Flagstaff Medical Center, Inc. v. National Labor Relations Board , 715 F.3d 928 ( 2013 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 15, 2013 Decided April 26, 2013
No. 11-1326
FLAGSTAFF MEDICAL CENTER, INC.,
PETITIONER
v.
NATIONAL LABOR RELATIONS BOARD,
RESPONDENT
Consolidated with 11-1398
On Petition for Review and Cross-Application for
Enforcement of an Order
of the National Labor Relations Board
Steven D. Wheeless argued the cause for petitioner. With
him on the briefs was Alan M. Bayless Feldman.
Elizabeth A. Heaney, Attorney, National Labor Relations
Board, argued the cause for respondent. With her on the brief
were John H. Ferguson, Associate General Counsel, Linda
Dreeben, Deputy Associate General Counsel, and Jill A.
Griffin, Supervisory Attorney.
Before: HENDERSON, BROWN and GRIFFITH, Circuit
Judges.
2
Opinion for the Court filed by Circuit Judge BROWN.
BROWN, Circuit Judge: Flagstaff Medical Center is an
acute-care hospital in Arizona that has witnessed a flurry of
union activity in recent years. This particular case finds its
roots in October 2006, when the Communications Workers of
America, Local Union 7019, AFL-CIO began organizing
among Flagstaff’s housekeeping and food services
employees. The organizing campaign strained relationships
with hospital management, and by January 2008, the union
had charged Flagstaff with dozens of unfair labor practices
under section 8(a)(1) and (3) of the National Labor Relations
Act (“NLRA”). See 29 U.S.C. § 158(a)(1), (3). The ALJ
hearing the case dismissed most of the allegations, concluding
only eight had merit, and when the Board reviewed the ALJ’s
decision, it largely agreed. In short, a divided Board affirmed
the eight § 8(a)(1) violations, reinstated four § 8(a)(1) and (3)
charges the ALJ had dismissed, and affirmed the dismissal of
everything else. See Flagstaff Med. Ctr., Inc. & Commc’ns
Workers of America, Local Union 7019 (“Flagstaff”), 357
NLRB No. 65, at 1–2 & n.1 (2011). Flagstaff now asks us to
review three of the reinstated charges.
Rejecting the ALJ’s findings, the Board concluded that
Flagstaff violated § 8(a)(1) when its president, Bill Bradel,
threatened employees that unionization would be futile; and
that Flagstaff violated § 8(a)(1) and (3) by modifying
employee Laverne Gorney’s schedule in retaliation for her
union activity and by firing employee Michael Conant
because of his union activity. We agree the Board failed to
muster substantial evidence for its conclusions about Bradel
and Conant, so we grant Flagstaff’s petition in part. We deny
the petition in all other respects.
3
I
Section 8(a)(1) of the NLRA prohibits an employer’s
interference with, or restraint or coercion of, the rights of
employees to organize and join unions, bargain collectively,
and engage in certain other “concerted activities.” 29 U.S.C.
§§ 157, 158(a)(1). The Board concluded Flagstaff ran afoul of
this provision when, in a June 2007 meeting with vice
president of ancillary services Roger Schuler and food
services department employees, Flagstaff president Bill
Bradel said something to the effect that if there was a union,
“I would not be negotiating with the union,” or, “you won’t
be negotiating with me.” According to the Board, this violated
NLRA § 8(a)(1) because “employees could have reasonably
construed Bradel’s statement as indicating that [Flagstaff]
would not bargain with the Union.” Flagstaff, 357 NLRB No.
65, at 7. We disagree.
“An employer’s statement violates the NLRA if,
considering the totality of the circumstances, the statement
has a reasonable tendency to coerce or interfere with those
rights,” Tasty Baking Co. v. NLRB, 254 F.3d 114, 124 (D.C.
Cir. 2001),1 but as long as it does not do so by threat or
1
Flagstaff insists the Board may find an employer’s statement
constitutes an unlawful threat of futility only if the employer “states
or implies that it will ensure its non-union status by unlawful
means,” a standard Flagstaff believes imposes a higher bar to
NLRA liability, Pet’r Br. at 29–31, but we need not address this
claim because Flagstaff effectively concedes a statement tending to
coerce or interfere with employees’ rights violates the NLRA. See
Reply Br. at 6 (“As a general proposition, the Board analyzes
employer statements under Section 8(a)(1) by determining whether
such statements reasonably tend to coerce employees in the
exercise of their Section 7 rights.”). Nor does the distinction matter
4
promise of benefit, an employer may “explain the advantages
and disadvantages of collective bargaining to its employees in
an effort to convince them that they would be better off
without a union,” Winkle Bus Co., 347 NLRB 1203, 1205
(2006). We think that is what happened here. Bradel and
Schuler established from the outset of the meeting that they
wanted to learn about employees’ issues, concerns, and
problems. Employees voiced concerns about wages, work
hours, the retirement plan, and benefits, and at the end of the
meeting, Bradel said that “we appreciate the direct activity
and that if we had a union that it would be difficult to have
that same direct communication and I didn’t think that, that
would be necessary for [Flagstaff].” Flagstaff, 357 NLRB No.
65, at 31 (ALJ Op.). This makes sense given that the issues
discussed presumably would be governed by a collective
bargaining agreement. See 29 U.S.C. §§ 158(a)(5), 159(a).
Considering this context, we are baffled by the Board’s
interpretation of Bradel’s subsequent first-person-singular
statement about negotiations as a comment about Flagstaff’s
threshold willingness to negotiate—rather than as a statement
about his own attendance at whatever meetings occur.2 The
record does not support this interpretive leap. See Pac. Micr.
Corp. v. NLRB, 219 F.3d 661, 665 (D.C. Cir. 2000) (“To meet
here: we reject the Board’s conclusions even under the standard it
applied.
2
Both Bradel, whose testimony the ALJ and Board credited,
and employee Lydia Sandoval testified that Bradel’s statement
responded to an employee’s claim that “you” will be dealing with
“us.” The ambiguity in the employee’s statement—whether “you”
meant Bradel individually or Flagstaff as a company—should be
resolved in harmony with its context. The Board insists the meeting
was infected by Flagstaff’s general union animus, but it is not every
company where employees feel comfortable engaging the president
so directly.
5
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,’
taking into consideration the ‘record in its entirety . . .
including the body of evidence opposed to the Board’s view.”
(internal citations omitted)).
Indeed, the record evidence about what Bradel actually
said suggests Bradel implicitly recognized there would be
negotiations. For instance, almost every witness who
recounted Bradel’s comment qualified it with the deictic
phrase “like this,” suggesting the comments expressly referred
to a particular type of meeting rather than the possibility of a
meeting. In the respective words of “outspoken union
advocates” Shawn White and Lydia Sandoval, Flagstaff, 357
NLRB No. 65, at 31 (ALJ Op.), “He said he wanted us to
think about our decision to unionize because, if we would
unionize, we wouldn’t have any more meetings with him like
this,” Hr’g Tr. at 360 (May 8, 2008) (J.A. 120), and “[H]e
mentioned something about if bring the union in [sic], we
won’t be able to have any meetings with him like this again,”
Hr’g Tr. at 1197 (May 15, 2008) (J.A. 241). Similarly,
multiple witnesses testified that Bradel said they “did not
need a third party brought in” in order to resolve issues,
Flagstaff, 357 NLRB No. 65, at 31 (ALJ Op.), which raises
the question of what Bradel thought the “third party” would
be doing if not helping employees resolve issues with
Flagstaff. See also Hr’g Tr. at 1232 (May 15, 2008) (J.A. 247)
(Sandoval testifying that Bradel said “he didn’t feel like
employees needed third party representation”). Hardly a
statement that unionizing would be futile.
The Board was troubled by the fact that Bradel—
Flagstaff’s “highest-ranking official”—did not make the
6
contested comment immediately after his statement about
direct communication but did so “in direct response to an
employee’s assertion that employees needed union
representation.” Flagstaff, 357 NLRB No. 65, at 7. Yet this
does not mean, as the Board thought, that deeming Bradel’s
comment innocuous would render it a non sequitur; nor does
Bradel’s status as president necessarily mean, as the Board
also thought, that employees reasonably would think he was
speaking for Flagstaff. Access to one of the company’s
highest executives may very well be relevant to gauging the
usefulness of union representation, and Bradel’s emphasis on
his appreciation of “direct communication” with employees
would make little sense if he did not in fact hold a high
position in the company.
At oral argument, the Board warned us against second-
guessing its expertise where we know nothing about the tone
of voice Bradel used when making the contested statement or
the body language accompanying it. But of course, the person
entrusted with evaluating witness credibility—the ALJ—
articulated his judgment about the factual record by finding
no NLRA violation. See Local 702, Int’l Bhd. of Elec.
Workers v. NLRB, 215 F.3d 11, 15 (D.C. Cir. 2000). The
Board adopted the ALJ’s credibility findings, so we are just
following its lead.
II
“[A]n employer violates the NLRA by taking an adverse
employment action in order to discourage union activity.” Ark
Las Vegas Rest. Corp. v. NLRB, 334 F.3d 99, 104 (D.C. Cir.
2003); see 29 U.S.C. § 158(a)(3). To determine whether an
employer’s motive was unlawful, the Board applies a burden-
shifting scheme known as the Wright Line test. Under it,
General Counsel for the NLRB has the initial burden of
7
showing that the employee’s protected conduct was a
“motivating factor” in the adverse employment decision; once
it makes this showing, the employer may escape liability only
if it shows by a preponderance of evidence that it would have
taken the same action even had there been no protected
conduct. See Ark Las Vegas Rest. Corp., 334 F.3d at 104. We
evaluate the Board’s conclusions about Gorney and Conant
within this framework.
A
Laverne Gorney has worked in the food services
department for over ten years, most recently as a dishwasher.
On May 26, 2007,3 Gorney appeared in a pro-union
advertisement in the local newspaper; in June, she was
assigned to a “very unusual” number of weekend shifts.
Flagstaff, 357 NLRB No. 65, at 48 (ALJ Op.). In concluding
general counsel satisfied its Wright Line burden, the Board
relied on Flagstaff’s other NLRA violations as evidence of
general animus toward unions, as well as the suspicious
timing of the schedule change. Flagstaff’s rebuttal attempts
fell short, the Board explained, because they either pertained
to Gorney’s July and August schedules without saying
anything about her June schedule, or were unhelpfully vague.
We will not disturb these findings.
Motive is a question of fact, so the Board’s inferences
about unlawful motive are entitled to substantial deference.
See Laro Maint. Corp. v. NLRB, 56 F.3d 224, 229 (D.C. Cir.
1995). The Board concluded Jeanine Drake, the director of
3
No date appears on the advertisement in the record. One
witness testified the advertisement was published “[s]omewhere in
[the] range” of May 28, Hr’g Tr. at 647 (May 9, 2008), but since
the parties seem to agree it came out May 26, we ignore this
potential discrepancy.
8
the food services department who set Gorney’s schedule,
interfered with the union campaign by telling employees not
to discuss their wages, by coercively interrogating an
employee about the usefulness of a union (and in the process,
calling the nurses’ union “foolish”), and by implicitly
suggesting a newly-hired employee would be laid off if the
hospital unionized. The Board could reasonably find that in
doing so, Drake demonstrated anti-union animus. See, e.g.,
Lee Builders, Inc., 345 NLRB 348, 349 (2005) (inferring anti-
union animus when managers “threatened employees with job
loss and plant closure if the Union were to succeed in the
organizing campaign”); see also Federated Logistics &
Operations v. NLRB, 400 F.3d 920, 923 (D.C. Cir. 2005). If
so, and Drake assigned Gorney a very unusual shift schedule
soon after Gorney began publicly supporting the union—
which Drake admitted seeing—then the Board could
reasonably infer an unlawful motive for the schedule change.
See Teamsters Local Union No. 171 v. NLRB, 863 F.2d 946,
955 (D.C. Cir. 1988) (“[T]he Board may consider such factors
as the employer’s knowledge of the employees’ union
activities, the employer’s hostility towards the union, and the
timing of the employer’s action.” (internal citations omitted)).
Flagstaff, for its part, disputes the factual premises
propelling this analysis. First, Flagstaff challenges the
“majority’s finding that the June shift was ‘very unusual,’”4
Pet’r Br. at 51 n.10, and second, it argues that “the schedule
for each upcoming month comes out on the 25th of the prior
month” so “Drake would have already made and posted the
June schedule before Gorney’s appearance in the newspaper
on May 26, 2007.” Pet’r Br. at 49. Presumably, the Board’s
4
This is perhaps Flagstaff’s artful way of avoiding the
consequences of its failure to raise the issue below: it was not the
Board that found the June shift to be very unusual, but the ALJ.
9
reasoning would fall apart without these factual linchpins. If,
for instance, Gorney’s June schedule had nothing to do with
her union activity, then it is not clear how her subsequent
schedules could be the product of her union activity: her July
schedule was hardly unusual if she had a comparable schedule
the previous month. Flagstaff’s failure to address Gorney’s
June schedule in its rebuttal arguments would no longer
matter, and we might be more inclined to question the
Board’s invocation of Flagstaff’s general union animus to
prove Drake’s specific motivation. See Chevron Mining, Inc.
v. NLRB, 684 F.3d 1318, 1327–28 (D.C. Cir. 2012);
Warshawsky & Co. v. NLRB, 182 F.3d 948, 956 (D.C. Cir.
1999).
But no matter: Flagstaff raised neither argument before
the Board, so we have no jurisdiction to consider them. See 29
U.S.C. § 160(e). The Board deemed the June schedule very
unusual precisely because Flagstaff never contested the ALJ’s
finding to that effect, see 29 C.F.R. § 102.48(a), and Flagstaff,
though pointing to a few arguments in the record it thinks
sufficient to meet its jurisdictional burden, identifies nothing
that would have put the Board on notice about the timing of
Drake’s June scheduling decision. See Local 900, Int’l Union
of Elec., Radio & Mach. Workers v. NLRB, 727 F.2d 1184,
1191–92 (D.C. Cir. 1984).
We may consider arguments not raised before the Board
in “extraordinary circumstances,” 29 U.S.C. § 160(e), but
Flagstaff gives us no reason to think these circumstances are
anything but ordinary. Perhaps Flagstaff might be excused
from raising these arguments before the Board rendered its
decision. Compare Detroit Edison Co. v. NLRB, 440 U.S.
301, 311 n.10 (1979) (rejecting argument that a party need not
object to ALJ recommendation where it has “no practical
reason” to do so, explaining that accepting this as
10
“extraordinary circumstance” would undermine the statutory
exception and that party in fact had a reason to challenge the
recommendation when the opposing party excepted to it),
with NLRB v. Good Foods Mfg. & Processing Corp., 492
F.2d 1302, 1305 (7th Cir. 1974) (noting that courts sometimes
excuse a party’s failure to file exceptions to the ALJ’s
findings where the findings “were favorable to the petitioner,
were subsequently reversed by the Board, and petitioner had
no reason to file exceptions to a decision in its favor”). But
we will not excuse its failure to raise them afterwards in a
motion for reconsideration. See Woelke & Romero Framing,
Inc. v. NLRB, 456 U.S. 645, 665–66 (1982); Stephens Media,
LLC v. NLRB, 677 F.3d 1241, 1255 (D.C. Cir. 2012);
Epilepsy Found. of Ne. Ohio v. NLRB, 268 F.3d 1095, 1101–
02 (D.C. Cir. 2001).
B
Michael Conant, a Flagstaff housekeeper, began wearing
a union button in July 2007; he was fired in August. Though
Conant had a record of poor attendance during his two years
at Flagstaff, the Board found that Flagstaff had general anti-
union animus, that the timing of Conant’s discharge was
suspicious, and that Flagstaff’s enforcement of the company
attendance policy was highly—and therefore suspiciously—
inconsistent. We think the Board failed to justify these
findings with substantial evidence.
Flagstaff’s attendance policy provides that “[e]xcessive
absenteeism and tardiness . . . may result in disciplinary
action to include termination.” J.A. 373. It also lists the
sanctions to be imposed for specified numbers of absences in
any rolling six- or twelve-month period. Four absences in any
rolling six-month period, or seven in any twelve-month
period, results in a verbal warning; five absences in any six-
11
month period, or eight in any twelve-month period, results in
a written warning; six absences in any six-month period, or
nine in any twelve-month period, results in a final warning
and possible suspension; and seven absences in any six-month
period, or ten in any twelve-month period, results in
termination. See Flagstaff, 357 NLRB No. 65, at 8.
By the summer of 2007, Conant had already received
verbal and written warnings and a three-day suspension. The
suspension apparently did not faze him. He missed work four
more times before he was fired: once in May, once in June,
and twice in July—making a total of twelve unscheduled
absences in twelve months. No one denies this entitled
Flagstaff under the attendance policy to fire Conant.
The Board makes much of the fact that Flagstaff did not
do so until after Conant began wearing a union button, but the
record easily explains this apparent oddity: in mid-June, the
director of the housekeeping department stepped down and an
interim director, Joe Brown, took over. Conant was absent
only twice after that, and Brown did not know about either
absence until the department secretary brought the second one
to his attention. At that point, Brown reviewed Conant’s file,
confirmed with the director of human resources that firing
Conant would comport with Flagstaff policies,5 and got the
go-ahead from Schuler. He fired Conant on August 1. (Both
the ALJ and the Board credited Brown’s testimony about the
matter.)
Only Brown and Schuler were involved in the decision to
fire Conant, and there is no substantial evidence either had an
5
The record is ambiguous about who spoke to the director of
human resources—Brown, Schuler, or both of them—but like the
parties and the ALJ, we ascribe no significance to that fact.
12
unlawful motivation. See Parsippany Hotel Mgmt. Co. v.
NLRB, 99 F.3d 413, 422 (D.C. Cir. 1996) (explaining that
general counsel must prove “that the employer knew of the
employee’s pro-union activities,” “that the timing of the
alleged reprisal was proximate to the protected activities,” and
that “there was anti-union animus to link the factors of timing
and knowledge to the improper motivation” (internal
quotation marks omitted)). First, there is little reason to think
Schuler knew anything about Conant’s unionizing. The
Board—which in its decision below referenced Schuler only
to note that he “reviewed and approved [Brown’s]
recommendation,” Flagstaff, 357 NLRB No. 65, at 9—now
points to an affidavit in which Schuler stated that “[a]t the
time of his termination, I could guess that Conant supported
the union.” Hr’g Tr. at 106 (May 6, 2008) (J.A. 68). The
Board considers this a damning admission. Not so. Schuler
clearly testified that his admittedly ambiguous statement did
not mean what the Board now asserts but rather meant only
that “at the time I was giving the affidavit, in retrospect” he
could have guessed Conant supported the union. Hr’g Tr. at
104 (May 6, 2008) (J.A. 66). Indeed, when signing the
affidavit, Schuler handwrote a qualifier next to the
controverted statement: “Based on conversations I had with
him in which he often expressed his dissatisfaction with
management and other work related issues. I never saw him
wear a union shirt or button, nor did he ever overtly express
his union support to me.” Hr’g Tr. at 106 (May 6, 2008) (J.A.
68).
The Board argues in the alternative that even assuming
Schuler “was personally unaware of Conant’s union support,
his lack of personal knowledge is not determinative” because
the Board could reasonably impute such knowledge to him.
Resp’t’s Br. at 48–49. This makes no sense. If general counsel
relies on circumstantial evidence and legal fictions about
13
constructive knowledge, it does so to carry its burden of
showing the decisionmaker knew about the employee’s union
activity. See, e.g., Avecor, Inc. v. NLRB, 931 F.2d 924, 928–
29 (D.C. Cir. 1991); Wolf Trap Foundation, 287 NLRB 1040,
1041 (1988); Kimball Tire Co., Inc., 240 NLRB 343, 344
(1979). Permitting circumstantial evidence and legal fictions
to trump direct proof to the contrary is absurd. See Chevron
Mining, Inc., 684 F.3d at 1327–28; see also Vulcan Basement
Waterproofing of Il. v. NLRB, 219 F.3d 677, 685 (7th Cir.
2000).
Second, though Brown testified he knew about Conant’s
union activity by July, the record does not support the
inference that Conant’s union activity played any role in
Brown’s decision or, put differently, that Brown would not
have recommended discharge anyway. We reject the Board’s
reliance on Bradel’s alleged unlawful threats to
“demonstrate[] that union animus . . . pervaded [Flagstaff],”
Resp’t’s Br. at 50; see Parsippany, 99 F.3d at 423–24,
because we do not think Bradel’s statements were improper—
and the Board’s circumstantial case cannot survive that
conclusion because Brown had nothing to do with any of
Flagstaff’s NLRA violations. Nor can the Board impute
animus to Brown directly because there is no such evidence in
the record.
Both the ALJ and the Board credited Brown’s testimony
that he followed Flagstaff’s attendance policy and, “from the
inception of his tenure with [Flagstaff], attempted to enforce
[Flagstaff’s] policies with consistency.” Flagstaff, 357 NLRB
No. 65, at 55 (ALJ Op.). As written, the policy is ambiguous:
it is possible to have accumulated no more than four or five
absences in any six-month period but nevertheless exceed
nine absences in a twelve-month period, thereby requiring
both warnings and discharge. The record shows Brown
14
understood the policy to mandate an incremental approach
whereby, for example, it would be inappropriate to fire an
employee who had not yet received a final warning.6 When
Monika Coby-Thompson had her ninth and tenth unscheduled
absences in six months, Brown suspended her for three days
rather than firing her because she had hitherto received only
verbal and written warnings. When Haskielena Begay had her
sixth unscheduled absence in six months, Brown issued a
written warning rather than a final warning because she had
hitherto received only a verbal warning (though he
subsequently suspended her as well for a separate policy
violation). But even under Brown’s relatively lenient
understanding of the policy, Conant’s excessive absences
warranted discharge. See, e.g., MECO Corp. v. NLRB, 986
F.2d 1434, 1438 (D.C. Cir. 1993) (“Absent a showing of anti-
union motivation . . . an employer may discharge an employee
for a good reason, a bad reason, or no reason at all without
running afoul of the labor laws.” (internal quotation marks
omitted)).
There appear to be two instances where a supervisor
ostensibly under Brown’s authority failed to escalate the
sanction though the escalation would have been warranted
and the employee had already received the same level of
discipline, but we think this insignificant in light of the ALJ
and Board’s conclusion that Brown tried to enforce
Flagstaff’s policies consistently and the record evidence that
Brown generally did so in fact. See MECO Corp., 986 F.2d at
6
Brown recommended firing a probationary employee who
had not received any warning, but the employee’s probationary
status refutes any attempt to cite that recommendation as an
example of inconsistent enforcement. See Rest. Corp. of Am. v.
NLRB, 827 F.2d 799, 806 (D.C. Cir. 1987) (“Disparate enforcement
inherently requires a finding that the employer treated similar
conduct differently.” (emphasis added)).
15
1437. Perhaps controversy over Flagstaff’s attendance policy
might have been avoided if the housekeeping department had
done a better job tracking employee absences so that an
employee received, for example, the verbal warning
immediately after a fourth unscheduled absence rather than
after the fifth, but it is unreasonable to find animus merely
because Brown’s reliance on the department secretary to track
absences and the exigencies of day-to-day work led to a few
false negatives. This of course assumes Brown was even at
Flagstaff when both incidents occurred, which is not at all
clear from the record. See Hr’g Tr. at 463 (May 8, 2008) (J.A.
135) (Brown testifying, “I’ve been at five different hospitals
in the last year.”).
III
Because there is no substantial evidence justifying the
Board’s findings that Bradel’s comments violated NLRA
§ 8(a)(1) or that Conant’s discharge violated § 8(a)(1) and (3),
we grant Flagstaff’s petition in part. We grant the Board’s
application for enforcement of its order in all other respects.
So ordered.