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Summary of NLRB Decisions for Week of January 9-13, 2012

The Weekly Summary is provided for informational purposes only and is not intended to substitute for the opinions of the NLRB.  Inquiries should be directed to the Office of Public Affairs at Publicinfo@nlrb.gov or 202-273-1991. Note: Some of the following Board decisions were issued earlier than the current week.  

Summarized Board Decisions

Milum Textile Services Co. (28–CA–20898, et al.; 357 NLRB No. 169) Phoenix, AZ, December 30, 2011.

This case arose from the Union’s efforts to organize the Respondent’s laundry workers.  The Board adopted the Administrative Law Judge’s findings, in the absence of exceptions, that the Respondent violated Section 8(a)(1) of the Act by granting employees the benefit of providing name tags, impliedly threatening to reduce employees’ wages if they selected the Union, and interrogating employees.  The Board also adopted the judge’s findings that the Respondent violated Section 8(a)(1) by promulgating and maintaining a rule prohibiting employees from wearing union buttons while working; and violated Section 8(a)(3) and (1) by suspending an employee because she refused to take off a union button and by discriminatorily discharging two employees. The Board adopted the judge’s dismissals of Section 8(a)(1) allegations that the Respondent unlawfully interrogated an employee about whether she was distributing buttons during working time; unlawfully attempted to have union handbillers arrested; unlawfully asked employees why they wanted a union; unlawfully gave employees the impression that their protected activities were under surveillance; unlawfully implied that organizing efforts were futile, and asked employees to report union activities. The Board also adopted the judge’s dismissals of two Section 8(a)(3) and (1) allegations that the Respondent unlawfully disciplined two employees.  In dismissing the unlawful interrogation allegation involving the distribution of buttons, Member Becker noted that the Respondent had a reason to believe that the employee had previously distributed buttons during working time. In dismissing one of the unlawful discipline allegations, Chairman Pearce and Member Becker found it unnecessary to rely on the judge’s apparent suggestion that the Respondent’s inconsistent disciplinary history made it easier for the Respondent to meet its rebuttal burden under Wright Line, 251 NLRB 1083, 1089 (1980), enfd. 662 F.2d 899 (1st Cir. 1981), cert. denied 455 U.S. 989 (1982).  Member Hayes would have adopted the judge’s rationale.

A Board majority (Chairman Pearce and Member Becker) found that the Respondent unlawfully filed and maintained a baseless and retaliatory motion for a Temporary Restraining Order (TRO) in Federal district court to enjoin communications from the Union to the Respondent’s customers and to prevent a Union rally. The majority found that the Respondent had no reasonable basis for seeking injunctive relief under Section 303 of the Act—the theory it advanced in its motion—or under its pendent state law claims of libel and tortuous interference. The Board found that the motion was filed to retaliate against Section 7 activity, primarily because the motion directly sought to interfere with protected activity, was baseless, and because the Respondent had a history of animus against the Union. Member Hayes, dissenting, found that it was inappropriate to consider the TRO motion separately from the remainder of the court action, that the Board’s retaliatory motive analysis relied on rationale expressly rejected by the Supreme Court in BE & K Construction Co. v. NLRB, 536 U.S. 516(2002)and that the majority analysis essentially collapsed the Board’s two-prong BE&K test into one. The same majority remanded to the judge the issue of whether the verified complaint filed contemporaneously with the motion was also unlawful. Member Hayes dissented from the remand decision.

Chairman Pearce and Member Becker found that the Respondent unlawfully gave employees the impression that their protected activities were under surveillance by putting a security camera in a breakroom. Member Hayes dissented. Chairman Pearce and Member Becker found it unnecessary to reach the judge’s dismissal of an additional surveillance-related allegation, while Member Hayes would have dismissed for the reasons the judge stated.  Chairman Pearce and Member Becker also found it unnecessary to pass on the judge’s dismissal of an allegation that the Respondent solicited and promised to remedy employee grievances as any such finding would be cumulative. Member Hayes would have adopted the judge’s dismissal. 

Chairman Pearce and Member Becker reversed the judge and issued an affirmative bargaining order, citing the hallmark violations of the unlawful discharges. Member Hayes, dissenting, would have adopted the judge’s determination based on the Respondent’s partial respect for the organizing campaign and on the passage of time since the employee petition.

Charges filed by UNITE HERE!   Administrative Law Judge Lana H. Parke issued her decision on October 5, 2007.  Chairman Pearce and Members Becker and Hayes participated.

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LM Waste Service, Corp. (24-CA-10847, et al.; 357 NLRB No. 194) Juana Diaz, PR, December 31, 2011.

The Board in this decision and order found LM Waste acted unlawfully by creating the impression among employees that their union activities were under surveillance, by threatening employees with discharge if they continued their support for the union, and by informing employees that they were discharged because of their activities on behalf of the union.  The Board also found that LM Waste acted unlawfully by discharging four employees because they formed, joined or assisted a union or encouraged support for any labor organization.  As to one of these four employees, the finding of unlawful discharge was made by Chairman Pearce and Member Becker with Member Hayes dissenting.  In addition, the Board found that LM Waste did not unlawfully discharge a fifth employee.  This finding of lawful discharge was made by Members Becker and Hayes with Chairman Pearce dissenting.

Charges filed by Union de Tronquistas de Puerto Rico, Local 901, IBT.  Administrative Law Judge Keltner W. Locke issued his decision on October 22, 2010.  Chairman Pearce and Members Becker and Hayes participated.

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Domsey Trading Corporation, Domsey Fiber Corporation and Domsey International Sales Corporation, a single employer (29-CA-14548, et al.; 357 NLRB No. 180) Brooklyn, NY, December 30, 2011.

The Board (Chairman Pearce and Member Becker; Member Hayes dissenting) pierced the Respondent’s corporate veil to hold  Arthur Salm, a primary shareholder, personally liable for backpay, plus interest owed approximately 200 discriminatees whom the Respondent failed to offer timely reinstatement after an unfair labor practice strike that ended in 1990.  See Domsey Trading Corp., 310 NLRB 777 (1993), enfd. 16 F.3d 517 (2d Cir. 1994).  Administrative Law Judge Marcionese issued his supplemental decision in 1999, in which he found that the Respondent owed over $1 million, plus interest, to the discriminatees.  In January 2002, while the judge’s supplemental decision was pending review before the Board, the Respondent sold its property and received more than $9 million as its share of the proceeds.  Salm then transferred the proceeds from the Respondent’s corporate bank account to his own personal accounts and that of the other principal shareholder.  Neither the Respondent nor its primary shareholders set aside money to satisfy the Board’s backpay claim nor did they notify the Board of the asset sale.

In 2007, the Board issued a supplemental decision (351 NLRB 824) in which it affirmed in part and reversed in part Judge Marcionese’s recommendations, and remanded to the Region in part for further calculations of backpay amounts owed, and to the judge to consider whether, in light of the Supreme Court’s decision in Hoffman Plastic Compounds v. NLRB, 535 U.S. 137 (2002), certain discriminatees were lawfully authorized to work in the United Stated during the backpay period and entitled to backpay.  The Board issued a second supplemental decision in 2008, in which it ordered the Respondent to pay all undisputed backpay amounts and to pay backpay to certain discriminatees as determined by the judge on remand (353 NLRB 86, affirmed in 355 NLRB No. 89 (2010)).  In 2010, the Second Circuit, looking only at the Hoffman Plastics issue, denied enforcement to the Board’s second supplemental decision and remanded the case to the Board for further proceedings (636 F.3d 33).  In a separate decision, also issued December 30, 2011, the Board remanded that part of the case for further proceedings consistent with the court’s decision (357 NLRB No. 164).

In 2010, the Acting General Counsel (AGC) filed an amended compliance specification in which he sought to hold the Respondent’s principal shareholders derivatively liable for the backpay owed the discriminatees.  In a third supplemental decision issued in 2011, the judge applied the Board’s White Oak analysis for determining when it is appropriate to assess derivative liability against a corporate owner or officer.  (White Oak Coal Co., 318 NLRB 732 (1995), enfd. mem. 81 F.3d 150 (4th Cir. 1996) (applying a two-prong test, Board will pierce a corporate veil when: (1) the shareholders and the corporation have failed to maintain separate identities; and (2) adherence to the corporate form would sanction a fraud, promote injustice, or lead to the evasion of legal obligations.)  Applying White Oak’s first prong, the judge found no evidence that the Respondent failed to maintain corporate formalities when it was still engaged in normal business activities (the judge surmised that the Respondent ceased business operations by the end of 2001; it was formally dissolved in 2009), and rejected the AGC’s argument that the transfer of funds after the sale established a “commingling” of funds that evidenced the Respondent and its shareholders failed to maintain separate identities.  Having found that White Oak’s first prong was not satisfied, he found it unnecessary to consider White Oak’s second prong.   

Reversing the judge, the majority found that Salm’s disbursement of the Respondent’s share of the proceeds from the asset sale to his personal accounts constituted a commingling of funds and that it “evidence[d] a lack of separation between the Respondent and its principals, as Salm clearly regarded the proceeds as being freely available for the taking, notwithstanding that they belonged to the Respondent.”  The majority further found it “immaterial that Salm’s transfer of the Respondent’s assets into his and [the other primary shareholder’s] personal accounts was tied to one major corporate transaction as opposed to many smaller transactions occurring over months or years.  Either way, a corporate respondent can be left undercapitalized and without the ability to satisfy its legal obligations[,]” as happened here.  Having found White Oak’s first prong satisfied, the majority found the second prong satisfied on the ground that adherence to the corporate form would promote injustice and lead to the evasion of legal obligations.  While the majority applied a White Oak analysis, it noted that its decision was “consistent with F & W Oldsmobile, 272 NLRB 1150 (1984), a pre-White Oak case where the Board imposed personal liability on corporate officers who dissolved a corporation and distributed its assets to themselves while they were on notice of a pending backpay claim against the corporation.”

In dissent, Member Hayes would have adopted the judge’s finding that the AGC failed to establish that White Oak’s first prong was satisfied because  corporate formalities had been maintained when the Respondent was in business.  Asserting that the White Oak test “was not intended to apply to a corporation that has ceased operations and gone out of business,” Member Hayes found that the majority erred in finding a commingling of funds from “a one-way, one-time distribution of funds from the Respondent to its owners upon the Respondent’s going out of business[.]”  Member Hayes further found that the majority erred by essentially applying a fraudulent transfer analysis instead of a White Oak analysis, as evidenced by its reliance on F & W Oldsmobile.  Since that legal theory is separate and distinct from the piercing the corporate veil theory of White Oak, and the fraudulent transfer theory was neither alleged nor litigated, Member Hayes found that the majority erred in invoking it here.  Accordingly, Member Hayes would not pierce the corporate veil to hold Salm personally liable for the backpay owed. 

Charges filed by International Ladies’ Garment Workers Union, AFL-CIO.  Administrative Law Judge Raymond F. Green issued the third supplemental decision.  Chairman Pearce and Members Becker and Hayes participated.

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Unpublished Board Decisions in Representation and Unfair Labor Practice Cases

R Cases

Manhattan Valley Management Company, Inc. (2-RC-08074) New York, NY, January 11, 2012.  Order denying Employer’s request for review of the Acting Regional Director’s decision and direction of election.  Petitioner – League of International Federated Employees, Local 890.  Chairman Pearce and Members Hayes and Griffin, Jr. participated.

Lutheran Social Services of Michigan d/b/a Luther Manor (7-RC-23419) Saginaw, MI, January 13, 2012.  Decision and certification of representative.  Petitioner – National Union of Healthcare Workers. 

C Cases

Open Door Retail Group, Inc. (16-CA-28083) Houston, TX, January 9, 2012.  Order transferring proceeding to the Board and notice to show cause why the Acting General Counsel’s motion should not be granted.  Charge filed by an Individual.

Bay SYS Technologies, LLC (5-CA-36314) Accomac, VA, January 11, 2012.  Order transferring proceeding to the Board and notice to show cause why the Acting General Counsel’s motion should not be granted.  Charge filed by an Individual.

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Appellate Court Decisions

Fred Meyer Stores, Inc., Board Case Nos. Nos. 19-CA-32171 (published at 355 NLRB No. 141) and 19-CA-32311 (published at 355 NLRB No. 130) (9th Cir. decided January 9, 2012)

In an unpublished decision the Ninth Circuit enforced in full the Board's orders two refusal-to-bargain cases involving the same employer.

The Company raised a variety of arguments to the Board in the initial two-member case, but narrowed them in a motion for reconsideration once a properly-constituted panel considered the issues following New Process.  At that point, it primarily claimed, contrary to its initial pleadings, that it did not refuse to bargain following the Board's certification of the unions.  It asked the Board to reopen the record to consider new evidence showing proof of negotiations, although it did not attach the evidence to its motion.  The Board denied the motion for reconsideration, finding that the Company failed to show that it was bargaining, and the Board also refused to reopen the record. 

Before the Court, the Company again claimed that it did bargain, but this time submitted documentary evidence ostensibly proving so, and asked the Court to direct the Board to reopen the record.  The Court rejected the Company's arguments, agreeing with the Board that the Company's failure in the first instance to present its evidence to the Board in its motion for reconsideration precluded it from bringing it to the Court under Section 10(e) of the Act.  Further, the Court agreed, in the alternative, that the Board was justified in rejecting the motion to open the record under its own rules and that, even if the proffered evidence could demonstrate that the Company bargained, the Company's compliance did not preclude the Board from obtaining enforcement of its orders. 

The Court's judgment is available here.

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Bentonite Performance Materials, LLC, Board Case No. 27-CA-20596 (reported at 355 NLRB No. 104) (D.C. Circuit decided January 10, 2012)

In an unpublished judgment, the D.C. Circuit denied the employer's petition for review and enforced the Board's order. 

In 2007, the employer contacted several employees and encouraged them to circulate a petition seeking decertification of the incumbent union.  Thereafter, a majority of employees signed the petition, and the employer withdrew recognition.  The Board found that the employer's solicitation of employees to circulate the petition violated the Act.  Further, applying Hearst Corp., 281 NLRB 764 (1986), the Board held that the employer's unlawful acts tainted the resulting petitions and that its withdrawal of recognition was therefore unlawful. 

On appeal, the D.C. Circuit agreed.  The Court first held that substantial evidence supported the Board's finding that the employer did not merely answer employee questions about decertification, but that it actually solicited workers to circulate decertification petitions.  Next, the Court rejected the employer's claim that the Board should have determined whether the unlawful solicitation actually caused a majority of employees to sign the decertification petition, citing the causation analysis of Master Slack Corp., 271 NLRB 78 (1984).  The Court rejected this argument, citing Hearst as the applicable precedent here: "[T]he Board, though it has been far from forthright in explaining this distinction, has applied Master Slack to cases where unfair labor practices not directly related to the decertification process are claimed to have caused the vote in favor of decertification.  In case of employer involvement in the decertification process itself rising to the level of an unfair labor practice, the Board has traditionally not used the Master Slack 'causal relationship' test, but rather has used a test in which it does not require any standard showing of causation between the unfair labor practices and the anti-union vote."  Because the employer did not directly challenge Hearst, the Court affirmed its application here and enforced the Board's unlawful-withdrawal-of-recognition finding.

Finally, the Court rejected the employer's challenge to the Board's imposition of an affirmative bargaining order.  Because the employer failed to except to that remedy before the Board, the Court recognized that it had no jurisdiction to hear the claim in the first instance. 

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J.S. Carambola, LLP, Board Case No. No. 24-CA-10951 (reported at 356 NLRB No. 23) (3d Circuit decided January 12, 2012).

In an unpublished opinion, the Third Circuit enforced the Board's order in this refusal-to-bargain case.  

First, the Court agreed with the Board that the union's slightly belated request for bargaining was harmless error. Following the Supreme Court's decision in New Process, the Board, on August 6, 2010, reconsidered a prior two-member Board certification of the union and recertified the union's election victory.  In that order, the Board also directed the General Counsel to file an amended complaint on the outstanding motion for summary judgment in the “technical 8(a)(5)” case, in which the employer had refused to bargain in order to challenge the Board’s certification of the union.  On September 3, 2010, the General Counsel issued an amended complaint; however, the union did not request bargaining following the three-member Board's certification until September 7, 2010.  The employer argued that the Court should not enforce the Board's order "because the Union never made a bargaining demand prior to the filing of [the] amended complaint."  The Court rejected this argument, holding that "this was harmless error because [the employer] does not maintain that it began bargaining once it received the Union's [demand] letter."  Quoting the Board, the Court held that "'[r]egardless of the exact date on which [the employer's] admitted refusal to bargain became unlawful, the remedy is the same."  

Second, the Court rejected the employer's challenges to the election itself, agreeing that a supervisor's comment to employees, "If you don't vote for the Union, you are a stupid a**," was merely a strong opinion unlikely to have interfered with employee free choice.  The Court also affirmed the Hearing Officer's evidentiary rulings. 

The Court's opinion is available here.

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Decisions of Administrative Law Judges

Wellington Industries, Inc. (7-CA-61568; JD-02-12) Belleville, MI.  Charge filed by International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW), Local 174, AFL-CIO.  Administrative Law Judge Arthur J. Amchan issued his decision on January 9, 2012.

USIC Locating Services, Inc. (6-CA-37328; JD-03-12) Bridgeville, PA.  Charge filed by Communication Workers of America, Local 13000, AFL-CIO, CLC.  Administrative Law Judge David I. Goldman issued his decision on January 10, 2012.

Loomis Armored US, Inc. (32-CA-25316, et al.; JD(SF)-01-12) Oakland, CA.  Charges filed by Teamsters, Locals 315, 439 and 853.  Administrative Law Judge Jay R. Pollack issued his decision on January 11, 2012.

Hargrove Electric Co., Inc. (16-CA-27812, et al.; JD(ATL)-03-12) Dallas and Balch Springs, TX, January 13, 2012.  Charges filed by International Brother of Electrical Workers, Local 20.  Administrative Law Judge Margaret G. Brakebusch issued her decision January 13, 2012.

Efficient Design, Inc. (07-CA-60306; JD(ATL)-01-12) Birmingham, MI.  Charge filed by International Union of Bricklayers and Allied Craftworkers (BAC), Local 9, AFL-CIO.  Administrative Law Judge Keltner W. Locke issued his decision on January 13, 2012. 

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