The opinion
Case: 24-60653 Document: 135-1 Page: 1 Date Filed: 09/04/2026
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
____________
FILED
September 4, 2026
No. 24-60653
____________ Lyle W. Cayce
Clerk
Starbucks Corporation,
Petitioner/Cross-Respondent,
versus
National Labor Relations Board,
Respondent/Cross-Petitioner.
______________________________
On Petition for Review and Cross-Application for Enforcement of an Order
of the National Labor Relations Board
Agency No. 14-CA-300065
______________________________
Before Smith, Wiener,1 and Higginson, Circuit Judges.
Stephen A. Higginson, Circuit Judge:
Starbucks petitions for review of the National Labor Relations Board’s
(the “Board”) determination that Starbucks violated the National Labor
Relations Act (the “NLRA”) due to a number of statements made by store
managers to employees with respect to protected activities.
_____________________
1
Judge Wiener was present for oral argument but is unable to participate in this
decision. The case is decided by a quorum. See 28 U.S.C. § 46(d).
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The NLRA “functions to regulate conduct attending organizational
activities in the workplace in a manner that balances between protecting the
rights of employees, employers, and to a lesser extent the union.” UNF W.,
Inc. v. NLRB, 844 F.3d 451, 457 (5th Cir. 2016) (citation modified). Under
Section 7 of the NLRA, employees have rights including the right to organize,
to “form, join, or assist labor organizations,” to pursue collective bargaining
through representatives, and more. 29 U.S.C. § 157 (2015). In turn, Section
8(a)(1) of the NLRA provides protection to employees such that employer
actions do not “interfere with, restrain, or coerce employees in the exercise
of the rights guaranteed in [Section 7].” 29 U.S.C. § 158 (a)(1).
But employers retain rights as well. Namely, “employers’ right of free
expression of opinion and fact” has long been protected. Brown & Root, Inc.
v. NLRB, 333 F.3d 628, 635 (5th Cir. 2003). Under the First Amendment and
Section 8(c) of the NLRA, employers may communicate their views about
unionization and to make “prediction[s] as to the precise effects [they]
believe[] unionization will have.” NLRB v. Gissel Packing Co., 395 U.S. 575,
618 (1969). However, speech that threatens “reprisal” violates the NLRA.
29 U.S.C. § 158(c).
The Board found that Starbucks violated Section 8(a)(1) of the NLRA
by threatening employees with reprisal for participating in unionization
efforts and creating the impression that it was surveilling employee
organizing activity. Taking the facts underlying each claim below, we grant
enforcement of the NLRB’s decision as to one threat of reprisal
determination and deny enforcement as to the other determinations.
I.
Around the time of the events underlying the present action, in 2022,
there was discussion of unionization in Starbucks stores across the country
and, in particular, in Kansas City. This petition centers around one Starbucks
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store—on North Amidon Avenue in Wichita, Kansas (the “Amidon
store”)—that had not yet unionized.
The Amidon store was managed by Carmella Neri. The store’s
assistant manager was Lauren Jacobs. In various interactions, both Neri and
Jacobs made comments to employees referencing unions and unionization
activity in the store. There were a number of interactions between the
Amidon store managers and employees that gave rise to the claims
underlying this petition. First, Neri made statements in individual employee
meetings that referenced unions and potential changes to benefits that cannot
be guaranteed in the bargaining process. Further, Neri explained to an
employee why the Amidon store’s hours were being shortened, with
reference to relieving union pressure on employees. Jacobs also explained to
an employee why the hiring portal was down, describing the difficulties with
hiring when the managers are unable to discuss the union with prospective
employees. The facts of these interactions will be provided in greater detail
in Part III.
In July 2022, following the unionization election among Amidon store
employees wherein the union lost, the union filed charges against Starbucks
with the Board. In December 2022, the Board’s General Counsel
(hereinafter referred to as the “NLRB”) issued a complaint alleging that
Starbucks violated Section 8(a)(1) of the NLRA by: “threatening employees
with loss of benefits if they unionized; creating the impression that
employees’ union activities were under surveillance; and telling employees it
closed its hiring portal and reduced store hours because of employees’ union
or other protected activities.”
The complaint was brought before an administrative law judge
(“ALJ”) who conducted a one-day virtual hearing on April 4, 2023. During
the hearing, the three employees and Neri testified. The ALJ ultimately
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found that Starbucks violated the NLRA by creating the impression of
surveillance and making threats of reprisal. Relevant here, the ALJ found
unlawful employer speech, under Section 8(a)(1), resulting from Neri’s
alleged statements in the April employee meetings, Jacobs’s alleged
statement about the hiring portal, and Neri’s alleged comment about store
hours.
Following the ALJ’s decision, Starbucks filed exceptions before the
Board. The Board consisted of Chairman McFerran and Members Kaplan
and Prouty. It adopted the ALJ’s findings that Starbucks violated Section
8(a)(1) of the NLRA. But Kaplan dissented in part: he disagreed with the
finding of surveillance and also found it “unnecessary to pass” on the two
coercive statements regarding hiring and store hours.
The Board narrowed the ALJ’s remedy for the violations, holding that
the violations did not “warrant[] a broad cease-and-desist order.” It issued a
narrow order “requiring [Starbucks] to cease and desist from violating the
Act ‘in any like or related manner.’” The Board also ordered Starbucks to
post a remedial notice of specified text that acknowledges Starbucks violated
labor laws, that employees have a right to join a union, and that Starbucks will
not act in the manner it did.
Starbucks timely petitioned for review and the NLRB cross-petitioned
for enforcement. See generally 29 U.S.C. § 160; see also Apple Inc. v. NLRB,
143 F.4th 291, 296 (5th Cir. 2025). Jurisdiction is proper, and no party argues
otherwise. See 29.U.S.C. § 160(e)–(f); Apple Inc., 143 F.4th at 296.
II.
We review the Board’s legal conclusions de novo. Dresser-Rand Co. v.
NLRB, 838 F.3d 512, 516 (5th Cir. 2016).
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We uphold the Board’s factual findings “only if they are supported by
evidence that is substantial when viewed in light of the record as a whole,
including ‘whatever in the record fairly detracts from its weight.’” NLRB v.
AllService Plumbing & Maint., Inc., 138 F.4th 889, 900 (5th Cir. 2025)
(quoting Dish Network Corp. v. NLRB, 953 F.3d 370, 376 (5th Cir. 2020)).
The substantial evidence standard considers “such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion.”
Universal Camera v. NLRB, 340 U.S. 474, 477 (1951). However, “a flawed
reading of the record provides no substantial evidence for a finding,” Dish
Network Corp., 953 F.3d at 376 (citation modified), and we “must reject an
order of the Board when it fails to grapple with countervailing portions of the
record.” AllService Plumbing, 138 F.4th at 900–01 (citation modified).
Finally, “[t]o the extent the Board affirms and adopts an ALJ’s
findings and conclusions, we apply these same deferential standards to the
ALJ’s decision itself.” In-N-Out Burger, Inc. v. NLRB, 894 F.3d 707, 714 (5th
Cir. 2018).
III.
As a general matter, Section 8(c) of the NLRA “explicitly provides
that an employer has the right to express ‘any views, argument, or opinion’
so long as ‘such expression contains no threat of reprisal or force or promise
of benefit.’” Brown & Root, 333 F.3d at 633 (quoting 29 U.S.C.
§ 158(c)). Thus, “an employer is free to communicate to employees a
statement of opinion about the union as well as predict the effect of
unionization on the workplace so long as such a prediction is based on
objectively verifiable facts and it does not contain a threat of reprisal or
force.” Id. (citation omitted). Employer statements rise to the level of a
threat of reprisal “where ‘under the totality of the circumstances, an
employee could reasonably conclude that the employer is threatening
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economic reprisals if the employee supports’ protected conduct.” Renew
Home Health v. NLRB, 95 F.4th 231, 242 (5th Cir. 2024) (quoting Brown &
Root, 333 F.3d at 634 n.3) (citation modified).
Various statements made by Amidon store managers in conversation
with employees are at issue in the present case. These conversations gave rise
to the Board’s determination that Starbucks unlawfully threatened reprisal
in violation of Section 8(a)(1) in three ways: statements made in employee
meetings potentially implicating loss of benefits; telling employees that store
hours changed; and explaining to employees why the hiring portal was closed.
Moreover, the Board also found that when considered together, the
conversations supported the determination that Starbucks created an
unlawful impression of surveillance in violation of Section 8(a)(1). We
address each of the claims below.
A. Loss of Benefits
Starbucks first challenges the Board’s finding that, in 1:1 meetings,
Neri’s statements constituted threats of reprisal by “threatening
employees . . . with loss of benefits if they engaged in union or
other protected activities.” Finding that at least one of the statements is
supported by substantial evidence, we grant enforcement of the Board’s
decision.
1.
The facts underlying this claim are as follows. Neri held Performance
Development Conversations (“PDC meetings”) with each employee, twice
a year. In April 2022, Neri had meetings with three employees: Arden
Ingram, Maia Cuellar-Serafini, and Ramon Fonseca. These employees were
relatively new, having started work within the past year. The meetings lasted
for 10 to 20 minutes, during which Neri covered employee performance,
career development interest, and Starbucks benefits. Neri also “had a
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benefits-enrollment packet, which described employee benefits such as
health coverage and paid parental leave, that she either showed or read to
employees.”
As relates to this claim, the below summaries describe only the
pertinent statements Neri made in the PDC meetings with Cuellar-Serafini
and Fonseca—statements regarding knowledge of union activity in the
Amidon store or of the effects of unionization. Notably, this information was
in large part drawn from the employees’ testimony and recall of the meetings,
because Neri’s testimony was not as detailed, nor did the ALJ credit it.2
Cuellar-Serafini. In this meeting, Neri shared with Cuellar-Serafini
that she was aware of discussions about union organizing in the store and that
“there was talk going around.” Cuellar-Serafini was pregnant at the time and
testified that Neri discussed Starbucks’s benefits, highlighting the maternity-
leave benefits. However, she testified that “after explaining the benefits,
[Neri] . . . said, ‘If you were interested in organizing, these benefits could not
be guaranteed to you.’”3 Cuellar-Serafini also recalled that Neri advised her
_____________________
2
Neri testified that she did not recall being aware of unionizing activity in her store,
but she “wanted to make sure that they had information in case they had any questions
about what was going on in Kansas City.” The ALJ’s credibility choices are binding
“unless one of the following factors exists: (1) the credibility choice is unreasonable, (2) the
choice contradicts other findings, (3) the choice is based upon inadequate reasons or no
reason, or (4) the ALJ failed to justify his choice.” UNF W., 844 F.3d at 457
(quoting Asarco, Inc. v. NLRB, 86 F.3d 1401, 1406 (5th Cir. 1996)). None of these factors
exists and therefore we maintain the ALJ’s credibility finding.
3
Cuellar-Serafini testified that Neri pulled the benefits package away while telling
Cuellar-Serafini that benefits may not be guaranteed. However, Cuellar-Serafini had
previously submitted an affidavit that does not mention this, and, in her testimony, she
stated that her recollection of events would have been more accurate at the time of her
affidavit.
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and other employees to do their own research about the union and make the
decision that was right for them.
Fonseca. In this meeting, Neri said she was aware of “some
unionization efforts going around in the district.” Fonseca recalled that Neri
“helped [him] look through the packet [of benefits],” and she “brought up
the Union while we were talking about it, and said that if we were to unionize,
then our benefits would be put on the table, and potentially we could lose
some of them or, you know, who knows what the change would be if we were
to unionize.”
The ALJ held that Neri’s statements in these PDC meetings violated
the NLRA because they “threaten[ed] employees with the loss of benefits if
they selected the Union as their bargaining representative.” The ALJ, relying
on Gissel Packing Co., considered the references to benefits to be a prediction
and reasoned that “[s]tatements that predict changes in working conditions
or benefits must be ‘carefully phrased on the basis of objective fact’ to reflect
the give-and-take nature of future collective bargaining.” See Gissel Packing
Co., 395 U.S. at 618.
The ALJ held that Neri’s statements in the PDC meetings included
unlawful threats of reprisal. First, “Neri stated that Cuellar-Serafini could
not be guaranteed maternity benefits if employees unionized,” and without
mentioning that “benefits could also go up, Neri implicitly threatened that
Cuellar-Serafini stood only to lose crucial benefits.” Second, Neri’s
statements to Fonseca that “benefits would be put on the table, and
potentially some could be lost, if employees unionized,” lacked reference to
or explanation of “the give-and-take nature of collective bargaining.”
Without “objective facts” to support Neri’s statements, they constituted a
threat of “the loss of existing benefits.”
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The Board adopted the ALJ’s findings. Kaplan wrote separately. He
agreed that the statement to Cuellar-Serafini was unlawful under Board
precedent, which requires reference to the collective bargaining process.
However, Kaplan noted that the ALJ “mischaracterized the record in stating
that during her PDC meeting with Cuellar-Serafini, Neri told Cuellar-
Serafini that she could not be guaranteed maternity benefits if employees
unionized.” Instead, “Neri’s statement that benefits could not be guaranteed
referred to benefits in general not just the maternity benefits.”4 Moreover,
because Kaplan agreed that the statement to Cuellar-Serafini constituted a
threat of reprisal, he also found it “unnecessary to pass on” whether the
statement to Fonseca in the PDC meeting was also a violation of Section
8(a)(1).
2.
Starbucks challenges the finding that Neri’s statements during PDC
meetings with Cuellar-Serafini and Fonseca amount to threats of reprisal by
referencing loss of benefits. Starbucks first argues that the ALJ, whose
reasoning was adopted by the Board, erred in applying the wrong burden of
proof. Substantively, Starbucks also argues that statements did not amount
to an unlawful prediction of the effect of unionization and that employee
subjective impressions are relevant. We disagree on both grounds with
respect to the statements Neri made to Cuellar-Serafini, granting the
NLRB’s request for enforcement of the Board’s determination, and we need
not reach the statements to Fonseca.
_____________________
4
As Kaplan recounted, Cuellar-Serafini testified that “Neri explained the
benefits” and then stated, “If you were interested in organizing, these benefits could not
be guaranteed you.”
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a.
As a first-order issue, Starbucks contends that the Board erred in
adopting the ALJ’s reasoning that Starbucks failed to meet its burden of
proof. Starbucks argues that the NLRB “carries the burden of proving the
elements of an unfair labor practice.” NLRB v. Transp. Mgmt. Corp., 462 U.S.
393, 401 (1983). The ALJ, relying on Board precedent, held that “[t]he
burden of proof falls on the employer to show that their statements were
based on fact and not threats.”
In Valmont Industries, Inc. v. NLRB, we addressed burden shifting. 244
F.3d 454, 464–65 (5th Cir. 2001). There, in the context of a Section 8(a)(3)
violation, our court recognized that once the NLRB had made “the required
showing, the burden shifts to the employer to prove by a preponderance of
the evidence that it would have discharged or disciplined the employee even
if the employee had not engaged in union activity.” Id. at 465. While different
than a Section 8(a)(1) violation, we apply the same burden shifting principle
here.
Accordingly, we disagree with Starbucks that the burden remained on
the NLRB. The Board placed the burden on Starbucks after finding that the
NLRB demonstrated that Neri’s statements were coercive. Starbucks then
needed to prove that it negated any coercive threat, for example by
demonstrating that statements were fact-based as discussed in the following
section.
b.
Turning to the substantive issue, in determining whether a statement
was unlawful, we consider both whether it was a predictive statement and
whether a reasonable employee would perceive a threat. Under our
precedent, we agree that Neri’s statements to Cuellar-Serafini contained
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both of these qualities, thus the Board did not err in finding a threat of
reprisal.
Starbucks contends that Neri’s statements in the PDC meetings were
dissimilar to the types of statements that our precedents have found to be
unlawful predictions. It also argues that Neri’s statement generally alludes to
the bargaining process and was non-coercive in nature. The question of
“whether statements have a threatening quality is a factual” one, which is
entitled to deferential substantial-evidence review. UNF W., 844 F.3d at 462
n.7.
Employers may “tell ‘what [they] reasonably believe[] will be the
likely economic consequences of unionization that are outside [their]
control,’ and not ‘threats of economic reprisal to be taken solely on [their]
own volition.’” Gissel Packing Co., 395 U.S. at 619 (quoting NLRB v. River
Togs, Inc., 382 F.2d 198, 202 (2d Cir. 1967)). However, the context
surrounding the statement matters. With respect to statements that address
wage or benefit reductions, we have held that “such a statement is not a threat
of reprisal where it was made in a context indicating that bargaining is a
process in which each side makes its own proposals, that it requires mutual
agreement, and where existing benefits may be traded away.” UNF W., 844
F.3d at 458 (emphasis in original) (citation modified); see also Gissel, 395 U.S.
at 618 (holding that employer predictive statements “must be carefully
phrased on the basis of objective fact to convey an employer’s belief as to
demonstrably probable consequences beyond his control”).
But a statement is “impermissible” when it fails to include “any
reference to the collective-bargaining process or to any economic necessities
or other objective facts as a basis for its prediction that wages might be
reduced.” UNF W., 844 F.3d at 458 (internal quotation marks and citation
omitted). Here, Neri stated that “benefits could not be guaranteed” to
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Cuellar-Serafini if she was interested in organizing. This statement included
none of the requisite context to temper the predictive statements and ground
them in objective fact. See id.
Moreover, Neri made this statement after having just highlighted the
maternity benefits to Cuellar-Serafini. Although the ALJ mischaracterized
the testimony,5 it remains true that Neri highlighted maternity benefits and
proceeded to say that benefits may not be guaranteed, thus suggesting
“Cuellar-Serafini stood only to lose crucial benefits.” Without context, the
statements were not clearly “cast as a prediction of demonstrable economic
consequences, but rather as a threat of retaliatory action,” one that can “be
taken solely on [Starbucks’s] own volition.” Gissel, 395 U.S. at 619 (internal
quotation marks and citation omitted). Thus, even though Neri’s “statement
could be plausibly understood as highlighting the give-and-take of
negotiation,” her statement that “benefits could not be guaranteed” due to
organizing, “paired with reference to benefits that were wholly
in Starbucks’s control could be reasonably interpreted as a suggestion
that Starbucks was going to take a punitive bargaining position by threatening
those benefits.” Starbucks Corp. v. NLRB, 179 F.4th 321, 330 (5th Cir. 2026).
Finally, Starbucks argues that the context of Neri’s statements was
non-coercive, including the fact that the PDC meetings with employees were
short discussions and generally for providing positive feedback. Moreover, it
reasons that there is no evidence that Cuellar-Serafini, for example, felt
threatened. These background facts are unavailing. We are only concerned
with the objective employee perspective under the totality of the
_____________________
5
The ALJ explained that “Neri stated that Cuellar-Serafini could not be
guaranteed maternity benefits if employees unionized.” While the maternity benefits
appear to have been implicated in Neri’s statement, the record does not support finding
that Neri stated that outright.
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circumstances. Renew Home Health, 95 F.4th at 242. Maintaining an objective
standard, the Board’s decision—that an employee could reasonably feel their
union activities were threatened by a suggested reduction in benefits—was
supported by substantial evidence. Coupled with the reasonable finding that
Neri’s statements were unlawful predictive statements, we grant
enforcement of the Board’s determination that Neri’s statements to Cuellar-
Serafini constituted an unlawful threat of reprisal.
Because we reach this finding regarding the statements to Cuellar-
Serafini in the PDC meeting, we need not separately address the statements
made to Fonseca. As Kaplan recognized, the remedy is the same regardless.
B. Store Hours Changes
Starbucks next challenges the Board’s finding that it acted unlawfully
where a manager told “employees that it had reduced the store’s operating
hours because of the employees’ union or other protected activities.” We
conclude that this statement did not rise to the level of a threat of reprisal.
1.
Throughout the spring of 2022, the Amidon store experienced
staffing shortages. In the summer, Neri began closing the store a half-hour
earlier on weekdays and an hour and a half earlier on weekends.
The specific statement at issue stems from a conversation wherein
Fonseca inquired about the hours change. Fonseca testified that he asked
Neri why the store was closing earlier, to which Neri said that it was “to
relieve some of the pressure that the Union had on the people.” Fonseca
testified that he simply responded, “Okay.”
Starbucks requires both a shift supervisor and a barista to be working
in order for the store to be open. Employee shifts “can only [be] schedule[d]
eight hours at a time, at a maximum,” so in reducing the store hours to 16
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hours per day, Neri testified that she was able to schedule “two supervisors
for the whole day, one in the morning and one at night, and then Baristas
also.”
Notably, Fonseca was a shift supervisor. In this position, he was privy
to information about why employees were missing work. Fonseca testified
that “there was a decent amount” of employees who were not showing up to
work around this time.6 He understood these “call-outs” were not union-
related; employees “were mostly calling off when they were sick, or some
incident happened.” Fonseca also testified that employee “call-outs”
interfered with the store’s ability to stay open, and that the Amidon store has
had to close early a number of times “[b]ecause it wasn’t properly staffed.”
The ALJ held that Starbucks violated the NLRA when “Neri told
Fonseca in July that the Amidon store hours had been reduced by a half hour
due to the union activity of the store’s employees.” The ALJ reasoned that
“it is irrelevant” that “the evidence failed to provide that [this] adverse
action was due to union activity.” Additionally, the ALJ credited Fonseca’s,
but not Neri’s, testimony regarding this interaction. The Board adopted the
ALJ’s determination that it constituted an unlawful threat for Starbucks to
have “link[ed] the . . . reduction in employees’ work hours by a half hour to
Section 7 activity.”
2.
We analyze whether the statements regarding store hours constitute a
threat of reprisal under the same framework set forth above. Here, however,
_____________________
6
Neri also testified to the extent of shortages, explaining that there had been 27
call-outs in a single week.
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we find the Board’s decision is not supported by substantial evidence and
deny enforcement of this claim.
First, the ALJ mischaracterized Neri’s testimony. As Starbucks
argues, Neri “never actually said that the hours were reduced because
partners were participating ‘in union activity,’” as the ALJ recounted.
Although Neri’s statement regarding store hours referenced the union, she
did not suggest that union activity will be penalized. Neri’s remark was that
she was trying to “relieve some of the pressure that the Union had on the
people.” We find this materially different from linking the store hours change
to the employees’ protected activities.
This correction is of import for the very reason that it diminishes the
basis for finding Neri’s remark to be coercive. For example, in NLRB v.
McCullough Environmental Services, Inc., our court considered a threat to
reduce hours if the union won the representation election. 5 F.3d 923, 929–
30 (5th Cir. 1993). The NLRB relies on this case to contend that a reduction
of hours can constitute an unlawful labor practice. But that precedent is
readily distinguishable. Here, there is no outright threat or invocation of a
reduction in store hours in the same manner, rendering it meaningful to
capture what exactly Neri said. Accordingly, the Board’s reasoning, which
adopted that of the ALJ’s, failed to grapple with essential “countervailing
portions of the record” and is, therefore, lacking substantial evidence on that
basis alone. AllService Plumbing, 138 F.4th at 901.
Second, reviewing the record as a whole, it is not apparent that
substantial evidence supports the finding that a reasonable employee in
Fonseca’s shoes would have understood the statement to be a coercive
threat. The ALJ’s analysis is entirely based on Fonseca’s testimony about his
interaction with Neri, yet his testimony reveals that he understood the
challenges from understaffing and that it was not uncommon to respond by
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reducing hours. Specifically, he testified that, when understaffed, the hours
have had to fluctuate before and, as shift supervisor, he understood that
employees were calling out of work for illnesses or various personal
reasons—but not because of the union. Because we consider the “reasonable
inferences an employee could draw from the employer’s statements,”
McCullough Env’t Servs., Inc., 5 F.3d at 930 n.5, we recognize that a
reasonable employee in Fonseca’s position—a shift supervisor—would
understand Neri’s statement differently from how another employee
potentially would.
Because “we uphold the Board’s factual findings only if they are
supported by evidence that is substantial when viewed in light of the record
as a whole,” we therefore deny enforcement of the claim that Neri’s
statement regarding store hours constituted an unlawful threat in violation of
Section 8(a)(1). AllService Plumbing, 138 F.4th at 900.
C. Hiring Portal Changes
Next, Starbucks challenges the Board’s determination that a manager
“telling employees that it had closed the store’s hiring function . . . because
of the employees’ union or other protected activities” constituted a threat of
reprisal. As above, we conclude that the statement does not rise to the level
of a threat of reprisal.
1.
In April 2022, Fonseca received inquiries from customers interested
in applying for a job at Starbucks. Interested applicants apply through
Starbucks’s online hiring portal; however, the customers that spoke to
Fonseca claimed that they were unable to find the hiring portal to submit
their application. Jacobs did not testify, but according to Fonseca’s
testimony, he confirmed that the hiring portal was down for the Amidon
store. He later shared this with Jacobs, the store’s assistant manager. Fonseca
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testified that Jacobs responded by saying that the portal was closed “because
of the unionization efforts.” More specifically, he recalls Jacobs’s claiming,
“that with the unions, [Starbucks] couldn’t talk about [unions] during the
hiring process, so they . . . didn’t feel comfortable hiring new people on
without talking to them about the Union.” Fonseca testified that he then said
the store was “understaffed and that we needed more people,” to which
Jacobs responded that the current employees “didn’t want to work and
weren’t covering shifts.” Fonseca did not check the portal following this
conversation to see if or when it was online again.
Although Neri was not a party to the interaction, she was asked about
hiring during her testimony. She testified that she did not remember the
hiring portal’s being closed, but she recognized that the portal has had
technical issues or glitches in the past. Neri also explained that, regardless,
the Amidon store was “actively interviewing” during the spring and summer
of 2022 and hiring did not change because of the unionization effort.
The ALJ held that Starbucks violated the NLRA when “Jacobs told
Fonseca that the hiring portal was closed due to her reluctance to hire amid
a union campaign.” As with store hours, the ALJ reasoned that it is not
determinative that “the evidence failed to provide that [this] adverse action
was due to union activity.” Thus, the ALJ ultimately held that it remains an
unlawful threat for Starbucks to have “link[ed] the closing of the hiring
portal . . . to Section 7 activity.” The Board adopted the ALJ’s findings here
as well.7
_____________________
7
Kaplan noted that it was unnecessary to pass on whether the hiring portal
statement was unlawful “as this additional finding would not affect the remedy” in light of
the store hours determination.
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2.
We again evaluate whether these statements are threats of reprisal. As
with the store hours statements, we find that the Board’s decision regarding
the hiring portal statements lacked substantial evidence for two reasons.8
First, there is a question of whether, “under the totality of the
circumstances,” the hiring portal statements rose to the level of coercion or
a threat of reprisal. Renew Home Health, 95 F.4th at 242. While Starbucks
argues the statements did not reference unionization in a way that was
coercive, the NLRB asserts that the hiring portal statement “conveyed to a
reasonable employee that Starbucks might take further adverse steps in the
future should employees continue their union activities.” Specifically, the
NLRB argues that the threat would be of understaffing the Amidon store and
exacerbating bad working conditions, or of “convey[ing] that Starbucks
considers applicants’ opinions of union activity relevant to their suitability as
employees—and thus that it might consider current employees’ union
sentiments or continued union activity relevant as well.” Yet, this argument
is divorced from context or the “common-sense interpretation” the NLRB
claims.
We must consider the context of the statements regarding the hiring
portal. In Renew Home Health v. NLRB, for example, our court agreed with
_____________________
8
The parties also dispute whether the ALJ failed to credit countervailing
testimony. Starbucks’s core argument is that the ALJ’s finding largely rests on “a single
phone call that Fonseca claimed he had with Jacobs,” yet there was “unrebutted” evidence
in the record that was not considered by the ALJ: Neri’s testimony that the store was
“actively interviewing” in the spring and summer of 2022. The NLRB refutes the
importance of Neri’s testimony about ongoing hiring, pointing to the fact that “Section
8(a)(1) violations turn on an objective tendency to coerce from the perspective of a
reasonable employee.” We agree with the NLRB with respect to Neri’s testimony’s being
of lesser importance under the objective standard.
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petitioner’s argument that statements were not “viewed in context,” and
found the Board’s analysis to be insufficient and conclusory, and therefore
“not entitled to deference.” 95 F.4th at 243 (explaining that “[o]ur
deferential standard of review applies only when the Board engages in
reasoned decision-making” and that “[w]ithout sufficient analysis, the
Board’s conclusory holding . . . cannot be evaluated for its plausibility”).
The ALJ only found that Jacobs expressed a “reluctance to hire amid a union
campaign,” a determination that is conclusory in itself. Yet, per Fonseca’s
testimony, Jacobs conveyed no reluctance to hire but instead conveyed that
doing so was difficult without being able to discuss the union. This distinction
is of import in light of the context of hiring; wages and benefits—aspects of
employment that may change following unionization—are two terms of
employment that prospective employees would reasonably want to know
before beginning their employment. Thus, in light of the context and the
exact statement Jacobs made, we find substantial evidence lacking that it was
coercive in nature.
Second, we find substantial evidence lacking for the reason that the
hiring pause statements were too attenuated from current employees’ terms
and conditions of employment. We have held “[a] violation of § 8(a)(1)
occurs when an employer takes adverse action against specific employees in
connection with terms and conditions of their employment that are subject
to collective bargaining.” NLRB v. Arkema, Inc., 710 F.3d 308, 320 (5th Cir.
2013). Take, for example, Denton County Electric Cooperative, Inc. v. NLRB,
which the NLRB relies on for support. 962 F.3d 161 (5th Cir. 2020). That
case involved raises for employees, a matter that is squarely within their
terms and conditions of employment. Id. at 164. Yet, the hiring of future
employees is not squarely an issue of current employees’ “terms and
conditions” of employment. We recognize that statements about hiring may
connect to current employees if the statement is made in such a way to draw
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that connection. However, the statements made here about the hiring pause
are too attenuated from current employees. As discussed above, the context
of the statement did not tie in to current employees’ employment by
threatening reprisal on account of their protected activities.
From these two bases, we find the Board’s reasoning lacked
substantial evidence, thus enforcement is denied as to the hiring portal claim.
D. Impression of Surveillance
Finally, Starbuck’s challenges the Board’s finding that it “create[ed]
the impression that employees’ union or other protected activities were
under surveillance.” Here, too, we find the decision lacking substantial
evidence.
1.
The facts underlying this claim stem from the PDC meetings. As
described in Section III.A, Neri held these meetings with a number of
employees and referenced having knowledge of union activity in the district
and the store. In addition to the meetings with Cuellar-Serafini and Fonseca,
as previously detailed, Neri also had a meeting with Ingram. In this meeting,
Neri said, “voting in favor of a union doesn’t only affect those in favor of it,
it affects everyone at the store,” and told Ingram to “keep that in mind.”
Ingram also recalled that Neri did not mention if or how she knew about
unionizing activities at the Amidon store.
In evaluating Neri’s references to unions during the PDC meetings, it
is also necessary to understand the context of where organizing activity took
place. From the employees’ testimony, union discussions may have occurred
both in and out of the store. Cuellar-Serafini, for example, testified that she
had “conversations with [her] co-workers outside of the workplace.” But
Ingram testified that she “would sit out there with [her] co-workers” when
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discussing unionization. The meaning of “out there” is not readily apparent,
although Starbucks asserts that it suggests “out there” on the floor inside the
Amidon store instead of in the back of the store.
The ALJ first discussed the allegation that Starbucks “has created the
impression that employees’ union activities are under surveillance.” The
ALJ considered “whether, under all the circumstances, the employer’s
statements or other conduct would lead reasonable employees to assume that
the employer has placed their union activities under surveillance.” Charter
Communications, LLC, 366 NLRB No. 46, slip op. at 4 (2018), enfd. 939 F.3d
798 (9th Cir. 2019). The ALJ emphasized that the “standard is objective,”
and “the impression of surveillance does not turn on whether a supervisor
observed union activity.”
In discussing the context, the ALJ recognized that “Neri’s comments
about union activity in Kansas City or the district alone did not reasonably
convey the impression” of surveillance, but that the full circumstances
“indicate otherwise.” Namely, the ALJ focused on two statements: (1)
“Neri’s statement to Cuellar-Serafini that there was talk going around in the
Amidon store about unionizing”; and (2) “her statement to Ingram that [] a
vote in favor of unionization affects everyone at the store and she ‘should
keep that in mind.’” Coupled with Neri’s statements “about the potential
consequences” of unionization on employees’ benefits, and in light of these
remarks’ seemingly being “out of the ordinary” for PDC meetings, the ALJ
held that Neri’s statements of “her awareness of union activity in the
Amidon store and within the company district violated Section 8(a)(1).”
The Board majority adopted the ALJ’s findings as to surveillance. It
found Neri’s statements to Ingram and Cuellar-Serafini to be determinative.
The majority also noted that Neri failed to convey how she obtained
knowledge of the union activity, which is important because it found that the
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Amidon store employees were discussing their organizing only outside the
workplace.
Kaplan dissented, reasoning that “Neri’s statements did not show
that she had specific knowledge of organizing activities or who was taking
part in them but instead indicated only her general awareness of the union
campaign at the Amidon store and in the district.” Kaplan further found that
Ingram’s description of sitting “out there” with co-workers to discuss
unionizing meant that employees were apparently “engaging in open union
activity prior to May 2022,” when it was publicly announced. Finally, Kaplan
disagreed with the majority’s reliance on the out-of-the-ordinary context of
Neri bringing up unionization during PDC meetings, which were the first
meetings to occur after the efforts were underway. He reasoned, “it is
illogical to assume that employees would feel coerced because unionization
had not been discussed at PDC meetings in the past given that there had
never before been any reason to discuss unionization.”
2.
Starbucks argues that the Board focused on inaccurate findings that
union-related conversations took place only outside the Amidon store and
that Neri’s discussions with employees on this topic were “out of the
ordinary” for PDC meetings. Further, Starbucks contends that the Board
also failed to focus on the necessary inquiry of whether the impression of
surveillance was one that “tends to interfere with, restrain, or coerce Union
activities.” NLRB v. Mueller Brass Co., 509 F.2d 704, 708 (5th Cir. 1975).
We first address the two bases of the Board’s decision, finding that
neither is supported by substantial evidence. Turning to the question of
coercion, we consider whether the alleged surveillance had a tendency to
coerce or interfere with employee activities. Determining it does not, we
deny enforcement of this claim.
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a.
The Board anchored its reasoning on statements Neri made to
employees Ingram and Cuellar-Serafini and, from this, it reasoned that
employees “did not engage in open union activity in the workplace.”
Although Cuellar-Serafini said she had conversations outside of work, that in
itself does not mean all conversations occurred there. Critically, Ingram’s
testimony calls this into question, yet the Board failed to fully grapple with
Ingram’s testimony. Although not referenced by the Board nor the ALJ,
Ingram shared that she “would sit out there with [her] co-workers” when
she discussed organizing. Kaplan’s dissent raised this exact point. The
parties dispute the meaning of “out there with my coworkers”; however, we
agree with Kaplan that its plain meaning describes being out in the main area
of the store as opposed to the back.
Both the Board majority and dissent discussed the Board precedent,
National Hot Rod Assn., 368 NLRB No. 26, slip op. at 2–3 (2019), but the
decision supports Kaplan’s dissenting position: that the key inquiry is
whether “all” activities were conducted outside the store. Ingram’s
testimony counters the notion that all discussions of unionization occurred
outside the Amidon store. The ALJ provided, and the Board adopted, “a
flawed reading of the record” with respect to where such conversations took
place. Dish Network Corp., 953 F.3d at 376. The Board’s first error was in
“fail[ing] to grapple with countervailing portions of the record.” AllService
Plumbing, 138 F.4th at 901.
Next, we consider another basis of the Board’s determination: that
Neri’s statements were “out of the ordinary” and contributed to leading
“reasonable employees to assume that [Starbucks] had placed their union
activities under surveillance.” Aligned with Kaplan’s dissent, Starbucks
challenges this characterization, reasoning that “if discussing unionization
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for the first time is per se evidence of unfair labor practices, then employers
would risk the Board’s wrath every time they bring up unionization.” Noting
that Neri first referenced unionization efforts in the April PDC meetings,
Starbucks highlights that, simply, these meetings were the first ones after
such efforts began. We agree, finding the context “adds nothing to the
coerciveness inquiry,” and therefore is at least not supportive of the Board’s
finding. Intertape Polymer Corp. v. NLRB, 801 F.3d 224, 240 (4th Cir. 2015);
see also id. (acknowledging that “[t]he union campaign itself was ‘out of the
ordinary’”).
Taken together, these two bases do not provide substantial evidence
to support the Board’s finding.
b.
Finally, we turn to Starbucks’s assertion that the Board also erred in
failing to determine whether the alleged surveillance was coercive.
In NLRB v. Mueller Brass Co., relied on by Starbucks, we held that the
NLRA “does not prohibit a conversation which merely acknowledges the
employer’s awareness of an employee’s Union activities.” 509 F.2d at 709.
Instead, the surveillance, or the impression of surveillance, rises to the level
of an unfair labor practice under Section 8(a)(1) only if it “tends to cause
interference with or restraint of an employee in the exercise of his statutory
rights.” Id.
There, for example, the employer was alleged to have created an
impression of surveillance from a manager’s brief statement that he was
aware of an employee’s loaning his car to others to go to union meetings. Id.
at 707. Our court held that the testimony alone “does not prove that the
Company created an impression of surveillance,” and that, “without
evidence of a background of antiunion animus or a widespread pattern of
antiunion conduct on the part of the Company, [the employee’s] statements
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do not establish that the Company interfered with, restrained, or coerced
Union activities in any manner.” Id. at 708.
Later, our court similarly held that “[i]n order for an employer to
violate Section 8(a)(1) by illegal surveillance, interrogation or any other
unlawful act, he must ‘interfere with, restrain, (or) coerce’ employees in the
exercise of their Section 7 rights.” NLRB. v. Computed Time Corp., 587 F.2d
790, 794 (5th Cir. 1979) (quoting NLRB v. Atkins Saw Div. of Nicholson File
Co., 399 F.2d 907, 910 (5th Cir. 1968)).9
The NLRB instead draws on Hendrix Manufacturing Co. v. NLRB, in
which we recognized that “the furtive nature of the [employer’s] snooping
tends to demonstrate spectacularly the state of the employer’s anxiety”
about unions, thus when employers engage in surveillance, employees “are
under the threat of economic coercion, retaliation, etc.” 321 F.2d 100, 104–
05 n.7 (5th Cir. 1963).The NLRB argues that an employer acts unlawfully
when “it tells employees it is aware of union activities that the employees
have deliberately kept private without revealing its source of information,”
because it causes employees to speculate as to how the employer learned of
the activities.
We find that the Board erred under either Hendrix or Mueller Brass.
Neri’s statements were distinct from those in Hendrix, which involved a
supervisor “interrogat[ing]” an employee about having “attend[ed] a Union
meeting.” Id. at 104; see also Delchamps, Inc. v. NLRB, 585 F.2d 91, 93–94
(5th Cir. 1978) (affirming the Board’s surveillance finding, where supervisors
stated “that union organizing meetings were being monitored by
_____________________
9
Since then, other circuits have also interpreted the holding to stand for the
proposition that surveillance alone, without evidence of its consequence, is insufficient to
violate the NLRA. See U.S. Steel Corp. v. NLRB, 682 F.2d 98, 101 (3d Cir.1982); Belcher
Towing Co. v. NLRB, 726 F.2d 705, 708 (11th Cir. 1984).
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management and that a company ‘spy’ had attended the meetings”). Neri,
however, only shared a general awareness of unionization talk going around.
Moreover, Neri’s statements can be distinguished from those in Mueller
Brass, as her statements are better characterized as
“acknowledg[ing] . . . awareness of an employee’s Union activities,” with no
further interference attached. 509 F.2d at 709. As Kaplan recognized as well,
Neri’s statements merely “disclosed a general awareness of organizing
activities.”
There was evidence of union discussions in the Amidon store, limited
evidence of whether the context was out of the ordinary, and only general
awareness of the organizing activities. Thus, there was not substantial
evidence to support the finding that Neri’s statements created an impression
of surveillance. Accordingly, we deny enforcement on this claim as well.
IV.
For the foregoing reasons, we GRANT the NLRB’s request for
enforcement as to the threat of reprisal for loss of benefits against Cuellar-
Serafini; and we DENY its request for enforcement of the threat of reprisal
claims for the statements regarding store hours and hiring portal changes and
the impression of surveillance.
26