Ozburn-Hessey Logistics, LLC v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 18, 2016 Decided August 19, 2016

No. 14-1253

OZBURN-HESSEY LOGISTICS, LLC,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

UNITED STEEL, PAPER AND FORESTRY, RUBBER,

MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND SERVICE

WORKERS INTERNATIONAL UNION,

INTERVENOR

Consolidated with 14-1289, 15-1184, 15-1242

On Petitions for Review and Cross-Applications

for Enforcement of Orders

of the National Labor Relations Board

Benjamin H. Bodzy argued the cause for petitioner. With

him on the briefs was Stephen D. Goodwin.

David A. Seid, Attorney, National Labor Relations Board,

argued the cause for respondent. With him on the briefs were

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Richard F. Griffin, General Counsel, John H. Ferguson,

Associate General Counsel, Linda Dreeben, Deputy Associate

General Counsel, and Robert J. Englehart, Supervisory

Attorney.

Katharine J. Shaw argued the cause and filed the briefs

for intervenor. With her on the briefs was Amanda M. Fisher.

Before: PILLARD and WILKINS, Circuit Judges, and

EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge PILLARD.

PILLARD, Circuit Judge: This appeal is the latest chapter

in an ongoing labor dispute between Ozburn-Hessey

Logistics, LLC (OHL or the Company) and the United Steel,

Paper and Forestry, Rubber, Manufacturing, Energy, Allied

Industrial and Service Workers International Union (the

Union). In 2009, the Union began a campaign to organize

workers at the OHL’s warehouse facilities in Memphis,

Tennessee. That campaign culminated in a July 27, 2011,

representation election, which the Union won by a one-vote

margin. The National Labor Relations Board (the Board)

found that the Company committed multiple unfair labor

practices during the months leading up to the representation

election. OHL violated the National Labor Relations Act, the

Board determined, by threatening, interrogating, and

surveilling employees; creating the impression of such

surveillance; confiscating union-related materials; urging

union supporters to resign; and disciplining two employees

because of their pro-union views. In that same decision, the

Board resolved pending ballot challenges and objections

arising from the July 27, 2011, representation election and

directed the Board’s Regional Director to count six of the

remaining challenged ballots, resulting in a wider margin of

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victory for the Union. Pursuant to that revised election tally,

the Board’s Regional Director certified the Union as the

exclusive bargaining representative for the Company’s

Memphis employees. The Company nonetheless refused to

bargain with the Union, prompting a separate Board decision

determining that OHL violated the Act.

The Company petitions for review, raising multiple

objections to the Board’s underlying decisions. We have

accorded the Company’s arguments full consideration after

careful examination of the record, but address in detail only

those arguments that warrant further discussion. Having

found no basis to disturb the Board’s well-reasoned decisions,

we deny the petitions for review and grant the Board’s cross-

applications for enforcement of its orders.

I. Background

A. Facts

OHL is a third-party logistics company that provides

transportation, warehousing, and supply-chain management

services for other companies. It operates warehouses

throughout the country, including five in Memphis,

Tennessee. In May 2009, the Union began organizing

employees at OHL’s Memphis warehouses and, later that

year, filed an election petition with the Board to represent

those workers. See Hooks ex rel. NLRB v. Ozburn-Hessey

Logistics, LLC, 775 F. Supp. 2d 1029, 1035-36 (W.D. Tenn.

2011). The Union lost the ensuing representation election in

March 2010 and filed charges against OHL, alleging that the

Company committed multiple unfair labor practices during

the unionization campaign. Id. at 1035-39. The Board found

merit to those allegations and concluded in two separate

decisions that, between June 2009 and March 2010, OHL

4

violated the Act by threatening employees, confiscating union

materials, and disciplining union supporters. See Ozburn-

Hessey Logistics, LLC, 357 NLRB 1632 (2011) (Ozburn I)

(finding that OHL committed unfair labor practices between

June and October 2009), enforced mem., 609 F. App’x 656

(D.C. Cir. 2015) (per curiam judgment); Ozburn-Hessey

Logistics, LLC, 357 NLRB 1456 (2011) (Ozburn II) (finding

that Company committed unfair labor practices between

November 2009 and March 2010), enforced mem., 605 F.

App’x 1 (D.C. Cir. 2015) (per curiam judgment). 1

The Company’s challenged misconduct did not end there,

however. Just a few months after the election, OHL

disciplined employees Jennifer Smith and Carolyn Jones, on

the basis of their union-related conduct. On June 9, 2011, the

Company issued a final warning to Smith, a known union

leader who distributed union literature and handbills, solicited

coworkers to support the Union, and openly wore union hats

and shirts to work. The final warning accused Smith of

violating OHL’s anti-harassment and non-discrimination

policy by calling Stacey Williams, a fellow African-

American, a racial slur on June 8 during a heated argument

about certain office supplies. Final Employee Warning

Notice, 14 J.A. 717. Smith denied having made the

derogatory remark and refused to sign the final warning.

A few days later, on June 14, the Company fired Jones, a

known union leader who distributed union handbills and

organizing materials, solicited coworkers to support the

Union, and routinely attended union meetings. The

1

While these cases were awaiting Board review, the Union

sought, and a federal district court granted, a temporary injunction

prohibiting OHL from committing further unfair labor practices and

ordering the Company to make whole several unlawfully

disciplined employees. See Hooks, 775 F. Supp. 2d at 1034, 1053.

5

Company’s termination letter gave two reasons for Jones’s

discharge. First, the Company accused Jones of violating the

Company’s “guidelines regarding failure to cooperate with an

internal investigation” by fabricating a witness statement

about a heated verbal exchange that occurred on May 26,

2011. See Jones Termination Letter, 14 J.A. 558. On that

day, Jones had attended a meeting during which OHL

management disseminated information to employees about

union dues. Afterward, Jones went to a break room and told

her coworkers that the President supported their right to

unionize and that it was “stupid” for employees not to want a

union. ALJ Decision of May 15, 2012, 14 J.A. 740-41.

According to Jones, OHL Director of Operations Phil Smith

suddenly appeared behind her and said, “[I] just had two . . .

employees . . . sa[y] they were called stupid. . . . Well, you all

are the ones that are stupid because you’re trying to get a

union in here.” Hearing Transcript, 14 J.A. 25. Jones asked

if Phil Smith was referring to her, to which he replied, “[i]f

the shoe fits, then you wear it.” Id. When Jones explained to

Phil Smith that she did not call anybody “stupid” and tried to

end their conversation, id. at 26, Phil Smith warned her, “you

better watch your back,” id. at 26-27.

Jones soon prepared a witness statement documenting her

encounter with Phil Smith and asked her coworkers to sign it.

Four OHL employees signed the statement, which Jones then

submitted to OHL’s Human Resources Department. After

investigating the incident, OHL determined that Phil Smith

was innocent of any wrongdoing and that Jones had asked her

coworkers to sign a blank sheet of paper before she filled in

the witness statement about Phil Smith’s threatening

comment—conduct the Company characterized as fraudulent.

Second, the Company claimed that Jones was fired

because she violated the Company’s Anti-Harassment Policy

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by repeatedly calling fellow employee Lee Smith a racial

epithet. Jones began calling Lee Smith that epithet in the

spring of 2011, shortly after he had voiced his opposition to

the Union. OHL conducted an internal investigation and

concluded that, despite her repeated denials, Jones in fact had

used the racial epithet on multiple occasions.

On June 14, 2011, the same day as Jones’s discharge, the

Union petitioned the Board for a second election to represent

workers at OHL’s Memphis warehouses. The Board held the

representation election on July 27, pursuant to a Stipulated

Election Agreement between OHL and the Union. The

parties agreed that “office clerical and professional

employees” would be excluded from the voting unit and

further stipulated that two administrative assistants would

vote subject to challenge by the Union. The Union won the

election by a vote of 165 to 164. The election tally reflected

fourteen ballot challenges, including the Company’s

challenge to Jones’s ballot and the Union’s challenge to

ballots of the two administrative assistants. OHL and the

Union thereafter each objected to the second election on

several grounds.

B. Decisions Below

1. The Unfair Labor Practice Case

Between June and September 2011, the Union filed a

series of unfair labor practice charges against OHL

challenging the Company’s conduct during the months

preceding the second representation election, including its

punishment of Jennifer Smith and Carolyn Jones. Based on

the Union’s charges, the Acting General Counsel issued a

consolidated complaint alleging, among other things, that the

Company disciplined Smith and Jones on account of their

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union-related conduct and support in violation of section

8(a)(3) and (1) of the Act.

On May 15, 2012, the Administrative Law Judge

determined that OHL had committed the charged unfair labor

practices. As relevant here, the ALJ found that, based on

hearing testimony and other evidence, the Company violated

section 8(a)(3) of the Act by issuing a final warning to

Jennifer Smith and terminating Carolyn Jones because of their

pro-union activities and views. 2 Applying the Board’s two-

part analysis from Wright Line, 251 NLRB 1083 (1980), the

ALJ determined that anti-union animus motivated the

Company’s punishment of Smith and Jones and that the

Company’s putative justifications for meting out those

disciplinary measures were pretextual. Because the

Company’s proffered reasons for disciplining Smith and

Jones were “mere pretext[s],” ALJ Decision of May 15, 2012,

14 J.A. 746, the ALJ explained, it “fail[ed] by definition to

show that it would have taken the same [disciplinary] action

for those reasons, absent the protected conduct,” id. (quoting

Rood Trucking Co., 342 NLRB 895, 898 (2004)). The ALJ

therefore directed the Company to post an appropriate

remedial notice regarding its violations of the Act and

imposed three additional remedies. The ALJ ordered OHL

(1) to distribute electronically the remedial notice to all unit

employees; (2) to have the notice read aloud to the Memphis

employees by a Board representative in the presence of two

designated OHL managers; and (3) to cease and desist from

committing the charged unfair labor practices and from

otherwise violating the Act.

2

The ALJ also found that the Company violated section

8(a)(1) by threatening and interrogating employees, surveilling

employees, creating the impression of surveillance, confiscating

union materials, and telling pro-union employees to resign.

8

In the same decision, the ALJ resolved the pending ballot

challenges and objections arising from the second

representation election. After ruling on the parties’ electoral

disputes largely in the Union’s favor, the ALJ issued a

recommended order to count six of the remaining ten

challenged ballots. The ALJ further recommended that, if the

Union did not prevail after those six votes were counted, the

Regional Director should invalidate the second election so

OHL employees could vote in a third, untainted election.

On May 2, 2013, the Board affirmed the ALJ’s rulings,

findings, and conclusions, rejected all of OHL’s exceptions to

the ALJ’s decision, and adopted the ALJ’s remedial order,

with one modification. 3 Ozburn-Hessey Logistics, LLC, 359

NLRB No. 109, at *1-4 & n.2 (2013) (Ozburn III). The

Board “agree[d]” with the ALJ’s findings that OHL

“discharged employee Carolyn Jones for engaging in

protected activity” and “unlawfully issued employee Jennifer

Smith a written final warning in retaliation for her prounion

activity.” Id. at *1-2. “[A]dditional circumstances,” the

Board emphasized, supported the ALJ’s conclusion that

Jennifer Smith’s discipline was unlawful. Id. at *2. The

Board found that, based on the credited evidence, OHL’s

“purported belief that Smith used a racial slur was not

reasonable.” Id. The Board also determined that OHL “was

highly inconsistent in its response to racial slurs,” noting that

the Company readily applied its Anti-Harassment Policy

against pro-union employees Jones and Smith, while

overlooking grossly offensive statements by OHL supervisor

Phil Smith. Id. That uneven treatment, the Board concluded,

3

The Board’s amended remedy afforded OHL the option to

have its own managers read the notice aloud to employees in the

presence of a Board representative.

9

suggested that OHL “was using its antiharassment policy to

target union supporters, further corroborating the [ALJ’s]

finding of pretext.” Id. Finally, the Board adopted the ALJ’s

resolution of the parties’ election objections and ballot

challenges and thus directed the Regional Director to count

six of the challenged ballots. Id. at *3-5. OHL petitioned for

review of the Board’s May 2013 Decision.

In compliance with the Board’s May 2013 Decision, the

Regional Director issued a revised election tally of 169-166 in

the Union’s favor and, on May 24, 2013, certified the Union

as the exclusive bargaining representative for the designated

employee unit. In June 2013, OHL refused the Union’s

request to bargain, prompting the Union to file charges under

the Act. Pursuant to those charges, the Acting General

Counsel filed a complaint alleging that OHL’s refusal to

bargain with the Union violated section 8(a)(5) and (1) of the

Act.

The following year, the Supreme Court decided NLRB v.

Noel Canning, 134 S. Ct. 2550 (2014), which invalidated the

appointments of two Board members on the panel that had

issued the Board’s May 2013 Decision on the unfair labor

charges. On June 27, 2014, the Board set aside that decision

in light of Noel Canning and retained the case on its docket.

On November 17, 2014, upon de novo review of the

ALJ’s decision, a lawfully constituted panel of the Board

affirmed the ALJ’s rulings, findings, and conclusions and

adopted with modification the recommended remedial order

“to the extent and for the reasons stated” in its May 2013

Decision, which the Board expressly incorporated by

reference. Ozburn-Hessey Logistics, LLC, 361 NLRB No.

100, at *1 (2014) (Ozburn IV). Although the Board found

that the Regional Director lawfully certified the Union based

10

on an accurate, revised tally of the representation election, it

nevertheless issued a new Certification of Representative “in

an abundance of caution.” Id. at *1. Shortly thereafter, OHL

petitioned for review of the Board’s November 2014

Decision, and the Board cross-applied for enforcement of the

same. The two unfair-labor-practice cases were consolidated,

and the Union intervened.

2. The Refusal To Bargain Case

Meanwhile, in December 2014, the Union sent another

letter to OHL requesting that the Company bargain, and OHL

once more refused. The following month, with the Board’s

permission, the General Counsel amended its complaint to

allege that the Company in 2014 had again refused to bargain

in violation of section 8(a)(5) and (1) of the Act. OHL

admitted that it had refused to bargain with the Union, but

asserted that it was not obligated to do so because the Board

had erred in resolving the ballot challenges, overruling the

Company’s election objections, and certifying the Union.

OHL also sought dismissal of the General Counsel’s

complaint on the ground that the Union never filed a new

charge following the Board’s 2014 Certification of

Representative.

On June 15, 2015, the Board issued a Decision and Order

finding that OHL’s refusal to bargain with the Union was

unlawful under section 8(a)(5) and (1) of the Act. See

Ozburn-Hessey Logistics, LLC, 362 NLRB No. 118, at *1-5

(2015) (Ozburn V). The Board rejected the Company’s

efforts to relitigate the ballot challenges and election

objections previously adjudicated in the Board’s November

2014 Decision and found no merit to the Company’s

contention that the General Counsel’s amended complaint

was procedurally infirm for want of a separately filed charge

11

after the Board certified the Union in 2014. See id. at *2.

OHL petitioned for review of the Board’s 2015 Decision, and

the Board cross-applied for enforcement. The two refusal-to-

bargain cases were consolidated, and the Union intervened.

After briefing was completed, we granted the Company’s

request to consolidate the refusal-to-bargain cases with the

unfair-labor-practice cases. We have jurisdiction over the

consolidated appeals under 29 U.S.C. § 160(e) and (f).

II. Analysis

A. Standard of Review

We “accord[] a very high degree of deference to

administrative adjudications by the [Board]” and reverse its

findings “only when the record is so compelling that no

reasonable factfinder could fail to find to the contrary.”

Bally’s Park Place, Inc. v. NLRB, 646 F.3d 929, 935 (D.C.

Cir. 2011) (internal quotation marks omitted). Under that

very deferential standard, we “must uphold the judgment of

the Board unless, upon reviewing the record as a whole, we

conclude that the Board’s findings are not supported by

substantial evidence, or that the Board acted arbitrarily or

otherwise erred in applying established law to the facts of the

case.” Tenneco Auto., Inc. v. NLRB, 716 F.3d 640, 646-47

(D.C. Cir. 2013) (quoting Wayneview Care Ctr. v. NLRB, 664

F.3d 341, 348 (D.C. Cir. 2011)). We also “owe substantial

deference to inferences drawn by the Board from the factual

record,” Tenneco, 716 F.3d at 647 (internal quotation marks

omitted), and “[o]ur review of the Board’s conclusion as to

discriminatory motive is even more deferential, because most

evidence of motive is circumstantial,” Fort Dearborn Co. v.

NLRB, --- F.3d ---, 2016 WL 3361476, at *3 (D.C. Cir. Apr.

12, 2016) (reissued June 17, 2016) (internal quotation marks

12

omitted); see also Citizens Inv. Servs. Corp. v. NLRB, 430

F.3d 1195, 1198 (D.C. Cir. 2005). Furthermore, we “will

uphold the Board’s adoption of an ALJ’s credibility

determinations unless those determinations are hopelessly

incredible, self-contradictory, or patently unsupportable.”

United Servs. Auto. Ass’n v. NLRB, 387 F.3d 908, 913 (D.C.

Cir. 2004) (internal quotation marks omitted).

B. Section 8(a)(3) Violations

OHL first challenges the Board’s determination that it

violated section 8(a)(3) and (1) of the Act by issuing a final

warning to Jennifer Smith and terminating Carolyn Jones on

account of their union-related activity.

Under section 8(a)(3), it is “an unfair labor practice for an

employer . . . to encourage or discourage membership in any

labor organization” by “discriminati[ng] in regard to hire or

tenure of employment or any term or condition of

employment.” 29 U.S.C. § 158(a)(3). An employer violates

section 8(a)(3) “by taking an adverse employment action,

such as issuing a disciplinary warning, in order to discourage

union activity.” Tasty Baking Co. v. NLRB, 254 F.3d 114,

125 (D.C. Cir. 2001); see Fort Dearborn, 2016 WL 3361476,

at *3. And an employer that violates section 8(a)(3)

derivatively violates section 8(a)(1)’s prohibition on

“interfer[ing] with, restrain[ing], or coerc[ing] employees in

the exercise of the rights guaranteed in section [7 of the Act],”

29 U.S.C. § 158(a)(1). See Metro. Edison Co. v. NLRB, 460

U.S. 693, 698 n.4 (1983).

Where, as here, an employer purports to have disciplined

or discharged an employee for reasons unrelated to protected

union activity, the Board applies the so-called Wright Line

test. Fort Dearborn, 2016 WL 3361476, at *3; Shamrock

13

Foods Co. v. NLRB, 346 F.3d 1130, 1135 (D.C. Cir. 2003).

Under that test, the General Counsel “must first make a prima

facie showing sufficient to support the inference that

protected [i.e., union-related] conduct was a motivating factor

in the . . . adverse action.” Tasty Baking, 254 F.3d at 125

(alteration and omission in original) (internal quotation marks

omitted). “Relevant factors” in determining an employer’s

motive “include ‘the employer’s knowledge of the

employee’s union activities, the employer’s hostility toward

the union, and the timing of the employer’s action.’” Fort

Dearborn, 2016 WL 3361476, at *3 (quoting Vincent Indus.

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

see Fortuna Enters., LP v. NLRB, 665 F.3d 1295, 1303 (D.C.

Cir. 2011). “Once a prima facie case has been established, the

burden shifts to the company to show that it would have taken

the same action in the absence of the unlawful motive.” Tasty

Baking, 254 F.3d at 126.

OHL does not seriously dispute the Board’s conclusion

that the General Counsel met his initial burden, at the first

step of the Wright Line analysis, to show that union animus

motivated the Company’s decisions to issue a warning to

Jennifer Smith and discharge Carolyn Jones. Nor could it.

Substantial evidence in the record supports the Board’s

findings that Smith and Jones were active supporters of the

Union, that OHL had knowledge of their union-related

conduct, and that OHL harbored animus toward the Union

and its supporters. See Fort Dearborn, 2016 WL 3361476, at

*3; Power Inc. v. NLRB, 40 F.3d 409, 418 (D.C. Cir. 1994).

OHL instead contends that the Board misapplied the

Wright Line test by denying the Company a meaningful

opportunity to show, at the second step of the Wright Line

analysis, that it would have issued a final warning to Smith

and discharged Jones even in the absence of the allegedly

14

unlawful motive. The Board further erred, OHL claims, by

concluding arbitrarily and without any basis in the record that

the Company’s proffered justifications for disciplining Smith

and discharging Jones were pretextual.

1. The Board’s Application of the Wright Line Test

We first consider OHL’s argument that the Board erred

by affirming what OHL characterized as the ALJ’s

misapplication of the Wright Line test. According to OHL,

the ALJ sidestepped the full Wright Line analysis by

concluding that, “[i]f the employer’s proffered defenses are

found to be a pretext, i.e., the reasons given for its actions are

either false or not, in fact, relied on, the employer fails by

definition to show that it would have taken the same action

for those reasons,” rendering it unnecessary “to perform the

second part of the Wright Line analysis.” ALJ Decision of

May 15, 2012, 14 J.A. 746. OHL argues that the ALJ’s

approach, which the Board subsequently affirmed and

adopted, impermissibly skipped over the second step of

Wright Line and thus abridged the Company’s opportunity to

rebut the General Counsel’s prima facie showing that it

disciplined Smith and Jones for unlawful reasons.

Neither the ALJ nor the Board deviated from the

analytical approach set forth in Wright Line. Applying that

test, the ALJ determined that the Company’s decisions to

punish Smith and Jones were motivated by anti-union animus

and rejected each of the reasons the Company claimed to have

relied on in taking those disciplinary actions. In doing so, the

ALJ did not, as OHL contends, deny it the opportunity to

present its affirmative defenses: the ALJ allowed the

Company to advance its defenses but, after considering them

in light of the record, concluded that they were “mere

pretext[s].” ALJ Decision of May 15, 2012, 14 J.A. 746.

15

Nothing in Wright Line forecloses that approach and,

indeed, the Board’s precedent interpreting and applying

Wright Line expressly authorizes it. In Rood Trucking, for

example, the Board clarified that:

[a] finding of pretext defeats any attempt by the

[company] to show that it would have discharged the

discriminate[e]s absent their union activities . . .

because where “the evidence establishes that the

reasons given for the [company’s] action are

pretextual—that is, either false or not in fact relied

upon—the [company] fails by definition to show that

it would have taken the same action for those reasons,

absent the protected conduct, and thus there is no

need to perform the second part of the Wright Line

analysis.

342 NLRB at 898 (quoting Golden State Foods Corp., 340

NLRB 382, 385 (2003)); see also Limestone Apparel Corp.,

255 NLRB 722 (1981) (“[W]here an administrative law judge

has evaluated the employer’s explanation for its action and

concluded that the reasons advanced by the employer were

pretextual, that determination constitutes a finding that the

reasons advanced by the employer either did not exist or were

not in fact relied upon.”). Accordingly, the ALJ’s articulation

of the legal standard comported with the Board’s guidance in

Rood Trucking.

The Company insists that even if Rood Trucking

countenances the ALJ’s approach here, that decision

“contravenes Wright Line” by “preclud[ing] the burden from

ever shifting” to the Company, resulting in the Board

“mak[ing] a premature declaration of pretext without ever

considering the employer’s justification for the disciplinary

16

decision.” 14 Petitioner’s Reply Br. 15-16. To the extent that

OHL asserts that the ALJ failed to consider the Company’s

defenses, it has mischaracterized the ALJ’s decision, which

considered OHL’s proffered reasons and found them to be

pretextual. To the extent that OHL claims legal error, we

decline its invitation to overturn Rood Trucking. To begin,

that decision constitutes the Board’s well-reasoned

“interpretation of its own precedent” in Wright Line and

therefore “is entitled to deference.” Ceridian Corp. v. NLRB,

435 F.3d 352, 355 (D.C. Cir. 2006) (internal quotation marks

omitted). Even absent such deference, however, we perceive

no conflict between Rood Trucking and the Wright Line test.

To be sure, Wright Line dictates that an employer may

rebut the General Counsel’s initial showing of union animus

by establishing that it “would have taken the same [adverse]

action [against the employee] in the absence of” the unlawful

motive. 251 NLRB at 1091. Rood Trucking’s logic is not to

the contrary. If the Board concludes, as it did here, that the

employer’s purported justifications for adverse action against

an employee are pretextual, then the employer fails as a

matter of law to carry its burden at the second prong of

Wright Line. See Rood Trucking, 342 NLRB at 898. Indeed,

the Board has articulated the Wright Line framework in

similar, if not identical, terms in numerous decisions both

before and since Rood Trucking. See, e.g., Ozburn II, 357

NLRB at 1456 n.3 (“We agree with the judge that the

[Company’s] proffered reason for terminating [the employee]

was shown to be pretextual, and that the [Company] therefore

failed to rebut the Acting General Counsel’s initial case by

showing it would have terminated [the employee] in the

absence of her union support.”); U-Haul of Cal., 347 NLRB

375, 388-89 (2006), enforced mem., 255 F. App’x 527 (D.C.

Cir. 2007) (judgment); Golden State Foods, 340 NLRB at

385; In re Sanderson Farms, Inc., 340 NLRB 402, 402

17

(2003). Courts, too, have formulated the Wright Line burden-

shifting test consistently with both Rood Trucking and the

ALJ’s decision here. See, e.g., USF Red Star, Inc. v. NLRB,

230 F.3d 102, 106 (4th Cir. 2000) (“If the Board believes the

employer’s stated lawful reasons are non-existent or

pretextual, the [employer’s affirmative] defense fails.”); cf.

NLRB v. Transp. Mgmt. Corp., 462 U.S. 393, 398 (1983),

abrogated on other grounds by Dir., Office of Workers’

Comp. Programs, Dep’t of Labor v. Greenwich Collieries,

512 U.S. 267 (1994). Because the ALJ correctly adhered to

the Board’s decisions in Wright Line and Rood Trucking, the

Board did not err in affirming and adopting the ALJ’s

articulation of the controlling legal standard.

2. Final Warning of Jennifer Smith

We next turn to OHL’s contention that the Board

arbitrarily found that the Company’s asserted justification for

issuing a final warning to Jennifer Smith—namely, that she

violated OHL’s Anti-Harassment Policy by calling her

coworker Stacey Williams a racial slur—“was a mere

pretext.” ALJ Decision of May 15, 2012, 14 J.A. 746. That

challenge misses the mark.

The ALJ determined, and the Board agreed, that Smith

never used that racial epithet. In reaching that determination,

the ALJ credited Smith’s testimony that she never called

Williams any such name because he “found her to be an

honest [and cooperative] witness.” Id. at 741. Smith’s

account, the ALJ emphasized, was consistent with the

accounts of other credible witnesses who observed the

altercation. Jennifer Smith’s co-worker, Jerry Smith, testified

that he would have heard the racial slur if Smith had actually

said it because he was “focused enough on what was going

on,” but that he did not hear it. Testimony of Jerry Smith, 14

18

J.A. 266-67. Likewise, Sheila Childress, a co-worker who

witnessed the altercation from about thirty feet away, stated

that she did not hear Smith utter the epithet. The ALJ

expressly discredited Stacey Williams’s testimony that

Jennifer Smith addressed him with a racial slur because he

“was a confusing, hostile, and argumentative witness,” whose

testimony was “disjointed.” ALJ Decision of May 15, 2012,

14 J.A. 741. The ALJ also found that OHL employee Shirley

Milan, who corroborated Williams’s account of events, was

“a biased witness, who previously made an unsubstantiated

claim that Smith threatened her with a knife, and who also

conceded that she dislikes Smith.” Id. We decline to disturb

the Board’s adoption of those credibility findings, which rest

on substantial record support and are certainly not reversible

as “hopelessly incredible, self-contradictory, or patently

unsupportable.” United Servs. Auto. Ass’n, 387 F.3d at 913

(internal quotation marks omitted); see Monmouth Care Ctr.

v. NLRB, 672 F.3d 1085, 1091-92 (D.C. Cir. 2012) (declining

to overturn administrative law judge’s credibility

determination “based on a combination of testimonial

demeanor and a lack of specificity and internal

corroboration”).

OHL nevertheless maintains that, even accepting the

Board’s factual finding that Jennifer Smith did not use a racial

slur against Stacey Williams, OHL reasonably believed that

she did based on the evidence at its disposal, and punished her

accordingly. Its reasonable belief, OHL claims, was

sufficient to rebut the General Counsel’s prima facie case of

anti-union motive at the second prong of the Wright Line

analysis. In support of that contention, OHL invokes our

decision in Sutter East Bay Hospitals v. NLRB, 687 F.3d 424

(D.C. Cir. 2012), where we held that “[i]f [a company’s]

management reasonably believed [the employee’s] actions

occurred, and the disciplinary actions taken were consistent

19

with the company’s policies and practice, then [a company]

could meet its burden under Wright Line regardless of what

actually happened.” Id. at 435-36; see also Fort Dearborn,

2016 WL 3361476, at *6.

Sutter East Bay is of little aid to OHL because, as the

Board concluded, “the record establishes that [OHL’s]

purported belief that Smith used a racial slur was not

reasonable.” Ozburn III, 359 NLRB No. 109 at *2 (emphasis

added), incorporated by reference in Ozburn IV, 361 NLRB

No. 100. The Board found that the credited testimony of

Jennifer Smith, Childress, and Jerry Smith, outlined above,

severely undercut the reasonableness of the Company’s belief,

which was based on the accounts of biased and incredible

witnesses. Id. In fact, the day before the Company issued

Jennifer Smith the final warning, Childress furnished to the

Company a signed statement explaining that she did not hear

Smith use any racial epithet during the verbal altercation with

Williams, giving the Company a significant reason to doubt

Williams’s allegation.

The Board also determined that “credited evidence in the

record” established “that [OHL] did not believe that the use of

racial slurs merited discipline.” Id. Most tellingly, that

record evidence showed that OHL supervisor Phil Smith was

not disciplined at all after hurling highly offensive racial and

homophobic slurs at employees in front of other managers

and employees. And several other witnesses testified that use

of racial slurs was commonplace among the workers at

OHL’s Memphis warehouses. Based on that and other

credited record evidence, the Board reasonably inferred that

OHL acted “inconsistent[ly] in its response to racial slurs”

and “was using its antiharassment policy to target union

supporters.” Ozburn III, 359 NLRB No. 109 at *2; see also

infra 23-25. Consequently, the Company cannot avail itself

20

of Sutter East Bay’s safe harbor, because, as the Board found,

it has not shown that it reasonably believed Jennifer Smith

used a racial epithet or that “it parceled out discipline as it

normally would when confronted with the same kind of

employee misconduct that its managers reasonably believed

had occurred.” See Fort Dearborn, 2016 WL 3361476, at *6.

The Board reasonably concluded, consistent with the

evidence, that, “even assuming [OHL] reasonably believed

that Smith had used a racial epithet,” the Company “could not

and did not establish that it would have disciplined her in the

absence of the union activity.” Ozburn III, 359 NLRB No.

109 at *2. We owe heightened deference to that well-

reasoned assessment of the Company’s discriminatory motive

and find no basis in the law or record to question the Board’s

determination that OHL’s proffered reason for disciplining

Smith was mere pretext. See Fort Dearborn, 2016 WL

3361476, at *3.

In sum, substantial evidence supports the Board’s

findings that Smith never used the alleged racial slur and that

it was unreasonable for the Company to believe that she did.

We therefore deny OHL’s petition for review, and grant the

Board’s cross-application for enforcement, of the Board’s

decision that OHL’s discipline of Smith violated section

8(a)(3) and (1) of the Act.

3. Discharge of Jones

OHL also challenges the Board’s determination that the

Company’s two putative justifications for terminating Jones

were pretextual. OHL maintains that it fired Carolyn Jones

for two legitimate reasons unrelated to her union support and

activity: (1) she violated the Company’s conduct guidelines

by fabricating a witness statement that supervisor Phil Smith

threatened her with the warning, “watch your back”; and (2)

21

she violated the Company’s Anti-Harassment Policy by

repeatedly using a racial slur against co-worker Lee Smith.

The Board found those reasons to be pretextual. We affirm

that finding.

a. Discharge Reason # 1: OHL Claims Jones

Fabricated Her Witness Statement

Substantial evidence supports the Board’s conclusion that

Carolyn Jones did not fabricate her witness statement

regarding Phil Smith’s alleged threat. All four witnesses who

signed the statement—Annie Ingram, Troy Hughlett, James

Bailey, and Kedric Smith—confirmed that they heard Phil

Smith tell Jones that she had better watch her back. And at

least two of those witnesses, Ingram and Hughlett, credibly

testified that the witness statement prepared by Jones had

some text on it before they had signed it, undercutting the

Company’s suggestion that Jones prepared the witness

statement only after obtaining the signatures. Kedric Smith

testified that Jones handed him a blank page to sign, but the

Board discounted that testimony because it found he had poor

recall of the pertinent issues. We decline to overturn the

Board’s well-reasoned credibility findings, which rested on a

comparison of “testimonial demeanor,” “specificity,” and

“internal corroboration.” Monmouth Care Ctr., 672 F.3d at

1091-92. The Board thus reasonably concluded, based on the

credible evidence, that Jones did not fraudulently manufacture

her witness statement.

Relying once more on our precedent in Sutter East Bay,

687 F.3d at 435-36, OHL insists that it reasonably believed

that Jones falsified her statement because all four witnesses

who signed her statement had given written statements

confirming that Jones handed them a blank page to sign. But

the Board concluded, based on the credible testimony of

22

Ingram, Hughlett, and Bailey, that OHL pressured or deceived

at least the three of them into signing false written statements

to that effect. Ingram testified that that Human Resources

Manager Evangelia Young interviewed her, gave her a blank

piece of paper to sign, and subsequently added false text

about Jones—notably, the very actions of which OHL accuses

Jones. Bailey testified that Young asked him to sign a

prepared statement confirming that Jones had given Bailey a

blank witness statement to sign. Although Bailey admits to

signing Young’s prepared statement, he testified that he did

not closely inspect the document because he assumed Young

was accurately writing “down what [he] said,” and that he

simply signed it because management’s “constant[]”

questioning about the incident “stressed [him] out.”

Testimony of James Bailey, 14 J.A. 139-41. Hughlett

testified that he signed a statement, prepared by Young,

declaring that Jones’s witness statement was blank when he

signed it, but he testified that he did so only because he did

not want to be questioned any more about the incident and felt

“pressure[d]” by management to sign the statement.

Testimony of Troy Hughlett, 14 J.A. 98. Given the ample

testimony suggesting that OHL itself manufactured evidence

to justify Jones’s termination, the Board had a sound basis for

concluding that OHL could not reasonably have believed that

Jones fabricated her witness statement. See Fort Dearborn,

2016 WL 3361476, at *6 (noting that, to rebut prima facie

case of anti-union motive, employer must show that it

“reasonably believed” that misconduct “had occurred”).

Substantial evidence in the record supports the Board’s

determination that OHL’s first reason for firing Carolyn Jones

was pretextual.

23

b. Discharge Reason # 2: OHL Claims Jones

Repeatedly Used a Racial Slur

We reach the same result with respect to the Company’s

second putative reason for Jones’s termination—her

ostensible use of a racial slur against her coworker Lee Smith.

Although the Board determined that Carolyn Jones did in fact

use that epithet, it rejected as pretextual OHL’s assertion that

Jones was fired for that reason. The Board found that OHL

punished Jones’s infraction far more severely than prior,

similar infractions by other employees. It pointed in

particular to the Company’s willingness to overlook racist and

other offensive statements made by supervisor Phil Smith,

which the Board found inconsistent with OHL’s decision to

fire Jones. The Board further concluded that OHL’s

termination of Jones deviated from the Company’s

progressive disciplinary policy, which sets forth lesser initial

penalties for violations like hers. Based on those findings, the

Board concluded that the Company would not have

discharged Jones based on her use of a racial slur absent her

union-related activity. Substantial evidence supports that

conclusion.

The record evidence confirms that OHL’s punishment of

Jones was far more severe than the discipline the Company

imposed on other, similar offenders. As the Board explained,

in ten prior disciplinary actions involving racial epithets or

other profane language, OHL issued eight warnings, one

suspension arising from recidivism, and one discharge arising

from recidivism and a connected assault. The only other

employee who was discharged, Ashley Burgess, was a repeat

offender who received a verbal warning for using profanity

against a supervisor in January 2006 and was fired after

hurling racial slurs at another employee during a heated

physical confrontation in September 2010. Unlike Burgess,

24

Jones was not a recidivist, did not assault, threaten, or

otherwise physically confront anyone at work, and had never

before been reported for using vulgar or offensive language.

In addition, OHL’s willingness to turn a blind eye to the racial

slurs and offensive remarks of OHL supervisor Phil Smith

further underscores the unusual harshness of OHL’s discipline

of Jones. As explained above, Phil Smith called an African

American worker a racial slur and another employee a

homophobic epithet. Unlike Jones, who received OHL’s

harshest punishment, however, OHL did not punish Phil

Smith at all.

OHL argues that the disciplinary cases evaluated by the

Board involved employees who committed different offenses

or were otherwise not comparably situated to Jones. But even

if none of those cases involved the exact circumstances or the

same racial epithets involved in Jones’s case, the Board

deemed them materially similar and held that they

demonstrated that no other employee who had engaged in

only verbal misconduct received as severe a punishment for

an initial infraction as she did. The evidence provides

substantial support for the Board’s findings that OHL engaged

in disparate treatment of Jones and that its stated justification

was mere pretext. See, e.g., Southwire Co. v. NLRB, 820 F.2d

453, 460 (D.C. Cir. 1987) (holding that absence of evidence

that employer discharged any other employee for similar

violation supported finding of pretext); La Gloria Oil & Gas

Co., 337 NLRB 1120, 1124 (2002) (observing that disparate

treatment of employees demonstrates pretext).

The record evidence likewise supports the Board’s

determination that OHL’s termination of Jones deviated from

the Company’s progressive disciplinary system. The

Company’s Handbook identifies four forms of discipline, the

most severe of which is termination. Under the Handbook,

25

termination may be warranted “[i]n cases in which [less

severe] disciplinary action has failed to correct unacceptable

behavior or performance, or in which the performance issue is

so severe as to make continued employment with OHL

undesirable.” OHL Handbook, 14 J.A. 649. The Company

emphasizes that OHL retains discretion under the Handbook

to “apply any level of discipline . . . without resort to prior

disciplinary steps.” Id. at 646. The Handbook makes equally

clear, however, that discipline “will generally be administered

at the lowest level of severity which will effect correction of

the problem.” Id. at 649. Rather than adhere to its general

disciplinary norm of starting out with the least severe penalty

that might accomplish the disciplinary objective, the

Company chose immediately to impose the harshest form of

discipline on Jones for her remarks, even though she was not

a recidivist and had not engaged in any violent conduct.

Accordingly, substantial evidence supports the conclusion

that the Company deviated from its progressive disciplinary

procedure, thus bolstering the Board’s finding of pretext. See

Fort Dearborn, 2016 WL 3361476, at *5 (concluding that

failure to apply progressive disciplinary policy without

explanation supports a finding of pretext).

Because substantial evidence supports the Board’s

determination that OHL’s proffered reasons for firing Jones

were pretextual, and because its decision is not otherwise

arbitrary or unlawful, we deny the Company’s petition for

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

enforcement, of the Board’s decision that OHL’s termination

of Jones violated section 8(a)(3) and (1) of the Act.

C. The Company’s Remaining Challenges

OHL challenges the Board’s decisions on several

additional grounds. It contends that the Board’s

26

determinations that the Company committed numerous

section 8(a)(1) violations were unsupported by substantial

evidence or otherwise erroneous; that the Board abused its

discretion by imposing three additional remedies; 4 and that

the Board denied OHL due process by affirming the decision

of an ALJ whom OHL believes harbors pro-union bias. The

Board then compounded those errors, OHL argues, by

mistakenly counting Carolyn Jones’s vote in the second

representation election, failing to count the votes of two

administrative assistants, rejecting OHL’s election objections,

and ruling on an amended complaint in the absence of an

amended unfair labor practice charge. After carefully

reviewing the Company’s remaining arguments in light of the

record and applicable legal authority, we conclude that they

lack merit and warrant no further discussion. See United

States v. McKeever, --- F.3d ---, 2016 WL 3213035, at *13

(D.C. Cir. June 10, 2016). Accordingly, “we grant without

amplification the Board’s cross-application for enforcement”

as to the remaining findings challenged by the Company.

Stephens Media, LLC v. NLRB, 677 F.3d 1241, 1251 (D.C.

Cir. 2012); see also Tenneco, 716 F.3d at 647-48.

4

We lack jurisdiction to consider OHL’s challenges to two of

the Board’s remedies—the cease-and-desist order and the electronic

distribution requirement—because the Company did not object to

those remedies before the Board. See 29 U.S.C. § 160(e); Nova Se.

Univ. v. NLRB, 807 F.3d 308, 313 (D.C. Cir. 2015); W&M Props.

of Conn., Inc. v. NLRB, 514 F.3d 1341, 1345 (D.C. Cir. 2008).

27

* * *

For the foregoing reasons, we deny the Company’s

petitions for review and grant the Board’s cross-applications

for enforcement.

So ordered.