The opinion
United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 11, 1998 Decided January 22, 1999
No. 97-1694
Freund Baking Company,
Petitioner/Cross-Respondent
v.
National Labor Relations Board,
Respondent/Cross-Petitioner
Bakery, Confectionery, and Tobacco Workers
International Union, Local 119,
AFL-CIO,
Intervenor
On Petition for Review and Cross-Application for
Enforcement of an Order of the
National Labor Relations Board
Ronald I. Tisch argued the cause for petitioner/cross-
respondent. With him on the briefs was David S. Durham.
Steven B. Goldstein, Attorney, National Labor Relations
Board, argued the cause for respondent/cross-petitioner.
With him on the brief were Linda Sher, Associate General
Counsel, John D. Burgoyne, Acting Deputy Associate General
Counsel, and Margaret A. Gaines, Supervisory Attorney.
Larry Engelstein argued the cause for intervenor Bakery,
Confectionery, and Tobacco Workers International Union,
Local 119, AFL-CIO. With him on the brief were Jonathan
P. Hiatt, James Coppess, David Rosenfeld, Jeffrey R. Freund
and Laurence Gold.
Before: Silberman, Ginsburg, and Randolph, Circuit
Judges.
Opinion for the Court filed by Circuit Judge Ginsburg.
Ginsburg, Circuit Judge: The National Labor Relations
Board certified the Bakery, Confectionary, and Tobacco
Workers, Local 119, AFL-CIO as the exclusive representa-
tive of certain employees of Freund Baking Company after
the Union won a representation election. Freund neverthe-
less refused to bargain, asserting that the Union had imper-
missibly interfered with the election by providing free legal
services to the employees shortly before voting began. The
NLRB rejected this argument and held that the Company's
refusal to bargain violated ss 8(a)(1) and (5) of the National
Labor Relations Act, 29 U.S.C. ss 158(a)(1) and (5). Freund
petitions for review of the Board's order, and the Board
cross-applies for its enforcement. For the reasons set out
below, we grant review and deny enforcement.
I. Background
In October, 1996 the Union filed a petition with the NLRB
seeking certification as the exclusive bargaining representa-
tive of a group of 41 Freund employees. In November the
Regional Director of the NLRB held a hearing to determine
the appropriate bargaining unit. At the hearing, a union
attorney elicited testimony from the president of the Compa-
ny about its overtime pay practices. Shortly thereafter,
Freund sent a letter to its employees acknowledging that it
had failed to pay overtime in accordance with then-applicable
California law. Freund assured the employees that its trans-
gression had been inadvertent and that it would promptly pay
all those to whom additional compensation was due. In
December the Regional Director denied Freund's motion to
dismiss the Union's petition and scheduled a representation
election for January 30, 1997.
One week before the election four Freund employees sued
the Company on behalf of all the workers in the proposed
bargaining unit, alleging that Freund had failed to pay for
overtime as required by California law. The employees were
represented by David A. Rosenfeld, Esq., who, in addition to
representing the Union in this action, has several times
before represented employees filing lawsuits against their
employers just before a representation election.
One day before the Freund election, Union representatives
distributed to the Company's employees a flyer, stating in
part:
[O]n January 23, 1997 a Class Action Law Suit was filed
against Freund ... on behalf of all the employees to
recuperate [sic] all wages owed to you.
Freund ... has been in business for many years,
THERE IS NO excuse for them to steal from the
Workers. The wage and hour laws have been in affect
[sic] for many years. It's Freund [sic] obligations [sic] to
know and to respect the laws.
VOTE FOR YOURSELF
VOTE UNION YES!
JUSTICE-DIGNITY-RESPECT
UNION YES!
Employees in the proposed bargaining unit returned 20
votes for and 15 against the Union. Seven ballots were
challenged either by Freund or by the Union. The Regional
Director, rejecting Freund's argument that the Union had
impermissibly interfered with the election by sponsoring the
employees' lawsuit against it, resolved enough of the chal-
lenges to determine that the Union had won. The Board
affirmed the Regional Director's decision.
When Freund nevertheless refused to bargain, the Union
filed an unfair labor practice charge against the Company.
The General Counsel issued a complaint and moved for
summary judgment before the Board, which granted the
motion and ordered Freund to recognize the Union as the
exclusive representative of the bargaining unit employees.
Freund now petitions this court for review of the Board's
order, repeating its claim that the Union's participation in the
lawsuit tainted the election.*
II. Analysis
In reviewing the Board's decision we accept its findings of
fact if they are supported by substantial evidence on the
record considered as a whole. See Universal Camera Corp.
v. NLRB, 340 U.S. 474, 487-88 (1951). We defer to the
Board's construction of the NLRA if it is reasonably defensi-
ble, "though not if the Board failed to apply the proper legal
standard." Noel Foods v. NLRB, 82 F.3d 1113, 1117 (D.C.
Cir. 1996).
The Board's principal duty in conducting a representation
election is "to insure the fair and free choice of bargaining
representatives by employees." NLRB v. Savair Mfg. Co.,
__________
* Freund raises a number of other procedural and substantive
objections to the Board's order. Specifically, it claims that the
election should be set aside because the Board erroneously deprived
it of an opportunity to present evidence on its motion to dismiss the
certification petition and denied its request for a post-election
hearing. Freund further claims that the election result should be
invalidated because the Union improperly monitored the voting and
distributed misleading campaign literature. Having considered the
factual and legal bases for these arguments, we conclude that they
are insufficiently meritorious to warrant discussion in a published
opinion.
414 U.S. 270, 276 (1973). The Act is studiously neutral upon
the merits of unionization, see id. at 278; its mandate to the
Board is that elections accurately ascertain employees' senti-
ment on the question of representation. As both the Board
and the courts have long recognized, this goal cannot be
achieved when either the employer or the union engages in
campaign tactics that induce workers to cast their votes upon
grounds other than the advantages and disadvantages of
union representation. For example, an employer may not
promise its employees a benefit, such as vacation or seniority,
contingent upon the union's defeat in an upcoming election.
See NLRB v. Flomatic Corp., 347 F.2d 74, 76-77 (2d Cir.
1965). And in the critical period between the filing of a
certification petition and the holding of an election, an em-
ployer may not grant an unconditional benefit unless it has a
legitimate business reason for doing so. See Torbitt & Cas-
tleman, Inc. v. NLRB, 123 F.3d 899, 908-09 (6th Cir. 1997);
St. Francis Fed'n of Nurses and Health Professionals v.
NLRB, 729 F.2d 844, 850-51 (D.C. Cir. 1984). Nor may an
employer cancel a planned wage increase in response to a
union's organizational effort, lest employees reject the union
out of fear of further retaliation. See GAF Corp. v. NLRB,
488 F.2d 306, 308-09 (2d Cir. 1973).
Just as the Act prohibits an employer from using threats or
rewards as campaign tactics, it bars both crude and subtle
forms of vote-buying on the part of the union. For example,
a union is prohibited not only from blatantly giving an
employee anything of value in exchange for his support, see
Plastic Masters, Inc. v. NLRB, 512 F.2d 449 (6th Cir. 1975)
(union tainted representation election by making excessive
payments for time lost from work and for expenses incurred
in aiding union's organizing effort), but also from uncondition-
ally providing a benefit in a way that tacitly obliges the
employee to vote for it. See Savair, 414 U.S. at 277-78
(union tainted election by waiving initiation fee for employees
who signed "recognition slips" because those who signed
solely to obtain waiver might feel morally obligated to vote
for union). Applying the latter rule, the Board has held that
a union may not give voters anything of "tangible economic
benefit" during the critical period before an election. Mail-
ing Servs., Inc., 293 N.L.R.B. 565, 565-66 (1989) (medical
screenings); Wagner Elec. Corp., 167 N.L.R.B. 532, 533
(1967) (life insurance). Even when such gratuities are offered
upon the same terms to employees who make no pledge of
support, the Board has explained, they impose upon voters an
implicit "constraint to vote for the donor Union." Mailing
Servs., 293 N.L.R.B. at 565.
Relying upon these principles, Freund argues that the
Union's aid to the employees in bringing their lawsuit against
the Company amounted to an indirect form of vote-buying in
that the Union thereby gave the voters free legal services.
This gift is just as likely as free medical screenings or free
life insurance to have constrained employees to vote for the
Union out of a sense of obligation rather than upon an
assessment of the merits of union representation. Indeed,
the only other court to have considered the issue concluded
that a union's pre-election filing of a lawsuit on behalf of
employee-voters violated the rule against giving gratuities to
voters. See Nestle Ice Cream Co. v. NLRB, 46 F.3d 578 (6th
Cir. 1995). In the present case, moreover, the Union first
publicized the lawsuit on the day before the election, which
greatly increased the likelihood that it would interfere with
the employees' free choice.*
Such is Freund's argument. Before considering the merits
of Freund's legal position, we pause to address the Union's
challenge to its factual underpinning.
A.The Union's Participation in the Lawsuit
As the Union observes, there is no definitive evidence
linking it to the filing of the suit against the Company. True,
both the employee plaintiffs in that suit and the Union here
are represented by Mr. Rosenfeld; and yes, the Union used
the suit to argue its case for election in the flyer it distributed
to Freund's employees. Although both facts suggest that the
__________
* We note that Mr. Rosenfeld represented the union and the
employee plaintiffs in the Nestle case as well. There, too, the suit
was announced to the employees the day before the election.
Union sponsored the suit, they do not "establish either that
the Union in fact did finance the litigation, or, if it did, ever
publicized that assistance to the employees." Therefore, the
Union contends, Freund has failed to prove that, even under
the Company's view of the law, the Union "provided an
objectionable benefit" to the employees before the election.
This argument need not detain us long. If the Union was
not responsible for the suit, it certainly encouraged voters to
believe it was: The Union announced the suit in a campaign
flyer consisting exclusively of pro-Union and anti-Freund
commentary and ending with the slogan "Union Yes!" Em-
ployees reading this flyer could not have failed to get the
message that they had the Union to thank for their legal
representation. That the flyer does not itself prove Union
sponsorship of the suit is immaterial; it is the appearance of
support, not the support itself, that may have interfered with
the voters' decisionmaking.
Indeed, in the post-election proceeding upon Freund's ob-
jections, the Regional Director referred to the Union itself as
having filed the lawsuit. The record does not indicate that
the Union ever disputed that characterization before the
Regional Director or filed a conditional cross-exception to it
before the Board. Therefore, we treat the Union's responsi-
bility for the suit as having been conclusively established.
B.The Significance of the Union Lawsuit
The Board, in contending that the Union's filing of the
lawsuit did not taint the representation election, does not
deny that the Union provided free legal services to voters;
nor does it suggest that the filing of the suit may not have
affected the outcome of the election. Instead, invoking its
own prior decision in Novotel New York, 321 N.L.R.B. 624
(1996), the Board contends that the Act permits a union to
sue an employer on behalf of its employees prior to an
election because such conduct is relevant to the "critical
question facing employees in the election: namely, whether
the union can improve working conditions." The Board also
argues that a contrary holding would discourage unions from
engaging in activity protected both by the Act and by the
First Amendment to the Constitution of the United States.
1.Bearing of a Lawsuit upon the Merits of an Election
The Board's primary claim is that the Union's filing of the
suit demonstrated the vigor with which it would defend the
rights of Freund's employees and therefore enabled those
employees to cast more informed votes. Even more to the
point, according to the Board, the suit gave Freund's employ-
ees an opportunity to evaluate the Union's ability to improve
the terms of their employment: "Such assistance can demon-
strate that the union knows how to improve working condi-
tions in the plant, is capable of doing so, and is willing to do
so."
We agree that a union's willingness to prosecute a suit
designed to insure that the wages paid to potential members
are legally adequate is at least relevant to the question
whether its election would benefit the employees. See NLRB
v. L & J Equip. Co., 745 F.2d 224, 231 (3d Cir. 1984) ("[A]n
employee's vote should be governed ... by consideration of
the advantages and disadvantages of unionization in his or
her work environment"). Indeed, in the abstract we suppose
that anything a union does or has done--its track record, so
to speak--may be relevant to the merits of a representation
election insofar as it helps employees to evaluate the likeli-
hood that representation by a particular union will improve
those conditions.
This only shows, however, that the Board's reasoning
proves too much: It is equally applicable to any number of
other gratuities that a union might want to give employees in
the pre-election period, including the specific medical and life
insurance benefits, the gift of which the Board has held is
forbidden by the Act. Like free legal services, medical and
insurance benefits are at least relevant to the union's claim
that it is willing and able to provide the employees with more
desirable working conditions. Nonetheless, although a union
is free to advertise the benefits for which its members are
eligible, it may not give voters "free samples" of health or
insurance benefits before an election. See, respectively,
Mailing Servs., 293 N.L.R.B. at 565-66, and Wagner, 167
N.L.R.B. at 533. The Board's attempt to distinguish free
legal services therefore fails.
Moreover, filing a lawsuit prior to an election is hardly, by
itself, probative on the question whether "the union knows
how to improve working conditions in the plant, is capable of
doing so, and is willing to do so." Indeed, the lawsuit may be
meritless, even frivolous, for all one can tell merely from its
having been filed. In the Nestle case, for example, the pre-
election suit was dismissed (after the election) for failure to
state a claim. When the union filed an amended complaint
and the employer again moved to dismiss and added a
request for sanctions, the union agreed to withdraw its com-
plaint with prejudice in exchange for the employer's with-
drawing its motion for sanctions. See 46 F.3d at 580. We
express no view upon the merits of the union-sponsored
lawsuit involved in this case, of course: Like Freund's em-
ployees, we are in no position to make any informed judgment
on the subject. Our point is only that the Board's first
reason for rejecting Freund's objection does not withstand
scrutiny.
2.Section 7
The Board next suggests that a union's suit against an
employer on behalf of voters in a representation election is
both protected by s 7 of the Act and "consistent with labor's
historical role of helping employees to improve their working
conditions." As the Board points out, unions frequently (and
uncontroversially) file unfair labor practice charges against
employers in the pre-election period; indeed, in some cases
they may even recover money for the employees as a result.
Furthermore, according to the Board, a union's effort to
advance the interests of employees through litigation de-
serves special solicitude because it is among the "core" activi-
ties protected by s 7.
The Board's argument here misses the point being pressed
by Freund. Although the Board is certainly correct that a
union may file an unfair labor practice charge against an
employer during the critical period before an election, the
purpose of such a charge is to prevent an employer's unfair
labor practice from inhibiting employees in the exercise of
their right freely to vote for or against union representation.
The ensuing litigation is not the cause of the problem; it is
the cure. GAF Corp., which the Board itself cites in this
regard, is a good example. There the employer had canceled
a planned pay increase when the union began its campaign to
organize the employees. See 488 F.2d at 307-08. The union
filed an unfair labor practice charge and the Board (which
was later upheld by the court of appeals) ordered the employ-
er to restore the status quo ante by granting the planned pay
increase. See id. at 308-09. The Union had to initiate
litigation in order to prevent the employer from "plac[ing] the
onus on the Union for the loss of the increase" and thereby
interfering with the employees' electoral choice. Id. at 309.
Litigation necessary to protect the electoral process, however,
cannot be equated with litigation intended improperly to
influence the voters.
The same point answers the Union's argument that the
service it rendered by filing the suit is no different from other
legal services unions are unquestionably allowed to provide to
employees in the critical period before an election, such as
"present[ing] a case in support of the petitioned for bargain-
ing unit and ... respond[ing] to the employer's objections to
the election results." Like a charge that an employer is
conducting an unlawful campaign against union representa-
tion, such issues often have to be resolved before a valid
election can take place: If the bargaining unit is not defined
correctly, for instance, some employees may be improperly
(dis)enfranchised. Unlike an unfair labor practice charge,
however, the lawsuits at issue here and in the Nestle case
were not integral to the conduct of a fair election.
Nor is there weight to the Board's argument that the
Union's lawsuit is unobjectionable because suing an employer
is at the "core" of the activity protected by the Act. No party
to this case has expressed any doubt that a union may,
pursuant to s 7, file a lawsuit in its representative capacity.
Cf. Eastex, Inc. v. NLRB, 437 U.S. 556, 565-66 (1978) ("[I]t
has been held [by the lower courts and by the Board] that the
'mutual aid or protection' clause protects employees from
retaliation by their employers when they seek to improve
working conditions through resort to administrative and judi-
cial forums"). The issue here is whether the Union improper-
ly influenced the impending election by gratuitously bringing
such a suit on behalf of employees it did not yet represent.
Under the Act contestants in a representation election are
routinely prevented from exercising certain rights during the
brief time when their exercise might interfere with the voters'
free choice. For example, although an employer may in
ordinary circumstances increase its employees' pay at will, it
may not grant a previously unscheduled raise during the
critical period prior to an election. See St. Francis Fed'n of
Nurses and Health Professionals, 729 F.2d at 850-51. Simi-
larly, while the s 7 right of employees to "engage in ...
concerted activities for the purpose of ... mutual aid or
protection" would appear to cover a union's provision of
medical and insurance services even to non-member employ-
ees, see Harvest Communications, Inc., 321 N.L.R.B. 40, 42
(1996), as we have seen, the Board has nevertheless held that
a union may not give such services to voters during the
critical pre-election period. See Mailing Servs., 293 N.L.R.B.
at 565-66; Wagner, 167 N.L.R.B. at 533. It does not follow,
therefore, that because a union ordinarily has the right under
s 7 to sue an employer, it must have the right to do so in any
and all circumstances. Because the Board's undifferentiated
view of a union's right to sue on behalf of non-member
employees ignores the employees' and the employer's coun-
tervailing interest in a free and fair representation election--
an interest the Board has zealously protected in analogous
situations--its decision cannot be upheld under s 7.
3.The First Amendment
Though it stops short of arguing that the Constitution
forbids it from limiting in any way a union's ability to file a
pre-election lawsuit on behalf of non-member employees, the
Board does suggest that overturning the election in this case
would have first amendment "implications," to which it must
be sensitive. See Bill Johnson's Restaurants, Inc. v. NLRB,
461 U.S. 731, 741 (1983). In support of this argument, the
Board points to NAACP v. Button, 371 U.S. 415 (1963), in
which the Supreme Court held unconstitutional a state anti-
solicitation law that would have severely limited the ability of
the NAACP to help potential litigants, including persons
unaffiliated with the organization, file school desegregation
lawsuits. See id. at 420, 428-29.
We shall assume arguendo that the Union had a first
amendment interest in filing the suit against the Company--
although the Union itself does not assert such an interest in
this case. As Freund points out, the Board again, as it did in
its s 7 argument, fails utterly to come to grips with the
proposition that, because of the need for an atmosphere
amenable to rational decisionmaking, the parties to a repre-
sentation election do not retain their full panoply of rights
during the critical period. For instance, an employer unques-
tionably has a right, protected by the first amendment, to
express inflammatory views on social issues, such as race
relations. When it expresses those views shortly before a
representation election, however, the Board may conclude
that this otherwise protected activity impermissibly inter-
fered with the employees' right to a free and fair vote. See
Sewell Mfg. Co., 138 N.L.R.B. 66, 69-72 (1962); see also
NLRB v. Gissel Packing Co., 395 U.S. 575, 617 (1969) ("Any
assessment of the precise scope of employer expression ...
must be made in the context of its labor relations setting.
Thus, an employer's rights cannot outweigh the equal rights
of the employees to associate freely, as those rights are
embodied in [the Act]"). So, too, a union organizer, who
ordinarily has a constitutional right to speak to employees
regarding the benefits of unionization, see Thomas v. Collins,
323 U.S. 516, 532 (1945), may not engage in a prolonged
discussion with a voter in the polling area. See Milchem,
Inc., 170 N.L.R.B. 362, 362-63 (1968).
Without disavowing its earlier decisions that limit much
expressive activity in the period prior to a representation
election, the Board here argues that one form of such activi-
ty--the filing of a pre-election lawsuit by a union on behalf of
non-member employees--cannot be compromised even where
the effect is to confer upon voters an otherwise unlawful
gratuity. This selective reasoning is, to say the least, not
persuasive.
III. Conclusion
The Union's sponsorship of the employees' lawsuit against
the Company clearly violated the rule against providing gra-
tuities to voters in the critical period before a representation
election. We conclude that the Board's justifications for
making an exception to the anti-gratuity rule for a union's
provision of legal services is not based upon any reasonably
defensible interpretation of the Act. Therefore, we hold the
Board erred when it denied Freund's petition to set the
election aside. Accordingly, Freund's petition for review is
granted and the Board's application for enforcement of its
order is denied.
So ordered.