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,
SPE Utility Contractors, LLC and Linda M. Leuch. Case 7–CA–50767
March 30, 2009
DECISION AND ORDER
By Chairman Liebman and Member Schaumber
On December 17, 2008, Administrative Law Judge Ira Sandron issued the attached decision. The Respondent filed exceptions and a supporting brief, and the General Counsel filed an answering brief.
The National Labor Relations Board1 has considered the decision and the record in light of the exceptions and briefs, and has decided to affirm the judge’s rulings,2 findings,3 and conclusions4 and to adopt the recommended Order.5
ORDER
The National Labor Relations Board adopts the recommended
Order of the administrative law judge and orders that the Respondent, SPE
Utility Contractors, LLC,
Dated,
Wilma B. Liebman,
Chairman
Peter C. Schaumber, Member
(seal) National
Labor Relations Board
Dynn Nick, Esq., for the General Counsel.
Kenneth
M. Gonko, Esq. (The Danielson Group, PC), of
DECISION
Statement of the Case
Ira Sandron, Administrative Law Judge.
The complaint, issued on January 31, 2008, stems from unfair labor
practice (ULP) charges that Linda M. Leuch, an individual, filed against SPE
Utility Contractors, LLC (Respondent or SPE), and alleges that Respondent
violated Section 8(a)(3), (4), and (1) of the National Labor Relations Act (the
Act) by discharging her on August 7, 2007.[1] The 8(a)(4) allegation relates to previous
charges filed against Respondent by Local 339, International Brotherhood of Teamsters
(the
Pursuant to
notice, I conducted a trial in
Issue
Was Respondent’s
August 7 discharge of Leuch for not meeting with Respondent on July 30 and
August 6, to provide information concerning her billing and performance of other
duties, based on lawful considerations, or because of union activities and/or
her status as a potential recipient of backpay under the Act and as a witness
at an NLRB trial?
At the outset, I note that Respondent’s
sole proffered basis for the discharge was her failure to meet and provide
information, not her conduct in any of the matters it wished to discuss with
her.[4]
Witnesses and Credibility
On April 30, the
General Counsel called David Postill, Respondent’s chief executive officer
(CEO) and majority stock holder, as an adverse witness under Section 611(c);
Kurt Satryb, Respondent’s former vice president in charge of
On October 23, Respondent called Michael
Moriarty, president, and Postill, whose testimony was limited to what was said
in his telephone conversation with Leuch in mid-August. I note here that at the time I scheduled the
resumed hearing for October 23, 2008, Postill had plans to be out of town. In the interest of timely concluding the
trial, I allowed him to testify telephonically on October 23, 2008, over the
General Counsel’s objections. I determined
that this would cause no prejudice to either the General Counsel or the
Charging Party, inasmuch as he had testified at length as a 611(c) witness on
April 30, and I therefore previously had ample opportunity to observe his demeanor.
Leuch appeared
sincere and to answer questions readily and without hesitation, taking into
account that much of her testimony involved events that occurred in 2005 during
and after Hurricanes Katrina and Rita (the hurricanes). She candidly conceded during portions of her
testimony that, in hindsight, she might have handled some of her communications
with SPE more tactfully.
Satryb also
struck me as candid and as not making efforts to slant his testimony in favor
of one party or the other. Although he
has contacted an attorney concerning possible legal action against SPE for
terminating him on July 31, allegedly for violating the no-competition clause
in his employment contract, he has continued to perform work for SPE under his
own business. Thus, he might naturally
have countervailing reasons to testify for or against Respondent. Reflecting his lack of bias in favor of Leuch
was his testimony that he had recommended she be discharged prior to her
December 2006 layoff, based on what Postill reported to him about her conduct,
but that Postill decided to lay her off instead.
Moriarty
admittedly had limited knowledge of Leuch’s performance; he testified that
prior to February, when he became president, Postill was always her direct
supervisor. On one matter, I find his
testimony implausible, to wit, that at the time he issued Leuch the July 23
letter (and, ergo, the August 2 letter), he did not know the specific date of
the scheduled NLRB trial (August 8) but merely knew that it was coming up.
Postill
demonstrated notable defensiveness and unease during his testimony on April 30,
and he also displayed defensiveness during his telephonic testimony on October
23. He was often evasive, vague, and/or
nonresponsive in his answers; he sometimes contradicted himself; and portions
of his testimony were not plausible.
Following are examples of these deficiencies in his testimony. Others will be addressed in the “Facts”
section.
Postill was
evasive and inconsistent on who made the decision to terminate Leuch. Thus, he first testified that, “I played a
role in that with my team,” then narrowed “management” to Moriarty, and later
testified, “I’m the CEO of the Company; ultimately I don’t care what
[Moriarty]—what decision [Moriarty] made.
I agreed with it and supported it.”[5]
To give context
to what follows, four subjects were cited in the discharge letter: (1) Leuch billed Florida Power and Light
(FPL) for her labor during a week she was off work and paid by SPE; (2) while
reconciling FPL records, she paid both office staff and temporary services for
16-hour shifts, although she had no authority to do so; (3) she continued to
use Vonage service paid by SPE; and (4) in reconciling FPL and Entergy
accounts, it appeared that she made significant payments to subcontractors
beyond the pay-when-due clause of their contracts. Significantly, all of the cited FPL issues
and the Vonage service matter arose in 2005 from post-hurricane work that SPE
performed for FPL in southern States.
Postill’s
testimony about SPE’s attempts to resolve its billing disputes with FPL
stemming from hurricane-related work in 2005 was evasive to the point where it
was practically incomprehensible.[6] His explanation of why he did not request
more information from Leuch until July was wholly unbelievable. Thus, when asked if he was aware of all of
the specific billing issues with FPL in May (which amounted to millions of dollars),
he replied, “Some were mentioned to me.
I don’t know if I had the documentation because at that point I was just
rolling up my hand and getting involved in it.”[7] Yet, he also testified that Leuch worked on
reconciling the billing differences with FPL prior to her layoff in December
2006. I cannot find plausible that, as
CEO and majority owner of a small company, he was still so unknowledgeable
about such a major problem with a large customer.
To best
illustrate why I have found Postill an unreliable witness, I will use his
testimony regarding Leuch’s allegedly paying office staff and temporary service
workers for 16-hour shifts, without authorization. He testified this occurred probably as far
back as 2004. He asserted that he did
not ask Leuch for more information until July, because, “I did research based
on a rumor I heard prior to [seeing documents in 2007], and I looked at it and
it was confirmed. Once it was confirmed,
I wanted to bring her in and ask her and see what the reasoning was.”[8]
Aside from
vagueness, such testimony is at odds with his admission that he knew she was
paying herself and his mother (then the only other office employee) for 16-hour
shifts at the time of occurrence. He
also stated in his affidavit that “[w]hen I talked to Leuch about this issue,
she acknowledged that she paid the employees outside of the rate,” even though
he had not authorized it, and it was his decision to make.”[9] Moreover, he averred in the affidavit that he
had talked to her about paying temporaries and office staff with the same
overtime provisions as provided to union members, and that she acknowledged
doing this. Finally, an e-mail dated
June 24, 2005, from Postill to FPL[10]
shows his knowledge of the issue at that time.
I also find
incredulous his testimony that despite his knowledge of Leuch’s alleged
malfeasance in 2004 and 2005, she continued “running” his office until her layoff
in December 2006.[11]
Postill’s
telephonic testimony, in which he was asked solely about a telephone conversation
with Leuch in mid-August was also unconvincing (Leuch had testified, in sum,
that he called her on August 16 and said he was sorry about her termination,
but SPE lawyers had instructed him to terminate her to limit liability). Vague and evasive, he professed absolutely no
recollection of anything specific that she said, although he testified that the
conversation occurred after her mother’s funeral (and, therefore, after her
termination). I find this totally
unbelievable, especially when he repeated over and over again that when he
called her to express condolences, she “went off” on matters unrelated to her
mother’s death. The following, during
his cross-examination, reflects both the defects in his testimony concerning
the phone call and his marked defensiveness:
When she picked up the phone, immediately
she started going off. Was she going off
because she’s mad at me, she’s mad at the company? I don’t know.
I didn’t put a lot of faith in it, even listen to it much because that
wasn’t the nature of my call. And we’re
talking about Linda. She could have been
going off because she lost the Lotto. I
don’t know. I don’t remember.[12]
I highly doubt that she would have vented
anger against him or SPE because she lost the Lotto or because he called to
offer condolences. The only plausible
explanation is that she expressed wrath at her termination, which had occurred
a little over a week earlier.
In this regard,
as amply reflected by Leuch’s testimony and that of other witnesses (including
Postill), documents of record, and my observations of Leuch during her testimony,
Leuch is a forceful individual who does not mince words. I find it wholly implausible that, even if he
did not raise the subject of her very recent discharge, she would not have done
so sua sponte.
For the above
reasons, I credit Leuch and Satryb where their testimony diverged from that of
Postill and Moriarty.
Facts
Based on the
entire record, including witness testimony, documents, stipulations, and
uncontested findings of fact in Judge Amchan’s previous decision, I find the
following facts.
Respondent, a
I take
administrative notice that Hurricane Katrina made landfall in southeast
SPE began operations
in 2001 under four partners, including Postill and Satryb. Later, Satryb sold his ownership interest to
Postill, who at some point became the majority owner.
Satryb hired
Leuch as office manager in September 2003.
From the start, she handled accounts receivable and prepared billings
for different power companies for which Respondent performed work, and she
continued doing so throughout her employment and until her layoff on December
20, 2006. Leuch was technically “demoted”
in mid-October 2005 from office manager to accounts receivable, as a result of
her out-of-State work following Hurricane Katrina. However, her duties in the office did not
change, and she continued to perform them with the same degree of
independence.
Following the
2005 hurricanes, SPE performed extensive work for FPL, in the repair of
overhead power lines to restore power to residential customers. Leuch spent a total of about 8 weeks in SPE’s
temporary office locations in
On August 14,
2006, the
Leuch was the
alternate steward until December 20, 2006, when she and two other unit
employees were laid off. Between August
7, 2006, and April 27, the
By letter of
January 4, Leuch requested a copy of her personnel file, pursuant to state law
and, after an exchange of correspondence, she met in late January with Thomas D’Luge,
SPE’s attorney, and reviewed documents that Respondent advised her were available.[13]
In May,
representatives of SPE, including Postill and Satryb, met with FPL executives
at FPL’s offices in
On June 27,
Regional Director Stephen Glasser issued an order rescheduling the trial from
June 27 to August 8.[15]
I credit Satryb’s
unrebutted testimony as follows. In
July, he had a conversation with Postill in the parking lot. When they were discussing the office
employees’ effort to decertify the
Moriarty, by
certified letter of July 23 to Leuch, stated:[17]
Since your layoff in December 2006, SPE has been working on reconciling its accounting records . . . .
In conjunction with these reconciliations, we have become aware of certain acts or omissions not in conformity with SPE’s practices.
We are seeking any input that you may have regarding these inconsistencies and request that you appear at SPE’s office this Monday, July 30, 3007 at 9 Am [sic] . . . .
This meeting is time sensitive as we are in the process of negotiating settlement with FPL and Afton Power. If you are unable to assist SPE in these matters, we shall proceed to finalize these matters without your input.
Moriarty
testified that at the time he prepared and sent the letter, he had no intention
of discharging Leuch; rather, his purpose was to get further information from
her.
Leuch telefaxed
a response on July 30, stating that the letter had arrived when she was
attending to the needs of her mother’s death and subsequent funeral, and that
she could not appear on Monday morning “due to a previous appointment regarding
the upcoming trial.”[18]
In a letter to
Leuch of August 2,[19]
Moriarty essentially repeated verbatim what he had stated in his July 23
letter, and he requested that she appear for the same purpose on August 6 at
12:30 p.m. Again, Moriarty asserted that
at the time he prepared and sent the letter, he had no intention of discharging
her.
Leuch responded
by a telefax of August 6,[20]
wherein she raised issues concerning whether SPE had properly paid benefits and
compensation to her and other employees.
As to the requested meeting on August 6, she replied, “I will be unable
to appear at SPE’s office due to a previous appointment regarding the upcoming
trial.”
The following
day, August 7, Moriarty sent her, by certified mail, a discharge letter.[21] He reiterated that SPE had sought her input
to “matters that arose after your layoff,” generally relating to FPL work. He set out and discussed four areas of her
alleged misconduct (specifically addressed in the next section). He concluded by stating that SPE considered
these allegations substantiated because she had not provided a sufficient
reason for her actions.
Leuch appeared
and testified at the NLRB trial on August 8 and 9. By faxed letter of August 14, she denied, in
rather colorful language, Moriarty’s allegations against her.[22]
On the evening
of August 16, Postill called Leuch at home.
He quoted portions of her August 14 letter and said he was sorry but
that his lawyers made him write the July 23 and August 2 letters because of the
August 8 trial.[23]
Respondent’s Position
I reiterate that
Respondent’s sole basis for discharging Leuch was her failure to come in and
discuss the issues raised in Moriarty’s July 23 and August 2 letters, not the
underlying alleged acts of misconduct.
Therefore, I will focus primarily on when they occurred and when Postill
first had knowledge.
Leuch billed FPL
for her labor during a week she was off and paid by SPE.
Postill
testified that FPL representatives complained in 2007 that Leuch had improperly
billed FPL for office work she performed at the temporary office(s).
However, Postill
also testified that he had knowledge of this issue as far back as 2005 and that
Leuch was working on the matter prior to her layoff, but that he waited until “we
had all our ducks in a row” before making the request that she meet to discuss
it.[24] He offered no explanation of why this took 2
years.
I credit Leuch’s
testimony that Postill knew and approved all of her billing of her hours to
FPL.
2. Leuch paid both office staff and temporary services for 16-hour shifts, without authorization.
Because, as
described earlier, Postill’s testimony on this was unreliable, I credit Leuch’s
testimony that she never authorized employees to work without his
approval.
3. Leuch set up a Vonage account that provided free Internet use at her residence and continued to use it after her layoff, at SPE expense.
When SPE had a
temporary office (in a trailer) in
Respondent’s
contends that Vonage has continued to bill it for the services and offered
Respondent’s Exhibit 7 as evidence. In
part, it shows items billed to Postill’s credit card in January, including a
charge for Vonage. Both the documents
and Postill’s testimony reflect that one of the problems in stopping service
was that Leuch’s password was needed, but Respondent offered no evidence that
Postill or anyone else from SPE ever asked her for it. Moreover, the temporary office was closed
back in 2005. I cannot, therefore, find
credible Postill’s assertion that he needed to meet with her to talk on the
matter in July.
I credit Leuch’s
testimony that she did not take the Vonage equipment with her and has never
used it for free Internet service.
4. Leuch made significant payments to subcontractors beyond the pay-when-paid clauses in their contracts with SPE.
Postill
testified that during the reconciliation process with FPL—on the dates of which
he was conveniently vague—he became aware that she prepaid subcontractors ahead
of what they were due under the pay-when-paid clause of their contracts; i.e.,
before SPE was itself paid for the job.
He testified that such instances were raised to him in 2005 and 2006 but
that he was not aware of the scope of the problem (millions of dollars) “until
I actually rolled my hands up and got involved.”[25] He also testified that there were issues with
“every subcontractor” she paid.[26] I note Satryb’s testimony that when representatives
of FPL and SPE met in May to reconcile their billing differences,
reconciliation attempts had already gone on for a full year (or back to
mid-2006).
I credit Leuch’s
testimony that she made payments to subcontractors under Postill’s direction.
In sum, I
discredit Postill’s highly implausible claims of ignorance of the scope of
Leuch’s alleged malfeasance until months after her December 2006 layoff, as
well as his testimony that she continued to “run” his office after he already
knew of major defects in her performance.
Analysis
The framework
for analyzing alleged violations of Section 8(a)(3) is Wright Line, 251 NLRB 1083 (1980), enfd. 662 F.2d 899 (1st
Cir. 1981), cert. denied 455 U.S. 989 (1982).
Under Wright Line, the General Counsel must make a prima facie
showing sufficient to support an inference that the employee’s protected
conduct motivated an employer’s adverse action.
The General Counsel must show, either by direct or circumstantial
evidence, that the employee engaged in protected conduct, the employer knew or
suspected the employee engaged in such conduct, the employer harbored animus,
and the employer took action because of this animus.
Leuch was an
alternate union steward, certainly protected activity. However, apart from her testimony as a
witness at the August 8 and 9 trial, conduct that comes under Section 8(a)(4),
the record is devoid of evidence of what she did in that role, or otherwise in
the way of union activities. There is no
direct evidence of animus against her because she served as an alternate
steward, nor can such be implied. Thus,
Satryb recommended that Leuch be discharged in December 2006, but Postill
instead lawfully laid her off, along with other office employees. Credited testimony of Satryb and Leuch
reflects that the discharge was directly connected to her involvement in NLRB
proceedings, not to any severable union activities. I therefore conclude that the General Counsel
has not established a prima facie case of unlawful termination under Section
8(a)(3).
A Wright Line approach is also used for
analyzing alleged violations of Section 8(a)(4) of the Act, and the remedy is
the same.
Section 8(a)(4)
prohibits adverse action against an employee “who has filed charges or given
testimony.” The provision is broadly
construed in order “to prevent the Board’s channels of information from being
dried up by employer intimidation of prospective complainants and witnesses.’” NLRB v. Scrivener, 405
Thus, its
protection extends to employees such as Leuch on whose behalf charges were
filed (Climatrol, Inc., 329 NLRB 946
(1999)), and to employees who plan to testify at NLRB trials. Lamar
Advertising of
The element of
knowledge is easily met. Leuch was named
in the earlier complaint and alleged therein to have been laid off in violation
of Section 8(a)(5). Further, she specifically
mentioned her upcoming role as a witness at the NLRB trial in her July 30 and
August 6 telefaxes. Animus is
demonstrated by Satryb’s testimony that in late July, Postill stated that he
probably would have to discharge Leuch to stop backpay, and Leuch’s testimony
that on August 16, Postill stated that SPE’s attorneys had directed that Leuch
be terminated because of the August 8 (NLRB) trial.[27] Respondent discharged her by letter of August
7. Therefore, I conclude that the
General Counsel has satisfied all of the elements necessary to establish a
prima facie case of unlawful termination under Section 8(a)(4).
Under Wright
Line, if the General Counsel establishes a prima facie case of unlawful
conduct, it meets its initial burden to persuade, by a preponderance of the
evidence, that protected activity was a motivating factor in the employer’s
action. The burden of persuasion then
shifts to the employer to show that it would have taken the same adverse action
even in the absence of such activity. NLRB
v. Transportation Management Corp.,
462
If the employer’s
proffered defenses are found a pretext, i.e., the reasons given for the
employer’s actions are either false or not in fact relied on, the employer
fails by definition to show that it would have taken the same action for those
reasons, and there is no need to perform the second part of the Wright Line analysis. SFO Good-Nite Inn, LLC, supra.
On the other hand, further analysis is required if the defense is one of
“dual motivation,” i.e., the employer defends that, even if an invalid reason
might have played some part in the employer’s motivation, the employer would
have taken the same action against the employee for permissible reasons. Palace Sports & Entertainment, Inc. v.
NLRB, 411 F.3d 212, 223 (D.C. Cir. 2005).
I conclude that
Respondent’s defense was a pretext, based on the following. Statements that Postill made to Leuch and Satryb
demonstrate that the real reason for her discharge related to her being a
subject of charges that were to be litigated at an upcoming NLRB trial, more
specifically, to limit her backpay in the event that her layoff was found
unlawful under the Act. The timing of
her discharge was also very suspicious.
In this regard, almost all of the major issues that Respondent contends
required further information from Leuch occurred during the 2005 hurricanes or
before, management admittedly had knowledge of the existence of at least most
of them by 2006 and before Leuch was laid off in December 2006, and Postill
even discussed at least some of them with her prior to her layoff. Respondent offered no good explanation of
why, suddenly right before the scheduled NLRB hearing, it was so urgent to have
Leuch come in to provide information and/or explanations. Nor did Respondent explain why it offered her
no alternative dates and times but, in each of its requests, presented her with
only one specific meeting time. In both
of her replies, Leuch stated that she could not make the proposed date and time
because of trial preparation for the August 8 hearing.
Accordingly, I
conclude that Respondent violated Section 8(a)(4) and (1) by discharging Leuch
on August 7, 2007, because of her status as a potential recipient of backpay
under the Act and as a witness in support of charges that the
Postill’s
statement to Leuch about her being discharged to limit her financial remedy
under the Act constituted an independent 8(a)(1) violation, in my view, but it
was not alleged in the complaint and, in any event, is essentially encompassed
in the subject of the discharge itself.
Remedy
Because I have
found that Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative
action designed to effectuate the policies of the Act.
Since the Board
determined that Leuch’s prior layoff was not unlawful, reinstatement and
backpay remedies are not germane.
ORDER
The Respondent, SPE Utility Contractors, LLC,
1. Cease and desist from
(a) Discharging or otherwise disciplining employees because
they are potential recipients of backpay under the Act and/or are witnesses
scheduled to testify in unfair labor practice trials, or because they otherwise
participate in National Labor Relations Board proceedings.
(b) In any like
or related manner interfering with, restraining, or coercing employees in the
exercise of the rights guaranteed them by Section 7 of the Act.
2. Take the
following affirmative action necessary to effectuate the policies of the Act.
(a) Within 14
days from the date of the Board’s Order, remove from its files any references
to the August 7, 2007 discharge of Linda Leuch and, within 3 days thereafter,
notify her in writing that this has been done and that the discharge will not
be used in any way against her in the event of a recall.
(b) Within 14
days after service by the Region, post at its facility at
(c) Within 21
days after service by the Region, file with the Regional Director for Region 7
a sworn certification of a responsible official on a form provided by the
Region attesting to the steps that the Respondent has taken to comply.
Dated,
APPENDIX
Notice To
Employees
Posted
by Order of the
National
Labor Relations Board
An Agency of the
The National Labor Relations Board has
found that we violated Federal labor law and has ordered us to post and obey
this notice.
federal law gives you the right to
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
We will not discharge or otherwise
discipline you because you are potential recipients of backpay under the Act
and/or are witnesses scheduled to testify in unfair labor practice trials, or
otherwise participate in National Labor Relations Board proceedings.
We will not in any like or related manner interfere with, restrain, or
coerce you in the exercise of your rights under Section 7 of the Act, as set
forth at the top of this notice.
We will remove from our files any reference to the unlawful
discharge of Linda Leuch, and we will
within 3 days thereafter notify her in writing that this has been done and that
the discharge will not be used against her in any way in the event of a recall.
SPE Utility Contractors, LLC