National Labor Relations Board v. Southwest Regional Council of Carpenters

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 14, 2012 Decided June 21, 2016
No. 11-1212
NATIONAL LABOR RELATIONS BOARD,
RESPONDENT
v.
SOUTHWEST REGIONAL COUNCIL OF CARPENTERS AND
GARNER/MORRISON LLC,
PETITIONERS
Consolidated with 11-1445, 11-1446
On Petitions for Review and Cross-Application for
Enforcement of Orders of the National Labor Relations Board
James A. Bowles argued the cause for petitioners. With
him on the brief was Daniel M. Shanley.
Nina Schichor, 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 Julie
Broido, Supervisory Attorney. Jeffrey W. Burritt, Attorney,
entered an appearance.
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Before: GRIFFITH, Circuit Judge, WILLIAMS and
SENTELLE, Senior Circuit Judges.
GRIFFITH, Circuit Judge: This matter comes before us on
petitions for review and cross-application for enforcement of
orders of the National Labor Relations Board finding that both
the company and the union committed unfair labor practices.
After oral argument, we held this case in abeyance pending the
Supreme Court’s consideration of the validity of the
President’s recess appointments to fill vacancies on the Board
in NLRB v. Noel Canning, 134 S. Ct. 2550 (2014). Member
Becker, who was on the Board panel in this case, had been
appointed to the Board by the President during a 17-day
intra-session recess of the Senate. Following the Supreme
Court’s decision, this court held that Becker’s appointment
was valid. See Mathew Enter. v. NLRB, 771 F.3d 812, 814
(D.C. Cir. 2014). Following that decision, we removed this
case from abeyance. We now hold that the Board’s orders
failed to provide a reasoned justification for departing from
precedent and we grant the petitions for review, vacate the
orders, and remand.
I
Garner/Morrison, LLC (G/M) is a construction company
that provides drywall installation and painting services for
office buildings and commercial construction sites. Founded in
November 2003 by its current owners, Cliff Garner, his son
Gary Travis Garner, and Chris Morrison, G/M hired its first
employee, a carpenter, in December 2003 and immediately
entered into a collective-bargaining agreement with the
Southwest Regional Council of Carpenters (the Carpenters
Union). The agreement established the Carpenters Union as the
bargaining representative of any carpenter hired by G/M, as
well as any painters or tapers the company employed unless
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they were covered by a separate agreement with the
International Union of Painters and Allied Trades (the Painters
Union).
In April 2004, G/M hired painters and tapers who were not
already covered by a collective-bargaining agreement. In short
order, G/M entered into an agreement with the Painters Union
that covered those new hires. The agreements were set to last
until March 31, 2007. As that date approached, G/M, which
had grown dissatisfied with the Painters Union, began to
explore whether the Carpenters Union would cover its painters
and tapers. Representatives of the Carpenters Union told the
management of G/M that once the company’s agreements with
the Painters Union expired, the Carpenters Union, pursuant to
its agreement with G/M, would automatically offer health and
pension benefits to the newly hired painters and tapers. G/M
decided to let its collective-bargaining agreements with the
Painters Union expire and asked the Carpenters Union to meet
with the company’s painters and tapers.
The Carpenters Union scheduled a meeting for April 2,
2007, after working hours, in a hotel conference room. The
Union chose the time and place of the meeting and paid for the
conference room. G/M encouraged painters and tapers to go to
the meeting, but in no sense was their attendance mandatory.
All but one or two of the 25 or so painters and tapers at G/M
attended. Also present were 15 or 16 representatives from the
Carpenters Union, three employees from a health insurance
company that worked with the Carpenters Union, the three
owners of G/M, and one of their superintendents.
The conference room where the meeting was held was
large—about 75 feet long by 50 feet wide. At the front of the
room, several representatives of the Carpenters Union sat at a
table. G/M’s three owners and a superintendent sat in the first
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row of seats. The painters and tapers sat in rows behind them.
At two tables at the back of the room—some 65 feet away from
the front table—sat other representatives of the Carpenters
Union and employees of the health insurer.
As the meeting began, G/M owner Morrison told the
painters and tapers to listen to the Carpenters Union’s
presentation, which the company thought was “a good deal.” It
was the view of the company, he explained, that the Carpenters
Union was a “better choice” for the employees than the
Painters Union and “probably the way we want to go.”
Morrison’s comments endorsing the Carpenters Union took no
more than a few minutes. Following his remarks,
representatives of the Carpenters Union made their case for
why the painters and tapers should join with them, highlighting
the insurance benefits provided by the Carpenters Union, as
well as the wages the painters and tapers would receive if they
joined. They also explained how to pay dues. Their
presentation took about an hour, including time for questions
and answers. Finally, they told the painters and tapers that there
would be a sign-up in the back of the conference room. At that
point, the painters and tapers went to the back of the room
where agents from the health insurance company gave them
information on the benefits packages available through the
Carpenters Union, and Carpenters Union representatives urged
the employees to sign union authorization cards to signal that
they wanted to “designate the [Carpenters] [U]nion as their
collective-bargaining representative.” Pa. State Educ.
Ass’n-NEA v. NLRB, 79 F.3d 139, 143 (D.C. Cir. 1996).
During this entire time, the G/M owners and
superintendent stayed at the front of the room. They did not
join their employees in the back of the room with the
representatives of the Carpenters Union and the insurance
company. From about 60 or 70 feet away, the owners said that
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they could see the employees’ movements in the back of the
room, but they could not hear their conversations or see
whether they were signing authorization cards. After the
painters and tapers had spent several minutes with them in the
back of the room, the representatives of the Carpenters Union
walked to the front of the room and gave Morrison and fellow
owner Travis Garner signed union authorization cards from the
majority of G/M’s painters and tapers. They asked for
recognition of the Carpenters Union as the exclusive
bargaining agent of G/M’s painters and tapers. See 29 U.S.C.
§ 159(a). The owners of G/M signed an agreement on the spot.
That very day, the Painters Union filed election petitions
with the Board seeking to represent G/M’s painters and tapers
once again. The Painters Union faxed the petitions to G/M’s
office at the same time representatives of the Carpenters Union
were meeting with G/M’s owners and employees in the
conference room of the hotel. The G/M owners did not see the
petitions until they returned from the meeting, where they had
already signed an agreement that the Carpenters Union would
represent the painters and tapers.
The Painters Union filed an unfair labor practice charge
with the Board, and the General Counsel issued a complaint
alleging that G/M violated section 8(a)(1) of the NLRA by
engaging in unlawful surveillance of the painters and tapers at
the April 2 meeting. An employer’s surveillance of employees
is unlawful under section 8(a)(1) where it “interfere[s] with,
restrain[s], or coerce[s] employees in the exercise” of their
collective-bargaining rights. 29 U.S.C. § 158(a)(1); see also
Gold Coast Rest. Corp. v. NLRB, 995 F.2d 257, 266 (D.C. Cir.
1993), amended, No. 91-1533, 1993 WL 444597 (D.C. Cir.
Oct. 25, 1993). The complaint also alleged that G/M violated
section 8(a)(2) of the NLRA, which prohibits an employer
from unlawfully assisting a union, by being present at the
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meeting while the Carpenters Union collected authorization
cards and unlawfully recognizing the Carpenters Union as the
bargaining representative of the painters and tapers. See 29
U.S.C. § 158(a)(2). Finally, the complaint alleged that the
Carpenters Union improperly accepted G/M’s unlawful
recognition and assistance. See id. § 158(b)(1)(A).
After a two-day hearing, the ALJ recommended
dismissing the complaint. As to the allegation of unlawful
surveillance, the ALJ found that the presence of the company’s
owners at the meeting “had no tendency whatsoever toward
interfering with, restraining, or coercing the painters and tapers
in the exercise of their rights” under section 8(a)(1). As to the
section 8(a)(2) charge, the ALJ found “no evidence whatsoever
of illegal assistance” by G/M because the Carpenters Union
paid for the hotel and ran the meeting. And given that G/M did
not provide any illegal assistance, the ALJ concluded that the
Carpenters Union could not have unlawfully accepted such
assistance under section 8(b)(1)(A).
The Painters Union and the General Counsel filed
exceptions to the ALJ’s decision. A two-member panel of the
Board reversed the ALJ, concluding that G/M had engaged in
unlawful surveillance and had provided unlawful assistance to
the Carpenters Union, which the Carpenters Union unlawfully
accepted. Garner/Morrison, LLC, 353 N.L.R.B. No. 78 (2009).
G/M and the Carpenters Union petitioned for review in this
court. In light of the Supreme Court’s decision in New Process
Steel, L.P. v. NLRB, 130 S. Ct. 2635 (2010), which held that
Board panels with only two members lack authority to issue
decisions, we remanded the case to the Board for decision by a
three-member panel.
On remand, a panel of Chairman Liebman and members
Becker and Pearce unanimously adopted the Board’s previous
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decision, finding that the critical evidence that established a
violation of section 8(a)(1) was the G/M owners’ “presen[ce]
in the room while the employees were solicited to sign the
Carpenters’ documents and while employees responded to that
solicitation by proceeding to the back of the room where
documents were signed.” Garner/Morrison, LLC, 356
N.L.R.B. No. 163 (2011) (citing Morehead City Garment Co.,
94 N.L.R.B. No. 45 (1951)). The Board concluded that, “even
assuming the [G/M] executives could not see the exact
documents that were signed,” their presence “constituted
unlawful surveillance for the purpose of influencing
employees to switch their allegiance to the Carpenters.” Id.
And, due to “the unlawful surveillance that tainted acquisition
of a majority” of employees supporting the Carpenters Union,
the Board concluded that G/M unlawfully assisted the
Carpenters Union, which unlawfully accepted that help. To
remedy these unfair labor practices, the Board issued an order
that G/M cease recognition of the Carpenters Union as the
representative of the painters and tapers. Id.
G/M and the Carpenters Union filed a motion for
reconsideration, arguing that the Board’s determination had
ignored its holding in Coamo Knitting Mills, Inc., 150
N.L.R.B. No. 35 (1964), which was on point and controlling.
The Board thought otherwise, concluding that Coamo was a
much different case.
G/M and the Carpenters Union petition for review and the
Board cross-applies for enforcement of its orders. We have
jurisdiction under 29 U.S.C. § 160(e), (f).
II
We give “a very high degree of deference to
administrative adjudications by the NLRB.” Bally’s Park
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Place, Inc. v. NLRB, 646 F.3d 929, 935 (D.C. Cir. 2011). But
our deference is not absolute. We will overturn the Board if its
“factual findings are not supported by substantial evidence,” or
if it “acted arbitrarily or otherwise erred in applying
established law to the facts of the case.” Comau, Inc. v. NLRB,
671 F.3d 1232, 1236 (D.C. Cir. 2012). A decision of the Board
that “departs from established precedent without a reasoned
explanation” is arbitrary. Id. Of course, the Board need not
address “every conceivably relevant line of precedent in [its]
archives,” but it must discuss “precedent directly on point.”
Lone Mountain Processing, Inc. v. Sec’y of Labor, 709 F.3d
1161, 1164 (D.C. Cir. 2013).
G/M and the Carpenters Union argue that the Board’s
decision was arbitrary and capricious because the Board did
not provide a reasoned justification for its departure from
Coamo Knitting Mills. We agree.
In Coamo, the General Counsel alleged that the company
had provided unlawful assistance and support to a union that
the union unlawfully accepted. 150 N.L.R.B. No. 35 at 583,
589. The charges stemmed in part from a meeting of the union
and the company’s employees. The Board found that the day
before the meeting, the company’s vice president urged his
employees to join the union. At the meeting, the vice president
introduced the union representative, then left, but another
member of management stayed. After a union representative
made his pitch to the employees to join the union, his
associates gave them authorization cards. Enough employees
signed the authorization cards to gain majority support for the
union. All this took place in the presence of a member of
company management. Id. at 581-82, 586.
At the trial, the examiner (now called an ALJ) determined
that the company and the union violated NLRA section 8, in
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part because the presence of management at the meeting
“necessarily had a coercive effect” on the employees. Id. at
589. The Board, however, disagreed. The representative of
management who stayed at the meeting testified that he could
not see the employees signing cards. Another witness
corroborated his testimony. Id. at 581-82. Further, company
management “made no attempt to ascertain which employees
even attended the meeting.” Id. at 582. According to the Board,
the “mere presence” of a member of management was not
coercive and therefore did not violate section 8. Id. at 582-83.
Coamo closely resembles this case. In both, the union held
a meeting for the company’s employees. In both, management
made statements in support of the union. In both, management
was present while union representatives spoke to employees
about why they should join the union and urged the employees
to sign union authorization cards. And in both, the signing of
those cards led to majority support for the union. Importantly,
in neither case did the Board conclude that the company
representative(s) saw what the employees were signing.
Not only are the facts in Coamo similar to the facts here,
but the legal issues in Coamo mirror those here. In both cases,
the Board examined whether the presence of management at a
union meeting where employees signed authorization cards
violated section 8(a)(1) and (a)(2). In both cases, the Board
looked at whether that conduct resulted in the union accepting
unlawful assistance under section 8(b)(1)(A).
The similarities between Coamo and the present case are
“significant enough” that the Board needed to provide a
reasoned explanation why Coamo “does not apply, or why
departure from [Coamo] is warranted.” Lone Mountain, 709
F.3d at 1164. The Board attempted to distinguish this case
from Coamo on the ground that Coamo did not involve a claim
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of unlawful surveillance. Although the Board in Coamo never
used the phrase “unlawful surveillance,” that is a distinction
without a difference. “Unlawful surveillance” is not a separate
statutory violation or cause of action in the NLRA. Section 8 of
the NLRA does not mention “unlawful surveillance”; instead it
prohibits an employer from “interfer[ing] with, restrain[ing],
or coerc[ing] employees in the exercise” of their protected
rights, 29 U.S.C. § 158(a)(1), and from “dominat[ing] or
interfer[ing] with the formation or administration of any labor
organization,” id. § 158(a)(2). As used by the Board and this
court, “unlawful surveillance” is simply shorthand for a type of
conduct that “interferes with, restrains or coerces the employee
in the exercise of protected organizational activities.” Gold
Coast, 995 F.2d at 266. The Board evaluated nearly identical
conduct and the same legal questions here and in Coamo. The
only material difference was the result. Without any other
justification for distinguishing Coamo, the Board’s decision
cannot stand.
In its brief to this court, the Board offers new reasons for
not following Coamo in this case. The Board contends that the
facts here are “starkly different” from those in Coamo because
G/M “corralled its employees to an off-site meeting” where all
the G/M owners “could watch as the Carpenters solicited
employees to sign cards.” Resp’t Br. at 29. Even if the Board
had explained the relevance of these alleged factual
differences, we cannot address this argument because it did not
appear in the Board’s orders below. We “may consider only the
Board’s own reasons, not the rationalizations of counsel.”
Charlotte Amphitheater Corp. v. NLRB, 82 F.3d 1074, 1080
(D.C. Cir. 1996) (citing SEC v. Chenery Corp., 318 U.S. 80, 95
(1943)). The Board’s order denying reconsideration relies
solely on the absence of a claim of unlawful surveillance in
distinguishing Coamo, not on any factual differences between
the cases. Accordingly, we “reject[ ] the temptation to supply
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reasons to support the Board’s decision that the Board itself has
not offered.” Detroit Newspaper Agency v. NLRB, 435 F.3d
302, 311 (D.C. Cir. 2006). We note, however, that nothing
precludes the Board from making such a distinction on remand
if supported by the record. See Lone Mountain, 709 F.3d at
1164.
G/M and the Carpenters Union also assert that the Board’s
decision was not based on substantial evidence and the Board’s
remedy was improper. Because we hold that the Board did not
adequately distinguish Coamo and grant the petitions for
review on that ground, we need not reach the remaining
arguments.
III
We grant the petitions for review, deny the Board’s
cross-application for enforcement, vacate the Board’s orders,
and remand.