Flagstaff Medical Center, Inc. v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued January 15, 2013 Decided April 26, 2013

No. 11-1326

FLAGSTAFF MEDICAL CENTER, INC.,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

Consolidated with 11-1398

On Petition for Review and Cross-Application for

Enforcement of an Order

of the National Labor Relations Board

Steven D. Wheeless argued the cause for petitioner. With

him on the briefs was Alan M. Bayless Feldman.

Elizabeth A. Heaney, Attorney, National Labor Relations

Board, argued the cause for respondent. With her on the brief

were John H. Ferguson, Associate General Counsel, Linda

Dreeben, Deputy Associate General Counsel, and Jill A.

Griffin, Supervisory Attorney.

Before: HENDERSON, BROWN and GRIFFITH, Circuit

Judges.

2

Opinion for the Court filed by Circuit Judge BROWN.

BROWN, Circuit Judge: Flagstaff Medical Center is an

acute-care hospital in Arizona that has witnessed a flurry of

union activity in recent years. This particular case finds its

roots in October 2006, when the Communications Workers of

America, Local Union 7019, AFL-CIO began organizing

among Flagstaff’s housekeeping and food services

employees. The organizing campaign strained relationships

with hospital management, and by January 2008, the union

had charged Flagstaff with dozens of unfair labor practices

under section 8(a)(1) and (3) of the National Labor Relations

Act (“NLRA”). See 29 U.S.C. § 158(a)(1), (3). The ALJ

hearing the case dismissed most of the allegations, concluding

only eight had merit, and when the Board reviewed the ALJ’s

decision, it largely agreed. In short, a divided Board affirmed

the eight § 8(a)(1) violations, reinstated four § 8(a)(1) and (3)

charges the ALJ had dismissed, and affirmed the dismissal of

everything else. See Flagstaff Med. Ctr., Inc. & Commc’ns

Workers of America, Local Union 7019 (“Flagstaff”), 357

NLRB No. 65, at 1–2 & n.1 (2011). Flagstaff now asks us to

review three of the reinstated charges.

Rejecting the ALJ’s findings, the Board concluded that

Flagstaff violated § 8(a)(1) when its president, Bill Bradel,

threatened employees that unionization would be futile; and

that Flagstaff violated § 8(a)(1) and (3) by modifying

employee Laverne Gorney’s schedule in retaliation for her

union activity and by firing employee Michael Conant

because of his union activity. We agree the Board failed to

muster substantial evidence for its conclusions about Bradel

and Conant, so we grant Flagstaff’s petition in part. We deny

the petition in all other respects.

3

I

Section 8(a)(1) of the NLRA prohibits an employer’s

interference with, or restraint or coercion of, the rights of

employees to organize and join unions, bargain collectively,

and engage in certain other “concerted activities.” 29 U.S.C.

§§ 157, 158(a)(1). The Board concluded Flagstaff ran afoul of

this provision when, in a June 2007 meeting with vice

president of ancillary services Roger Schuler and food

services department employees, Flagstaff president Bill

Bradel said something to the effect that if there was a union,

“I would not be negotiating with the union,” or, “you won’t

be negotiating with me.” According to the Board, this violated

NLRA § 8(a)(1) because “employees could have reasonably

construed Bradel’s statement as indicating that [Flagstaff]

would not bargain with the Union.” Flagstaff, 357 NLRB No.

65, at 7. We disagree.

“An employer’s statement violates the NLRA if,

considering the totality of the circumstances, the statement

has a reasonable tendency to coerce or interfere with those

rights,” Tasty Baking Co. v. NLRB, 254 F.3d 114, 124 (D.C.

Cir. 2001),1 but as long as it does not do so by threat or

1

Flagstaff insists the Board may find an employer’s statement

constitutes an unlawful threat of futility only if the employer “states

or implies that it will ensure its non-union status by unlawful

means,” a standard Flagstaff believes imposes a higher bar to

NLRA liability, Pet’r Br. at 29–31, but we need not address this

claim because Flagstaff effectively concedes a statement tending to

coerce or interfere with employees’ rights violates the NLRA. See

Reply Br. at 6 (“As a general proposition, the Board analyzes

employer statements under Section 8(a)(1) by determining whether

such statements reasonably tend to coerce employees in the

exercise of their Section 7 rights.”). Nor does the distinction matter

4

promise of benefit, an employer may “explain the advantages

and disadvantages of collective bargaining to its employees in

an effort to convince them that they would be better off

without a union,” Winkle Bus Co., 347 NLRB 1203, 1205

(2006). We think that is what happened here. Bradel and

Schuler established from the outset of the meeting that they

wanted to learn about employees’ issues, concerns, and

problems. Employees voiced concerns about wages, work

hours, the retirement plan, and benefits, and at the end of the

meeting, Bradel said that “we appreciate the direct activity

and that if we had a union that it would be difficult to have

that same direct communication and I didn’t think that, that

would be necessary for [Flagstaff].” Flagstaff, 357 NLRB No.

65, at 31 (ALJ Op.). This makes sense given that the issues

discussed presumably would be governed by a collective

bargaining agreement. See 29 U.S.C. §§ 158(a)(5), 159(a).

Considering this context, we are baffled by the Board’s

interpretation of Bradel’s subsequent first-person-singular

statement about negotiations as a comment about Flagstaff’s

threshold willingness to negotiate—rather than as a statement

about his own attendance at whatever meetings occur.2 The

record does not support this interpretive leap. See Pac. Micr.

Corp. v. NLRB, 219 F.3d 661, 665 (D.C. Cir. 2000) (“To meet

here: we reject the Board’s conclusions even under the standard it

applied.

2

Both Bradel, whose testimony the ALJ and Board credited,

and employee Lydia Sandoval testified that Bradel’s statement

responded to an employee’s claim that “you” will be dealing with

“us.” The ambiguity in the employee’s statement—whether “you”

meant Bradel individually or Flagstaff as a company—should be

resolved in harmony with its context. The Board insists the meeting

was infected by Flagstaff’s general union animus, but it is not every

company where employees feel comfortable engaging the president

so directly.

5

the requirement of ‘[s]ubstantial evidence,’ the Board must

produce ‘more than a mere scintilla’ of evidence; it must

present on the record ‘such relevant evidence as a reasonable

mind might accept as adequate to support a conclusion,’

taking into consideration the ‘record in its entirety . . .

including the body of evidence opposed to the Board’s view.”

(internal citations omitted)).

Indeed, the record evidence about what Bradel actually

said suggests Bradel implicitly recognized there would be

negotiations. For instance, almost every witness who

recounted Bradel’s comment qualified it with the deictic

phrase “like this,” suggesting the comments expressly referred

to a particular type of meeting rather than the possibility of a

meeting. In the respective words of “outspoken union

advocates” Shawn White and Lydia Sandoval, Flagstaff, 357

NLRB No. 65, at 31 (ALJ Op.), “He said he wanted us to

think about our decision to unionize because, if we would

unionize, we wouldn’t have any more meetings with him like

this,” Hr’g Tr. at 360 (May 8, 2008) (J.A. 120), and “[H]e

mentioned something about if bring the union in [sic], we

won’t be able to have any meetings with him like this again,”

Hr’g Tr. at 1197 (May 15, 2008) (J.A. 241). Similarly,

multiple witnesses testified that Bradel said they “did not

need a third party brought in” in order to resolve issues,

Flagstaff, 357 NLRB No. 65, at 31 (ALJ Op.), which raises

the question of what Bradel thought the “third party” would

be doing if not helping employees resolve issues with

Flagstaff. See also Hr’g Tr. at 1232 (May 15, 2008) (J.A. 247)

(Sandoval testifying that Bradel said “he didn’t feel like

employees needed third party representation”). Hardly a

statement that unionizing would be futile.

The Board was troubled by the fact that Bradel—

Flagstaff’s “highest-ranking official”—did not make the

6

contested comment immediately after his statement about

direct communication but did so “in direct response to an

employee’s assertion that employees needed union

representation.” Flagstaff, 357 NLRB No. 65, at 7. Yet this

does not mean, as the Board thought, that deeming Bradel’s

comment innocuous would render it a non sequitur; nor does

Bradel’s status as president necessarily mean, as the Board

also thought, that employees reasonably would think he was

speaking for Flagstaff. Access to one of the company’s

highest executives may very well be relevant to gauging the

usefulness of union representation, and Bradel’s emphasis on

his appreciation of “direct communication” with employees

would make little sense if he did not in fact hold a high

position in the company.

At oral argument, the Board warned us against second-

guessing its expertise where we know nothing about the tone

of voice Bradel used when making the contested statement or

the body language accompanying it. But of course, the person

entrusted with evaluating witness credibility—the ALJ—

articulated his judgment about the factual record by finding

no NLRA violation. See Local 702, Int’l Bhd. of Elec.

Workers v. NLRB, 215 F.3d 11, 15 (D.C. Cir. 2000). The

Board adopted the ALJ’s credibility findings, so we are just

following its lead.

II

“[A]n employer violates the NLRA by taking an adverse

employment action in order to discourage union activity.” Ark

Las Vegas Rest. Corp. v. NLRB, 334 F.3d 99, 104 (D.C. Cir.

2003); see 29 U.S.C. § 158(a)(3). To determine whether an

employer’s motive was unlawful, the Board applies a burden-

shifting scheme known as the Wright Line test. Under it,

General Counsel for the NLRB has the initial burden of

7

showing that the employee’s protected conduct was a

“motivating factor” in the adverse employment decision; once

it makes this showing, the employer may escape liability only

if it shows by a preponderance of evidence that it would have

taken the same action even had there been no protected

conduct. See Ark Las Vegas Rest. Corp., 334 F.3d at 104. We

evaluate the Board’s conclusions about Gorney and Conant

within this framework.

A

Laverne Gorney has worked in the food services

department for over ten years, most recently as a dishwasher.

On May 26, 2007,3 Gorney appeared in a pro-union

advertisement in the local newspaper; in June, she was

assigned to a “very unusual” number of weekend shifts.

Flagstaff, 357 NLRB No. 65, at 48 (ALJ Op.). In concluding

general counsel satisfied its Wright Line burden, the Board

relied on Flagstaff’s other NLRA violations as evidence of

general animus toward unions, as well as the suspicious

timing of the schedule change. Flagstaff’s rebuttal attempts

fell short, the Board explained, because they either pertained

to Gorney’s July and August schedules without saying

anything about her June schedule, or were unhelpfully vague.

We will not disturb these findings.

Motive is a question of fact, so the Board’s inferences

about unlawful motive are entitled to substantial deference.

See Laro Maint. Corp. v. NLRB, 56 F.3d 224, 229 (D.C. Cir.

1995). The Board concluded Jeanine Drake, the director of

3

No date appears on the advertisement in the record. One

witness testified the advertisement was published “[s]omewhere in

[the] range” of May 28, Hr’g Tr. at 647 (May 9, 2008), but since

the parties seem to agree it came out May 26, we ignore this

potential discrepancy.

8

the food services department who set Gorney’s schedule,

interfered with the union campaign by telling employees not

to discuss their wages, by coercively interrogating an

employee about the usefulness of a union (and in the process,

calling the nurses’ union “foolish”), and by implicitly

suggesting a newly-hired employee would be laid off if the

hospital unionized. The Board could reasonably find that in

doing so, Drake demonstrated anti-union animus. See, e.g.,

Lee Builders, Inc., 345 NLRB 348, 349 (2005) (inferring anti-

union animus when managers “threatened employees with job

loss and plant closure if the Union were to succeed in the

organizing campaign”); see also Federated Logistics &

Operations v. NLRB, 400 F.3d 920, 923 (D.C. Cir. 2005). If

so, and Drake assigned Gorney a very unusual shift schedule

soon after Gorney began publicly supporting the union—

which Drake admitted seeing—then the Board could

reasonably infer an unlawful motive for the schedule change.

See Teamsters Local Union No. 171 v. NLRB, 863 F.2d 946,

955 (D.C. Cir. 1988) (“[T]he Board may consider such factors

as the employer’s knowledge of the employees’ union

activities, the employer’s hostility towards the union, and the

timing of the employer’s action.” (internal citations omitted)).

Flagstaff, for its part, disputes the factual premises

propelling this analysis. First, Flagstaff challenges the

“majority’s finding that the June shift was ‘very unusual,’”4

Pet’r Br. at 51 n.10, and second, it argues that “the schedule

for each upcoming month comes out on the 25th of the prior

month” so “Drake would have already made and posted the

June schedule before Gorney’s appearance in the newspaper

on May 26, 2007.” Pet’r Br. at 49. Presumably, the Board’s

4

This is perhaps Flagstaff’s artful way of avoiding the

consequences of its failure to raise the issue below: it was not the

Board that found the June shift to be very unusual, but the ALJ.

9

reasoning would fall apart without these factual linchpins. If,

for instance, Gorney’s June schedule had nothing to do with

her union activity, then it is not clear how her subsequent

schedules could be the product of her union activity: her July

schedule was hardly unusual if she had a comparable schedule

the previous month. Flagstaff’s failure to address Gorney’s

June schedule in its rebuttal arguments would no longer

matter, and we might be more inclined to question the

Board’s invocation of Flagstaff’s general union animus to

prove Drake’s specific motivation. See Chevron Mining, Inc.

v. NLRB, 684 F.3d 1318, 1327–28 (D.C. Cir. 2012);

Warshawsky & Co. v. NLRB, 182 F.3d 948, 956 (D.C. Cir.

1999).

But no matter: Flagstaff raised neither argument before

the Board, so we have no jurisdiction to consider them. See 29

U.S.C. § 160(e). The Board deemed the June schedule very

unusual precisely because Flagstaff never contested the ALJ’s

finding to that effect, see 29 C.F.R. § 102.48(a), and Flagstaff,

though pointing to a few arguments in the record it thinks

sufficient to meet its jurisdictional burden, identifies nothing

that would have put the Board on notice about the timing of

Drake’s June scheduling decision. See Local 900, Int’l Union

of Elec., Radio & Mach. Workers v. NLRB, 727 F.2d 1184,

1191–92 (D.C. Cir. 1984).

We may consider arguments not raised before the Board

in “extraordinary circumstances,” 29 U.S.C. § 160(e), but

Flagstaff gives us no reason to think these circumstances are

anything but ordinary. Perhaps Flagstaff might be excused

from raising these arguments before the Board rendered its

decision. Compare Detroit Edison Co. v. NLRB, 440 U.S.

301, 311 n.10 (1979) (rejecting argument that a party need not

object to ALJ recommendation where it has “no practical

reason” to do so, explaining that accepting this as

10

“extraordinary circumstance” would undermine the statutory

exception and that party in fact had a reason to challenge the

recommendation when the opposing party excepted to it),

with NLRB v. Good Foods Mfg. & Processing Corp., 492

F.2d 1302, 1305 (7th Cir. 1974) (noting that courts sometimes

excuse a party’s failure to file exceptions to the ALJ’s

findings where the findings “were favorable to the petitioner,

were subsequently reversed by the Board, and petitioner had

no reason to file exceptions to a decision in its favor”). But

we will not excuse its failure to raise them afterwards in a

motion for reconsideration. See Woelke & Romero Framing,

Inc. v. NLRB, 456 U.S. 645, 665–66 (1982); Stephens Media,

LLC v. NLRB, 677 F.3d 1241, 1255 (D.C. Cir. 2012);

Epilepsy Found. of Ne. Ohio v. NLRB, 268 F.3d 1095, 1101–

02 (D.C. Cir. 2001).

B

Michael Conant, a Flagstaff housekeeper, began wearing

a union button in July 2007; he was fired in August. Though

Conant had a record of poor attendance during his two years

at Flagstaff, the Board found that Flagstaff had general anti-

union animus, that the timing of Conant’s discharge was

suspicious, and that Flagstaff’s enforcement of the company

attendance policy was highly—and therefore suspiciously—

inconsistent. We think the Board failed to justify these

findings with substantial evidence.

Flagstaff’s attendance policy provides that “[e]xcessive

absenteeism and tardiness . . . may result in disciplinary

action to include termination.” J.A. 373. It also lists the

sanctions to be imposed for specified numbers of absences in

any rolling six- or twelve-month period. Four absences in any

rolling six-month period, or seven in any twelve-month

period, results in a verbal warning; five absences in any six-

11

month period, or eight in any twelve-month period, results in

a written warning; six absences in any six-month period, or

nine in any twelve-month period, results in a final warning

and possible suspension; and seven absences in any six-month

period, or ten in any twelve-month period, results in

termination. See Flagstaff, 357 NLRB No. 65, at 8.

By the summer of 2007, Conant had already received

verbal and written warnings and a three-day suspension. The

suspension apparently did not faze him. He missed work four

more times before he was fired: once in May, once in June,

and twice in July—making a total of twelve unscheduled

absences in twelve months. No one denies this entitled

Flagstaff under the attendance policy to fire Conant.

The Board makes much of the fact that Flagstaff did not

do so until after Conant began wearing a union button, but the

record easily explains this apparent oddity: in mid-June, the

director of the housekeeping department stepped down and an

interim director, Joe Brown, took over. Conant was absent

only twice after that, and Brown did not know about either

absence until the department secretary brought the second one

to his attention. At that point, Brown reviewed Conant’s file,

confirmed with the director of human resources that firing

Conant would comport with Flagstaff policies,5 and got the

go-ahead from Schuler. He fired Conant on August 1. (Both

the ALJ and the Board credited Brown’s testimony about the

matter.)

Only Brown and Schuler were involved in the decision to

fire Conant, and there is no substantial evidence either had an

5

The record is ambiguous about who spoke to the director of

human resources—Brown, Schuler, or both of them—but like the

parties and the ALJ, we ascribe no significance to that fact.

12

unlawful motivation. See Parsippany Hotel Mgmt. Co. v.

NLRB, 99 F.3d 413, 422 (D.C. Cir. 1996) (explaining that

general counsel must prove “that the employer knew of the

employee’s pro-union activities,” “that the timing of the

alleged reprisal was proximate to the protected activities,” and

that “there was anti-union animus to link the factors of timing

and knowledge to the improper motivation” (internal

quotation marks omitted)). First, there is little reason to think

Schuler knew anything about Conant’s unionizing. The

Board—which in its decision below referenced Schuler only

to note that he “reviewed and approved [Brown’s]

recommendation,” Flagstaff, 357 NLRB No. 65, at 9—now

points to an affidavit in which Schuler stated that “[a]t the

time of his termination, I could guess that Conant supported

the union.” Hr’g Tr. at 106 (May 6, 2008) (J.A. 68). The

Board considers this a damning admission. Not so. Schuler

clearly testified that his admittedly ambiguous statement did

not mean what the Board now asserts but rather meant only

that “at the time I was giving the affidavit, in retrospect” he

could have guessed Conant supported the union. Hr’g Tr. at

104 (May 6, 2008) (J.A. 66). Indeed, when signing the

affidavit, Schuler handwrote a qualifier next to the

controverted statement: “Based on conversations I had with

him in which he often expressed his dissatisfaction with

management and other work related issues. I never saw him

wear a union shirt or button, nor did he ever overtly express

his union support to me.” Hr’g Tr. at 106 (May 6, 2008) (J.A.

68).

The Board argues in the alternative that even assuming

Schuler “was personally unaware of Conant’s union support,

his lack of personal knowledge is not determinative” because

the Board could reasonably impute such knowledge to him.

Resp’t’s Br. at 48–49. This makes no sense. If general counsel

relies on circumstantial evidence and legal fictions about

13

constructive knowledge, it does so to carry its burden of

showing the decisionmaker knew about the employee’s union

activity. See, e.g., Avecor, Inc. v. NLRB, 931 F.2d 924, 928–

29 (D.C. Cir. 1991); Wolf Trap Foundation, 287 NLRB 1040,

1041 (1988); Kimball Tire Co., Inc., 240 NLRB 343, 344

(1979). Permitting circumstantial evidence and legal fictions

to trump direct proof to the contrary is absurd. See Chevron

Mining, Inc., 684 F.3d at 1327–28; see also Vulcan Basement

Waterproofing of Il. v. NLRB, 219 F.3d 677, 685 (7th Cir.

2000).

Second, though Brown testified he knew about Conant’s

union activity by July, the record does not support the

inference that Conant’s union activity played any role in

Brown’s decision or, put differently, that Brown would not

have recommended discharge anyway. We reject the Board’s

reliance on Bradel’s alleged unlawful threats to

“demonstrate[] that union animus . . . pervaded [Flagstaff],”

Resp’t’s Br. at 50; see Parsippany, 99 F.3d at 423–24,

because we do not think Bradel’s statements were improper—

and the Board’s circumstantial case cannot survive that

conclusion because Brown had nothing to do with any of

Flagstaff’s NLRA violations. Nor can the Board impute

animus to Brown directly because there is no such evidence in

the record.

Both the ALJ and the Board credited Brown’s testimony

that he followed Flagstaff’s attendance policy and, “from the

inception of his tenure with [Flagstaff], attempted to enforce

[Flagstaff’s] policies with consistency.” Flagstaff, 357 NLRB

No. 65, at 55 (ALJ Op.). As written, the policy is ambiguous:

it is possible to have accumulated no more than four or five

absences in any six-month period but nevertheless exceed

nine absences in a twelve-month period, thereby requiring

both warnings and discharge. The record shows Brown

14

understood the policy to mandate an incremental approach

whereby, for example, it would be inappropriate to fire an

employee who had not yet received a final warning.6 When

Monika Coby-Thompson had her ninth and tenth unscheduled

absences in six months, Brown suspended her for three days

rather than firing her because she had hitherto received only

verbal and written warnings. When Haskielena Begay had her

sixth unscheduled absence in six months, Brown issued a

written warning rather than a final warning because she had

hitherto received only a verbal warning (though he

subsequently suspended her as well for a separate policy

violation). But even under Brown’s relatively lenient

understanding of the policy, Conant’s excessive absences

warranted discharge. See, e.g., MECO Corp. v. NLRB, 986

F.2d 1434, 1438 (D.C. Cir. 1993) (“Absent a showing of anti-

union motivation . . . an employer may discharge an employee

for a good reason, a bad reason, or no reason at all without

running afoul of the labor laws.” (internal quotation marks

omitted)).

There appear to be two instances where a supervisor

ostensibly under Brown’s authority failed to escalate the

sanction though the escalation would have been warranted

and the employee had already received the same level of

discipline, but we think this insignificant in light of the ALJ

and Board’s conclusion that Brown tried to enforce

Flagstaff’s policies consistently and the record evidence that

Brown generally did so in fact. See MECO Corp., 986 F.2d at

6

Brown recommended firing a probationary employee who

had not received any warning, but the employee’s probationary

status refutes any attempt to cite that recommendation as an

example of inconsistent enforcement. See Rest. Corp. of Am. v.

NLRB, 827 F.2d 799, 806 (D.C. Cir. 1987) (“Disparate enforcement

inherently requires a finding that the employer treated similar

conduct differently.” (emphasis added)).

15

1437. Perhaps controversy over Flagstaff’s attendance policy

might have been avoided if the housekeeping department had

done a better job tracking employee absences so that an

employee received, for example, the verbal warning

immediately after a fourth unscheduled absence rather than

after the fifth, but it is unreasonable to find animus merely

because Brown’s reliance on the department secretary to track

absences and the exigencies of day-to-day work led to a few

false negatives. This of course assumes Brown was even at

Flagstaff when both incidents occurred, which is not at all

clear from the record. See Hr’g Tr. at 463 (May 8, 2008) (J.A.

135) (Brown testifying, “I’ve been at five different hospitals

in the last year.”).

III

Because there is no substantial evidence justifying the

Board’s findings that Bradel’s comments violated NLRA

§ 8(a)(1) or that Conant’s discharge violated § 8(a)(1) and (3),

we grant Flagstaff’s petition in part. We grant the Board’s

application for enforcement of its order in all other respects.

So ordered.