Vico Products Co. v. National Labor Relations Board

Notice: This opinion is subject to formal revision before publication in the

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 24, 2003 Decided June 27, 2003

No. 01-1484

VICO PRODUCTS COMPANY, INC.,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE

AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, UAW,

INTERVENOR

On Petition for Review and Cross–Application

for Enforcement of an Order of the

National Labor Relations Board

Mark S. Ruderman argued the cause and filed the briefs

for petitioner.

Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

2

Richard A. Cohen, Senior Attorney, National Labor Rela-

tions Board, argued the cause for respondent. With him on

the brief were Arthur F. Rosenfeld, General Counsel, John

H. Ferguson, Associate General Counsel, Aileen A. Arm-

strong, Deputy Associate General Counsel, and David S.

Habenstreit, Supervisory Attorney.

Catherine J. Trafton argued the cause for intervenor.

With her on the brief was Michael B. Nicholson.

Before: GINSBURG, Chief Judge, and SENTELLE and

RANDOLPH, Circuit Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge: Vico Products, Co., Inc. (Vico)

petitions this Court for review of a decision and order of the

National Labor Relations Board (Board) in an unfair labor

practice proceeding against Vico. Vico Prods. Co., 336

NLRB No. 45 (2001). The National Labor Relations Board

seeks enforcement of its order. Vico argues that substantial

evidence does not support the Board’s findings that Vico had

committed various unfair labor practices. Vico also argues

that the Board’s restoration order imposes an undue burden

on it. Because there is substantial evidentiary support for

the Board’s findings, and because the remedial order is well

within the Board’s broad discretion, we deny the petition for

review and grant the Board’s cross-application for enforce-

ment.

I

Vico is a family-owned company in the business of manufac-

turing and distributing parts used in the manufacture of

automobile brakes. Robert Schultz is President and principal

owner of Vico. Robert Schultz’s son, Curt Schultz,1 a 15

percent owner of Vico stock, manages the day-to-day opera-

tions of Vico as Vice President and General Manager. Since

well before the relevant events, Vico owned an 83,000 square-

1Hereinafter, Curt Schultz will be identified simply as ‘‘Schultz,’’

whereas Robert Schultz will be identified as ‘‘Robert Schultz.’’

3

foot manufacturing and distribution facility located in Plym-

outh, Michigan. In 1993, Vico opened a warehouse and

distribution facility in South Carolina. At that location, Vico

conducted some sorting functions that previously were located

in Plymouth. Vico also relocated a chucker, which is used to

perform a series of machining functions such as turning,

boring, and/or threading, from Plymouth to South Carolina.

In 1994, Vico began manufacturing caliper pins, which are

components of a disc brake assemblage. The production of

caliper pins requires the use of large cold-forming machines

(‘‘headers’’) that cut and mold steel coil into rough-hewn parts

that later go into the assembly of a larger finished part.

After the cold-forming process, the rough-hewn parts are

processed by finishing and fine-tooling machines. Next, the

parts are sent to a company near Chicago for heat treatment

and plating. Finally, the parts are returned to Vico for

sorting, packaging, and shipment to customers.

By 1995, caliper pins became an important product line for

Vico. At the time, Vico had only one caliper-pin customer,

Bosch Manufacturing, which was located approximately 170

miles from Vico’s Plymouth facility. Vico had numerous

customers for its other products in the Louisville, Kentucky

area. In the later part of 1995, a Louisville company (Am-

brake) became Vico’s second (and soon largest) customer for

caliper pins.

On April 18, 1995, Vico applied through the Michigan

Strategic Fund (MSF) for a $3,000,000 federally-guaranteed,

low-interest loan to be used exclusively to upgrade the pro-

ductive capacity of the Plymouth facility. The loan, by its

terms, was to be used for the purchase of new machines and

for renovating the Plymouth facility, including the ‘‘Blue

Room,’’ a 2300 square-foot room in the facility where the

finishing operation for caliper pins was housed. Vico decided

to use the Blue Room for production because it considered its

facility ‘‘landlocked’’ – its property in Plymouth lacked any

space into which Vico could expand its facility. In its applica-

tion to the MSF, Vico specifically stated that ‘‘we are not

considering an out-state/national location for this project.’’

4

The MSF issued tax-exempt development revenue bonds to

Vico. Vico used these to secure a loan from a local bank. On

March 1, 1996, Vico entered into a loan agreement, in which

Vico committed to use the loan proceeds on the above ‘‘Pro-

ject’’ and to keep the equipment purchased ‘‘at the Project

Site’’ until the bonds underlying the loan reached maturity

(10 years). Vico also stated that it expected to hire 10–15

new employees as a result of the planned upgrade. If Vico

relocated the machines outside of the Plymouth facility before

the bonds became due, it was obligated under the loan

agreement to secure the lender bank’s advance consent. If

approved, Vico would then have to repay the portion of the

loan equal to the cost of the relocated machines.

In December of 1995, Vico applied to Plymouth Township

for a tax abatement with respect to its purchase of machinery

with the loan proceeds. In its application, Vico stated that it

would use the machinery within the town limits and that it

anticipated hiring more employees for its caliper-pin line.

The tax abatement was approved on January 29, 1997.

Vico made draws on the loan on March 1, 1996; May 13,

1996; December 30, 1996; February 27, 1997; and May 1,

1997. With each draw, Vico certified that the funds would be

used to finance costs on the ‘‘Project.’’ Vico took the first two

draws to refurbish existing equipment and the remainder to

purchase new equipment and convert the Blue Room into a

caliper-pin production area. According to Vico’s evidence,

almost immediately after converting the Blue Room to pro-

duction use, Vico experienced problems with its manufactur-

ing process in that portion of the facility, due to its low ceiling

and oily, pitched floor.

On May 10, 1996, Vico leased a 10,800 square-foot ware-

house facility in the Louisville, Kentucky area (Louisville

Building A). After taking possession of the warehouse facili-

ty, Vico moved some equipment to Louisville, including some

cold-header machines and some sorting and assembly ma-

chines. Vico sent Ambrake an announcement, welcoming

Ambrake to Vico’s ‘‘Warehouse & Distribution Center.’’ The

announcement explained that Ambrake would be able to

5

operate with ‘‘reduced shipping cost and time’’ and with a

‘‘just in time’’ delivery system by which Ambrake could pick

up products ‘‘daily or several times a day depending on the

demand.’’ The announcement did not mention the possibility

of manufacturing caliper pins at that facility.

In June, Vico held a meeting with its employees at Plym-

outh, during which Schultz discussed Vico’s plan to expand

Plymouth’s capacity to manufacture caliper pins. Schultz

showed slides indicating that Vico’s customer base was locat-

ed mostly in the Louisville area. Schultz expected Vico to see

growth for its products in that area. Schultz stated that

Vico’s future plans might include relocating part of the cali-

per-pin business to the Louisville warehouse and distribution

center. In July, Vico distributed a newsletter to its employ-

ees in which it described the Louisville facility as a warehouse

and distribution center. The newsletter made no mention of

a relocation of the caliper-pin production.

In December of 1996, Schultz met with Ambrake President

Richard Stephenson to discuss Vico’s plans for the Louisville

facility. At this meeting, Schultz may have mentioned to

Stephenson the possibility of moving the caliper-pin opera-

tions to Louisville. (Schultz’s testimony on this point is

uncorroborated; the Board made no finding on this point.)

In January of 1997, Schultz again met with Stephenson.

Alyse Leslie, Quality Control and Shipping and Receiving

Manager of Vico, attended the meeting as well. No mention

of relocating the caliper-pin operations was made at the

meeting. At this time, Leslie had no knowledge of the

possibility of such a relocation. Some time after January,

Vico began building up its inventory of caliper pins.

In February of 1997, a union organizing campaign began at

the Plymouth facility. Several employees formed the UAW

Volunteer Organizing Committee (VOC). On March 3, 1997,

employee and VOC Chairman Jim White presented Schultz

with a document signed by several employees that set out

employee rights under the National Labor Relations Act

(NLRA). Three days later, the International Union, United

Automobile, Aerospace & Agricultural Implement Workers of

6

America, AFL–CIO (Union) filed a representation petition

with the National Labor Relations Board. On March 11,

1997, White gave Schultz a union document labeled ‘‘Sensible

Rules for a Fair Election’’ that was signed by at least 50

employees. White asked Schultz to sign this document, but

Schultz refused.

Some time in March, Robert Schultz approached employees

Jacqueline Whitehead and Lucy Arnold and asked ‘‘Do you

know what’s going on around here?’’ After a response of

‘‘No,’’ Robert Schultz stated that ‘‘if a Union gets out here, a

lot of people could be laid off.’’ He then put his hand on

Whitehead’s shoulder and stated, ‘‘If the Union gets in here,

you can be laid off.’’ Late in March of 1997, Company

Comptroller and General Manager of Organizational Support

Karen Dearing told a group of employees who had been

discussing unionization that ‘‘changes TTT are going to be

made when the Union is voted in and there may or may not

be jobs left. Nothing is in stone, nothing is permanent.’’

The Union won the Board election and was certified as the

exclusive bargaining representative for the Plymouth employ-

ees.

In May of 1997, Union Representative Phillip Keeling

contacted Vico and arranged a June 27 meeting with Schultz.

In late May, Schultz informed Company Operations Manager

Martin Cibich that he planned to move the caliper-pin finish-

ing operations to Louisville over the July 4th holiday and

instructed Cibich to arrange for a mover. Cibich met at the

Louisville facility with Stephen Daugherty, the owner of an

equipment moving company, to make arrangements for the

move. They met at the plant on Sunday, June 8, 1997, when

no employees were present. During their meeting, Daugher-

ty noticed union materials and asked Cibich if there would be

any labor problems with regard to the move, and Cibich

replied that there would be none. Some time after this

meeting, Daugherty informed Union Representative Keeling

of the planned move.

On June 24, Schultz signed a one-year lease for a second,

smaller facility in Louisville, which was to be used in the

7

manufacture of caliper-pins for Bosch (Louisville Building B).

On June 25, in a meeting with members of the Union’s

bargaining committee, Keeling asked if anyone had heard of

the possibility of equipment being relocated to Louisville. No

one in attendance had heard of such a plan. At the June 27

meeting between Schultz and Keeling, Keeling asked Schultz

if there was a move being planned. Schultz replied that

relocation ‘‘may have to be considered in the future’’ but that

there were ‘‘no immediate plans to move anything out of the

plant.’’ Keeling remarked to Schultz that if it came up, then

Schultz should let Keeling know because the Union had a

right to discuss the issue.

On July 2, 1997, Schultz informed Ambrake of the move. A

few days later, Ambrake expressed concerns about the move

in a letter to Vico. On July 3, 1997, Schultz announced the

move to the employees. He explained that the caliper-pin

finishing machines were being moved to Louisville over the

weekend and that 33 unit employees were being laid off that

day. Schultz added that applications would be accepted from

anyone interested in applying for a job in Louisville. Schultz

then faxed a letter to Keeling, notifying him of the move and

the layoffs. Keeling responded by letter that day, expressing

his disbelief that just six days earlier Schultz could have been

unaware of the move when Keeling inquired whether a move

was being planned.

On the morning of July 4, Cibich contacted Daugherty, but

Daugherty was not ready to proceed with the move because

he had not received a signed written proposal from Vico.

Cibich contacted Thomas Rahburg, owner of another moving

company, to arrange for the move. Rahburg agreed to

handle the move. Shortly thereafter, Rahburg brought three

flatbed trucks and two pickup trucks to the Plymouth facility.

Several machines were loaded onto the trucks, and the trucks

left the facility escorted by the Plymouth police.

On July 7, 1997, the machines were unloaded from the

trucks and moved into the two Louisville facilities. Five of

the machines were fitted with automatic feeds, including the

Bosch machines that were placed in Louisville Building B.

8

The machines were arranged in triangular cells in order to

permit them to be staffed by one, rather than three, employ-

ees. Vico staffed its Louisville facility in part with temporary

employees.

During July, the parties began negotiating for a collective-

bargaining agreement (CBA). In August of 1997, Vico de-

clined to give its employees a wage increase as it had done

the preceding 5 years (at rates of increase varying from 3–

5%). Vico did not inform the Union of this decision nor

engage in bargaining regarding the decision.

In September of 1997, the lender bank learned of Vico’s

move. By letter, the bank informed Vico that the bonds had

to be redeemed to the value of the machinery moved out of

state. On November 7, 1997, Vico redeemed $1.3 million of

the bonds with funds borrowed from the bank.

In September of 1997, the Union filed unfair labor practice

(ULP) charges against Vico. Administrative Law Judge

Bruce D. Rosenstein (ALJ) conducted a hearing on the

charges in March and May of 1998. On October 1, 1998, the

ALJ issued a decision holding that Vico violated the National

Labor Relations Act by failing to bargain with the Union over

the relocation decision and the effects thereof and by failing

to bargain over the decision to withhold an annual wage

increase from employees in August of 1997. The ALJ dis-

missed the portion of the complaint which alleged that Vico’s

relocation decision was motivated by antiunion animus.

In the meantime, in December of 1997, after the ULP

complaint had issued, the Board initiated a proceeding in

district court in Michigan seeking as interim relief the return

of relocated machines to the Plymouth facility. Vico settled

that action by agreeing to return the Bosch machines from

Louisville Building B back to the Plymouth facility. Instead

of placing these machines back in the Blue Room, Vico placed

these machines in a different part of the plant, where they

were configured in a triangular cell arrangement similar to

the way they had been configured in Louisville.

9

Both Vico and the Union filed exceptions to the ALJ’s

decision. On September 30, 2001, the Board issued a decision

and order finding that Vico had violated section 8(a)(5) and (1)

of the NLRA, 29 U.S.C. § 158(a)(5) & (1) (2000), by relocating

its caliper-pin finishing operations to Louisville and laying off

33 employees in the process without affording the Union

notice and an opportunity to bargain. Similarly, the Board

found that Vico violated the same section of the NLRA by

discontinuing its practice of annual wage increases without

giving the Union notice and an opportunity to bargain. The

Board also found (contrary to the ALJ) that Vico’s relocation

of its caliper-pin finishing operations and layoff of 33 employ-

ees were undertaken for antiunion reasons in violation of

section 8(a)(3) and (1). 29 U.S.C. § 158(a)(3) & (1). The

Board ordered Vico to cease and desist from the ULPs found.

It ordered Vico to reestablish its caliper-pin operations in

Plymouth and to offer the laid-off employees reinstatement to

their previously held positions. In addition, the Board or-

dered Vico to make whole the laid-off employees for any

losses incurred because of the ULPs. Finally, the order

directed Vico to bargain to impasse and to post a remedial

notice.

Vico filed a petition for review, arguing that the Board’s

findings were not supported by substantial evidence and that

the Board’s order imposed an undue burden on Vico. The

Board filed a cross-petition for enforcement of its order, and

the Union intervened in support of the Board’s order.

II

A. Relocation Decision

1. Failure to give notice and opportunity to bargain

Under Dubuque Packing Co., 303 NLRB 386 (1991), the

burden is on the Board’s General Counsel to establish a

prima facie case by demonstrating that the employer’s relo-

cation decision involved a relocation of unit work unaccompa-

nied by a basic change in the nature of the employer’s

operation. Id. at 391. Such a demonstration establishes that

the relocation decision is a mandatory subject of bargaining.

10

Id. The employer may then rebut the prima facie case by

showing (1) that the work performed at the new location

varies significantly from the work performed at the former

location; (2) that the work performed at the former location

is to be discontinued entirely and not moved to the new

location; or (3) that the employer’s decision involved a change

in the scope and direction of the enterprise. Id. Alternative-

ly, the employer may defend itself by showing that (1) labor

costs (either direct or indirect) were not a factor in the

decision; or (2) even if labor costs were a factor, the Union

could not have offered labor cost concessions that would have

resulted in the employer changing its decision. Id.

Vico does not dispute the fact that the relocation decision

was a ‘‘relocation of unit work unaccompanied by a basic

change in the nature of the employer’s operations’’ and,

therefore, a mandatory subject of bargaining. Vico thereby

concedes that the General Counsel has satisfied the prima

facie requirements as outlined in Dubuque Packing.

Vico attempts to defend its action by arguing that labor

costs were not a factor, or to the extent they were a factor,

that the Union could not have offered concessions sufficient to

induce Vico to refrain from relocating. Vico contends that

labor costs in Louisville were as high as or higher than labor

costs in Plymouth. Vico explains that labor costs in Louis-

ville included payment for temporary employees, which re-

quired payment to the temp agency over and above the actual

wages paid to the temporary employees. Temporary employ-

ees in Louisville cost Vico $12.00/hour ($8.00 for the employ-

ee; $4.00 for the temp agency) whereas the laid-off employees

cost Vico $8.85/hour. Vico argues that any difference in

benefits between the two is offset by the fees to the temp

agency.

Vico contends that it relocated not for reduced labor costs,

but because relocation allowed for implementation of the cell

configuration and automation of the machines, which reduced

the number of steps in the manufacturing process, thereby

reducing the total number of employees required in the

manufacturing process. In addition, Vico contends that it

11

saved on freight charges and that relocation relieved it of its

landlocked situation in Plymouth and its difficulties relating

to the Blue Room.

Even assuming that labor costs were a factor, Vico argues

that the Union could not have offered concessions sufficient to

overcome the benefits of the relocation. Vico conducted a

cost-benefit analysis based on confirmed orders that indicated

that Vico’s relocation would yield savings of approximately

$240,000 in 1998 and $325,000 in 1999. Vico contends that

spreading these savings over the number of employees would

mean that the Union would have to offer concessions of $3.50

to $4.72/hour per laid off employee (using the 1998 and 1999

figures, respectively) or $.89 to $1.20/hour per employee

overall. Further, Vico argues that it needed to utilize the

Louisville facility in any event, at least to house new equip-

ment and machinery because the Plymouth facility could hold

no more equipment or machinery.

Vico’s arguments fail. The evidence shows that Vico’s

decision was based on labor costs. Schultz testified that he

believed that Vico could make caliper pins more cheaply in

Louisville. More importantly, one of Vico’s primary reasons

for relocation – that relocation allowed for the implementation

of cell configuration and automation of machines, thereby

reducing the amount of labor – is in fact based on labor costs.

Similarly, Vico’s contention that its savings were so sub-

stantial that the Union could not have made concessions fails.

As the Board noted below, Vico’s cost-benefit analysis of the

relocation was performed after the fact and could not have

formed the basis for Vico’s decision to relocate. Further,

Vico’s analysis fails to account for efficiencies that would

result if Vico implemented cell configuration and added auto-

matic feeders to its machines in Plymouth (as it did in

Louisville). Vico’s later agreement to move certain machines

back to Plymouth and its subsequent use of cell configura-

tions there underscores the fact that utilization of the more

efficient cell process was and is viable in Plymouth. Also,

Vico’s analysis fails to account for the potential increased

efficiencies resulting from the build-up of inventory in Louis-

12

ville. As Vico’s arguments fail, we see that substantial evi-

dence supports the Board’s finding that Vico failed to give the

Union notice and an opportunity to bargain over the reloca-

tion decision.

2. Failure to engage in effects bargaining

Vico argues that the Board erred in ruling that Vico failed

to negotiate with the Union over the impacts and effects of

the relocation of Vico’s caliper-pin production facility. Vico

contends that at the time of the relocation, it offered to

negotiate the effects of the relocation with the Union. The

parties met for a bargaining session on July 21, 1997, during

which Vico’s counsel asked Union representatives whether

they had any proposals relative to the ‘‘effects of the reloca-

tion.’’ The Union representatives replied that they were

unwilling to negotiate over the effects at that time and would

only negotiate over the alleged outstanding ULPs. Later, at

the hearing on March 4, 1998, counsel for the Union submit-

ted a party admission acknowledging the Union made propos-

als regarding the decision to relocate and the effects of that

decision. Further, the Union admitted that Vico made pro-

posals on effects (two weeks salary to the laid-off employees

and recall rights for those employees as well). The Union

responded that they would consider the offer if it included a

requirement that Vico enter into a CBA with the Union.

Vico’s arguments miss the mark. As the Board has held,

‘‘pre-implementation notice is required to satisfy the obli-

gation to bargain over the effects’’ of a decision that impacts

conditions of employment. Los Angeles Soap Co., 300 NLRB

289, 289 n. 1 (1990) (quoting Metropolitan Teletronics Corp.,

279 NLRB 957, 959 n. 14 (1986)). As Vico gave the Union no

advance notice of the relocation plan and the 33 lay-offs, Vico

denigrated the Union and the viability of the process of

collective bargaining itself, in the eyes of unit employees.

Honeywell Int’l, Inc. v. NLRB, 253 F.3d 125, 131 (D.C. Cir.

2001). Vico’s after-the-fact offers to engage in effects bar-

gaining are irrelevant because they cannot undo the damage

already done to the Union and the process of collective

bargaining.

13

B. Discontinuation of Practice of Granting Annual Wage

Increases

Vico makes two arguments to justify its failure to give the

Union notice and an opportunity to bargain on the subject of

annual wage increases. Vico first argues that the Union

waived its right to bargain on this subject. Vico contends

that the Union’s failure to object to a statement in a letter

from Mark Ruderman, an attorney for Vico, to UAW staff

representative Phil Keeling constitutes a clear and unmistak-

able waiver. The relevant statement reads: ‘‘The parties

agree to discuss language issues first and then economics as a

total package.’’ Letter from Ruderman to Keeling of 8/11/97,

at 2. Vico notes that not only did the Union fail to object to

this statement, but also Keeling failed to request past wage

increase information from Vico or to discuss wage increases

with employees until October of 1997. Vico contends that

Keeling’s nonfeasance lead to the Union’s acquiescence in the

terms of the above letter, waiving negotiations over the

economics proposals until a later date.

Vico then compares this case to Norris Indus., 231 NLRB

50 (1977). In that case, the employer proposed to terminate

the medical group insurance of employees on medical leaves

of absence and incorporated this proposal in a letter of

understanding that was signed with a contract between the

parties. The Board held that even though the Union under-

estimated the scope of the proposal, the letter constituted a

waiver. Vico argues that here the letter defers negotiations

on the amount of any wage increase pending discussions of

the non-economic language.

Vico’s waiver argument fails. The fatal defect in Vico’s

waiver argument is that the Union was unaware of the past

practice of annual wage increases. The Board’s ‘‘clear and

unmistakable’’ rule as explained in Metropolitan Edison Co.

v. NLRB, 460 U.S. 693, 707–08 (1983), requires that for a

waiver to have occurred, the subject in question must have

been explored and the waiver expressed in unequivocal terms.

See Proctor Mfg. Corp., 131 NLRB 1166, 1169 (1961). The

Union ‘‘cannot be held to have waived the right to bargain

14

over an issue that was never proposed.’’ Vincent Indus.

Plastics v. NLRB, 209 F.3d 727, 735 (D.C. Cir. 2000).

Vico’s second argument is that its history of granting

annual wage increases is not the type of term or condition

that requires bargaining because the past wage increases did

not follow any set formula or criteria. Vico maintains that

this requires a dismissal for vagueness. Again, Vico’s argu-

ment fails. The lack of an explicit formula for computing wage

increases is not controlling. As we have held, ‘‘when an

employer has established a regular wage-increase program

with fixed criteria, even though discretionary in amount, that

program cannot be discontinued unilaterally.’’ Daily News of

Los Angeles v. NLRB, 73 F.3d 406, 412 (D.C. Cir. 1996). The

past wage increases here were not only regular but also

consistent in criteria: Vico granted across-the-board increas-

es equally to all employees. In addition, Vico alone was in

possession of its data regarding the wage increases, and the

General Counsel should not be faulted for Vico’s failure to

make this data known.

C. Antiunion Animus

Under Wright Line, 251 NLRB 1083 (1980), the General

Counsel must establish a prima facie case that protected

conduct was a motivating factor in Vico’s decision to layoff.

The burden then shifts to Vico to demonstrate as an affirma-

tive defense that the decisions would have been the same

even in the absence of the protected conduct. 251 NLRB at

1084, n.5.

The Board’s conclusion that Vico’s relocation decision was

based on antiunion animus rests on four main points: (1)

statements made by Robert Schultz and Dearing in the

presence of unit employees; (2) provisions in the loan docu-

ments that required Vico to acknowledge that equipment

purchased with MSF funds were to remain in the Plymouth

facility; (3) the June 27, 1997 meeting between Schultz and

Keeling; and (4) the timing of Vico’s leasing of space in

Louisville in relation to the Union’s certification.

15

Vico attempts to attack each of the points relied upon by

the Board. Vico first attacks the Board’s reliance on the

statements of Robert Schultz and Dearing. Regarding Rob-

ert Schultz’s statement, Vico contends that the statement

itself is unreliable because it was made during working hours

in a busy part of the facility that would have been very loud.

Also, Vico argues that the statements carry no weight be-

cause Robert Schultz was inactive at the company at the time.

Regarding Dearing’s statements, Vico notes that Nitz, the

employee to whom the alleged statements were made, testi-

fied that he was a five-year employee when he actually had

been at the company for only seven months in his most recent

stint. In addition, Vico points out that Nitz was in a part of

the facility where hearing protection was required. Vico

further notes that Dearing denies having made the comment,

and states that Nitz’s testimony was uncorroborated. These

arguments fail. They are no more than challenges to credi-

bility determinations. It is long past the time for such

arguments. We do not retry the evidence. ‘‘[C]redibility of

witnesses is a matter for Board determination, and not for

this court.’’ Joy Silk Mills, 185 F.2d 732, 741 (D.C. Cir.

1950). ‘‘[W]e do not reverse the Board’s adoption of an ALJ’s

credibility determinations unless, unlike here, those determi-

nations are ‘hopelessly incredible,’ ‘self-contradictory,’ or ‘pat-

ently unsupportable.’ ’’ Cadbury Beverages, Inc. v. NLRB,

160 F.3d 24, 28 (D.C. Cir. 1998).

Vico points out that the ALJ found that Dearing’s state-

ment was protected under section 8(c) of the NLRA, which

protects an employer’s non-coercive antiunion statements and

prohibits the Board from inferring an unlawful motivation for

employer actions from such statements. 29 U.S.C. § 158(c).

See B.E. & K. Constr. v. NLRB, 133 F.3d 1372, 1376–77 (11th

Cir. 1997). However, Dearing’s statement, much like the

statement of Robert Schultz, reasonably can be construed as

evidence of antiunion motivation because it represented a

threat (‘‘changes TTT are going to be made when the Union is

voted in and there may or may not be jobs left TTT’’) from an

authoritative source within the company (the Company Comp-

troller & General Manager of Organizational Support). Reno

16

Hilton Resorts v. NLRB, 196 F.3d 1275, 1283 (D.C. Cir. 1999)

(‘‘[R]easonable inferences of anti-union motivation were virtu-

ally compelled by the statements of Reno Hilton officials TTT

that the hotel would strongly consider contracting out TTT

jobs if the Union prevailed in the election.’’).

Next, Vico argues that its actions relating to the MFS loan

and Plymouth tax abatement did not indicate union animus.

Vico notes that the Michigan Attorney General’s Office be-

lieved Vico not in default. Vico adds that the only penalty for

relocation is acceleration of a pro rata portion of the loan.

Contrary to Vico’s arguments, Vico’s efforts to obtain the

MSF loan and the Plymouth tax abatement do not square

with the relocation decision. The sudden relocation marked a

dramatic shift from Vico’s prior statements made in connec-

tion with the loan and tax abatement that it intended to

remain in Michigan.

Vico attacks the Board’s reliance on the June 27, 1997

meeting in which Schultz failed to tell Keeling of Vico’s

impending relocation. Vico argues that Keeling’s testimony

is unreliable because his notes of the meeting include no

notation that Schultz stated that Vico had no immediate plans

of relocating. Further, Vico argues that Keeling’s testimony

was incredible and contradicted by Schultz’s testimony that

no discussion of relocation took place at the meeting. These

credibility arguments fail for the same reason as the ones

made previously by Vico.

Vico attempts to undercut the Board’s reliance on the

timing and circumstances of the relocation to Louisville. Vico

argues that it introduced substantial evidence supporting its

argument that its intent to relocate began before the Union

petition. Vico contends that its evidence shows that the

Louisville facility was intended for manufacturing rather than

simply distribution; that the Blue Room was an inadequate

space for production work; that Schultz explained to employ-

ees at the June 1996 meeting that the caliper-pin operations

might be relocated to better serve customers as Vico had

done previously in South Carolina; that the inventory build-

up began before the Union’s representation petition; and that

Vico’s cost-benefit analysis serves as an adequate basis for

17

Vico’s relocation decision. In addition, Vico emphasizes the

fact that none of the bargaining committee members were

among the 33 employees laid off. Vico argues that all of this

evidence prohibits a finding that the timing of the relocation

decision tends to show union animus.

We find the haphazardness, the timing, and the secretive

nature of the hasty relocation decision render the decision

‘‘suspicious.’’ NLRB v. United Mineral & Chemical Corp.,

391 F.2d 829, 833 (2d Cir. 1968). Just a week-and-a-half

before the move, Vico needed to lease a second facility in

Louisville (Louisville Building B). And as of the morning of

the move, Vico did not have a mover under contract to haul

the equipment from Plymouth to Louisville.

The relocation occurred just three months after the Union

election and took place with almost no planning and no notice

to anyone, including Vico’s key customers. Schultz’s failure

to inform Union Representative Keeling of the impending

move when Keeling asked about it just a week prior to the

move is especially suspicious and suggests that Schultz was

hiding the relocation decision from the Union. Equally suspi-

cious is Vico’s failure to notify its primary customers, espe-

cially considering Vico’s previous announcement to Ambrake

of its new warehouse and distribution facility in Louisville.

Vico failed to notify Ambrake (the customer whom Vico

claims benefits most from the move) until two days before the

relocation and without so much as a written plan for the move

or engineering drawings of the new set-up. Ambrake’s sur-

prised and uneasy response casts further doubt on Vico’s

stated motives. Further, Schultz failed to recall whether he

informed Bosch of the move despite the fact that the move

appeared potentially to affect Bosch adversely because the

move resulted in Vico being farther away from Bosch.

In an attempt to make its relocation decision appear as if it

was made prior to union organization efforts, Vico contends

that its build-up of inventory prior to the move to Louisville

was an effort to help establish the facility as a manufacturing

center as soon as it opened. However, the build-up of

inventory just as easily supports the Board’s view that Vico

initially intended to establish the Louisville facility solely as a

18

distribution center. The Board’s view is further supported by

the announcement that Vico sent to Ambrake upon opening

the Louisville facility, welcoming Ambrake to Vico’s new

‘‘Warehouse & Distribution Center.’’ All of the evidence,

taken together, constitutes substantial evidence that the relo-

cation decision was motivated by antiunion reasons. Cf.

Bandag, Inc. v. NLRB, 583 F.2d 765 (5th Cir. 1978); Carter

& Sons Freightways, 325 NLRB 433 (1998).

In an attempt to create an affirmative defense, Vico, rely-

ing on its aforementioned cost-benefit analysis, suggests that

its relocation decision would have been the same even in the

absence of union activity. As indicated above, this after-the-

fact analysis cannot support Vico’s decision to relocate and

does nothing to undermine the Board’s finding that the

relocation decision was motivated by antiunion animus.

Finally, Vico argues that the Board erred in reversing the

ALJ’s decision that the relocation decision was not motivated

by antiunion animus because the ALJ’s decision was based

upon credibility determinations of several witnesses. Vico

argues that the Board is at a disadvantage regarding credibil-

ity determinations and that the ALJ’s credibility determina-

tions are ‘‘entitled to great weight.’’ Holyoke Visiting Nurs-

es Ass’n v. NLRB, 11 F.3d 302, 308 (1st Cir. 1993). However,

the Board ‘‘is authorized to make findings contrary to the

findings of the [ALJ], and where there is substantial evidence

to support the Board’s findings, the court may not set them

aside merely because the Board’s view of the weight and

credibility of the witnesses differed from that of the [ALJ].’’

Joy Silk Mills, 185 F.2d at 742. And we are ‘‘even more

deferential when reviewing the Board’s conclusions regarding

discriminatory motive, because most evidence of motive is

circumstantial.’’ Vincent Indus. Plastics, 209 F.3d at 734.

We will not disturb the Board’s finding that Vico’s relocation

decision was based upon antiunion animus as this finding was

supported amply by substantial evidence on the record as a

whole.

D. Remedial Order

The Board ‘‘has wide discretion in ordering affirmative

action’’ to fashion remedies for unfair labor practices. Virgi-

19

nia Elec. & Power Co. v. NLRB, 319 U.S. 533, 539 (1943).

Generally, we will affirm a Board remedial order unless the

order is shown to be ‘‘a patent attempt to achieve ends other

than those which can fairly be said to effectuate the policies of

the Act.’’ O’Dovero v. NLRB, 193 F.3d 532, 538 (D.C. Cir.

1999) (quotation omitted).

In the context of restoration orders, the Board’s order will

be set aside as contrary to law if it imposes an undue burden

on the employer. Fibreboard Paper Prods. Corp. v. NLRB,

379 U.S. 203, 216 (1964). In order to show that a Board

order imposes an undue burden on an employer, courts have

required that the employer demonstrate by a preponderance

of the evidence that it faces a capital investment that is

disproportionate to its resources or that it faces substantial

and continuous losses. O’Dovero v. NLRB, 193 F.3d at 538.

Vico argues that the present case is comparable to Coronet

Foods, Inc. v. NLRB, 158 F.3d 782 (4th Cir. 1998). In

Coronet, the Fourth Circuit held that an employer did not

need to restore its transportation department that it had

closed in retaliation for union activities. The Fourth Circuit

found that a restoration order would impose upon the employ-

er an undue financial hardship. The court found that the

ALJ had focused too narrowly, stating that evidence concern-

ing ‘‘subsequent relevant economic TTT factors’’ could be

considered. Id. at 795. The court noted that the transporta-

tion department that the employer had shut down was ‘‘out-

moded and inefficient’’ and that to require restoration would

put the employer ‘‘at a competitive disadvantage within its

industry.’’ Id. at 796. Vico contends that this case is quite

similar in that requiring restoration of the Plymouth facility

and its Blue Room would put Vico at a competitive disadvan-

tage by withholding the purported benefits of Vico’s Louis-

ville facility, such as a loss of increased business since the

relocation.2

2 Vico states that since its relocation to Louisville, its caliper-pin

production has increased from 15,273,850 units in 1997 to 21,698,530

in 2002.

20

Vico adds that the Board’s order neglects the costs Vico

faces in moving back into the under-sized, inefficient Plym-

outh facility. Vico points to NLRB v. G&T Terminal Pack-

aging Co., 246 F.3d 103 (2d Cir. 2001), a case in which the

court found a restoration order unduly burdensome to the

employer. In that case, the Second Circuit addressed the

issue of space constraints, noting that ‘‘nothing in the record

contradicts the Company’s claim that it simply does not have

enough space to install a new machine in its TTT facility and,

therefore, that reinstating the TTT operation is all but impos-

sible.’’ Id. at 121–22; see also Garwin Corp., 153 NLRB 664

(1965); Bonnie Lass Knitting Mills, Inc., 126 NLRB 1396

(1960) (restoration order unwarranted).

Last, Vico argues that Fast Food Merchandisers, Inc., 291

NLRB 897 (1988), and Litton Business Systems, 286 NLRB

817 (1987), stand for the proposition that where a layoff

decision is an effect of an earlier identifiable decision that is

not a mandatory subject of bargaining, a restoration order is

not an appropriate remedy. Vico contends that in this case

the layoff decision was a result of the earlier decision to

relocate and does not warrant a restoration order. Vico adds

that the effect of the layoffs has been mitigated by Vico’s

offers of reinstatement (in reverse-seniority order) following

settlement of the injunction proceeding.

We conclude that the Board’s restoration order is within its

broad discretion. Vico has not shown an undue burden by a

preponderance of the evidence. Vico is not without a viable

option. Vico has not shown evidence that it was operating at

a loss in Plymouth. Nor has it offered any proof that it

would lose business by moving back to Plymouth. Thus, its

reliance on Coronet is misplaced. Likewise, G&T Terminal

is distinguishable. Vico has not shown that it is without

adequate space in Plymouth. The fact that Vico already has

returned some machines to Plymouth following the injunction

proceeding and has implemented cell configuration more ef-

fectively to utilize space there severely undercuts its argu-

ment ‘‘that reinstating the TTT operation is all but impossi-

ble.’’ G&T Terminal, 246 F.3d at 121–22. Finally, Vico’s

argument that Fast Food and Litton stand for the proposition

21

that a restoration order is inappropriate where a layoff

decision is the product of an earlier decision that is not a

mandatory subject of bargaining completely misses the mark.

Here, the underlying decision to relocate is a mandatory

subject of bargaining (a point that Vico does not contest).

See supra Part II.A.1.

III

Each of the Board’s findings is supported by substantial

evidence on the record considered as a whole. First, substan-

tial evidence supports the Board’s finding that the relocation

of the caliper-pin equipment was a mandatory subject of

bargaining and that Vico therefore violated the Act when it

relocated the caliper-pin facility, and the Board was correct in

deciding that Vico unlawfully failed to engage in effects

bargaining. Second, the Board was correct in finding that

Vico acted unlawfully in unilaterally discontinuing its estab-

lished practice of granting an annual across-the-board wage

increase. Third, the Board’s finding that Vico’s decision to

relocate was based upon antiunion animus was supported by

substantial evidence, including statements made by manage-

ment to employees, Vico’s previous loan commitments, and

the stealthy manner in which Vico conducted the relocation.

Finally, we agree with the Board that it acted within its broad

remedial authority in ordering Vico to return the caliper-pin

operation to Plymouth and to reinstate the laid-off employees

with back pay. Accordingly, we deny Vico’s petition for

review and grant the Board’s cross-application for enforce-

ment.

So ordered.