National Labor Relations Board v. Eastern Smelting & Refining Corp.
Opinion of the Court
The fact that four cases involving, broadly, a single principle on which this Circuit and the National Labor Relations Board have been in disagreement for over a decade, were heard in a single week, suggests that we should once more consolidate past decisions and set out our views. The issue is the proper analysis in cases challenging the discharge of an employee under sections 8(a)(1) and (3) of the Act. 29 U.S.C. §§ 158(a)(1) and (3) (1976). Because three of these cases raise the question in a variety of illustrative ways, we treat them in this one opinion.
Historically, the Board is prone to two errors: labelling the good reason “pretextual” without giving it adequate consideration,
O. No basis for finding a bad reason.
1. Bad reason, and “pretextual” good reason.
(a) Evidence supporting asserted good reason is insubstantial or not credited.
(b) Alleged good reason was not a motivation at all.
2. Bad reason and good reason.
(a) Good reason existed, but was insufficient without bad reason.
(b) Good reason would, of itself, have produced the action.
In types 0 and 2(b) the finding must be for the employer.
Admittedly, it is not always easy to determine in which category a particular case falls.
The difficulties intensify when the Board has no independent evidence, and must find improper motivation in the circumstances of the discharge itself. This requires affirmative showing. Hiring and firing decisions are made routinely, and are not inherently improper even though they may occur at a time embarrassing to the union. If an employer asserts an obviously weak or implausible good reason, or one
Even if the Board can meet its burden of demonstrating improper motivation, the matter does not end there. The employer may still defend by proving that there was a good reason for the discharge and that “it would have reached the same decision . . . even in the absence of the protected conduct.” Mt. Healthy City Board of Educ. v. Doyle, 1977, 429 U.S. 274, 287, 97 S.Ct. 568, 576, 50 L.Ed.2d 471. The Board has never mentioned Mt. Healthy, let alone explained why it should be thought less serious to violate the First Amendment than the Labor Act.
The Board’s persistent disregard of the principles governing mixed motive cases ultimately led to our announcing that we would no longer “rescue [it] if it does not both articulate and apply our rule.” Coletti’s Furniture, Inc. v. NLRB, 1 Cir., 1977, 550 F.2d 1292, 1293. Even this has not been fully effective.
Eastern Smelting & Refining Corp.
Before reaching the bad reason discharge issue in this case, we dispose of a section 8(a)(1) charge based upon allegedly threatening statements made to employees during the early stages of an organizational drive. On October 21, 1977 one Berg, a recently hired employee who had already compiled an admittedly bad record for absenteeism, distributed authorization cards obtained from a union organizer the previous day. The company learned promptly that cards were circulating, and that afternoon its manager, Wandry, began interviewing employees individually. There was conflicting testimony as to what was said. According to respondent’s evidence, Wan-dry essentially followed a prepared written script, telling the employees that there had been a strike 14 years before with unfortunate consequences for both sides, and that “as a result of the strike, a number of people were replaced and they had lost their jobs.” The ALJ, accepting the employees’ somewhat different version, found, however, that Wandry had said only, in various summary forms, “A strike occurred and employees lost their jobs.” He found this coercive, and the Board agreed.
Apart from Berg’s later discharge, post, no other allegations against the company have been raised.
We have no reason to question the ALJ’s findings as to what was said. The conclusion that the manager’s statement unlawfully coerced the employees is, however, another matter. The Board does not claim that the statement was not an accurate, if somewhat cryptic, account of historical fact. Not only under the First Amendment, but under section 8(c) of the Act, such is normally protected. We can agree with the Board that the recitation of past events, could, under the circumstances, be taken as implying that the events could reoccur. That a union might call a strike, however, is a simple fact of life. So is the possibility that it may be unsuccessful. To state either cannot be condemned by the process of calling it a threat; the employer is not restricted to pleasant facts. If there was an implication in the statement that this company had weathered a strike in the past that, too, was a simple fact.
If the past event had involved a wrongful act, e. g., an unfair labor practice strike and the employees had not been reinstated, recounting it could be understood as a threat that such unlawful conduct might be repeated. Wandry’s account had no such connotation; nor did the Board so suggest. Respondent’s failure to state the full sequence, viz., that some employees had been replaced and not recalled, and its summary form that they had “lost their jobs” is not significant, cf. NLRB v. Rollins Telecasting, Inc., 2 Cir., 1974, 494 F.2d 80, 82, cert. denied, 419 U.S. 964, 95 S.Ct. 224, 42 L.Ed.2d 178; the test is the “total effect.” NLRB v. Four Winds Industries, Inc., 9 Cir., 1976, 530 F.2d 75, 78. Plainly, the present case was not an exaggerated effect, such as we condemned in NLRB v. Sinclair Co., 1 Cir., 1968, 397 F.2d 157, aff’d sub. nom. NLRB v. Gissel Packing Co., 1969, 395 U.S. 575, 89 S.Ct. 1918, 23 L.Ed.2d 547. The Board gave no reason why it considered it a threat. We see none. Indeed, absent some special ground for believing it untrue, we consider it extraordinary to forbid a simple prophecy, implied or express, that proper past events may reoccur. Cf. NLRB v. Gissel Packing Co., ante, at 618; NLRB v.
Taking off from this finding of misconduct,
Although there is no direct evidence, we readily assume that respondent knew that Berg was the employee who had originated the cards. It is also clear that respondent was opposed to unionization. Neither of these factors sustained the Board’s burden of proof. There being nothing else, it must look to the circumstances surrounding the discharge itself to satisfy it. The ALJ’s approach was to analyze in detail the absentee records of six other employees, concluding that Berg’s record “was not appreciably different from other employees who were given suspensions rather than discharges.” From this he concluded that Berg’s treatment was “significantly disparate and the Company’s ascribed reasons for the action are not credited.”
We do not question the Board’s right to disbelieve witnesses. At the same time, when it draws inferences from admitted facts, it must do so fairly, and with full recognition of the burden of proof. As we have said, it is important in cases involving business judgment that the Board not set up its own standard, and then conclude that, since the employer had another, it was ipso facto suspect. The significant phrase in the foregoing quotations is “was not appreciably different.” What is appreciable is in the eye of the beholder. The ALJ ignored the fact that the great majority of Berg’s absences, unlike those of the other employees, occurred the day following payday — obviously suggestive of a lack of a bona fide excuse. A matter that he could not ignore, the fact that respondent discharged employee Nelson, whose record was highly similar, the ALJ sought to brush aside by referring to the fact that Berg had been complimented on his work, and had received a raise, and there was no such evidence as to Nelson.
Very possibly if the burden had been on it as a vulnerable respondent to establish its good faith, we could not say that respondent here had incontrovertibly succeeded. However, it was not vulnerable. The burden was on the Board, and the Board failed to show an impropriety affirmatively warranting a finding of an improper motive. To overrule a business judgment, the Board is in the same position as is a court overruling the Board. It cannot overcome a showing of reasonableness simply by concluding that some other action would seem to it more reasonable. Cf. Universal Camera Corp. v. NLRB, 1951, 340 U.S. 474, 488, 71 S.Ct. 456, 95 L.Ed. 456. If that were so, every action of an employer involving known union supporters would be at risk.
Barnes & Noble Bookstores, Inc.
The Board here found that respondent’s layoff (in fact a discharge) during a union campaign, of one Diamond, a clerk in the children’s book department of its Boston store, was illegally based on Diamond’s pro-union activities. Asserted good reasons for the discharge — overstaffing in the children’s department, and Diamond’s overqualification for the job by virtue of his recently completed legal education — were rejected by the Board as pretextual. Unhappily, again the Board misstated the applicable legal principles.
The record bears out the preliminary findings that respondent, through its president, Riggio, and its Boston general manager, Oviatt, knew of Diamond’s union activities, and that its actions independent of the discharge reflected unlawful anti-union animus.
There is a further issue in this case, a section 8(a)(1) charge based on respondent’s granting benefits — insurance—to part-time employees during the organization campaign. Respondent counters that its Boston branch is but one of 24 stores of a New York based company, and that it would be absurd to find this was done, company wide, in order to affect an election in a single store. The Board replies that respondent may have already determined, for a proper cause, to grant such benefits generally, but adjusted its timing to meet its Boston problem. To this respondent made no answer, leaving a singular absence of records on an issue affecting 24 stores. There being no established practice to point to, the Board was warranted in concluding that respondent had failed to meet its burden applicable in section 8(a)(1) cases, of showing that the , added benefits were granted in the ordinary course. NLRB v. Rich’s of Plymouth, ante, at 883-84; NLRB v. Styletek, Div. of Pandel-Bradford, Inc., 1 Cir., 1975, 520 F.2d 275, 280-82.
Wonder Markets, Inc.
This case started out conventionally, but developed in an unusual fashion. Respondent market, during a prolonged organizational campaign, discharged a meat cutter, Whitney. General Counsel asserted it was because of anti-union animus; respondent claimed that declining business required eliminating a meat cutter — a highly paid position — and that Whitney had the least seniority. The ALJ warrantably found conduct independent of the discharge itself demonstrating unlawful anti-union animus, namely, unlawful threats seeking to dissuade Whitney from advocating the union, adding, “I further find that such warnings evidence the reason for Whitney’s [discharge].” This properly put the burden on the respondent of showing good cause for the discharge. It so proceeded, but the ALJ analyzed respondent’s admittedly fluctuating and allegedly declining sales and concluded that they did not conform to respondent’s negative interpretation, and that there was no need of reducing staff.
In first finding independent evidence of bad motive, then analyzing and rejecting on the merits respondent’s asserted good reason and drawing certain inferences therefrom, the ALJ followed exactly the right course. Since he neither cited any of our cases, nor stated that his procedure was obligatory, we do not know whether he was correct because he so recognized, or simply as a matter of good judgment. In any event, his approach went to naught when the case came before the Board and it agreed with respondent that the ALJ’s analysis of its sales data had been faulty. Instead of then making its own analysis and determining whether there was an independent good reason for the discharge, the Board stated that the ALJ’s error was irrelevant because his finding that the discharge was improperly motivated was correct, viz., was all that needed to be done.
Since the evidence would at least have warranted a finding that respondent had a valid reason for reducing the number of
The ALJ with some justification questioned respondent’s good faith, even though he relied in part on factors we consider erroneous.
We need spend no words on respondent’s attack on the Board’s finding that in subsequently offering Whitney a position as a manager trainee it failed to meet its obligation to offer an equivalent position. For a number of reasons Whitney could properly be unwilling to assume the additional duties. Respondent’s further challenge to the computation of back pay need not be reached, as it has not been presented to the Board. 29 U.S.C. § 160(e) (1976); Cf. NLRB v. Seven-Up Bottling Co., 1953, 344 U.S. 344, 73 S.Ct. 287, 97 L.Ed. 377; NLRB v. Otis Hospital, 1 Cir., 1976, 545 F.2d 252, 257.
The Board’s petition in No. 78-1453 is denied. In No. 78-1452 and No. 78-1370, as well as No. 78-1422, the orders will be enforced.
. The fourth case, NLRB v. McCain Foods, Inc., No. 78-1422, requires no treatment in text. Substantial evidence supports the findings, and the ALJ’s well reasoned analysis, adopted by the Board, applies the correct legal principles. Therefore we enforce the Board’s order on the basis of its opinion, pursuant to our general ’ discussion herein. We need note further only our rejection of respondent’s claim that a more exacting standard than that applicable to discharge cases should be required in failure-to-hire cases. Cf. NLRB v. New England Tank Ind., Inc., 1 Cir., 1962, 302 F.2d 273, cert. denied, 371 U.S. 875, 83 S.Ct. 147, 9 L.Ed.2d 114. As a practical matter, the difficulty of proof may vary, cf. NLRB v. Rich’s of Plymouth, Inc., 1 Cir., 1978, 578 F.2d 880, 886, but the legal principles must be the same.
. E. g., Liberty Mut. Ins. Co. v. NLRB, ante, at 601; NLRB v. Rich’s of Plymouth, Inc., ante, at 886 & n.7; NLRB v. Fibers Int’l Corp., 1 Cir., 1971, 439 F.2d 1311, 1313-15; NLRB v. Billen Shoe Co., 1 Cir., 1968, 397 F.2d 801; cf. Stone & Webster Eng. Corp. v. NLRB, 1 Cir., 1976, 536 F.2d 461; NLRB v. Agawam Food Mart, Inc., 1 Cir., 1970, 424 F.2d 1045.
. E. g., Coletti's Furniture, Inc. v. NLRB, 1 Cir., 1977, 550 F.2d 1292; cf. Hubbard Regional Hospital v. NLRB, 1 Cir., 1978, 579 F.2d 1251, 1254-56; NLRB v. Lowell Sun Pub. Co., 1 Cir., 1963, 320 F.2d 835.
. Conversely, we recognize, and warn, that formulism itself presents a danger, and cannot be a substitute for hard analysis.
. “The expressing of any views, argument, or opinion . . . shall not constitute or be evidence of an unfair labor practice . if such expression contains no threat of reprisal or force or promise of benefit.” 29 U.S.C. § 158(c) (1976).
. See, e. g., NLRB v. Lowell Sun Pub. Co., 1 Cir., 1963, 320 F.2d 835, 840; NLRB v. New England Tank Ind., Inc., 1 Cir., 1962, 302 F.2d 273, 276 & n.4, cert. denied, 371 U.S. 875, 83 S.ct. 147, 9 L.Ed.2d 114; Indiana Metal Prod. Corp. v. NLRB, 7 Cir., 1953, 202 F.2d 613, 617; Pittsburgh S.S. Co. v. NLRB, 6 Cir., 1950, 180 F.2d 731, 735-36, aff'd, 340 U.S. 498, 71 S.Ct. 453, 95 L.Ed. 479; cf. Wal-Lite Div. of U.S. Gypsum Co. v. NLRB, 8 Cir., 1973, 484 F.2d 108, 112.
. Over the years we have observed that our decisions restricting the Board are rarely cited by it, no matter how pertinent, a seeming symbolic bookburning difficult to ascribe to oversight.
. E. g., Raytheon Co. v. NLRB, 1 Cir., 1964, 326 F.2d 471; NLRB v. Prince Macaroni Mfg. Co., ante; Stone & Webster Eng. Corp. v. NLRB, 1 Cir., 1976, 536 F.2d 461.
. E. g., Liberty Mut. Ins. Co. v. NLRB, ante; NLRB v. Fibers Int’l Corp., 1 Cir., 1971, 439 F.2d 1311; NLRB v. Billen Shoe Co., 1 Cir., 1968, 397 F.2d 801.
. Mt. Healthy and Givhan v. Western Line Consol. School Dist., - U.S. -, 99 S.Ct. 693, 58 L.Ed.2d 619 (79), are not labor cases, but involved the discharge of teachers by school boards assertedly because they had engaged in constitutionally protected speech. As we pointed out in Coletti’s Furniture, Inc. v. NLRB, 1 Cir., 1977, 550 F.2d 1292, 1293, the principle is the same. See, also Waterbury Community Antenna, Inc. v. NLRB, 2 Cir., 1978, 587 F.2d 90, 99.
. E. g., Liberty Mut. Ins. Co. v. NLRB, ante, at 602-603; Hubbard Regional Hospital v. NLRB, 1 Cir., 1978, 579 F.2d 1251, 1255; NLRB v. Rich’s of Plymouth, Inc., ante, 887-88; Coletti’s Furniture, Inc. v. NLRB, ante, at 1293.
. Even here, however, we caution that the Board may not simply substitute its judgment for that of the employer, and may not reject the employer’s proof, absent a reasonable basis. Compare Eastern Smelting & Refining Corp., post, with Barnes & Noble Bookstores, Inc., post; see, also Wonder Markets, Inc., post.
. Cf. Liberty Mut. Ins. Co. v. NLRB, ante, Barnes & Noble Bookstores, Inc., post; but cf. NLRB v. Jack August Enterprises, Inc., 1 Cir., 1978, 583 F.2d 575; McCain Foods, Inc., note 1, ante.
. An unconnected threatening statement, made to one employee, was held by the ALJ not chargeable as an unfair labor practice because not pleaded. It is not relied on here by the Board, and we disregard it.
. If we can be forgiven a poor pun, respondent faced the Berg issue with a strike on it when, in fact, its record was clean.
. Here, again, is an example of what apparently is expected of an employer, though it is up to the Board to prove a case and not up to the respondent to disprove it.
. Particularly, second guessing by every ALJ, whose resolution, under announced Board principles, including the instant case, will not be overruled unless “the clear preponderance of all the relevant evidence convinces us. . . ”
. It is altogether inexplicable that at this late date, June, 1978, an ALJ could say,
“The existence of justifiable grounds for the layoff is no defense if the motivation for the layoff was in part because of the employee’s participation in union activities.”
Equally inexplicable is the Board’s silent adoption.
. In addition to the improper promise of insurance benefits, post, respondent had committed various other unfair labor practices while opposing a union drive in its New York stores.
. "|T]his error does not affect the validity of the Administrative Law Judge’s conclusion that Whitney was laid off because of his union activity and not for economic reasons.” 236 N.L. R.B. No. 81, n.1.
. The ALJ’s complaint that respondent used seniority as the basis for selecting the cutter to be discharged (thereby removing Whitney)— without suggesting what other basis would have been preferable — is an example of damned-if-you-do and damned-if-you-don’t. One can readily imagine what would have been said if respondent had removed Whitney by going against seniority. We mention this because it is a method of meeting its burden of proof that too often appeals: once it is concluded that an employer is opposed to unions, everything fits. That this is not idle speculation on our part, see NLRB v. Wells Fargo Armored Service Corp., ante, where the Board held against an employer whose only offense was not respecting seniority in recalling economic strikers.
Reference
- Full Case Name
- NATIONAL LABOR RELATIONS BOARD v. EASTERN SMELTING AND REFINING CORPORATION, Respondent NATIONAL LABOR RELATIONS BOARD v. BARNES AND NOBLE BOOKSTORES, INC., and NATIONAL LABOR RELATIONS BOARD v. WONDER MARKETS, INC.
- Cited By
- 2 cases
- Status
- Published