Medeco Security Locks v. NLRB ( 1998 )

FILED: May 28, 1998
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 96-2803
(11-CA-16215)
MEDECO SECURITY LOCKS, INCORPORATED,
Petitioner,
versus
NATIONAL LABOR RELATIONS BOARD,
Respondent.
No. 97-1116
NATIONAL LABOR RELATIONS BOARD,
Petitioner,
versus
MEDECO SECURITY LOCKS, INCORPORATED,
Respondent.
O R D E R
The court amends its opinion filed April 29, 1998, as follows:
- 2 -
On page 23, first full paragraph, lines 6-8, the sentence be-
ginning "We therefore remand" and ending "violations of § 8(a)(1)"
is deleted.
The disposition on pages 2 and 23 is edited to read "Enforce-
ment granted in part and denied in part."
The petitioner, Medeco Security Locks, Inc., is given seven
days from the entry of this order to submit any further objection
to the Board’s proposed judgment.
Entered at the direction of Judge Michael with the concurrence
of Chief Judge Wilkinson.
For the Court,
Clerk
PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
MEDECO SECURITY LOCKS,
INCORPORATED,
Petitioner,
No. 96-2803
v.
NATIONAL LABOR RELATIONS BOARD,
Respondent.
NATIONAL LABOR RELATIONS BOARD,
Petitioner,
v.
No. 97-1116
MEDECO SECURITY LOCKS,
INCORPORATED,
Respondent.
On Petition for Review and Cross-application
for Enforcement of an Order
of the National Labor Relations Board.
(11-CA-16215)
Argued: October 29, 1997
Decided: April 29, 1998
Before WILKINSON, Chief Judge, and RUSSELL* and
MICHAEL, Circuit Judges.
_________________________________________________________________
*Judge Russell participated in the decision of this case but died before
the opinion was issued. The opinion is filed by a quorum of the panel
pursuant to 28 U.S.C. § 46(d).
Enforcement granted in part and denied in part by pub-
lished opinion. Judge Michael wrote the opinion, in which Chief
Judge Wilkinson joined.
_________________________________________________________________
COUNSEL
ARGUED: Clinton Stephen Morse, FLIPPIN, DENSMORE,
MORSE, RUTHERFORD & JESSEE, Roanoke, Virginia, for Peti-
tioner. Richard A. Cohen, NATIONAL LABOR RELATIONS
BOARD, Washington, D.C., for Respondent. ON BRIEF: Todd A.
Leeson, FLIPPIN, DENSMORE, MORSE, RUTHERFORD & JES-
SEE, Roanoke, Virginia, for Petitioner. Frederick L. Feinstein, Gen-
eral Counsel, Linda Sher, Associate General Counsel, Aileen A.
Armstrong, Deputy Associate General Counsel, NATIONAL LABOR
RELATIONS BOARD, Washington, D.C., for Respondent.
_________________________________________________________________
OPINION
MICHAEL, Circuit Judge:
Medeco Security Locks, Inc. petitions this court to review a deci-
sion and order of the National Labor Relations Board, and the Board
cross-petitions for enforcement of its order. The Board's decision
affirmed the administrative law judge's ruling that Medeco had (1)
violated § 8(a)(1) of the National Labor Relations Act by prohibiting
employees from discussing certain employment matters and (2) twice
violated § 8(a)(1) and § 8(a)(3), first by transferring William C. Fol-
den to a second-shift position and second by subsequently firing Fol-
den. We conclude that there were three independent violations of
§ 8(a)(1). On the other hand, we believe there was a lack of substan-
tial evidence to support the Board's determination that anti-union ani-
mus motivated the personnel decisions affecting Folden. Accordingly,
we grant the Board's cross-petition for enforcement as to § 8(a)(1) but
deny enforcement as to § 8(a)(3).
I.
Medeco operates a Salem, Virginia, plant where it manufactures
and distributes precision locks. In 1993 the International Union of
2
Electronic, Electrical, Salaried, Machine, and Furniture Workers,
AFL-CIO (the "Union") attempted to unionize the employees at
Medeco. The Union collected enough union cards to bring about an
election, but on March 22, 1993, a majority of Medeco's employees
voted against unionization.
After this election Medeco made several company wide changes
aimed at providing its employees an alternative to unionization.
Medeco's new employee handbook explained in May 1993 that "[w]e
are a non-union company and we want to stay that way. We feel our
union-free status is a benefit to [our employees] . . . [and] we intend
to oppose unionization by every proper and legal means and by the
equitable treatment of all individuals." Medeco began initiatives to
emphasize team building, employee participation, and an open-door
complaint policy to address employee concerns. It also hired Dennis
Taggert in August 1993 as a new vice-president of human relations
and promoted Diane Ward, a rank-and-file employee, to the position
of human relations manager in November 1993. Ward's office was
located in the center of the production floor to make her readily acces-
sible to employees who wished to discuss or mention concerns about
employment.
The next year, in January of 1994, the Union began another cam-
paign to unionize Medeco. As expected, the company responded by
mounting an aggressive anti-unionization campaign. Medeco held a
series of meetings with its employees, showed anti-union films that
depicted union violence, posted various signs opposing unionization,
and instructed its managers to ask employees not to sign union cards.
This time, perhaps because of the company's effort, the Union was
not able to obtain enough cards to petition for an election.1
In 1994 Medeco employees William C. Folden and Louis Rickman
were subject to several adverse employment actions. Folden was ulti-
_________________________________________________________________
1 After the events relevant to this case, the Union collected enough sig-
natures to petition for an election in 1995. However, a majority of Mede-
co's employees again voted against unionization on May 15, 1995.
Medeco represents that no unfair labor practice charges were filed
against it with respect to either the 1993 or 1995 election. Brief in Sup-
port of Petition for Review at 26 n.15.
3
mately fired in late May, and Rickman quit in November. Medeco's
treatment of these employees and the company's alleged anti-union
motivations are the subject of this proceeding.
A.
William C. Folden began working for Medeco in 1976 and
remained with the company until he was terminated on May 27, 1994.
During the 1993 organizing effort, Folden was a highly visible and
active union supporter. He attended union meetings, served as a union
representative in observing the election, and was one of the more out-
spoken advocates of unionization. Folden admits that he wore a pro-
union cap and was not shy about his union support. Once Medeco
began to change its policies after the 1993 campaign, however, Fol-
den told his supervisor, Steve Bullock, that he was not interested in
any more organizational activity with the union. Specifically, when
the 1994 union drive was about to begin, Folden told Bullock that he
(Folden) was "very positive about the change that was going on" at
Medeco and that he "didn't feel the need for[the union] any more."
In addition, human relations manager Ward testified that Folden told
her that he had been active in the 1993 union effort "but that this year
[1994] he wasn't, he didn't want any part of it." Folden did not have
a clear recollection of this conversation.
Folden nevertheless had some participation in the 1994 union cam-
paign. When compared to his role in the 1993 campaign, however, his
involvement in 1994 was minimal. Folden first testified that he "[j]ust
attended the meeting[s]." He later added that he "received some
signed [union] cards" in Medeco's parking lot, but any part he played
in taking cards appears to have been quite minimal. He acknowledged
that these acts constituted the "extent of [his] involvement" in 1994.
By early 1994 Folden was serving, as a representative from the
Quality Control Department, on a "cross-functional team" organized
by Medeco. The team was composed of a cross-section of employees
who met weekly with management to discuss topics of concern and
interest to employees. During one of the team's meetings on February
4, 1994, the team's normal chairwoman (a manager) was absent and
Norma Doudy, a non-management employee in the accounting
department, stood in as her replacement. Doudy explained that she
4
would be reporting to Medeco's president about the meeting. At one
point during the meeting, Doudy asked Folden how the union drive
was going and whether there were enough cards for a petition. There-
after, Folden went to Bullock and told him that he (Folden) "didn't
think [a team meeting] was the proper time or place to discuss those
topics." Bullock agreed and said that he would advise Doudy that her
questions about the union drive were inappropriate. During this con-
versation Bullock asked why employees wanted a union. In a brief
response, Folden told him that there were several reasons, including
favoritism and the lack of fair treatment.
Bullock had joined Medeco in August 1993 as manager of the
Quality Control (QC) Department. His management style reflected
Medeco's "Team Concept" and its commitment to employee partici-
pation. Bullock soon established three skill levels for the quality
inspectors in the QC Department, with level III being the most
skilled. The job descriptions associated with each skill level were
developed with input from the QC employees, and in January 1994
the employees were allowed to choose their own skill level based on
their own assessment of their capabilities. Of the ten QC inspectors,
Folden and two others rated themselves at level III, while the rest
selected level II.
Bullock also required that all QC employees pass a Geometric
Dimension and Tolerance (GD&T) exam, which would test their abil-
ity to interpret engineering drawings. To prepare them for the GD&T
test, Bullock provided books and access to instructional videos that
the employees could use on their own time. Because Bullock felt that
"it would be difficult for the group to complete[the test] without
some instruction," he also taught a series of classes on the exam over
several weeks and made himself available to answer questions. Fol-
den attended these classes but illness caused him to miss the last two
sessions, in which course materials were reviewed in preparation for
the exam. Folden took the test on April 7, 1994, and scored a 68.5
percent.
Because Bullock had promised that the team as a whole would par-
ticipate in making decisions, he told them before the test that they
would decide the passing grade. Once the QC inspectors knew their
scores, they held a meeting and voted to make 70 percent the passing
5
score. Folden's score of 68.5 was the lowest in the group, and he was
the only one who did not pass.
At this point the testimony diverges. Folden claims Bullock told
him that he (Bullock) would schedule another GD&T exam in the
next few weeks, while Bullock claims that he told Folden to retake
the exam within the next five days. It is undisputed, however, that on
April 20 Bullock met with Folden to discuss the retaking of the exam.
In this meeting Bullock had Folden sign a memorandum that restated
Bullock's version of their previous discussions on the subject. Addi-
tionally, the memorandum stated that Folden was to retake the GD&T
exam by April 23 and score at least 80 percent in order to maintain
his level III classification. Regardless of how well Folden might do,
the memo provided that he would "be the lowest qualified in the
level III classification" because of his "need to retake [the exam] and
[the] additional time allowed." Finally the memo included the follow-
ing "confidentiality statement":
This conversation between Steve Bullock . . . and Billy Fol-
den . . . in regards to Billy's performance . . . and the correc-
tive action that must take place no later than April 23, 1994
is strictly confidential. Any sharing of this information with
any other member(s) of Team Medeco will be interpreted as
disruptive in nature and result in termination . . ..
Bullock would testify later that the purpose of this confidentiality
statement was to avoid any perception of favoritism that might be
drawn from the extra time Folden was given to take the test. After the
April 20 meeting with Bullock, Folden prepared to retake the exam
with the help of Mike Furrow, a fellow level III inspector, who
shared his notes and answered Folden's questions. When Folden
retook the GD&T exam, he increased his score to 86 percent.
The GD&T, however, was only one of two tests taken by the Qual-
ity Control group. In 1993 and continuing though 1994, Medeco
strongly emphasized a training program known as Quality Skills 1
(QS-1). QS-1 was a largely voluntary program through which Medeco
sought to improve the skills of its employees in various subject areas
important to the company's business.2 Because the company wanted
_________________________________________________________________
2 Although the program was voluntary for most employees, the QC
inspectors were required to take QS-1 training.
6
a high degree of employee participation, Medeco offered a twenty-
five-cent hourly wage premium as an incentive to certain employees
who completed QS-1 training. Despite this incentive many employees
still were hesitant to participate and take the QS-1 diagnostic tests. To
encourage more employees to volunteer for the training, Medeco
attempted to address employee concerns by emphasizing that only the
wage premium was tied to the QS-1 exams, that no one could "fail"
the QS-1 program, and that the company would not base its assess-
ment of an employee's qualifications on QS-1 test performance.
Confusion surrounding these two exams, QS-1 and GD&T, eventu-
ally led to Folden's termination. The final chain of events began soon
after Folden retook his GD&T test on April 23, 1994.
As a consequence of a reorganization of the QC group's shift struc-
ture, a position on the second (evening) shift was left vacant when
one employee transferred out of the group in April of 1994. In order
to deal with this vacancy, Bullock first asked for a volunteer to fill
the position but no one stepped forward. He then recommended that
the inspectors on the first shift take turns rotating through the second
shift so that everyone (both level II and III inspectors) would share
equally in the burden of working evening hours. Consistent with his
"team" approach to management, Bullock had the group vote on his
proposal. Although the first vote adopted the rotation plan, a second
vote was taken because one employee changed his mind and another
was not present for the first vote. After the second vote rejected the
plan, Medeco posted a job notice for the second-shift position on
April 29, 1994. This notice described job requirements that were con-
sistent with the skills of a level III inspector.
When no one responded to the notice, Bullock told Folden that
because he (Folden) was the least qualified of the level III inspectors,
the Medeco handbook required that he be transferred from the first to
the second shift. Folden testified that when he objected to the second-
shift assignment, Bullock told him that QS-1 and GD&T scores deter-
mined the assignment and that Folden's scores on both tests made
him the least qualified inspector. Bullock denied this, claiming that
the GD&T scores alone made Folden the least qualified, as reflected
by the April 20 memorandum. Mike Furrow, another level III inspec-
tor, claims that he approached Bullock and registered a complaint,
7
saying that it was unfair to transfer Folden because Folden's second
GD&T score was higher than his. Furrow testified that Bullock
responded by showing him a spreadsheet printout with test scores that
included QS-1 scores. Bullock denied showing him these sheets, but
the ALJ found Furrow's version to be credible. The ALJ thus found
that Bullock told Furrow that he based his decision to transfer Folden
on both the GD&T and QS-1 test scores.
On May 26, 1994, nine days after the transfer, Folden read an arti-
cle in the company newsletter which said that an employee could not
be transferred to a new shift because of his QS-1 scores. This article
was a response to rumors that QS-1 scores were a factor in Folden's
transfer to the second shift. After reading the newsletter, Folden went
to two supervisors and told them that he thought the article was
wrong. These supervisors, in turn, informed Bullock of what Folden
had said.
The next day, Bullock called Folden into his office and questioned
him in the presence of Robert King, another Medeco supervisor. Bul-
lock handed the April 20 memorandum to Folden and asked him if
there was something that he did not understand. The memo clearly
stated that Folden would be considered the least qualified level III
inspector because of his GD&T score and that the discussions at the
April 20 meeting would be kept confidential. Bullock claims that Fol-
den gave no response, Folden claims that he was not allowed to
respond, and King claims that Folden repeatedly answered "I don't
know." Bullock then fired Folden. Bullock contends this action was
because Folden lied about the reason for his transfer, but both Folden
and King testified that Bullock said that Folden was fired for the "dis-
ruptive behavior" of telling others that he was transferred because of
his test scores. Folden tried to explain to Bullock as he was being
escorted out of the plant that there had been a misunderstanding, but
Bullock did not give him an opportunity to explain himself. The ALJ
and the Board found that Folden's termination and his prior transfer
to the second shift were both motivated by anti-union animus and that
the April 20 "confidentiality statement" illegally restricted rights pro-
tected by the National Labor Relations Act ("NLRA" or "Act").
B.
Louis Rickman worked for Medeco from 1985 until he quit his job
in November of 1994. In early October 1994 Rickman received a
8
head injury in his ninth job-related accident in less than three years.
Because of this history of accidents, Rickman was suspended pending
a "fitness for duty exam," Medeco's term for a drug screening test.
Rickman ultimately tested negative for drug use. However, Rickman
was told orally by his supervisor and in a memorandum that he could
not discuss the drug test with other employees. Specifically, the mem-
orandum prohibited him from having "discussions pertaining to [the]
fitness for duty exam with co workers as this would be disruptive to
our team concept and result in further disciplinary actions." When he
was told this by his supervisor, Rickman answered by saying that "the
plant was already aware that I was suspended [and that t]he rumor
was that I was suspended for use of cocaine and marijuana." Rickman
added that he "didn't appreciate being labeled as a drug user." The
ALJ and the Board later ruled that this restraint on Rickman's speech
violated the Act.
C.
On September 23, 1994, the Union initiated this case by filing
unfair labor practice charges with the National Labor Relations
Board. The General Counsel issued a complaint on October 24, which
was amended three times. After a hearing was held before an adminis-
trative law judge (ALJ) on March 16, 1995, the ALJ ruled that
Medeco had committed several violations of the National Labor Rela-
tions Act. The ALJ found (1) that Medeco violated§ 8(a)(1) of the
Act by restricting the communications of Folden and Rickman and (2)
that it violated both § 8(a)(1) and § 8(a)(3) because its transfer and
termination of Folden were motivated by anti-union animus. Medeco
appealed to the Board, which affirmed and adopted the ALJ's deci-
sion and order. See Medeco Sec. Locks, Inc., 319 N.L.R.B. 224 (1995)
(Medeco I). Medeco then petitioned this court for review, but we
remanded the case to the Board at its request. The Board then
remanded the case to the ALJ for specific credibility determinations.
After the ALJ filed a supplemental decision that failed to address the
substance of the Board's remand order, the Board again remanded the
case for the same purpose. See Medeco Sec. Locks, Inc., 322 N.L.R.B.
664, 664-67 (1996) (Medeco II) (supplemental decision). The ALJ
thereafter filed a second supplemental decision that the Board
affirmed. See id. at 664, 667-68 (second supplemental decision and
9
affirmance). Medeco now petitions this court for review, and the
Board cross-petitions for enforcement.
II.
Section 8(a)(3) of the Act prohibits an employer from engaging in
"discrimination in regard to hire or tenure of employment or any term
or condition of employment to encourage or discourage membership
in any labor organization." 29 U.S.C. § 158(a)(3). Generally, an
employer violates this section "only if its actions are motivated by
anti-union animus." Goldtex, Inc. v. NLRB, 14 F.3d 1008, 1011 (4th
Cir. 1994). Because substantial evidence does not support the Board's
finding that Folden's transfer to the second shift and his subsequent
termination were motivated by anti-union animus, we deny enforce-
ment as to the finding of a § 8(a)(3) violation.
Because an employer's motives may often be a mix of legitimate
and discriminatory reasons, the Board established a procedure in
Wright Line, 251 N.L.R.B. 1083 (1980), enforced, 662 F.2d 899 (1st
Cir. 1981), to deal with such mixed-motive cases. See also NLRB v.
Transportation Management Corp., 462 U.S. 393, 401-02 (1983)
(approving Wright Line procedure), modified in part, Director, Office
of Workers' Compensation Programs v. Greenwich Collieries, 512
U.S. 267, 276-78 (1994). Under Wright Line the General Counsel first
bears the burden of making a prima facie case that the employer's
adverse employment decision was motivated in part by discriminatory
intent. See FPC Holdings, Inc. v. NLRB, 64 F.3d 935, 942 (4th Cir.
1995); Ultrasystems W. Constructors, Inc. v. NLRB, 18 F.3d 251, 257
(4th Cir. 1994). To establish a prima facie case, the General Counsel
must prove by a preponderance of the evidence:
(1) that the employee was engaged in protected activity, (2)
that the employer was aware of the activity, and (3) that the
activity was a substantial or motivating reason for the
employer's action. Motive may be demonstrated by circum-
stantial as well as direct evidence, and is a factual issue
"which the expertise of the Board is peculiarly suited to
determine."
FPC Holdings, 64 F.3d at 942 (citations omitted); see also NLRB v.
CWI, Inc., 127 F.3d 319, 330-32, 331 n.7, 332 n.8 (4th Cir. 1997)
10
(standard of proof for prima facie case is preponderance of evidence
based on whole record). Of course, the absence of a legitimate basis
for an employer's action may form part of the proof of the General
Counsel's case, while the presence of legitimate reasons can work to
negate proof of anti-union animus. See CWI, 127 F.3d at 332 (quoting
Wright Line, 251 N.L.R.B. at 1088 n.12). Even if an employer's moti-
vation is "combined with other legitimate nondiscriminatory
motives," however, a prima facie case is nevertheless established
when "anti-union animus was a [substantial or] motivating factor" in
the employment action. See Ultrasystems, 18 F.3d at 257.
Once a prima facie case has been made, the employer may still
escape liability by presenting the affirmative defense that the discrim-
inatory motivation, though illicit, was harmless. See Transportation
Management, 462 U.S. at 401-02; Ultrasystems, 18 F.3d at 257. To
make this defense, the employer bears the burden of proving by a pre-
ponderance of the evidence that, even though discriminatory animus
was present, "the employer nonetheless would have taken the same
employment action for legitimate reasons." Ultrasystems, 18 F.3d at
257; see also Greenwich Collieries, 512 U.S. at 278 (employer has
burden of persuasion to sustain this affirmative defense);
Transportation Management, 462 U.S. at 402; FPC Holdings, 64 F.3d
at 942. If the Board finds that the proffered reason is pretextual, we
must affirm the Board if substantial evidence supports this factual
determination. See NLRB v. Grand Canyon Mining Co., 116 F.3d
1039, 1047 (4th Cir. 1997).
The scope of our inquiry in reviewing the Board is limited. We
must affirm the Board's interpretations of the NLRA if they are "ra-
tional and consistent with the Act." NLRB v. Curtin Matheson Scien-
tific, Inc., 494 U.S. 775, 787 (1990) (citation omitted); see also Fall
River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 42 (1987);
Transportation Management, 462 U.S. at 402-03; NLRB v. J. Wein-
garten, Inc., 420 U.S. 251, 266-67 (1975). Similarly, we must affirm
the Board's factual findings if they are "supported by substantial evi-
dence on the record considered as a whole." 29 U.S.C. § 160(e); see
also CWI, 127 F.3d at 326; Fieldcrest Cannon, Inc. v. NLRB, 97 F.3d
65, 69-70 (4th Cir. 1996). Substantial evidence is"such relevant evi-
dence as a reasonable mind might accept as adequate to support a
conclusion," and if we find such evidence on the record, we must
11
uphold the Board's decision "even though we might have reached a
different result had we heard the evidence in the first instance." Alpo
Petfoods, Inc. v. NLRB, 126 F.3d 246, 250 (4th Cir. 1997) (internal
quotation omitted); see also Grand Canyon, 116 F.3d at 1044.
In this case, the Board adopted the ALJ's finding that anti-union
animus motivated Medeco's decision to transfer and later terminate
Folden. Because motive is a question of fact, we review this finding
only to determine if it is supported by substantial evidence. See Alpo,
126 F.3d at 250 (quoting FPC Holdings, 64 F.3d at 942); Grand
Canyon, 116 F.3d at 1047. While motive may be proven with circum-
stantial evidence, "mere speculation as to the employer's real
motives" is insufficient and will not be upheld as substantial evidence.
Alpo, 126 F.3d at 250 (alteration and internal quotation omitted); see
also Carry Cos. v. NLRB, 30 F.3d 922, 928 (7th Cir. 1994) ("sheer
speculation" is not substantial evidence). The ALJ found that Medeco
knew of Folden's renewed union activities in 1994 because of Fol-
den's prominent role in the 1993 campaign, his union participation in
1994, and Folden's discussion with Bullock after the February 4
meeting of the cross-functional team. See Medeco I, 319 N.L.R.B. at
228. The ALJ further found that Medeco's anti-union propaganda
exhibited anti union animus. Id. Because neither conclusion is sup-
ported by substantial evidence on the record, we hold that the General
Counsel failed to prove a prima facie case of discrimination under
§ 8(a)(3). We now discuss each of these findings in greater detail.
A.
In Goldtex, Inc. v. NLRB we emphasized that "the most basic ele-
ment" of many § 8(a)(3) cases is a showing "that the employer was
. . . aware of the discharged employees' protected activities." 14 F.3d
1008, 1011, 1012-13 (4th Cir. 1994). The ALJ found that Medeco
knew of Folden's renewed union activities in the 1994 campaign and
relied on this finding to infer animus from the events surrounding his
transfer to the second shift and his eventual termination. See
Medeco I, 319 N.L.R.B. at 228. This finding is not supported by sub-
stantial evidence, however.
Folden's only open act of aid to the 1994 organizing drive was his
receipt of some union cards in the employee parking lot. There was
12
no evidence that Medeco had any knowledge of this. Of course, if
Folden's organizational work or his expressions of support for the
union had been more apparent or more extensive, knowledge of his
protected activities could be imputed to Medeco. See NLRB v. Instru-
ment Corp. of America, 714 F.2d 324, 329, 330 (4th Cir. 1983)
(knowledge of union activities may be "imputed to the company"
from circumstantial evidence). However, there is nothing more of
consequence here. Folden's testimony confirms that he played a
minor role in the 1994 campaign. Even though Folden was a visible
union supporter in 1993, he affirmatively disavowed any further inter-
est in the union to management just before the 1994 campaign. It was
reasonable for Medeco to take Folden at his word, particularly in light
of the changes at the company and Folden's acknowledgment that
things were improving.
We also conclude that Folden's complaint to Bullock concerning
Norma Doudy's inquiry about the level of union support during the
cross-functional team meeting does not constitute substantial evi-
dence that Medeco knew of Folden's union activity. We agree with
Medeco that this incident is similar to the one in Carry Cos. v. NLRB,
30 F.3d 922, 927 (7th Cir. 1994). There an employee-warehouseman
said in the presence of a supervisor that company drivers "``had
enough authorization cards signed to have an election for the Union,
and that the warehousemen should decide what they were going to
do.'" The court concluded that this comment "did not indicate [the
employee's] view of or participation in the union campaign, and any
conclusion to the contrary[ ] is sheer speculation" that did not amount
to substantial evidence. Id. at 928. Likewise, Folden's complaint did
not reveal either his support of or participation in union activity; it
merely reflected his concern that the union drive was not a proper
topic at the team meeting. When Folden was asked by Bullock why
employees wanted a union, Folden simply gave a brief, factual answer
without expressing his own opinion.
Moreover, the fact that Bullock asked Folden this question is itself
unremarkable. This is not a case where a supervisor approached an
employee out of the blue to ask about the reasons behind a unioniza-
tion drive. In such a case where the employee was known to have sup-
ported the union in the past, a factfinder might properly infer that the
supervisor's decision to ask this specific employee about the union
13
reflected management's knowledge of the employee's continued
union support. Here, however, Folden served on a Medeco committee
whose very function was to collect employee concerns and pass them
on to management. Moreover, Folden himself raised the union issue
(although in a neutral fashion) by bringing his complaint about Doudy
to Bullock. Together, these facts illustrate that Bullock's question
about why employees wanted a union, when viewed in context, is not
substantial evidence to support a finding that Medeco knew of Fol-
den's union sympathies.
Folden's minimal role in the 1994 campaign, his clear expression
to management that he no longer was interested in the union, the neu-
tral nature of his complaint about Doudy's question at the team meet-
ing, and the benign nature of Bullock's question to Folden all lead us
to conclude that there is a lack of substantial evidence to support the
finding that Medeco was aware of Folden's union activity.
B.
We recognize that a company can violate § 8(a)(3) by disciplining
or firing employees who are not union sympathizers in an effort to
send an anti-union message or to otherwise discourage union mem-
bership. Nevertheless, some evidence of anti-union animus is essen-
tial for such a case, see Alpo, 126 F.3d 255-56 (citing cases), and that
evidence is not present here.
The ALJ relied on Medeco's anti-union propaganda campaign to
support his finding of "company animus against the Union."
Medeco I, 319 N.L.R.B. at 228. This finding cannot stand. "[A]n
employer's speech that does not threaten reprisal or force, or promise
a benefit, in relation to union activities is unqualifiedly privileged
under [§ 8(c) of] the Act." Alpo, 126 F.3d at 252; see also 29 U.S.C.
§ 158(c); Louisberg Sportswear Co. v. NLRB, 462 F.2d 380, 385-86
(4th Cir. 1972) (company propaganda campaign presenting truthful
but skewed perspective that portrayed unions "in a most unfavorable
light" was protected since it did not threaten reprisal or promise bene-
fit); Corrie Corp. v. NLRB, 375 F.2d 149, 153 (4th Cir. 1967) (finding
employer's statement was not protected in light of other circum-
stances that made statement coercive). Section 8(c) plainly states that
the
14
expressi[on] of any views, argument, or opinion, or the dis-
semination thereof, whether in written, printed, graphic, or
visual form, shall not constitute evidence of an unfair labor
practice . . . [unless it] contains [a] threat of reprisal or force
or promise of benefit.
29 U.S.C. § 158(c). Consequently, speech protected by that section
cannot be used by the General Counsel to establish an employer's
anti-union animus. See Alpo, 126 F.3d at 252. Otherwise "[a]n
employer's lawful anti-union speech [would] be chilled by the return
threat that the Board may use it as evidence of unlawful motivation."
Id. This impermissible result would completely undermine § 8(c) by
rendering its protection an empty promise.
Medeco's propaganda campaign clearly falls within the protection
of § 8(c) because there is no indication that the company's speech was
coercive or contained any implicit threats or promises of benefits.
Thus, evidence about the company's campaign cannot be used by the
General Counsel to prove anti-union animus.
In sum, there is no substantial evidence to support either the
Board's conclusion that Medeco knew of Folden's pro-union activi-
ties or its conclusion that Medeco exhibited anti-union animus more
generally. As a result, the General Counsel has failed to establish a
prima facie case, and the Board's ruling that Medeco violated
§ 8(a)(3) cannot be enforced.
III.
We now turn to the § 8(a)(1) violations, where substantial evidence
does support the Board's findings. The evidence clearly reveals that
Medeco committed three independent violations of § 8(a)(1) by pro-
hibiting Folden and Rickman from discussing matters concerning the
conditions of their employment and by firing Folden for discussing
such matters.
Section 8(a)(1) of the National Labor Relations Act makes it an
unfair labor practice for an employer "to interfere with, restrain, or
coerce employees in the exercise of the rights guaranteed in" § 7 of
15
the Act. 29 U.S.C. § 158(a)(1). If protected activity is implicated, the
well-settled test for § 8(a)(1) violations is whether, "under all the cir-
cumstances, the employer's conduct may reasonably tend to coerce or
intimidate employees." NLRB v. Grand Canyon Mining Co., 116 F.3d
1039, 1044 (4th Cir. 1997); see also Equitable Gas Co. v. NLRB, 966
F.2d 861, 866 (4th Cir. 1992). It matters "``not whether the [employ-
er's] language or acts were coercive in actual fact.'" Equitable Gas,
966 F.2d at 866; see also Corrie Corp. v. NLRB, 375 F.2d 149, 153
(4th Cir. 1967). Our inquiry instead focuses on "``whether the conduct
in question had a reasonable tendency in the totality of circumstances
to intimidate.'" Equitable Gas, 966 F.2d at 866. This question of
"[w]hether particular conduct is coercive is a ``question essentially for
the specialized experience of the NLRB,'" Grand Canyon, 116 F.2d
at 1044, and we grant considerable deference to its determinations.
Establishing the existence of coercive conduct, however, does not
end our analysis. We must balance the employee's protected right
against any substantial and legitimate business justification that the
employer may give for the infringement. "[I]t is only when the inter-
ference with § 7 rights outweighs the business justification for the
employer's action that § 8(a)(1) is violated." Textile Workers Union
of America v. Darlington Mfg. Co., 380 U.S. 263, 269 (1965); see
also Eastex, Inc. v. NLRB, 437 U.S. 556, 570-74 (1978) (balancing
interests); J.P. Stevens & Co. v. NLRB, 547 F.2d 792, 794 (4th Cir.
1976). This determination is also squarely within the expertise of the
Board. "``[I]t is the primary responsibility of the Board and not the
courts ``to strike the proper balance between the asserted business jus-
tifications and the invasion of employee rights in light of the Act and
its policy." Jeannette Corp. v. NLRB, 532 F.2d 916, 918 (3d Cir.
1976) (quoting NLRB v. Fleetwood Trailer Co., 389 U.S. 375, 378
(1967)). On review, we must affirm the Board's balancing if it is
rational and consistent with the Act. See Beth Israel Hosp. v. NLRB,
437 U.S. 483, 501 (1978); see also Charles D. Bonanno Linen Serv.,
Inc. v. NLRB, 454 U.S. 404, 409-10, 417 (1982).
Consequently, an independent violation of § 8(a)(1) exists when (1)
an employer's action can be reasonably viewed as tending to interfere
with, coerce, or deter (2) the exercise of protected activity, and (3) the
employer fails to justify the action with a substantial and legitimate
business reason that outweighs the employee's § 7 rights.
16
A.
1.
To determine if Medeco violated § 8(a)(1) by prohibiting Folden
from talking to other employees about his test score performance and
its effect on his transfer, we must determine if the above three condi-
tions are met. Because the confidentiality statement's sanction of ter-
mination clearly is coercive, we turn our focus to whether Medeco's
action implicates protected conduct.
An employer's coercive action affects protected rights whenever it
can have a deterrent effect on protected activity. See NLRB v. Van-
guard Tours, Inc., 981 F.2d 62, 66-67 (2d Cir. 1992); Jeannette, 532
F.2d at 918. This is true even if an employee has yet to exercise a
right protected by the Act. The rationale for this rule is straightfor-
ward. Section 8(a)(1) reaches all acts by employers that "interfere
with, restrain, or coerce" their employees' exercise of protected
rights, see 29 U.S.C. § 158(a)(1), and this requires that the section
reach employer conduct even when employees have yet to engage in
protected activity. As we state above, the test is not whether the
employer's action was coercive in fact, but whether it reasonably
tends to coerce or deter the exercise of protected rights. We find that
Medeco's blanket prohibition against discussing the circumstances
surrounding Folden's transfer affected protected rights because it cov-
ered communications that would be protected by the Act.
The right of employees "to engage in . . . concerted activities for
the purpose of . . . mutual aid or protection" is established by § 7 the
National Labor Relations Act. See 29 U.S.C.§ 157. This protection
applies even to activities that do not involve unions or collective bar-
gaining. Halstead Metal Prods. v. NLRB, 940 F.2d 66, 69 (1991).
Thus, any actions taken by employees that are both (1) concerted and
(2) performed for the purpose of mutual aid or protection are pro-
tected by the Act. See New River Indus. v. NLRB, 945 F.2d 1290,
1294 (4th Cir. 1991).
We have previously recognized that action by an individual is a
"concerted" action under the Act so long as it is "``intended to enlist
the support and assistance of other employees.'" Krispy Kreme
17
Doughnut Corp. v. NLRB, 635 F.2d 304, 307-08, 307 n.6 (4th Cir.
1980) (following Mushroom Transp. Co. v. NLRB, 330 F.2d 683, 685
(3d Cir. 1964)); see also Blaw-Knox Foundry & Mill Machinery Inc.
v. NLRB, 646 F.2d 113, 115-116 (4th Cir. 1981). Folden's discussion
of the events surrounding his transfer certainly could be a central part
of any effort to enlist the support of his coworkers in addressing the
terms and conditions of their employment. It is clear in this case that
the possible impact of the GD&T and QS-1 test scores on an employ-
ee's qualifications was an issue of common concern to employees.
Employee discussions of these topics in the midst of a union cam-
paign could clearly be protected activities that are concerted and per-
formed for mutual aid and protection. Information about such issues
is the very fuel on which unionization campaigns are run, and to pre-
vent the dissemination of first-hand accounts of a company's treat-
ment and evaluation of its employees frustrates the rights that § 7
seeks to protect.3
Medeco's action in prohibiting such discussions is thus no different
than other blanket rules prohibiting the discussion of employment
conditions that have repeatedly been held to violate the Act. See, e.g.,
Handicabs, Inc. v. NLRB, 95 F.3d 681, 684-85 (8th Cir. 1996) (rule
prohibiting employees from discussing problems or complaints about
company with customers was invalid because it was not narrowly
drawn); Aroostook County Reg'l Ophthalmology Ctr. v. NLRB, 81
F.3d 209, 212 (D.C. Cir. 1996) (acknowledging that, "under the
NLRA, employees are generally free to discuss the terms and condi-
tions of their employment"); Wilson Trophy Co. v. NLRB, 989 F.2d
1502, 1510-11 (8th Cir. 1993) (rule banning wage discussions during
working hours was invalid where its application to break times was
not justified by productivity or safety concerns); NLRB v. Vanguard
Tours, Inc., 981 F.2d 62, 66-67 (2d Cir. 1992) (rule prohibiting
employees from discussing issues such as hours, wages, and work-
place conditions violated § 8(a)(1) "even absent evidence of [its]
enforcement"); Jeannette, 532 F.2d at 918 & n.2, 920 (rule prohibit-
ing wage discussions violates § 8(a)(1) because wage discussions can
_________________________________________________________________
3 We need not decide whether Folden's actual conversations were pro-
tected by the Act. It is enough to conclude that the "confidentiality state-
ment" affected discussions that could be protected by the Act. See
Jeannette, 532 F.2d at 918 & n.2, 920.
18
be protected activity; declining to rule whether actual discussions
were protected); Waco, Inc., 273 N.L.R.B. 746, 747-48 (1984) (unen-
forced rule banning discussion of wages invalid when not justified by
"substantial and legitimate business reasons"); IBM Corp., 265
N.L.R.B. 638, 638 (1982) (finding policy that forbid discussion of
internal records of employee wages infringes on § 7 rights, but ruling
that policy was justified by confidentiality concerns). The danger
inherent to such rules, even when they are not enforced, is their
"likely chilling effect" on protected rights. See Vanguard Tours, 981
F.2d at 67. Because of its potential to deter protected activities, we
hold that Medeco's blanket prohibition against Folden's discussion of
the circumstances surrounding his transfer was coercive and impli-
cates protected conduct.
Therefore, we address the third requirement of a§ 8(a)(1) violation
by balancing Medeco's business justification for this restriction
against its employees' § 7 rights. Bullock testified that "[t]he intent of
the confidentiality statement . . . was to ward off any perception of
favoritism that . . . could have been interpreted[from] giving [Folden]
additional time to take the exam." This reason, however, is not a sub-
stantial and legitimate business reason that would justify Medeco's
infringement on employee rights. Any perceived favoritism could
most easily be dispelled by fully disclosing the facts and the rationale
behind Bullock's decision. Given that Folden was ill and absent from
the last GD&T review classes, employees might easily conclude that
Bullock acted fairly in giving Folden another chance at the exam and
that no favoritism existed. On the other hand, if employees were to
find this treatment preferential, this type of information would be
essential to the very discussions about working conditions that the Act
protects. Suppressing this discussion by prohibiting employees from
sharing the facts surrounding the terms and conditions of their
employment cannot be justified here. We therefore conclude that the
confidentiality statement is coercive and implicates protected rights
that are not outweighed by a substantial and legitimate business justi-
fication. As such, we hold that it violates § 8(a)(1).
Medeco's assertion that it lacks anti-union animus does not affect
this determination. Unlike violations of § 8(a)(3), an employer's anti-
union motivation is not a required element of § 8(a)(1). See Standard-
Coosa-Thacher Carpet Yarn Div., Inc. v. NLRB, 691 F.2d 1133, 1138
19
& n.6 (4th Cir. 1982) (courts reviewing independent§ 8(a)(1) viola-
tions decide if employer's actions are coercive and do not inquire into
anti-union animus; this discriminatory intent is element of § 8(a)(3)
alone). The Board has long held that "interference, restraint, and coer-
cion under Section 8(a)(1) of the Act does not turn on the employer's
motive," see American Freightways Co., 124 N.L.R.B. 146, 147
(1959), and the federal courts have reflected this position. See, e.g.,
Textile Workers Union of America v. Darlington Mfg. Co., 380 U.S.
263, 269 (1965) ("A violation of § 8(a)(1) alone . . . presupposes an
act which is unlawful even absent a discriminatory motive."); NLRB
v. Burnup & Sims, Inc., 379 U.S. 21, 22-24 (1964) (finding violation
of § 8(a)(1) "whatever the employer's motive"); Wyman-Gordon Co.
v. NLRB, 654 F.2d 134, 145 (1st Cir. 1981) (test is objective coercive-
ness; employer intent is not part of offense); Caterpillar Tractor Co.
v. NLRB, 638 F.2d 140, 141 (9th Cir. 1981) (no need to inquire into
motive if employer does not have legitimate business justification);
National Cash Register Co. v. NLRB, 466 F.2d 945, 962-63 (6th Cir.
1972) ("lack of unlawful motive is not a defense to a section 8(a)(1)
charge"); Crown Central Petroleum Corp. v. NLRB, 430 F.2d 724,
727-29 (5th Cir. 1970) (unlike § 8(a)(3),§ 8(a)(1) does not require
"unlawful motive"); Welch Scientific Co. v. NLRB, 340 F.2d 199, 203
(2d Cir. 1965) ("cases clearly demonstrate that it is the tendency of
an employer's conduct to interfere with the rights of his employees
protected by Section 8(a)(1), rather than his motives, that is control-
ling"). As the Supreme Court explained in Burnup, this rule that intent
is not a necessary element of § 8(a)(1) is
in conformity with the policy behind [that section]. Other-
wise the protected activity would lose some of its immunity
. . . . A protected activity acquires a precarious status if
innocent employees can be discharged while engaging in it,
even though the employer acts in good faith. It is the ten-
dency of those discharges to weaken or destroy the§ 8(a)(1)
right that is controlling.
379 U.S. at 23-24.4 Consequently, Medeco's claim that the evidence
_________________________________________________________________
4 While anti-union animus may come into play in analyzing whether
the employer's justification is legitimate, it is not an element of § 8(a)(1).
20
fails to show discriminatory intent cannot save it from liability under
§ 8(a)(1).
2.
Because we hold that Medeco's "confidentiality statement" violates
§ 8(a)(1), it is also clear that Folden's termination for his breach of
this confidentiality also violates § 8(a)(1). Although Medeco claims
that Folden was terminated for lying and that he was not fired for dis-
cussing his transfer, the ALJ's factual findings fatally undermine this
argument. First, the ALJ found that Folden was telling the truth and
that Bullock had in fact told both Folden and Furrow that QS-1 and
GD&T scores were used in the transfer decision. See Medeco II, 322
N.L.R.B. at 664 & n.2, 667-68; Medeco I, 319 N.L.R.B. at 226. In
reaching this conclusion, the testimony of both Folden and Furrow
was credited, and we see no reason to question this credibility deter-
mination.
_________________________________________________________________
See National Cash Register, 466 F.2d at 963 ("the absence of improper
motive is relevant only to the extent it makes credible the asserted exis-
tence of legitimate business reasons for the employer's decision"). Simi-
larly, cases recognizing that anti-union animus can transform an
otherwise legitimate act into a coercive act which violates § 8(a)(1) do
not change this conclusion. See, e.g., NLRB v. Exchange Parts Co., 375
U.S. 405, 409 (1964) (employer's provision of benefit to employees
made with "express purpose" of discouraging unionization violates
§ 8(a)(1)); Halstead Metal Prods. v. NLRB, 940 F.2d 66, 70-71 (4th Cir.
1991) ("retaliatory action motivated by an employee's participation in, or
instigation of, [protected] activity violates section 8(a)(1)").
We also note that cases sometimes fail to distinguish carefully between
independent § 8(a)(1) violations and derivative violations which require
motive. This confusion arises because a § 8(a)(3) violation necessarily
involves a "derivative violation of § 8(a)(1)." Metropolitan Edison Co. v.
NLRB, 460 U.S. 693, 698 n.4 (1983); see also New River Indus. v. NLRB,
945 F.2d 1290, 1295 n.3 (4th Cir. 1991); Microimage Display Div. of
Xidex Corp. v. NLRB, 924 F.2d 245, 250 (D.C. Cir. 1991) (violations of
§ 8(a)(2)-(5) yield derivative violations of § 8(a)(1)). Consequently,
cases which involve both § 8(a)(1) and (3) may blur the line between
these two offenses.
21
The ALJ also found that when Bullock fired Folden, Bullock told
him that he had "violated the ``confidentiality' statement and had been
disruptive." Medeco I, 319 N.L.R.B. at 227. This is corroborated not
only by Folden's testimony but also by that of Robert King, a plant
supervisor. King, who was present at the May 27, 1994, termination
meeting, testified that Bullock told Folden that Folden's discussions
with fellow employees about his transfer were "considered disruptive
behavior [constituting] grounds for dismissal and, therefore, he would
be dismissed effective immediately." Consequently, it is clear from
the record that Folden was fired not for "lying" but instead for his vio-
lation of the confidentiality agreement, which provided that "[a]ny
sharing of this information with any other [employees] will be inter-
preted as disruptive in nature and result in termination." Because the
memo's prohibition standing alone violates § 8(a)(1), § 8(a)(1) also
forbids firing Folden for violating this illegal prohibition.
B.
When Medeco forbade Lewis Rickman from discussing his
required drug test, this restriction had a reasonable tendency to deter
the exercise of protected rights for the same reason that the "confiden-
tiality statement" did. Moreover, Medeco's justification that not dis-
cussing the incident would better protect Rickman's reputation clearly
falls short since Rickman himself wanted to dispel rumors that he was
suspended for cocaine and marijuana use. The best way to do this
would have been to reveal that Rickman passed the drug screen. This
is not a situation in which a company forbids an employee from dis-
cussing another's drug test without permission. That prohibition could
be a substantial and legitimate business reason based on concerns for
the tested employee's privacy. Cf. IBM Corp., 265 N.L.R.B. 638, 638
(1982) (policy that forbid discussion of internal records of employee
wages was justified by need to keep wages of company's employees
confidential; policy did not prevent discussion of employee's own
wages). Here, Rickman's reputation is a matter of personal concern
to him, and the company cannot legitimately prevent him from
attempting to air the facts in a manner that he believes will restore his
good name. Consequently, we affirm the Board's ruling that Medeco
restricted Rickman's speech in violation of § 8(a)(1).5
_________________________________________________________________
5 Medeco's claim that it was denied a fair hearing because the ALJ was
biased is without any merit. We find no evidence of bias on this record.
22
IV.
Because substantial evidence does not support the Board's finding
of anti-union animus, we deny enforcement of the Board's order inso-
far as it relates to the transfer of Folden to the second shift. However,
we grant enforcement of the Board's order as to the violations of
§ 8(a)(1) that resulted from Medeco's restriction of employee com-
munications and from the termination of William Folden.
ENFORCEMENT GRANTED IN PART
AND DENIED IN PART
_________________________________________________________________
Similarly, Medeco's citation to prior cases over which the ALJ presided
is irrelevant to the issues raised in this proceeding. See Fieldcrest Can-
non, Inc. v. NLRB, 97 F.3d 65, 69 (4th Cir. 1996) ("A decision-maker's
ruling deserves to rise or fall on the case at hand, not on the results in
other cases that have little bearing on the issues before us.").
23