NOTICE: This opinion is subject to formal revision before publication in the bound volumes of NLRB decisions. Readers are requested to notify the Executive Secretary, National Labor Relations Board, Washington, D.C. 20570, of any typographical or other formal errors so that corrections can be included in the bound volumes.

Grosvenor Orlando Associates, LTD., d/b/a The Grosvenor Resort, and its general partners Grosvenor Properties, Ltd., Donald E. Werby and Robert K. Werbe and Hotel Employees and Restaurant Employees, Local 55, AFL–CIO. Cases 12–CA–18190, 12–CA–18381 (–2, –4, –5), 12–CA–18467, 12–CA–18518, 12–CA–18576, and 12–CA–18830

September 11, 2007

SUPPLEMENTAL DECISION AND ORDER

By Chairman Battista and Members Schaumber and Walsh

On June 29, 2005, Administrative Law Judge Benjamin Schlesinger issued the attached supplemental decision. The Respondent filed exceptions[1] and a supporting brief, the General Counsel filed an answering brief, and the Respondent filed a reply brief. The General Counsel filed cross-exceptions with a supporting brief, the Respondent filed an answering brief, and the General Counsel filed a reply brief. Finally, counsel for the individual discriminatees filed exceptions.

The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel.

The Board has considered the supplemental decision and the record in light of the exceptions and briefs and has decided to affirm the judge’s rulings, findings,[2] and conclusions only to the extent consistent with this Supplemental Decision and Order.

i. introduction

The Respondent’s housekeeping, service, and maintenance employees commenced an unfair labor practice strike on September 27, 1996. Three days later, the Respondent discharged them. On September 30, 2001, the Board issued a Decision and Order finding, in relevant part, that the discharges were unlawful. The Order directed the Respondent to reinstate the employees and to make them whole for any loss of earnings and benefits resulting from their discharge.[3] On October 8, 2002, the United States Court of Appeals for the Eleventh Circuit enforced the Board’s Order.[4] The Respondent offered the employees reinstatement on December 9, 2002. Thus, the backpay period began on September 30, 1996, and it ended on December 9, 2002.

In his supplemental decision, the judge resolved numerous issues raised by the Respondent in opposition to the General Counsel’s compliance specification alleging the amounts of backpay to be due 44 discriminatees.[5] We adopt the judge’s findings that (1) the Union’s strike benefits and donations are not deductible as interim earnings,[6] (2) interest should be accrued on backpay after the date the Respondent filed for bankruptcy, (3) the Starlite Cutting, 280 NLRB 1071 (1986), escrow remedy should apply for discriminatees Maria Hernandez and Norma Jimenez, even though they were subpoenaed but did not appear to testify,[7] (4) an adverse inference should be drawn against the Respondent regarding the average hours the discriminatees worked per week for the Respondent,[8] (5) the Respondent’s backpay liability for discriminatee Maria Quevedo should be reduced during the fourth quarter of 2001 when Quevedo was on maternity leave, and (6) discriminatee Andres Alvarez did not willfully conceal his interim earnings and thus should be awarded the full amount of backpay. Further, we adopt the judge’s backpay awards to discriminatees Gilberto Carranza, Carlos Delgado, Oslaine Desir, Jules Josaphat, Martin Malagon, Lourdes Matos, Earl Rankin,[9] and Raymond Smith.[10]

For the reasons stated below, however, we reverse the judge’s findings that (1) certain discriminatees did not incur a willful loss of earnings by delaying their initial search for interim work, (2) the Respondent’s expert testimony should be “generally reject[ed],” (3) discriminatee Montgomery was justified in quitting her interim employment with K-Mart, and (4) the following discriminatees reasonably mitigated their damages: Robert Baity, Hector Caban, Ella Mae Davis, Aida Febles, Deborah Goodman, Israel Hernandez, Lidia Hernandez, Mollie Jackson, Flor Javier, Margarita Jimenez, Adisseau Louisius, Frederic Meradin, Charitable Ovince, Joseph Paschal, Marie A. Pierre, Maria Quevedo, Feliza Ryland, Cleofas Viscaino-Hernandez, and Flossie Williams.

ii. analysis

In a backpay proceeding, the General Counsel must first show the amount of gross backpay due to each discriminatee. The Respondent then has the burden of establishing affirmative defenses to mitigate its liability, including willful loss of interim earnings. Millennium Maintenance & Electrical Contracting, 344 NLRB No. 62, slip op. at 2 (2004). A discriminatee must make reasonable efforts to secure interim work to be entitled to backpay. Glenn’s Trucking Co., 344 NLRB No. 41, slip op. at 1 (2005). The “sufficiency of a discriminatee’s efforts to mitigate backpay are determined with respect to the backpay period as a whole and not based on isolated portions of the backpay period.” IBEW Local 3, supra at at 1266. It is the respondent’s burden to prove that the discriminatee failed to exercise reasonable diligence in searching for work. Millennium Maintenance & Electrical Contracting, supra. Backpay is not compelled by the Act, but is instead entrusted to the Board’s discretion, consistent with the “healthy policy” underlying the Act of “promoting production and employment.” Phelps Dodge Corp. v. NLRB, 313 U.S. 177, 199 (1941).[11]

A. Delay in Initial Search for Interim Work

Some discriminatees did not begin their search for interim work until several weeks after being discharged. It is well settled that “an employee discriminatorily laid off or discharged need not instantly seek new work; rather the test is whether, on the record as a whole, the employee has diligently sought other employment during the entire backpay period.” (Emphasis added.) Saginaw Aggregates, 198 NLRB 598 (1972), enfd. 482 F.2d 946 (6th Cir. 1973) (backpay awarded even though employee did not seek interim work for initial 2 weeks). Notwithstanding the Board’s focus on the totality of a discriminatee’s mitigation efforts, a discriminatee’s unreasonable delay in commencing an initial search for interim work will not be excused simply because he or she thereafter diligently seeks work. If the discriminatee unreasonably delays an initial search, the Board will toll backpay for that period, and will commence it if and when a reasonably diligent search begins. See Marlene Industries Corp., 183 NLRB 50, at 54–55 and 59 (1970) (discriminatee Edge’s backpay tolled for initial 6-week period, despite subsequent successfully diligent job search efforts).[12] Thus, the question in this case is whether some of the discriminatees waited an unreasonably long time before beginning their search for interim work.

The judge did not exclude backpay for the discriminatees’ initial weeks of inactivity, even though he acknowledged that some of the discriminatees waited as long as 8 weeks before making any attempts to secure interim employment. He found that so long as a discriminatee commenced a search for interim work within the fourth quarter of 1996 it was reasonable, provided the discriminatee made a reasonably diligent search for interim work thereafter. The Respondent contends that the discriminatees who did not begin their initial search for interim work immediately upon being discharged are not entitled to backpay for the fourth quarter of 1996.

To determine whether some of the discriminatees unreasonably delayed their initial search for interim work, we look to the Board’s precedent on this issue. As stated above, while the Board has not required discharged discriminatees to look for new work immediately, it has recognized limitations on the amount of time a discriminatee may wait to begin his or her initial search for interim work. In this regard, the longest period of total initial job search inactivity the Board has found permissible is the 2 weeks in Saginaw Aggregates, supra.[13] Consistent with this precedent, we find that, absent circumstances justifying a longer delay, the discriminatees here should have begun their initial search for interim work within the 2-week period following their discharges. If a discriminatee began a reasonably diligent search anytime within this period, then his or her backpay would run from the date of the Respondent’s unlawful action. If, however, a discriminatee failed to commence a search at some point within this 2-week period, then his or her backpay would not begin to accrue until the discriminatee commenced a proper job search.

Applying the foregoing, while we agree with the dissent that the reasonableness of interim job searches depends on an assessment of the circumstances of individual discriminatees, we find, contrary to the dissent, that no circumstances exist in this case that would justify finding that any discriminatee reasonably delayed his or her initial search for interim work for more than 2 weeks after discharge. We recognize that many of the discriminatees were elderly, with limited skills and education, a long history of employment with the Respondent, and, in some instances, limited transportation. All of these factors warrant consideration in determining whether an individual discriminatee exercised reasonable diligence when searching for interim work. None of these factors, however, justifies a discriminatee’s failure to search for work at all for periods of time beyond the first 2 weeks. Furthermore, since virtually all discriminatees found some employment once they commenced a reasonable job search, we know that work was available in the relevant labor market to applicants of similar age with similar experience and skill levels. Under these circumstances, to award backpay to discriminatees who delayed their initial search for interim work beyond an initial 2-week period would be to reward idleness. NLRB v. Mercy Peninsula Ambulance Service, 589 F.2d 1014, 1017 (9th Cir. 1979) (employee who has been a victim of an unfair labor practice is not entitled to simply await reimbursement from his employer for lost wages, for “the statute was not intended to encourage idleness” (citation omitted)).

Our dissenting colleague errs when he asserts that the discriminatees were entitled to delay any initial job search while picketing in support of a strike to regain their jobs with the Respondent. It is well established that “[p]icket line activity does not relieve the discriminatees of the obligation of making reasonable efforts to obtain appropriate interim employment”[14] and that “[e]mployees who engage in picketing at the expense of seeking alternate employment incur willful losses of earnings by their failure to make the requisite search for work.”[15] Further, since the dissent concedes that some discriminatees did look for jobs while they were still picketing, there is no apparent reason why others could not have done so.

As a corollary argument, the dissent contends that the discriminatees delayed their initial search for interim work because they reasonably hoped to get their jobs back with the Respondent soon as a result of the strike and picketing. In this respect, the dissent relies on the expressed hopes of Union Organizer and Business Agent Gail Fabian rather than on the testimony of any discriminatee. There is no evidence that the Respondent engaged in any conduct that would warrant any optimism about the prospect of reinstatement and justify a further delay in the initial search for interim work beyond a 2-week period. Even assuming that some delay in searching for interim work could be justified on this basis, we find that reasonably diligent discriminatees should at least have begun searching for interim work at some time within the initial 2-week period, whether or not they continued to engage in picketing activities to regain their former jobs.

Based on the foregoing, we reverse the judge and find that the following discriminatees unreasonably delayed their initial search for interim work: Baity, Goodman, Israel Hernandez, Lidia Hernandez, Javier, Jimenez, Louisius , Meradin, Ovince, Paschal, Pierre, Quevedo, Ryland, Viscaino-Hernandez, and Williams. As these discriminatees unreasonably delayed their initial searches, we toll their backpay to the date when each discriminatee commenced his or her search for interim work. [16]

In reaching our decision, we have fully considered the individual circumstances of the discriminatees in this case and our conclusions are entirely consistent with established Board precedent concerning the time period accorded discriminatees to commence their interim job search. In the absence of a showing of unusual circumstances in this case, we find that the discriminatees here unreasonably delayed their initial search for interim work by not beginning their search until 4–8 weeks after their discharge—a much longer time period than the Board has previously found to be reasonable. With due respect to our dissenting colleague, our decision represents neither a radical departure from established backpay principles nor a mechanical application of a 2-week rule. Rather, it is our colleague who would depart from Board precedent by permitting a prolonged and indefinite delay before a discriminatee must begin his or her initial search for interim work.

B. The Respondent’s Expert Testimony

In support of its contention that certain discriminatees failed to mitigate their damages, the Respondent called expert witnesses, including Doctor Bruce Seaman, a professor of economics, to testify about the conditions of the labor market at the time in question.[17] Dr. Seaman testified that the Orlando metro region had an “unusually strong” labor market during much of the backpay period, as measured by unemployment rates and “help wanted” ads in local newspapers. Dr. Seaman determined that if an employee searched for 40 jobs in a month, there was only a 12.9-percent chance of not getting a job. Dr. Seaman did not, however, meet with the discriminatees or consider their age and language barriers in his analysis.

The judge “generally reject[ed]” this evidence. We reverse the judge’s wholesale rejection. While we agree that expert testimony is too speculative to meet the Respondent’s burden of establishing that the backpay of certain discriminatees should be reduced, we nonetheless consider the expert testimony as a factor in determining whether the discriminatees diligently searched for interim work. See United Aircraft Corp., 204 NLRB 1068 (1973) (good-faith search for work depends on circumstances surrounding the search, including the economic climate in which the discriminatee operates).

C. Willful Loss of Interim Earnings

1. Quitting Interim employment

The judge found that discriminatee Deborah Montgomery, a laundry attendant for the Respondent, was justified in quitting her interim job on March 28, 1998, and thus did not incur a willful loss of interim earnings from that date until June 19, 1998, when she started working for another employer. The judge determined that Montgomery’s decision to quit was justifiable because she had been embarrassed by a coworker in front of customers. We disagree.

On January 30, 1997, Montgomery was hired as a cashier by K-Mart. On March 28, 1998, Montgomery quit her job with K-Mart because of an incident with a coworker. Montgomery told the coworker not to prepare her own food in the store’s café. In the presence of customers, the coworker responded that she was going to cook her food whether Montgomery “liked it or not.” K-Mart tried to convince Montgomery not to quit because of the incident, but she quit because of what she said was her “embarrassment.” She did not work again until June 19, when she started a job with Winn Dixie.

Contrary to the judge’s analysis, when a discriminatee is shown to have voluntarily quit interim employment, the burden shifts from the Respondent to the General Counsel to come forward with evidence that the action was reasonable.[18] A voluntary quit is not a willful loss of employment “if the interim job is substantially more onerous or is unsuitable or threatens to become so. . . [or] when it is prompted by unreasonable working conditions.”[19] Montgomery’s testimony failed to show that she quit for any of these reasons. She quit simply because she was assertedly embarrassed by a coworker in front of customers. Her subjective reaction to a single incident does not show that continued employment with K-Mart would be unduly burdensome. In fact, K-Mart tried to convince Montgomery not to quit. Under these circumstances, Montgomery’s voluntary quit was unjustified and constituted a willful loss of interim earnings.[20] Consistent with the offset formula in Knickerbocker Plastic Co., 132 NLRB 1209, 1215 (1961), we shall therefore reduce Montgomery’s net backpay for the first and second quarters of 1998 by offsetting from gross backpay an interim earnings amount equal to that which she would have earned at K-Mart from the date she quit until the June 19 date when she started working for Winn Dixie.[21]

2. Inadequate search for interim work

We find merit in the Respondent’s arguments that the discriminatees discussed below failed to sufficiently mitigate their damages by exercising reasonable diligence in seeking interim employment. Specifically, considering all relevant employment factors in determining whether a discriminatee sufficiently mitigated losses, we find that the number of applications filed, the period of time between the applications, and the period of time between the applications and the starting date of interim work for these discriminatees shows an inadequate job search. With the exception of Mollie Jackson, the inadequate job searches are limited to the fourth quarter of 1996.[22] Thus, contrary to the judge and for the reasons discussed below, we find that the Respondent’s backpay liability for these discriminatees should be reduced accordingly.

a. Robert Baity

Baity, a banquet server for the Respondent, did not begin his search for interim work until he unsuccessfully applied to an employer on October 29. He did not submit another application until November 29. On December 3, Baity applied a third time and secured employment, which he held for the remainder of the backpay period.

We find that Baity not only unreasonably delayed his initial job search, as discussed above, but also that he thereafter conducted an insufficient search for interim work. Baity did not apply for interim work until October 29, approximately 1 month after his discharge. He did not apply again for another month. One application in a 2-month period does not amount to a reasonable job search in a resort area where jobs were readily available.[23] In fact, Baity quickly found interim employment once he began a reasonable job search. Accordingly, we toll Baity’s backpay until November 29, when he began sufficiently mitigating his damages. Therefore, we have recalculated Baity’s net backpay for the fourth quarter of 1996. See Appendix 10 for details on Baity’s backpay recalculations.

b. Hector Caban

Caban, a laundry attendant for the Respondent, applied for work on October 1 (see fn. 22, supra), in November, and on December 2. Caban secured employment on December 2, but did not begin working until January 1997. While Caban did not unreasonably delay his initial search for interim work, we find that he conducted an insufficient search by applying to only three employers in approximately 3 months. Additionally, while Caban secured employment in December, he did nothing further to mitigate his damages even though he did not begin working until approximately 1 month later.[24] Accordingly, we toll Caban’s backpay until January 1, 1997, when he began sufficiently mitigating his damages.[25] Therefore, Caban is not entitled to any backpay for the fourth quarter of 1996. See Appendix 11 for details on Caban’s backpay recalculations.

c. Ella Mae Davis

Davis, a salad maker for the Respondent, credibly testified that she “went to two or three hotels” during the fourth quarter. Davis made only two or three applications in 3 months. We find one application per month insufficient under the circumstances. Accordingly, Davis is not entitled to backpay for the fourth quarter of 1996. As the fourth quarter of 1996 was the only quarter of the backpay period in which backpay was sought for Davis, no backpay is due.

d. Aida Febles

Febles, a room attendant for the Respondent, applied for interim work immediately upon being discharged. She did not apply again until November 22, when she successfully secured employment and began working. Thus, Febles’ second application was approximately 7 weeks from the date of her first application. While Febles did not unreasonably delay her initial job search, we find that she conducted an insufficient search by applying to only two employers in 2 months. Accordingly, we toll Febles’ backpay until November 22, when she began sufficiently mitigating her damages.[26] Therefore, we have recalculated Febles’ net backpay for the fourth quarter of 1996. See Appendix 12 for details on Febles’ backpay recalculations.

e. Mollie Jackson

The fourth quarter of 1996 and the first three quarters of 1997 are in dispute for Mollie Jackson, a room attendant for the Respondent. The judge found that Jackson sufficiently mitigated her damages. We disagree.

Following her unlawful discharge, Jackson did not apply for interim work. Instead, Jackson made minimal interim earnings by arranging flowers for her daughter. Jackson had injured her foot in an accident sometime before the strike began and her injury ultimately required surgery, which she had during the fourth quarter of 1997. Shortly thereafter, Jackson undisputedly withdrew from the labor market. The Board has found self-employment to be a proper way to mitigate damages. See Fugazy Continental Corp., 276 NLRB 1334, 1338–1339 (1985), enfd. 817 F.2d 979 (2d Cir. 1987) (less lucrative self-employment was sufficient mitigation). In this case, however, Jackson’s flower arranging was not self-employment, but merely a “hobby,” as conceded by Jackson during her testimony. Further, Jackson did not report her minimal earnings for tax purposes and she testified that she could not work because of an injury. Accordingly, we find that Jackson’s flower arranging was not sufficient mitigation and that she is not entitled to backpay.

f. Flor Javier and Margarita Jimenez

We discuss these discriminatees together because their situations are identical. Both Javier and Jimenez, who were room attendants with the Respondent, secured employment on November 1 (see fn. 22, supra), but did not begin working until December 7. They remained employed for the rest of the backpay period.

We find that Javier and Jimenez not only unreasonably delayed their initial job search but also conducted an insufficient search. They applied approximately 1 month after their discharge and submitted only one application in more than 2 months before beginning to work. While they secured employment in November, they did not begin working until approximately 1 month later and they did nothing further to mitigate their damages during this time. Accordingly, we toll Javier’s and Jimenez’ backpay until December 7. Therefore, we have recalculated their net backpay for the fourth quarter of 1996. See Appendices 13 and 14 for details on Javier’s and Jimenez’ backpay recalculations.

g. Frederic Meradin

Meradin, a houseman for the Respondent, unsuccessfully applied for interim work on November 1 and in December. On January 3, 1997, Meradin registered with IATSE and obtained some work. He applied to another employer in March 1997 and to two other employers in April. On June 21, 1997, Meradin secured full-time employment.

With respect to the fourth quarter of 1996, we find that Meradin unreasonably delayed his initial job search by not applying for interim work until November 1, approximately 1 month after his discharge. Further, we find that Meradin conducted an insufficient search during the entire fourth quarter of 1996 because he applied to only two employers in approximately3 months.

With respect to the first and second quarters of 1997, however, we conclude that Meradin conducted a sufficient search. Within 3 days of the start of the first quarter of 1997, Meradin registered with IATSE. He was referred by IATSE to work at Freeman Decorating from January 7, until sometime in February 1997. As fully explained by the judge in his decision, job referral opportunities for new registrants with IATSE depend on several factors and employees would have to stay in the system for some time in order to achieve higher wages, higher priority, and more regular employment. Still, Meradin’s first quarter interim earnings through IATSE compare favorably to those of fellow discriminatees who first registered with IATSE in the fourth quarter of 1996.[27] Further, while still registered with IATSE, Meradin applied to two additional employers during that quarter. Similarly, in the second quarter of 1997, Meradin applied to two employers and secured full-time employment by the end of the quarter. Thus, we find that Meradin’s IATSE work, although not substantial, and his continuing efforts to secure full-time work during these quarters were sufficient mitigation. Accordingly, we toll Meradin’s backpay only until the first quarter of 1997, when he began sufficiently mitigating his damages. Therefore, we have recalculated Meradin’s backpay for the fourth quarter of 1996. See Appendix 15 for details on Meradin’s backpay recalculations.

h. Cleofas Viscaino-Hernandez

Viscaino-Hernandez, a room attendant for the Respondent, did not apply for interim work until November 15.[28] She secured employment on that date but did not begin working until December 11. She made no other applications for interim work during the quarter.

For the reasons discussed above, we find that Viscaino-Hernandez unreasonably delayed her initial job search. Further, she applied only once before beginning work more than 2 months after her discharge. While Viscaino-Hernandez secured employment on November 15, she did not begin working until approximately 1 month later and she did nothing further to mitigate her damages during this time. Accordingly, we toll Viscaino-Hernandez’ backpay until December 11, when she began mitigating her damages. Therefore, we have recalculated Viscaino-Hernandez’ backpay for the fourth quarter of 1996. See Appendix 17 for details on Viscaino-Hernandez’ backpay recalculations.

i. Flossie Williams

Williams, a room attendant for the Respondent, applied for interim work in November and in December. She started working for an interim employer on December 11,[29] and remained employed for the rest of the backpay period, until her death in 1997. For the reasons discussed above, we find that Williams unreasonably delayed her initial job search. Further, we find that applying to only two employers in more than 2 months was insufficient mitigation. Accordingly, we toll Williams’ backpay until December 11, when she sufficiently mitigated her damages. Therefore, we have recalculated Williams’ backpay for the fourth quarter of 1996. See Appendix 18 for details on Williams’ backpay recalculations.

ORDER

The National Labor Relations Board adopts the recommended Supplemental Order of the administrative law judge as modified below and orders that the Respondent, Grosvenor Orlando Associates, Ltd., its officers, agents, successors, and assigns, doing business as The Grosvenor Resort, and its general partners, Grosvenor Properties, Ltd., Donald E. Werby, and Robert K. Werbe shall pay to each of the following discriminatees the amounts set forth opposite their respective names, plus interest as computed in New Horizons for the Retarded, 283 NLRB 1173 (1987), and minus tax withholdings required by Federal and State laws:

DISCRIMINATEE CLAIMANTS	NET BACKPAY	FICA MATCH	MEDICAL EXPENSES	SUM TOTAL
Francisco Abreu	$11,917.67	$911.70	-	$12,829.37
Andres Alvarez	$55,148.31	$4,218.85	$313.89	$59,681.05
Robert Baity	$18,394.26	$1,407.16	-	$19,801.42
Rosetta Brown	$2,480.05	$189.72	-	$2,669.77
Hector Caban	$6,171.68	$472.13	-	$6,643.81
Gilberto Carranza	$1,035.38	$79.21	-	$1,114.59
Dorothy Collier	$5,611.55	$429.28	$620.50	$6,661.33
Ella Mae Davis	$0.00	$0.00	$0.00	$0.00
Lindsey Day	$4,935.73	$377.58	$2,129.93	$7,443.24