Smithfield Packing Co. v. National Labor Relations Board

PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

SMITHFIELD PACKING COMPANY, 

INCORPORATED,

Petitioner,

v.  No. 06-1541

NATIONAL LABOR RELATIONS BOARD,

Respondent.



NATIONAL LABOR RELATIONS BOARD, 

Petitioner,

v.

 No. 06-1652

SMITHFIELD PACKING COMPANY,

INCORPORATED,

Respondent.



On Petition for Review and Cross-application

for Enforcement of an Order of

the National Labor Relations Board.

(11-CA-20240)

Argued: September 27, 2007

Decided: December 5, 2007

Before WILLIAMS, Chief Judge, DUNCAN, Circuit Judge, and

Raymond A. JACKSON, United States District Judge for the

Eastern District of Virginia, sitting by designation.

Petition for review granted; cross-application for enforcement granted

in part and denied in part by published opinion. Chief Judge Williams

wrote the opinion, in which Judge Duncan and Judge Jackson joined.

2 SMITHFIELD PACKING COMPANY v. NLRB

COUNSEL

ARGUED: Gregory Branch Robertson, HUNTON & WILLIAMS,

Richmond, Virginia, for Smithfield Packing Company, Incorporated.

Heather Stacy Beard, Office of the General Counsel, NATIONAL

LABOR RELATIONS BOARD, Washington, D.C., for the Board.

ON BRIEF: Kimberlee W. DeWitt, Kurt G. Larkin, HUNTON &

WILLIAMS, Richmond, Virginia, for Smithfield Packing Company,

Incorporated. Ronald Meisburg, General Counsel, John E. Higgins,

Jr., Deputy General Counsel, John H. Ferguson, Associate General

Counsel, Aileen A. Armstrong, Deputy Associate General Counsel,

Steven L. Sokolow, Deputy Associate General Counsel, David

Habenstreit, Supervisory Attorney, NATIONAL LABOR RELA-

TIONS BOARD, Washington, D.C., for the Board.

OPINION

WILLIAMS, Chief Judge:

Smithfield Packing Company, Incorporated ("Smithfield") petitions

for review of an order of the National Labor Relations Board (the

"Board") finding Smithfield in violation of § 8(a)(1) of the National

Labor Relations Act, 29 U.S.C.A. § 158(a)(1) (West 1998 & Supp.

2007) (the "Act"), for threatening, beating, and falsely arresting

employees of Smithfield’s independently contracted cleaning services

company, QSI, Inc. ("QSI"), on the morning of November 15, 2003.

Because we conclude that the employees in question were not

engaged in concerted protected activity within the meaning of § 7 of

the Act, 29 U.S.C.A. § 157 (West 1998), we grant Smithfield’s peti-

tion for review. In addition, we grant the Board’s cross-application for

enforcement of its order with respect to a separate § 8(a)(1) violation

that Smithfield chose not to include in its petition for review.

I.

A.

Smithfield is among the largest pork products companies in the

world and is well-known for its "Smithfield Ham." Among its many

SMITHFIELD PACKING COMPANY v. NLRB 3

operations, Smithfield currently runs a large hog-slaughtering produc-

tion facility in Tar Heel, North Carolina (the "Plant"). The Plant is the

largest of its kind in the world and employs between 5,500 and 6,000

workers. By comparison, the largest town in Bladen County, the pre-

dominantly rural county in which the Plant is located, has a popula-

tion of less than 4,000 people.

The Plant operates from roughly 8 a.m. to 11 p.m. each day with

coverage provided by two production shifts. The third shift is a clean-

ing shift, during which time the Plant is thoroughly cleaned and then

inspected by agents from the United States Department of Agriculture

("USDA"), who must certify that the facility is clean before the next

day’s production shifts may begin. Since the Plant’s opening in 1992,

Smithfield has hired independent contractors to handle these cleaning

services. In July 2002, Smithfield awarded the contract for these

cleaning services to QSI, which succeeded Mossburg Sanitation

("Mossburg"). During each cleaning shift, QSI staffed the Plant with

between 250 and 300 workers, almost all of whom were of Hispanic

descent, and many of whom spoke only Spanish. Although the clean-

ing shift ended at 7 a.m., as an incentive to promote efficiency, QSI

permitted its employees to leave early but still receive full pay if they

finished their work early.

Although Mossburg and QSI were competitors, QSI retained many

of Mossburg’s supervisors in similar positions. For example, QSI’s

Plant Manager, Manuel Plancarte, who was responsible for oversee-

ing QSI’s operations during the cleaning shift, had served as the

Associate Plant Manager for Mossburg.1

QSI’s safety department, which was also present at the Plant during

the cleaning shift, and was headed by Mayra Saucedo, did not report

to Plancarte. Instead, the safety department reported principally to

QSI’s Area Manager Eduardo Guzman, Safety Director Lane Parsons,

and Division Manager Owen Patterson.

1

Plancarte himself was also related to several individuals serving under

his watch. Two of his cousins, Antonio Cruz and Jorge Rodriguez,

served as supervisors for QSI. Those three men were reared in the same

household by another employee, Juan Hernandez Velasquez. Cruz was

Velasquez’s son.

4 SMITHFIELD PACKING COMPANY v. NLRB

By November 2003, tensions at the Plant were rising, pitting the

employees and their supervisors against the safety department. QSI

employees were upset with their treatment by the safety department

and, from time to time, voiced their objections to their supervisors.

Plancarte and another supervisor, Antonio Cruz, were particularly

sympathetic to these complaints, and, in fact, Cruz would decline to

discipline his employees when requested to do so by the safety

department for what he deemed minor safety infractions. For exam-

ple, on November 7, Saucedo requested that Cruz discipline an

employee for a safety violation, but Cruz refused. In response,

Saucedo telephoned Patterson and complained about Cruz’s refusal to

follow her discipline requests. In addition, Saucedo informed Patter-

son that she believed Cruz had come to work inebriated on several

occasions. On one occasion when she smelled alcohol on his breath,

she attempted to take Cruz for an alcohol screening test, but he

refused to go.

Armed with this information, Patterson decided to terminate Cruz

for his continued insubordination. Patterson contacted Guzman, who

was off-site visiting one of the other five plants he was responsible

for managing, and instructed him to return to Smithfield and escort

Cruz from the premises. Guzman followed these instructions, termi-

nating Cruz and removing him from the Plant. About an hour later,

and apparently at Plancarte’s urging in response to Cruz’s termina-

tion, QSI employees began walking off the job. Saucedo telephoned

Patterson to report the development; in turn, Patterson again contacted

Guzman and told him to return to Smithfield and get the employees

back to work. When Guzman arrived, he found a large number of

employees lingering in the Plant’s parking lot, and, after speaking

with several employees, Guzman learned that they were upset with

Cruz’s dismissal and what they viewed as unfair treatment by the

safety department.

At that point, Guzman removed Saucedo and her two associates

from the plant and terminated them.2 After this event, some employ-

ees returned to work while others went home. Because of the walkout,

QSI did not finish its cleaning work that evening, and the USDA did

2

Owen Patterson later rescinded these terminations, but none of the

safety personnel returned to the Plant in their former capacity.

SMITHFIELD PACKING COMPANY v. NLRB 5

not permit the Plant to open for production on November 8. As a

result, Smithfield lost its entire production for that day.

On November 10, prior to the start of QSI’s cleaning shift, around

140-150 QSI employees met in front of the Plant with Guzman and

Patterson to discuss the employees’ concerns.3 The employees

requested: (1) a $1 per hour raise for all employees; (2) the removal

of QSI’s safety personnel; and (3) the reinstatement of Cruz and

another recently terminated employee, Ruben Baltazar. In a hand-

written agreement that was written in Spanish, Guzman and Patterson

assented to these demands. It is undisputed that all three requests were

carried out by QSI.

Although QSI employees returned to work without incident on

November 10, Patterson, along with other senior QSI managers,

decided to fire a majority of the Plant’s supervisors, including Plan-

carte and Cruz, for their failure to support management during the

events of November 7 and 10. Patterson, after consultation with Lane

Parsons, decided that Patterson, Parsons, and Guzman should travel

to the Plant to conduct the terminations on the morning of November

15. QSI brought in replacement supervisors to step in following the

terminations.

As a courtesy, QSI informed Robert Claiborne, Smithfield’s third-

shift supervisor, that it would be conducting the terminations on

November 15 and requested the use of a conference room. Claiborne

agreed to let QSI use a conference room and then informed Danny

Priest, Chief of the Smithfield Special Police,4 about QSI’s plans. In

3

The impetus of the November 10 meeting was a meeting Plancarte

held at his home sometime between November 8 and November 10. Dur-

ing this meeting, Plancarte registered his distaste for QSI and his desire

to help Mossburg regain the cleaning contract with Smithfield.

4

Smithfield had a special police force certified under North Carolina’s

Company Police Act, N.C.G.S. § 74E. The Smithfield Special Police is

comprised of four full-time and two reserve officers; the officers wear

primarily black uniforms with Smithfield Special Police company insig-

nia. Under the Company Police Act, these officers have the same author-

ity within their "jurisdiction" (the Plant) as police officers throughout the

State. In addition, the Smithfield Special Police fell under the same stric-

tures as police officers throughout the state in terms of using excessive

force. Smithfield also employed unarmed security guards throughout the

plant, primarily at entrances and exits. These guards wore gray uniforms.

6 SMITHFIELD PACKING COMPANY v. NLRB

response, Priest increased his staffing for the November 14-15 shift,

placing several officers in the visitors’ lobby outside of the confer-

ence room where QSI was terminating the supervisors and placing

several others on standby to patrol the Plant’s parking lot.

Beginning at around 3:00 a.m. on November 15, Patterson and Par-

sons instructed Guzman to enter the production area of the Plant and

gather the supervisors who were to be terminated. QSI decided to

conduct the terminations in groups: Plancarte was terminated in the

first group of supervisors, and Cruz was to be terminated in the third

group. At some point after the first group of supervisors were termi-

nated but prior to his own termination, Cruz became aware that Plan-

carte had been terminated and that QSI was also terminating other

supervisors. At the time, he had not been informed that he was about

to be terminated. Nonetheless, Cruz began encouraging employees in

the production area to leave their posts because Plancarte had been

fired. Some employees complied and began heading towards the

exits, although trial testimony was unclear why these employees left.

Most indicated that they were upset that QSI was terminating people

like Plancarte who were sympathetic to their complaints; however,

others simply decided to follow the workers they saw heading off the

job. Cruz himself began running through the Plant and shouting at the

employees to leave their posts.

At this point, events are hotly disputed. For our purposes, it is suf-

ficient to note that a large number of QSI’s employees moved, in a

somewhat chaotic fashion, from the production areas through a set of

double steel doors to the employee lobby, and then into the parking

lot, where they congregated. After some time, the employees either

returned to work or went home.

In terms of objective evidence regarding the events of November

15, we note that two criminal charges were filed. First, Priest arrested

employee Roberto Munoz-Guerrero in the parking lot, at least thirty

minutes after the employees had dispersed and after announcements

were made requesting the employees to return to work or go home.

Munoz-Guerrero was booked on charges of resisting arrest at Bladen

County Magistrate’s Office because, according to Priest, he resisted

an officer’s request to leave the premises. The charge was later dis-

missed.

SMITHFIELD PACKING COMPANY v. NLRB 7

Cruz filed the other criminal charge, which was premised on a fan-

ciful story to say the least. According to Cruz, Patterson saw Cruz on

the production floor and began running after Cruz in an effort to

apprehend him. Cruz, as mentioned, had not been terminated at this

point or even informed that he would be terminated. Cruz originally

testified in a workman’s compensation hearing that he believed Pat-

terson had a large six-inch knife in his hand and was going to stab

him. In this case, Cruz testified that he never saw a knife, just a "shiny

object." (J.A. at 264). Regardless, before Patterson reached Cruz, two

employees, Munoz-Guerrero and Pablo Zacarias, turned their high-

pressure hoses on Patterson, knocking him down. Eventually, accord-

ing to Cruz, Patterson tracked Cruz down and forcibly removed him

from the Plant. Cruz left, but he returned to the Plant later that morn-

ing to file an assault charge against Patterson with the Special Police.

B.

As a result of the events on November 15, the United Food &

Commercial Workers International Union ("the Union") brought a

charge against Smithfield and QSI, alleging that both violated

§ 8(a)(1); in Smithfield’s case, the Union charged that Smithfield vio-

lated § 8(a)(1) by threatening, beating, and falsely arresting employ-

ees. The Board, after reviewing the Union’s filings, issued two

complaints alleging: (1) that Smithfield violated § 8(a)(1) of the

National Labor Relations Act; and (2) that QSI violated numerous

sections of the Act.5 The Board’s complaint did not list the victimized

employees or identify the Smithfield personnel alleged to have com-

mitted the offending acts. Smithfield requested and was granted a

hearing before an Administrative Law Judge ("ALJ").

Prior to the trial before the ALJ, Smithfield moved to sever the two

complaints and filed a Motion for a Bill of Particulars, arguing that

the Board’s complaint included insufficient evidence to permit Smith-

field to defend itself properly. The ALJ denied both motions. During

trial before the ALJ, the Board broke down its complaint into several

different charges, alleging that Smithfield violated § 8(a)(1) by: (1)

assaulting QSI employees on the morning of November 15; (2) threat-

5

QSI has since settled its claims with the Board and is discussed only

as relevant to our disposition of Smithfield’s petition for review.

8 SMITHFIELD PACKING COMPANY v. NLRB

ening QSI employees with immigration charges on the morning of

November 15; (3) falsely arresting QSI employee Roberto Munoz-

Guerrero on the morning of November 15; and (4) refusing to grant

a transfer request to Smithfield employee Dan English because of

English’s union activities.

Both the Board and Smithfield put forth numerous witnesses and

documentary evidence before the ALJ. In addition, Smithfield entered

into evidence a security video from the employee lobby. The video,

recorded in a quad-screen split, showed the employee lobby for the

duration of the events of November 15. At the time Smithfield moved

to enter the video, the ALJ opined that "45 minutes of a tape sounds

a little onerous to me," (J.A. at 2097), but permitted entrance of the

entire tape into evidence. After the parties stipulated that the relevant

portion of the tape was from 2:45 a.m. to 4:00 a.m., the ALJ did

watch that portion of the video.

Following the trial, the ALJ issued a written decision finding that

Smithfield violated § 8(a)(1) of the Act by threatening and assaulting

QSI employees on November 15 and by falsely arresting Munoz-

Guerrero on November 15. The ALJ also concluded that Smithfield

violated § 8(a)(1) by refusing to consider Dan English for a job open-

ing because of his union activities. As a remedy, the ALJ instructed

Smithfield to cease and desist from threatening, assaulting, and

falsely arresting QSI employees and from refusing to consider

employees for job openings based upon their union activities.

In reaching its conclusion that Smithfield violated the Act, the ALJ

first ruled that the November 15, 2003 walkout by QSI employees

was protected activity under § 7 of the Act. As the ALJ explained,

"[e]mployees who walk out in protest of the discharge of a supervisor

are engaged in protected concerted activity and are protected by Sec-

tion 7 of the Act." (J.A. at 19A.) The ALJ concluded that the walkout

"originated with the employees" (J.A. at 19A), although it admitted

that there was "some support for the conclusion that certain of the

QSI’s management at the plant were so motivated and were instru-

mental in urging the production employees to engage in [the walk-

out]." (J.A. at 20.) In addition, the ALJ concluded that the walkout

"was peaceful and a reasonable means of protest under the Act." (J.A.

at 19A.)

SMITHFIELD PACKING COMPANY v. NLRB 9

The ALJ further concluded that Smithfield violated § 8(a)(1) by

assaulting QSI employees, threatening them with immigration pro-

ceedings, and falsely arresting Munoz-Guerrero. The ALJ did not

explain why it credited the testimony of the Board’s witnesses over

Smithfield’s, noting only that the videotape was "incomplete" and

"distorted." (J.A. at 17A.) The ALJ found that the portion of the video

shown in court was unhelpful because "[t]he record bears out that the

vast majority of the 150 plus employees left prior to this in a frenzied

manner following . . . efforts to prevent them from leaving the pro-

duction area." (J.A. at 17A.) In addition, the ALJ universally credited

the testimony of the employees as "bolstered by the testimony of

Smithfield’s security guards," (J.A. at 17A), noting "inconsistencies"

in the employee testimony but finding the "crux" of the testimony

consistent. (J.A. at 17A.) For instance, the ALJ credited the testimony

of one QSI employee, Ebdin Perez, that he was taken to a dark room,

beaten, taken out the back door and almost stuck in a trash can.

Although the ALJ considered this "bizarre," he "noted the short physi-

cal stature of Perez and f[ound] it would be possible to put him inside

of a large trash can." (J.A. at 18.) Without discussing the testimony

of Smithfield’s witnesses, the ALJ nonetheless noted that in a prior

case "Chief Danny Priest was found to have engaged in violence per-

petrated upon employee union supporters." (J.A. at 18.)

Smithfield appealed the ALJ’s decision to the Board, arguing: (1)

that the November 15, 2003 walkout was not a protected activity; (2)

that, assuming the walkout was a protected activity, it was unreason-

able; and (3) that the ALJ’s credibility determinations were in error.

The Board issued a unanimous opinion on April 28, 2006 upholding

the ALJ’s ruling and adopting its findings of facts and conclusions of

law. In its opinion, the Board clarified the ALJ’s reasoning in some

respects relevant to our review. First, the Board noted that the ALJ

considered whether the walkout was a reasonable means of protest

and ruled that "consistent with the Supreme Court’s decision in

N.L.R.B. v. Washington Aluminum Co., the Board has not imposed a

reasonable means requirement on employees’ concerted activity."

(J.A. at 56 (quotation marks omitted.)) The Board held in the alterna-

tive, however, that even if it were to apply a reasonableness standard

to employee concerted activity taken in response to the termination of

supervisors, "[it] would affirm" because "a main impetus of the walk-

out was Respondent QSI’s discharge of Supervisor Cruz." (J.A. at

10 SMITHFIELD PACKING COMPANY v. NLRB

56.) Because Cruz’s rehiring had been part of the November 10 agree-

ment, his termination on November 15 permitted the employees to

"reasonably conclude[ ] not only that QSI had reneged on its agree-

ment but also that further discussion with QSI was an ineffective

means of protest." (J.A. at 57.) The Board further noted that "the

employees had no bargaining representative to present their griev-

ances to QSI." (J.A. at 57.) Smithfield filed a timely petition for

review of the Board’s order, and the Board filed a cross-application

for enforcement of the portion of its order finding Smithfield in viola-

tion of § 8(a)(1) for a separate incident explained below. We have

jurisdiction under § 10(e) of the Act. 29 U.S.C.A. § 160(e) (West

1998 & Supp. 2007).

II.

A.

In its petition for review, Smithfield raises three issues: (1) that the

Board denied due process by failing to inform Smithfield of the

charges against it;6 (2) that the employees’ walkout on November 15

was not protected activity under § 7; and (3) that substantial evidence

does not support a finding that Smithfield violated § 8(a)(1). For the

reasons that follow, we conclude that the walkout by QSI employees

6

Smithfield’s argument that its due process rights were violated stems

from the Administrative Law Judge’s denial of Smithfield’s Motion for

a Bill of Particulars. In denying that motion, the ALJ concluded the

Board’s complaint was sufficient to put Smithfield on notice of the

charges against it because Smithfield should have possessed the relevant

information regarding which of its employees were at the Plant that eve-

ning. We do not see how this action violated Smithfield’s due process

rights. Simply, "due process is not offended if an agency decides an issue

the parties fairly and fully litigated at a hearing." Yellow Freight System,

Inc. v. Martin, 954 F.2d 353, 358 (6th Cir. 1992). Such a result inures

because "[w]hen parties fully litigate an issue they obviously have notice

of the issue and have been given an opportunity to respond." Id. Here,

as is perhaps apparent from the remainder of our discussion, Smithfield

ably litigated each issue raised in the Board’s complaint, indicating that

it had sufficient notice and opportunity to respond.

SMITHFIELD PACKING COMPANY v. NLRB 11

on November 15 was not protected activity under § 7 and therefore

we grant Smithfield’s petition for review.7

Our standard of review in this context is a familiar one. The

Board’s legal interpretations are entitled to deference. Holly Farms

Corp. v. N.L.R.B., 517 U.S. 392, 409 (1996). Thus, we must defer to

the Board where it has chosen "between two fairly conflicting views,

even though the court would justifiably have made a different choice

had the matter been before it de novo." Universal Camera Corp. v.

N.L.R.B., 340 U.S. 474, 488 (1951). And the Board’s decisions are to

be upheld if its factual findings are supported by substantial evidence.

Id. at 493. This standard means the Board’s factual findings are to be

upheld "even though we might have reached a different result had we

heard the evidence in the first instance." N.L.R.B. v. Gen. Wood Pre-

serving Co., 905 F.2d 803, 810 (4th Cir. 1990) (internal quotation

marks omitted). Moreover, we note that substantial evidence is "more

than a scintilla." Richardson v. Perales, 402 U.S. 389, 401 (1971). It

is "such relevant evidence as a reasonable mind might accept as ade-

quate to support a conclusion." Consol. Edison Co. v. N.L.R.B., 305

U.S. 197, 229 (1938).

Section 7 of the Act provides protection to "[e]mployees" who

engage in "concerted activities for the purpose of collective bargain-

7

We also briefly note that, even if we were to conclude the walkout

was protected activity, substantial evidence does not support the Board’s

conclusion that Smithfield violated § 8(a)(1). 29 U.S.C.A. § 158(a)(1)

(West 1998 & Supp. 2007). Instead, a review of the record before the

ALJ leads to the inescapable conclusion that the ALJ offered, at best,

conclusory reasons for accepting the employees’ version of events. And,

of course, "[w]here an ALJ provides no more than a generalized, conclu-

sory statement purportedly incorporating a host of individual compara-

tive credibility determinations with respect to multiple witnesses, we

refuse to indulge the presumption that its findings are entitled to the ordi-

nary deference." Be-Lo Stores v. N.L.R.B., 126 F.3d 268, 279 (4th Cir.

1997). For instance, the ALJ’s treatment of the video bordered on the

absurd. After indicating that viewing even 45 minutes of video of the rel-

evant events was a hardship, the ALJ then found that the video displayed

the incorrect time frame even though (1) the parties stipulated that the

tape showed the relevant time frame; and (2) the entire video was in evi-

dence for the ALJ to watch.

12 SMITHFIELD PACKING COMPANY v. NLRB

ing or other mutual aid and protection." 29 U.S.C.A. § 157 (West

1998 & Supp. 2007). The Act "is not meant to be used offensively as

a sword—to discourage one’s employer from making an impending

layoff. The Act instead seeks to provide a shield—to protect employ-

ees who wish to band together and engage in concerted activity for

their mutual benefit." TNT Logistics of N. Am., Inc. v. N.L.R.B., 413

F.3d 402, 407 (4th Cir. 2005). Section 8(a)(1) implements the protec-

tions of § 7 by declaring "[i]t shall be an unfair labor practice for an

employer to interfere with, restrain, or coerce employees in the exer-

cise of rights guaranteed in [§ 7]." 29 U.S.C.A. § 158(a)(1). Of

course, "[t]here can . . . be no violation of § 8(a)(1) by the employer

if there is no underlying § 7 conduct by the employee. Conduct must

be both concerted and protected to fall within § 7." Yesterday’s Chil-

dren, Inc. v. N.L.R.B., 115 F.3d 36, 44 (1st Cir. 1997).

The ALJ concluded that the QSI employees engaged in concerted

protected activity on November 15 because "[e]mployees who walk

out in protest of the discharge of a supervisor are engaged in protected

concerted activity and are protected by Section 7 of the Act." (J.A. at

19A.) The ALJ further found that the walkout itself "was peaceful and

a reasonable means of protest under the Act." (J.A. at 19A.) The

Board adopted the ALJ’s first conclusion, but rejected the notion that

the means of protest must be reasonable. In the alternative, however,

and recognizing that "certain Federal courts of appeal consider the

reasonableness of the employees’ means of protest," the Board found

the walkout reasonable. (J.A. at 56.)

With respect for the Board’s views, we believe its conclusion that

all employee action taken in response to the discharge of a supervisor

is protected under § 7 is an unreasonable construction of the Act.

Instead, as § 7 makes clear, although the protections of the Act extend

to employees, those protections do not extend to supervisors, who are

explicitly excluded by virtue of the Taft-Hartley Act. Indeed, supervi-

sors are not protected under the Act for good reason: "[m]anagement,

like labor, must have faithful agents" N.L.R.B. v. Sheraton Puerto

Rico Corp., 651 F.2d 49, 51 (1st Cir. 1981) (quoting H.R. Rep. No.

245, 80th Cong., 1st Sess. 16-17 (1947)), and the Supreme Court has

explained that "supervisors [are] management obliged to be loyal to

their employer’s interests," Beasley v. Food Fair of N.C., 416 U.S.

653, 659-60 (1973). Thus, "[i]t is fundamental to the structure of the

SMITHFIELD PACKING COMPANY v. NLRB 13

Act that ‘not all forms of employee protest over supervisory changes

are per se protected.’" Yesterday’s Children, 115 F.3d at 45 (quoting

Puerto Rico Food Prods. Corp. v. N.L.R.B., 619 F.2d 153, 155 (1st

Cir. 1980)).

Such a conclusion follows because "[t]he guiding policy behind § 7

is not implicated when supervisors, who are management’s ‘faithful

agents,’ are the ones concertedly agitating against the employer’s

actions" nor when "non-supervisory employee concerted activity con-

cerns supervisory staffing matters." Id.; see also N.L.R.B. v. Oakes

Mach. Corp., 897 F.2d 84, 89 (2d Cir. 1990) ("Employee action seek-

ing to influence the identity of management hierarchy is normally

unprotected activity because it lies outside the sphere of legitimate

employee interest."). Indeed, it is "generally accepted that the hiring

and firing of supervisory personnel is a managerial action unrelated

to the terms and conditions of the work of non-supervisory employ-

ees." Bob Evans Farms, Inc. v. N.L.R.B., 163 F.3d 1012, 1021 (7th

Cir. 1998).

Although we have never considered the issue of employee action

in response to a supervisor’s discharge, as the above discussion sug-

gests, many of our sister circuits have done so, and their approaches

— even when they vary — demonstrate that the Board’s approach in

this case cannot be squared with § 7. Those appellate courts to have

considered the issue have generally concluded that employee protest

in response to personnel decisions regarding management is protected

under § 7 only when such protest is "in fact . . . a protest over the

actual conditions of [the employees’] employment" and the "means of

the protest [are] reasonable." Yesterday’s Children, 115 F.3d at 45;

see also Bob Evans Farms, 163 F.3d at 1021-22; Oakes Mach. Corp.,

897 F.2d at 89; Puerto Rico Food, 619 F.2d at 156; N.L.R.B. v. Okla-

Inn, 488 F.2d 498 (10th Cir. 1973); N.L.R.B. v. Guernsey Muskingum

Elec. Co-Op, Inc., 285 F.2d 8 (6th Cir. 1960). For the reasons that fol-

low, we adopt this approach to § 7 in cases involving the unique situa-

tion of employee protest in response to management personnel

changes.

First, it is only sensible that the Board must "proceed with caution"

when "non-supervisory employees engage in activity directly related

to the retention of supervisors or to supervisory activities." Sheraton

14 SMITHFIELD PACKING COMPANY v. NLRB

Puerto Rico, 651 F.2d at 52. When such activity occurs, "the

employee protest over a change in supervisory personnel must in fact

be a protest over the actual conditions of their employment." Puerto

Rico Food, 619 F.2d at 155 (alterations omitted). This rule is viewed

as a "narrow but well recognized exception to the general rule" that

supervisors gain no protection from the Act. Bob Evans Farms, 163

F.3d at 1021.

Such personnel decisions regarding management will affect the

terms and conditions of employees only in "exceptional cases." Bob

Evans Farms, 163 F.3d at 1022. Thus, for example, "instruct[ing] the

employees on the manner of performing their jobs" appears to charac-

terize the actions of "any proper supervisor." Puerto Rico Food, 619

F.2d at 156. Indeed, "every dispute over managerial employees

involves working conditions to some degree." Sheraton Puerto Rico,

651 F.2d at 53; see also Bob Evans Farms, 163 F.3d at 1022

("Lending a sympathetic ear and umpiring coworker disputes are part

of what supervisors do."). Instead, the "impact of such supervisors on

working conditions must be special, or at least distinct from the effect

which supervisors usually have on employees." Sheraton Puerto Rico,

651 F.2d at 53 (internal quotation marks omitted). Absent such a

dichotomy, "the line between managers and workers would erode,

inconsistently with the rule that denies supervisors the protection of

labor law." Trompler Inc. v. N.L.R.B., 338 F.3d 747, 749 (7th Cir.

2003). For instance, the terms and conditions of an employee’s work-

place may be at issue when the personnel decision is "linked with an

underlying employment related concern" so that the supervisor in

question "has either contributed to the underlying complaint . . . or

has sought to alleviate the pre-existing grievance." Puerto Rico Food,

619 F.2d at 156. And, in making this determination the initial focus

should be upon "the employees’ subjective state of mind." Id.; see

also Bob Evans Farms, 163 F.3d at 1022 (finding "substantial evi-

dence that [a supervisor’s] removal would signal a downturn in the

working conditions of her charges and was therefore a legitimate

employee concern").

We also believe a reasonableness standard is appropriate in this

context. The Board’s rejection of a reasonableness test for the means

of protest relies upon dicta from N.L.R.B. v. Washington Aluminum

Co., 370 U.S. 9 (1962), which held, in finding employees’ decision

SMITHFIELD PACKING COMPANY v. NLRB 15

to leave an unheated factory in the middle of winter was protected

under § 7, that activity is protected unless it is "unlawful, violent or

in breach of contract . . . [or] characterized as ‘indefensible’ because

they . . . show a disloyalty to the employer." Id. at 17. The Washing-

ton Aluminum Court also posited in dicta that "it has long been settled

that the reasonableness of workers’ decisions to engage in concerted

activity is irrelevant to the determination of whether a labor dispute

exists or not." Id. at 16.

Although we owe deference to the Board’s legal conclusions, we

cannot abide by its construction of the Act in the context of employee

reaction to supervisory terminations. The Board’s approach of pro-

tecting all such employee reaction regardless of reasonableness utterly

fails to account for the bedrock principle that management’s role is

to be faithful to the employer, not the employee. In addition, the dicta

posited in Washington Aluminum simply carries no weight in this con-

text. As the First Circuit has explained, "Washington Aluminum did

not involve the peculiar issue of changes in supervisory personnel."

Abilities and Goodwill Inc. v. N.L.R.B., 612 F.2d 6, 10 (1st Cir. 1979).

It is only sensible that in an area where "such changes [in supervisory

personnel] have only recently been regarded as matters of legitimate

employee concern and even then subject to the legitimate claim of

employers to a minimum of interference in this area," some limitation

on the means of protest employed by employees would exist. Id.; see

also Dobbs Houses, Inc. v. N.L.R.B., 325 F.2d 531, 539 (5th Cir.

1963) ("The cause of the employees’ grievance must be considered in

determining the reasonableness of their course of conduct undertaken

in protest."). In one of the more recent cases to examine this tension,

the Seventh Circuit, in Trompler, suggested that the reasonableness

standard might be properly viewed as a part of the inquiry into

whether protected concerted activity occurred rather than as a sepa-

rate factor. Trompler, 338 F.3d at 749; see also Oakes Mach. Corp.,

897 F.2d at 89 (listing reasonableness as one of four factors in deter-

mining whether the termination of supervisors affected terms and

conditions of employees). Regardless of the specific approach, how-

ever, a reasonableness standard has been adopted by every court to

have considered the issue.

In sum, we believe the Board’s interpretation of § 7 in the unique

context of employee protest regarding supervisory personnel change

16 SMITHFIELD PACKING COMPANY v. NLRB

is unreasonable and should not be given deference. Instead, we

choose to follow the approach of our sister circuits, that employee

protest in response to personnel decisions regarding management is

protected under § 7 only where such protest is "in fact . . . a protest

over the actual conditions of their employment" and the "means of the

protest [are] reasonable." Yesterday’s Children, 115 F.3d at 45. Such

an approach also aligns with our own precedent interpreting § 7.

Although we have noted that the language of § 7 is "broadly-worded,"

we have also cautioned that "it is not without limits." TNT Logistics,

413 F.3d at 407. Indeed, "[t]he purpose of the act was not to guaran-

tee to employees the right to do as they please." Joanna Cotton Mills

Co. v. N.L.R.B., 176 F.2d 749, 752 (4th Cir. 1949)(internal citation

omitted). "[I]t is not the motive of the participants that we are con-

cerned with here but the ‘purpose’ of the activity." Id. at 753. To be

protected, "the purpose of the concerted activities must be the mutual

aid or protection of the employees."8 Id. A contrary ruling, as urged

by the Board, would inevitably blur the line between employers and

employees and potentially create a CEO-by-committee approach

whereby employees could control the hiring and firing of their man-

agers by walking out over every managerial change. The Board’s

approach fails to recognize that "[m]anagement, like labor, must have

faithful agents." Sheraton Puerto Rico, 651 F.2d at 51.

B.

With this framework in place, we turn to whether the actions of

QSI’s employees on the morning of November 15, 2003 were prop-

erly found to be protected under § 7.

First, we note that neither the ALJ nor the Board considered

whether the walkout was in fact a protest over the actual terms and

conditions of employment. Instead, the ALJ simply found that

"[e]mployees who walk out in protest of the discharge of a supervisor

are engaged in protected concerted activity." (J.A. at 19A.) In review-

ing administrative action, it is axiomatic that the basis for such action

"be set forth with such clarity as to be understandable" because we

8

As we recently explained, "[d]etermining whether activity is protected

or not depends on a proper identification of the activity’s purpose." TNT

Logistics of N. Am., Inc. v. N.L.R.B., 413 F.3d 402, 407 (4th Cir. 2005).

SMITHFIELD PACKING COMPANY v. NLRB 17

must "judge the propriety of such action solely by the grounds

invoked by the agency." S.E.C. v. Chenery Corp., 332 U.S. 194, 196

(1947). And "[f]or purposes of affirming no less than reversing its

orders, an appellate court cannot intrude upon the domain which Con-

gress has exclusively entrusted to an administrative agency." S.E.C.

v. Chenery Corp., 318 U.S. 80, 88 (1943). We thus "remand a case

to an agency for decision of a matter that statutes place primarily in

agency hands." I.N.S. v. Ventura, 537 U.S. 12, 16 (2002) (per curiam).

The rule rests on the "basic proposition that a reviewing court may

not decide matters that Congress has assigned to an agency." W. Va.

Highlands Conservancy, Inc. v. Norton, 343 F.3d 239, 248 (4th Cir.

2003). Thus, the fact that neither the ALJ nor the Board passed upon

the question of whether the QSI employees’ action implicated the

terms and conditions of their employment precludes us from doing so

here. It does not, however, require us to remand the case to the Board

because the Board did pass upon the reasonableness of the walkout

and, because we conclude that the Board’s finding that the walkout

was reasonable was an unreasonable legal conclusion, we grant the

petition for review.

As a starting point, we note that in virtually every case involving

an employee walkout in response to a supervisor’s termination, the

court has found such a choice unreasonable. See, e.g., Puerto Rico

Food, 619 F.2d at 156 (noting "[g]enerally, strikes over changes in

even low level supervisory personnel are not protected" (internal quo-

tation marks omitted)); Abilities & Goodwill, 612 F.2d at 11

(employee "sick out" unprotected); Bob Evans Farms, 163 F.3d at

1022-23) (en masse walkout by wait-staff during busy shift not pro-

tected); Dobbs Houses, 325 F.2d at 538-39 (walkout by waitresses "at

the height of the dinner hour" unreasonable); Henning & Cheadle,

Inc. v. N.L.R.B., 522 F.2d 1050, 1055 (7th Cir. 1975) (walkout unrea-

sonable when departmental deadline existed). As the Seventh Circuit

noted at the time it decided Bob Evans Farms, although case law does

not necessarily "condemn[ ] walkouts generically in this context,"

there "is apparently no reported instance of a work stoppage suffi-

ciently tempered to win court approval." Id. at 1023. In contrast,

courts have routinely approved of less drastic means of protest. See,

e.g., Atlantic-Pacific Constr. Co. v. N.L.R.B., 52 F.3d 260, 264 (9th

Cir. 1995) (approving of letter written to complain about direct super-

visor); Oakes Mach. Corp., 897 F.2d at 89 (protecting employee com-

18 SMITHFIELD PACKING COMPANY v. NLRB

plaints about company president who dealt directly with them because

president "directly affect[ed] working conditions by tying salary

increases to company profitability and then prevent[ed] employees

from working on profitable company projects"); Guernsey-

Muskingum Elec., 285 F.2d at 12-13 (approving of employee oral

complaint about foreman); N.L.R.B. v. Phoenix Mut. Life Ins. Co., 167

F.2d 983, 988 (7th Cir. 1948) (supporting employees’ entitlement to

write a letter complaining about supervisor).

We recognize that, more recently, the Seventh Circuit has, in fact,

affirmed a Board decision finding a § 8(a)(1) violation resulted from

an employee strike regarding management activity. See Trompler, 338

F.3d at 752. A closer look at the Seventh Circuit’s resolution of that

case, however, serves to buttress our finding that the walkout perpe-

trated by QSI’s employees on November 15 was unprotected. In

Trompler, an employer fired six employees who walked off a shift

because their shift supervisor "failed to prevent sexual harassment of

one of the six workers by another [who had not joined the walkout],"

"failed to deal competently with a worker’s drug problem," and

"didn’t know how to operate the machines used by the workers."

Trompler, 338 F.3d at 748. In upholding the Board’s ruling, the court

noted that although the employee action caused the production to shut

down for the remainder of the shift, "Trompler was able to make up

the lost production . . . at no higher cost or loss of revenue." Id. at

752. Trompler underscores the rationale behind the line of cases con-

cluding that walkouts and strikes are unreasonable means of protest-

ing personnel decisions regarding management: that such actions

cause financial injury to the employer. And, in the context of deciding

whether to retain or hire management personnel, it is unreasonable to

permit employees to cause financial harm to the employer in order to

make their demands heard. A contrary result, as discussed above,

would undermine the employer’s prerogative to assign faithful agents

to serve in its stead.

In contrast to Trompler, the QSI workers’ actions were unreason-

able in this instance: they walked off during the shift, causing poten-

tially massive harm—not just to QSI but also to Smithfield which,

under USDA regulations, cannot operate its production shifts in the

Plant until the Plant is certified clean by the USDA. With respect to

the Seventh Circuit, if the loss of a shift at Bob Evans, and the corre-

SMITHFIELD PACKING COMPANY v. NLRB 19

sponding loss of its (admittedly delectable) home-style breakfasts is

unreasonable, certainly the loss of production at one of America’s

largest food producers is unreasonable. The means of protest pursued

by QSI’s employees in this case affected not only QSI’s ability to per-

form its contract with Smithfield but also risked requiring 2,000 to

3,000 workers to lose one day of work. Accordingly, because QSI’s

employees on November 15 "strayed into the realm of unprotected

activity," Bob Evans Farms, 163 F.3d at 1024, we grant Smithfield’s

petition for review.

III.

Finally, the Board cross-applies for enforcement of the portion of

its order finding that Smithfield violated § 8(a)(1) by retaliating

against an employee, Dan English, for his union activities. Specifi-

cally, the Board found that Smithfield refused to consider English for

a job opening in another department because he was photographed by

a local paper supporting union activities. Smithfield has not chal-

lenged this finding in its petition for review and it has been our prac-

tice, from which we shall not deviate here, to grant enforcement to

unchallenged portions of a Board order. See N.L.R.B. v. Daniel

Constr. Co., 731 F.2d 191, 193 (4th Cir. 1984) (enforcing unchal-

lenged portions of Board order).

IV.

For the foregoing reasons, Smithfield’s petition for review is

granted and the Board’s cross-application for enforcement is granted

in part and denied in part.

PETITION FOR REVIEW GRANTED;

CROSS-APPLICATION FOR ENFORCEMENT

GRANTED IN PART AND DENIED IN PART