NLRB v. Amglo Kemlite Laboratories

In the
United States Court of Appeals
For the Seventh Circuit
____________________
Nos. 15-3695 & 15-1141
AMGLO KEMLITE LABORATORIES, INC.,
Petitioner/Cross-Respondent,
v.
NATIONAL LABOR RELATIONS BOARD,
Respondent/Cross-Petitioner.
____________________
Petition for Review and Cross-Application
for Enforcement of a Decision and Order
of the National Labor Relations Board.
No. 13-CA-065271
____________________
ARGUED FEBRUARY 11, 2016 — DECIDED AUGUST 17, 2016
____________________
Before BAUER and WILLIAMS, Circuit Judges, and
ADELMAN, District Judge. *
WILLIAMS, Circuit Judge. Amglo Kemlite Laboratories
makes specialty lights, such as those on airplane wings. Its
* Of the Eastern District of Wisconsin, sitting by designation.
2 Nos. 15-3695, 15-1141
employees in Illinois went on strike to protest low wages.
The National Labor Relations Board found that Amglo un-
lawfully retaliated by transferring some work from Illinois to
a separate Amglo facility in Mexico. The Board issued a re-
medial order. In this case, the Board asks us to enforce its
order and Amglo asks us to set it aside. Because the order
has a reasonable basis in law and is supported by substantial
evidence, we enforce it.
I. BACKGROUND
A. Strike and Response
On September 19, 2011, Amglo’s President, Izabella
Christian, visited Amglo’s Illinois facility. Before her visit,
several employees had complained to her—and to the Illi-
nois plant manager, Anna Czajkowska—about low wages.
During the visit, a supervisor reminded Christian about the
employees’ complaints, but she responded that Amglo
would not raise wages.
The next morning, nearly all of the plant’s 94 employees
went on strike. Christian and Czajkowska arrived shortly
after the strike began, told employees that Amglo would not
raise wages, and directed employees to return to work or go
home. The employees asked to speak to Amglo’s owner, Jim
Hyland, but Christian responded that Hyland was not as
“pro-Polish” as he used to be. (Nearly all of the employees
were of Polish descent.) Czajkowska said: “I’ll tell you what
he’s going to say. He will tell us to get rid of half of you. And
you’re not going to do anything. You’re not going to scare
him. You’re not going to threaten him. You’re going to lose.”
Czajkowska held resignation forms in her hand and told
employees that if they did not like their wages, they could
Nos. 15-3695, 15-1141 3
quit. Christian discussed globalization and explained that
companies can move production to China and Mexico (two
places where Amglo had plants). The employees made a
written demand for guaranteed annual raises and for back-
pay since their last raise. They got no response.
Employees arrived at the plant at 5:00 a.m. the next
morning and continued striking. Two hours later, Christian
and Czajkowska arrived and ordered employees to return to
work or get off the company’s property. Choosing the second
option, employees reassembled on public property and con-
tinued their strike—but not for long. Over the next week,
several employees returned to work, with no raise.
On September 27, all of the employees who remained on
strike—more than 50 people—signed an unconditional offer
to return to work without a raise. Christian said that she
could not give them a timeline for recalls, nor could she say
how many of them would be recalled, because Amglo was
transferring some work from Illinois to Mexico “because of
the situation.” By September 30, Amglo had recalled all but
22 employees. A month later, Amglo sent those 22 people a
letter stating that, in part because of the transfer of work to
Mexico, there were no jobs available. The letter informed the
employees that, if a job opened up, they would be recalled
before any new employee was hired. As of February 2012,
none of the 22 had been recalled.
B. Administrative Proceedings
The National Labor Relations Board includes a General
Counsel, who is responsible for investigating and prosecut-
ing unfair labor practices. It also includes a “Board,” which
is a quasi-judicial body that decides such cases. The General
4 Nos. 15-3695, 15-1141
Counsel is independent of the Board. See generally
https://www.nlrb.gov/who-we-are. Here, after an investiga-
tion, the General Counsel charged Amglo with unfair labor
practices.
An Administrative Law Judge held a hearing and issued
findings and conclusions, which were appealed to the Board.
The Board concluded that Amglo engaged in unfair labor
practices by: (1) threatening to fire employees for striking,
and (2) transferring work from Illinois to Mexico in retalia-
tion for the strike. The Board ordered Amglo to avoid taking
such actions in the future, to return the transferred work to
Illinois, to offer full reinstatement to any employee who lost
his or her job as a result of the transfer, and to make employ-
ees whole for earnings and benefits lost as a result of the
transfer.
The Board asks us to enforce its order, and Amglo asks us
to set it aside. 1
II. ANALYSIS
The National Labor Relations Act gives employees “the
right to … engage in … concerted activities for the purpose
of collective bargaining or other mutual aid or protection.”
29 U.S.C. § 157. It constitutes an “unfair labor practice” for
an employer to “interfere with, restrain, or coerce employees
1 Amglo’s challenge concerns only the transfer of work from Illinois
to Mexico. Amglo did not challenge the finding that it threatened to fire
workers for striking. So we summarily affirm the findings and remedial
orders on that issue. See NLRB v. Shelby Mem’l Hosp. Ass’n, 1 F.3d 550, 567
(7th Cir. 1993) (summarily affirming uncontested violations); NLRB v.
P*I*E Nationwide, Inc., 923 F.2d 506, 516 (7th Cir. 1991) (defenses waived
if not raised in opening brief).
Nos. 15-3695, 15-1141 5
in the exercise of” that right. Id. § 158(a)(1). The Board is
empowered to find the existence of an unfair labor practice,
and to issue remedial orders. Id. §§ 160(a), (c); see also Con-
temporary Cars, Inc. v. NLRB, 814 F.3d 859, 868 (7th Cir. 2016).
We have jurisdiction to enforce, modify, or set aside the
Board’s order. 29 U.S.C. §§ 160(e), (f).
Amglo does not challenge the Board’s finding that the
strike was protected activity under the Act. So our review is
only of the Board’s conclusion that Amglo violated the Act
by transferring work from Illinois to Mexico for the unlawful
purpose of retaliating against striking employees. See NLRB
v. Washington Aluminum Co., 370 U.S. 9, 14–17 (1962) (em-
ployer cannot “punish a man by discharging him for engag-
ing in concerted activities which § 7 of the Act protects”); St.
Regis Paper Co., 247 N.L.R.B. 745, 745 (1980) (transferring work
can constitute retaliation); Westpoint Transp., Inc., 222 N.L.R.B.
345, 352 (1976) (same). “We apply a deferential standard of
review to the Board’s findings, looking only to see whether
they are supported by substantial evidence. This means such
relevant evidence that a reasonable mind might accept as
adequate to support the conclusions of the Board. Our task is
not to reweigh the evidence; it is only to determine whether
there is evidence in the record supporting the Board’s out-
come that could satisfy a reasonable fact finder.” AutoNation
v. NLRB, 801 F.3d 767, 771 (7th Cir. 2015) (internal citations
and quotation marks omitted). “We review the Board’s ap-
plications of the law to the facts and its interpretations of the
Act deferentially as well, taking care to ensure that its legal
conclusions have a reasonable basis in law.” Id. (internal
quotation marks omitted).
6 Nos. 15-3695, 15-1141
Amglo acknowledges that it transferred some work from
Illinois to Mexico. Its purpose was unlawful if animus to-
ward the employees, because of the strike, was a “motivating
factor” for its action. See Molon Motor & Coil Corp. v. NLRB,
965 F.2d 523, 526 (7th Cir. 1992); Wright Line, Inc., 251 N.L.R.B.
1083, 1089 (1980). Finding that to be the case, the Board re-
lied on the following:
• Christian’s discussion of globalization implicitly
warned employees that if they continued striking,
Amglo would transfer work to a foreign facility.
• Amglo showed hostility to the strike, including by
threatening to fire half of the employees on the
first day.
• Christian told striking employees that Amglo was
moving work to Mexico “because of the situation.”
• During the General Counsel’s investigation, Czaj-
kowska admitted that Amglo “accelerated” exist-
ing plans to transfer work “because of the strike.”
• The timing of the transfer, so soon after the strike
began, was suspicious.
Also, in a separate section of its opinion, the Board noted
that Amglo had increased its workforce, from 85 to 94 em-
ployees, in the nine months prior to the strike—which un-
dercuts Amglo’s argument that the post-strike reduction was
for economic reasons. We are satisfied that substantial evi-
dence supports the Board’s finding that the strike was a mo-
tivating factor in Amglo’s transfer of some work to Mexico.
Amglo argues that the Board’s order cannot be enforced
because the General Counsel failed to prove the extent of the
Nos. 15-3695, 15-1141 7
unlawful transfer, meaning exactly how much work was
transferred to Mexico and how many employees were affect-
ed. But that is not required at this stage. As Amglo acknowl-
edges in its reply brief, the Board employs a “judicially ap-
proved bifurcation procedure” in which a first proceeding
determines whether an employer engaged in an unfair labor
practice, and a second proceeding determines the precise
contours of an appropriate remedy. See NLRB v. Trident Sea-
foods Co., 642 F.2d 1148, 1150 (9th Cir. 1980); see also Sure-Tan,
Inc. v. NLRB, 467 U.S. 883, 902 (1984) (approving Board’s bi-
furcated procedures); NLRB v. Katz’s Delicatessen of Houston
Street, Inc., 80 F.3d 755, 771 (2d Cir. 1996) (finding employer’s
challenge premature because compliance proceeding had
not yet occurred).
So the initial proceeding must show the existence of a vio-
lation, while the extent may be proved at the second stage.
But there is a nuance to that rule. It must be shown in the
first proceeding that the violation is not de minimis. Chal-
lenge-Cook Bros. of Ohio, Inc., 295 N.L.R.B. 435, 438 (1989). In
Challenge-Cook Brothers, the Board found that the employer’s
transfer of work to another plant violated the Act, and the
Board ordered backpay. Challenge-Cook Bros. of Ohio, Inc., 282
N.L.R.B. 21, 22 (1986). The Sixth Circuit enforced that order.
NLRB v. Challenge-Cook Bros. of Ohio, Inc., 843 F.2d 230 (6th
Cir. 1988). In the subsequent compliance proceeding, “the
quantity of work that was transferred and the number of
employees affected thereby [remained to] be determined.”
Challenge-Cook Bros. of Ohio, Inc., 295 N.L.R.B. at 435. But the
Board refused to let the employer argue that no employees
were affected, because that would amount to relitigating the
existence of a violation. Id. at 438.
8 Nos. 15-3695, 15-1141
Amglo argued that the amount of work transferred was
“miniscule.” To the extent this was an argument that no em-
ployees were adversely affected, the argument needed to be
addressed in the Board’s first proceeding. And it was. In re-
jecting the view that minimal work was transferred, the
Board relied on the following evidence:
• Amglo told a significant fraction of its employ-
ees—22 out of 94—that they could not return to
work in part because of the transfer of work to
Mexico.
• When more than 50 employees offered to return to
work without a raise, Christian could not give
them a timeline or say how many would be re-
hired, because of the transfer of work to Mexico.
Amglo points to different evidence to argue that the
transfer was minimal. But “[t]he presence of contrary evi-
dence does not compel us to reverse the Board’s order as
long as there is also substantial evidence supporting it.” Con-
temporary Cars, 814 F.3d at 868–69. Because the Board relied
on “such relevant evidence that a reasonable mind might ac-
cept as adequate to support the conclusions of the Board,”
AutoNation, 801 F.3d at 771, our review is complete.
III. CONCLUSION
We DENY Amglo’s petition for review and ENFORCE the
Board’s order.