court’s careful attention to the factual record,
the Board misreads Baptist Hospital, maintaining that it
stands for the broad proposition that any testimony by a hos-
pital administrator about potential harm to patients and their
family members is entitled to deference and is therefore suffi-
cient to establish special circumstances. Sacred Heart Med.
Ctr., 2006 WL 1875747, at *3 & n.9.4 It stands for no such
  4
   Although both Sacred Heart and the Board stress potential “unease”
and “disturbance” to family members as justifying the ban, see Sacred
Heart Med. Ctr., 2006 WL 1875747, at *2, *3, the law is clear that the
Board must focus on disturbances to patients, not their relatives, when
assessing whether special circumstances exist. See, e.g., Baptist Hosp.,
442 U.S. at 786-87.
              WASHINGTON STATE NURSES v. NRLB               5825
principle. To the contrary, the basis for the Court’s determina-
tion in Baptist Hospital was the “extensive evidence,” offered
“through the testimony of doctors and a hospital administra-
tor.” Baptist Hosp., 442 U.S. at 782. Their testimony tied the
need for tranquility to past experiences with patients and
established where patient care occurred. Id. at 783-84, 786.
To the extent that the Court afforded any deference to the
administrator and doctors, it was with respect to their opinion
that the Hospital needed to maintain a tranquil environment.
Significantly, the Court concluded that this testimony was
insufficient to establish that patients would be disturbed in
several areas of the Hospital, including the cafeteria, gift
shop, and first-floor lobbies.

   Notably, the witnesses in Baptist Hospital expressly con-
nected the solicitation prohibition to patient well-being. See,
e.g., id. at 783. By contrast, the limited offer of proof in this
case set forth no basis for the Hospital’s concern. Sacred
Heart’s speculation about the potential effects of the safe
staffing button is not, for example, substantiated by testimony
about how similar buttons caused patient disturbances in the
past. To the contrary, the record shows that the arguably more
controversial “Staffing Crisis—Medical Errors” button, worn
for months, caused no ill effects. See Mt. Clemens Gen.
Hosp., 328 F.3d at 848 (noting that there was no evidence that
more controversial buttons had caused disturbances); cf. Beth
Israel Hosp., 437 U.S. at 502 (noting that the fact that hospital
had previously allowed union solicitation “apparently without
untoward effects,” supported the Board’s determination that
solicitation would not disturb patients).

   The Board argues that Sacred Heart need not wait for
patient complaints before taking preventative action. But
every case must be judged on its own record. The speculation
as to potential harm in this case is far outweighed by the
record evidence establishing that there was no actual harm or
likelihood of harm. The record reveals that nurses wore both
the “RNs Demand Safe Staffing” button and the “Staffing
5826         WASHINGTON STATE NURSES v. NRLB
Crisis—Medical Errors” button for months without incident.
There were no patient complaints. Indeed, there were not even
any patient questions about the button’s message. Evidence of
what actually occurred is far more telling than unsubstantiated
conjecture about what might occur.

   [5] “ ‘[T]he substantial evidence test requires a case-by-
case analysis and a review of the whole record,’ and requires
a reviewing court to ‘take into account whatever in the record
fairly detracts’ from the Board’s conclusions.” Healthcare
Employees Union, 463 F.3d at 918 (internal citations omit-
ted). Examining the record as a whole, substantial evidence
simply does not support the Board’s finding that Sacred Heart
met its burden of establishing special circumstances.

  [6] WSNA’s petition for review is GRANTED and the
matter is REMANDED to the National Labor Relations
Board with directions to reinstate the ALJ’s Decision and
Order.