In-N-Out Burger, Inc. v. Nat'l Labor Relations Bd.
Opinion
In April 2015, employees at an In-N-Out Burger in Austin, Texas wore buttons demonstrating solidarity with the "Fight for $15" campaign, a national movement advocating for a $15 per hour minimum wage, the right to form a union without intimidation, and other improvements for low-wage workers. 1 But when managers responded by invoking a company rule that prohibits employees from "wearing any type of pin or stickers" on their uniforms, the employees desisted. The National Labor Relations Board (the "Board" or "NLRB") found the company's rule unlawful under the National Labor Relations Act (the "Act" or "NLRA"). In-N-Out now asks this court to set aside the Board's order, while the Board asks us to enforce it. For the reasons stated below, we DENY In-N-Out's petition for review and GRANT the Board's cross-application for enforcement.
*712 I
In-N-Out Burger, Inc. owns and operates a chain of over 300 fast-food restaurants in California, Texas, and several other western states. In-N-Out requires its employees to follow a detailed appearance code and to wear a uniform consisting of "nine elements": white pants, a white shirt, white socks, black shoes, a black belt, a red apron, a gold apron pin, a company-issued name tag, and a hat. The company also maintains a rule in its employee handbook that states: "Wearing any type of pin or stickers is not permitted." In-N-Out strictly enforces its uniform policy and appearance rules.
On April 17, 2015, Amanda Healy, an employee at an In-N-Out restaurant in Austin, wore a "Fight for $15" button during work. The button was the size of a quarter and featured "$15" superimposed on an image of a raised fist.
No manager spoke to Healy about her button that day, but when employee David Nevels asked manager Daniel Moore if he could wear a "Fight for $15" button, Moore responded that the button was "not part of the In-N-Out uniform."
The following day, Healy again wore a "Fight for $15" button. This time, Moore questioned her about it. Healy told Moore that the button referred to a campaign by fast-food workers pursuing "a higher minimum wage, living wages." Moore asked Healy if she thought store manager Nick Palmini "would be okay" with her wearing the button. Healy replied that while she believed he would be, it was her understanding that Palmini could not ask her to remove the button. The conversation then ended. That same day, employee Brad Crowder wore a "Fight for $15" button similar to Healy's. An assistant manager reported Crowder to Palmini, who called Crowder to his office. Palmini asked Crowder if he was familiar with the company's uniform policy. Crowder replied that he was. Palmini then told Crowder that he could not add anything to the uniform and instructed Crowder to remove the button. Crowder complied but informed Palmini that he would be filing an unfair labor practice charge with the National Labor Relations Board.
Notwithstanding the "no pins or stickers" rule, In-N-Out requires its employees to wear company-issued buttons twice a year. During the Christmas season, employees are required to wear buttons stating "MERRY CHRISTMAS / IN-N-OUT HAMBURGERS / NO DELAY." During the month of April, employees must wear buttons soliciting donations to the In-N-Out Foundation, a nonprofit organization established by the company's owners that focuses on preventing child abuse and neglect. Those buttons read: "TEXT '4KIDS' TO 20222 TO DONATE / YOUR $5 WILL HELP PREVENT CHILD ABUSE / IN-N-OUT BURGER FOUNDATION." The In-N-Out Foundation buttons come in four variations, each featuring a picture of a different child. The Christmas and In-N-Out Foundation buttons are approximately three times larger in diameter than the "Fight for $15" buttons.
*713 Unfair labor practice charges were filed against In-N-Out, and following an investigation, the NLRB's General Counsel issued a complaint alleging that the company's "no pins or stickers" rule violated the National Labor Relations Act. An administrative law judge ("ALJ") held a hearing at which Healy, Palmini, Moore, and In-N-Out's vice president of operations, Robert J. Lang, Jr., testified. In-N-Out sought to demonstrate that its interest in maintaining a unique public image and its concern with ensuring food safety constituted "special circumstances" sufficient to justify the rule. The ALJ rejected the company's "special circumstances" defense, found that In-N-Out had committed unfair labor practices by maintaining and enforcing the "no pins or stickers" rule and by directing Crowder to remove his "Fight for $15" button, and issued a recommended order. In-N-Out then sought further review by the Board.
The Board's decision largely affirmed the ALJ's findings and conclusions.
In-N-Out Burger, Inc.
,
In-N-Out subsequently filed a petition for review of the Board's order with this court, and the Board cross-applied for enforcement.
See
*714 II
A
Judicial review of NLRB decisions and orders is limited and deferential. This court "will affirm the Board's legal conclusions 'if they have a reasonable basis in the law and are not inconsistent with the [National Labor Relations] Act,' "
Entergy Miss., Inc. v. NLRB
,
B
Section 7 of the National Labor Relations Act guarantees to employees "the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection."
Since the Act's earliest days, it has been recognized that Section 7 protects the right of employees to wear items-such as buttons, pins, and stickers-relating to terms and conditions of employment (including wages and hours), unionization, and other protected matters.
Republic Aviation Corp. v. NLRB
,
The Board has created a "narrow" exception to this rule, however: if an employer can demonstrate "special circumstances sufficient to outweigh [its] employees'
*715
Section 7 interests and legitimize the regulation of such insignia," then the right of employees to wear these items "may give way."
Pac. Bell Tel. Co.
,
First, the Board recognizes the "special circumstances" exception in only a limited number of situations, such as where permitting employees to display protected items would: (1) "jeopardize employee safety"; (2) "damage machinery or products"; (3) "exacerbate employee dissension"; or (4) "unreasonably interfere with a public image that the employer has established, as part of its business plan, through appearance rules for its employees."
P.S.K. Supermarkets, Inc.
,
When reviewing a Board decision involving the "special circumstances" test, courts must give considerable deference to this framework and to the Board's application
*716
of it to the evidence in the record. As the Supreme Court has held in the context of Board rules governing the right of employees to engage in union-related solicitation and distribution on the job, "[t]he judicial role is narrow: [t]he rule which the Board adopts is judicially reviewable for consistency with the Act, and for rationality, but if it satisfies those criteria, the Board's application of the rule, if supported by substantial evidence on the record as a whole, must be enforced."
Beth Israel Hosp.
,
III
By prohibiting employees from "[w]earing any type of pin or stickers," In-N-Out's rule restricts its employees' Section 7 rights and is therefore presumptively unlawful. In-N-Out contends, however, that its unique "public image" interest and its concern with maintaining food safety constitute "special circumstances" sufficient to overcome this presumption and justify the "no pins or stickers" rule.
A
We first consider In-N-Out's "public image" argument. To establish "special circumstances" based on a purported "public image" interest, In-N-Out was required to put forth substantial, non-speculative evidence that the wearing of protected items by employees would "unreasonably interfere" with a "public image" that the company "has established, as part of its business plan, through appearance rules for its employees," and then show that its "no pins or stickers" rule was "narrowly tailored" to those particular circumstances.
See, e.g.
,
Boch Imports
,
In-N-Out claims that its business plan has long been focused on fostering a "particularized public image," the "key component" of which "is that the customer experience should be consistent from one store to another." According to In-N-Out, the "core components" of this "consistent image" are: (1) a menu that has remained essentially unchanged since 1948; (2) a "sparkling clean environment" in which customers can see their food being prepared in kitchens surrounded by glass; (3) excellent customer service; (4) a business model in which all stores are owned by the company itself rather than by franchisees; and (5) employee uniforms consisting of "a limited number of specific identified elements," to which nothing can be added.
The Board "assum[ed]" that In-N-Out had "tried to create a business identity based on these factors" but concluded that most of these "core components" were "irrelevant" to the company's "special circumstances" defense. In particular, the Board found that In-N-Out failed to demonstrate a connection between the "no pins or stickers" rule and the company's asserted interests in preserving a consistent menu and ownership structure, ensuring excellent customer service, and maintaining a "sparkling clean" environment in its restaurants. The record amply supports the Board's determination in this respect.
The Board then evaluated In-N-Out's assertion that its interest in maintaining consistent, unadorned employee uniforms as part of its public image justified the "no pins or stickers" rule. At the outset, the Board correctly observed that In-N-Out had not established "special circumstances" based solely on the longstanding nature of its uniform and appearance policies, its strict adherence to those policies, or the fact that customers were likely to see any buttons worn by In-N-Out employees. The scope of the "public image"
*717 exception is exceedingly narrow, and it is well established that none of the following considerations, standing alone, justifies a rule restricting employees from wearing items protected by Section 7: an employer's requirement that employees wear uniforms or adhere to a dress code; 2 an employer's status as a retailer or service provider; 3 the fact that employees interact with the public or that customers may be exposed to employees displaying protected items; 4 or the possibility that an employer's customers might be offended by the items' content or message. 5
The Board also found that In-N-Out's requirement that its employees wear the Christmas and In-N-Out Foundation buttons undercut its claim that "special circumstances" required employee uniforms to be button-free.
See
Meijer, Inc.
,
In-N-Out contends that the Christmas and In-N-Out Foundation buttons do not undermine its "public image" argument because they are "part of the uniform." But this assertion hurts rather than helps the company's case. If the employee uniform-which In-N-Out describes as an integral component of its overall public image-changes several times each year, then either the company's interest in maintaining a "consistent" public image is not as great as it suggests, or, alternatively, the uniform does not play as critical a role in maintaining that public image as In-N-Out claims. As the Board observed, the Christmas
*718
and In-N-Out Foundation buttons are appreciably larger and "significantly more conspicuous" than the "Fight for $15" buttons. Since the addition of larger, more noticeable buttons to employee uniforms does not interfere with In-N-Out's public image, the Board permissibly concluded that allowing employees to wear smaller buttons protected by Section 7, such as the "Fight for $15" buttons, would not
unreasonably
interfere with the company's public image.
See
Boch Imports
,
Under Board law, an employer need not show "actual harm" in order to establish "special circumstances," but it must put forth specific, non-speculative evidence of the adverse effects it claims justify its restriction.
See
Medco Health
,
In-N-Out asserts that the Board's decision impermissibly conflicts with its previous decision in
Starwood Hotels & Resorts Worldwide, Inc.
,
This explanation is more than adequate to distinguish
W San Diego
from the present case. The Board may not contravene its own precedents without sufficient explanation, but "where [it] has not departed from a 'uniform rule,' the Board need not give a detailed rationale" for taking a different approach or reaching a different result.
Macy's, Inc. v. NLRB
,
*719
Boch Honda
,
Nor are we persuaded by In-N-Out's argument that
Davison-Paxon Co. v. NLRB
,
We uphold the Board's reasonable conclusion that In-N-Out failed to establish a "special circumstances" defense based on its "public image" interest.
B
In-N-Out also argues that it demonstrated "special circumstances" based on its concern with maintaining food safety.
See
W San Diego
,
As the Board explained in rejecting the company's food safety argument, In-N-Out's "no pins or stickers" rule banned
all
buttons other than its own, "without regard to their safety." Accordingly, even if In-N-Out had demonstrated a genuine basis for its food safety concerns-which it did not-it failed to show that its rule was "narrowly tailored" to that concern.
See
BochImports
,
*720 The Board's conclusion that In-N-Out failed to establish "special circumstances" based on its purported food safety concern is reasonable and supported by substantial evidence.
C
The Board properly rejected In-N-Out's "special circumstances" defense. Accordingly, we uphold the Board's findings that the company violated Section 8(a)(1) of the Act by maintaining and enforcing the "no pins or stickers" rule, and by instructing Crowder to remove his "Fight for $15" button. We also uphold the Board's finding that In-N-Out violated Section 8(a)(1) when Moore responded to Nevels' question about wearing a "Fight for $15" button by stating that the button was not a part of the uniform. As the Board explained, "an employee would reasonably infer from that statement that he was being told he could not wear the button."
See
Comcast Cablevision of Phila., L.P.
,
In-N-Out suggests that the Board's order is overbroad because it would require the company to allow buttons and pins of "any size" and "any construction[ ]" into its kitchens and dining rooms. Neither In-N-Out's exceptions to the ALJ's decision nor its supporting brief to the Board discussed this objection. Consequently, under Section 10(e) of the Act, we cannot review it.
IV
For these reasons, we DENY In-N-Out's petition for review and GRANT the Board's cross-application for enforcement.
See generally
Kate Andrias,
The New Labor Law
,
Pac. Bell Tel. Co.
,
Medco
,
NLRB v. Floridan Hotel of Tampa, Inc.
,
Casino Pauma
,
The Board adopted this discussion of W San Diego from the ALJ's decision. Two Board members disavowed the ALJ's discussion of "the scope of what might constitute a legitimate public image justification in circumstances outside the boundaries of this case ," (emphasis added) but, contrary to In-N-Out's assertion, they did not disavow the grounds on which the ALJ distinguished W San Diego from this particular case.
Furthermore, because In-N-Out raised this argument for the first time in its reply brief, it is waived.
Flex Frac Logistics
,
Reference
- Full Case Name
- In-N-OUT BURGER, INCORPORATED, Petitioner Cross-Respondent v. NATIONAL LABOR RELATIONS BOARD, Respondent Cross-Petitioner
- Cited By
- 11 cases
- Status
- Published