# Trencor, Inc., Petitioner-Cross-Respondent v. National Labor Relations Board, Respondent-Cross-Petitioner

> Court of Appeals for the Fifth Circuit · April 8, 1997 · 110 F.3d 268

URL: https://www.frixlaw.com/law-library/cases/9490158

## Case

- **Full name:** TRENCOR, INC., Petitioner-Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent-Cross-Petitioner
- **Court:** Court of Appeals for the Fifth Circuit
- **Decided:** April 8, 1997
- **Citations:** 110 F.3d 268; 154 L.R.R.M. (BNA) 3027; 1997 U.S. App. LEXIS 6615; 1997 WL 163531
- **Precedential status:** Published
- **Opinion:** Dissent by Garza
- **Judges:** Garza, Jones, Demoss
- **Cited by:** 12 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9490158

## How later opinions describe it (automated extraction)

- stating that this Court will not disturb the Board’s policy determination unless it is unreasonable or inconsistent with the Act

## Opinion text

*277 REYNALDO G. GARZA, Circuit Judge,
dissenting.
While I concur with the majority’s treatment of the union’s guarantees and its alleged “Cateh-22” campaign tactics, I cannot concur with its treatment of the alleged promise of a party and therefore respectfully dissent from its refusal to grant the Board’s petition for enforcement. My disagreement extends to several points, as I explain below.
In his report on Treneor’s objections to the election, the Regional Director for Region 16 stated as follows with respect to the issue of the party:
In support of this objection the Employer provided an employee witness who testified that a Union representative told an employee, a Union supporter, that when the Union won the election they were going to have the biggest party in the history of Texas and that he would buy all the food and beer for them. The Union employee supporter then, on or about August 2, 1995, told the Employer witness about the party.
Assuming the Union representative made the above statements at some point prior to the election about a prospective party and even assuming the employee who told of this party was an agent of the Union, such would not be a basis for setting the election aside.
While the party referred to may have served as a possible inducement to get employees to vote for the Union, it does not amount to an impermissible coercion of the absence [sic ] of a linkage between the party and either a pre-election pledge of Union support or an actual vote for the Union. Accordingly, the alleged prospective party cannot be a basis for setting the election aside. See Nu Skin International, Inc., 307 NLRB No. 46 . Accordingly, it is recommended this objection be overruled.
(emphasis added). The Board adopted the Regional Director’s findings and recommendations and overruled Trencor’s objections to the election.
The majority states that the Board’s legal analysis is flawed, and estops the Board from supplementing its legal citation with additional cases to demonstrate the consistency with which it has treated this issue. The majority also relies upon language in the Board’s decision that the party “may have served as a possible inducement.” The majority states: “Ultimately, we are persuaded that the Board cannot adopt the recommendation of the Regional Director, which notes that offering a party conditioned on a Union victory ‘may have served as a possible inducement’ but rests on a flawed legal analysis, and then argue on appeal that offering a party could not reasonably have been seen as an inducement.” Maj. op. at 272. The mar jority goes on to reject the Board’s legal argument by stating that “[t]he Board’s reasoning on appeal might be more persuasive if it comported with the facts administratively found.” Maj. op. at 271.
The majority errs in its treatment of the Board’s opinion. First, the language the majority alludes to is not a finding of fact on this issue. Even if it was, it is of no legal import because the Board determined that even if true, Trencor’s objection failed as a matter of policy because the alleged inducement — offering a victory party — was not an improper inducement, i.e. one that would serve as a ground for setting aside the election. Second, the majority finds error in the Board’s adoption of the report when legal authority cited within it is not exactly on point. Essentially, the majority holds that the Board is estopped from not relying specifically on the Nu Skin case and the Board’s analysis therein. What the majority overlooks is that the Board’s opinion in Nu Skin did nothing more than discuss the topic of unlawful inducements in light of guidance provided by the Supreme Court in NLRB v. Savair Mfg. Co., 414 U.S. 270 , 94 S.Ct. 495 , 38 L.Ed.2d 495 (1973), the Court’s only decision in this area. Moreover, the Board’s task in an election challenge is not a quest for on-point precedent, but to make an ad hoc determination based on the facts presented or, as here, alleged. See Loch Simkins Dental Labs., 186 NLRB 671 , 672 (1972) (Board will approach the question of whether “laboratory conditions” have been upset on a ease-by-case basis).
*278 The Board’s opinion states that the promise was minimal and could not have been expected to influence the election. In this court, the Board argues that the promise was minimal and could not be expected to influence the election. The Board’s appellate brief certainly expresses its position much better than does its opinion in this case, but there is no requirement that the two documents be identical. In its petition for review, the Board provides a number of cases setting forth the Board’s long-held position that an employer or union’s simple promise to have a party is not improper, to bolster its argument here that it properly determined, the promise of the party was an inducement of de minimis proportions. This is not a case where a new legal argument is being introduced into the mix. Rather, the NLRB General Counsel has done additional research for this court and supplied the on-point legal citations.
The majority is quite correct that agencies are not permitted to justify their actions in a judicial review proceeding on different grounds than those they relied upon at the time of that action. For us to sanction this sort of post hoc rationalization would allow agencies to engage in unprincipled decision making and would make us their accomplice. But this is not the type of situation the Court had in mind when it decided Chenery and Burlington Truck Lines. The Court has stated that “[w]hile we may not supply a reasoned basis for the agency’s action that the agency itself has not given, we will uphold a decision of less than ideal clarity if the agency’s path may reasonably be discerned.” Bowman Transp. v. Arkansas-Best Freight Sys., 419 U.S. 281, 285-86 , 95 S.Ct. 438, 442 , 42 L.Ed.2d 447 (1974); see also State of Texas v. United States, 756 F.2d 419, 427 (5th Cir.), cert. denied, 474 U.S. 843 , 106 S.Ct. 129 , 88 L.Ed.2d 106 (1985). Because I believe “the agency’s path may be reasonably discerned,” I would reject Trencor’s argument that the Board’s appellate argument does not match the reasons guiding its opinion.
In addition to its Chenery argument, the majority goes further and states that the Board’s decision is foreclosed by the decision of our court in NLRB v. Lou Taylor, Inc., 564 F.2d 1173 (5th Cir.1977). In that case, the Board sought enforcement of an order finding that an employer violated section 8(a)(1) of the Act and requiring a new election where an employer told its employees before the election that it would pay them to attend its Christmas party and would also pay them for the holiday. The Board ordered the new election “despite the Company’s contention that Christmas parties were not new benefits and there were valid reasons for the absence of Christmas parties in the preceding years.” Id. at 1175 . If the employer’s argument that the party itself was not improper was of no concern to the Board or to us in our review of its decision, it is abundantly clear that our decision rested on the fact that a monetary benefit was conferred to the employees. The Board has consistently held that parties may not buy votes. See, e.g., NLRB v. Exchange Parts Co., 375 U.S. 405 , 84 S.Ct. 457 , 11 L.Ed.2d 435 (1964) (employer’s conferral of benefit violated section 8(a)(1)); Crestwood Manor, 234 NLRB 1097 (1978) (“laboratoiy conditions” case holding union’s promise to hold $100 raffle to be an improper inducement). The Board has also consistently held that it can be an unfair labor practice for an employer to withhold an ordinarily granted benefit, such as hosting a Christmas party, during the pendency of a campaign. An employer’s assertion that the benefit conferred is one it has always given operates as an affirmative defense to an 8(a)(1) charge. That the Board still found a violation makes it plain that the objectionable activity in that case was the promise of a paid holiday and paid attendance. 1
*279 The majority does not find it sufficient, however, to rest on the arguments discussed above, and proceeds to reject the Board’s position on this issue. It essentially determines that the Board’s Crestwood Manor decision overruled, by implication, all previous Board decisions in which an inducement of $1.18 or more was found to be unobjectionable. Maj. op. at 270-73 & nn. 2-3. As a consequence of this, the majority must be arguing (although it does not state that it is) that this has caused the Board to be acting inconsistent with its own precedent, a basis for us to approach its present position with skepticism. See I.N.S. v. Cardoza Fonseca, 480 U.S. 421 , 446 n. 30, 107 S.Ct. 1207 , 1221 n. 30, 94 L.Ed.2d 434 (1987) (“An additional reason for rejecting the INS’s request for heightened deference to its position is the inconsistency of the positions the BIA has taken through the years.”); Shaw’s Supermarkets v. NLRB, 884 F.2d 34 (1st Cir.1989) (Board must explain departure from precedent). Even were this argument valid, the Board must have in turn overruled the Crest-wood Manor decision and abandoned this “$1.18 rule” (again by implication), because it held fourteen years later in Nu Skin that the promise of t-shirts (costing from $4 to $5) was unobjectionable. 2
The Supreme Court has long emphasized that, because the Board is the expert body in the field of labor relations, we are to give “considerable deference” to the Board’s position on policy determinations and are not to disturb it “as long as it is rational and consistent with the Act.” NLRB v. Curtin Matheson Scientific, 494 U.S. 775, 787 , 110 S.Ct. 1542, 1549 , 108 L.Ed.2d 801 (1990). Stated another way, as an administrative agency, the NLRB is entitled to the deference announced by the Court in Chevron U.S.A. v. Natural Resources Defense Council, 467 U.S. 837, 844 , 104 S.Ct. 2778, 2782-83 , 81 L.Ed.2d 694 (1984). See ABF Freight Sys. v. NLRB, 510 U.S. 317 , 114 S.Ct. 835 , 127 L.Ed.2d 152 (1994) (“When Congress expressly delegates to an administrative agency the authority to make specific policy determinations, courts must give the agency’s decision controlling weight unless it is ‘arbitrary, capricious, or manifestly contrary to the statute.’ ”); Stardyne, Inc. v. NLRB, 41 F.3d 141, 147-48 (3d Cir.1994) (Board’s case-by-case adjudications to fill gaps in Act are analyzed under Chevron ). We also look to the consistency with which the Board has acted as a factor in deciding whether the agency’s action should stand. Cardoza Fonseca, 480 U.S. at 446 , 107 S.Ct. at 1221 ; NLRB v. New Jersey Bell Tel., 936 F.2d 144, 147 (3d Cir.1991).
Nowhere, perhaps, is this deference greater than when the issue is whether the “laboratory conditions” of the election are alleged to-, have been upset. Section 9 of the Act gives the Board “the broad duty of providing election procedures and safeguards for elections and a wide discretion in determining when conduct did or did not jeopardize the untrammeled expression of employee free choice.” NLRB v. Sanitary Laundry, 441 F.2d 1368, 1369 (10th Cir.1971). The issue before us today, whether the promise of a party is the type of benefit that could reasonably have tended to influence the employees’ decision, represents “precisely the type of minor, detailed, interstitial question of labor election policy that Congress asked the Labor Board, not' the courts, to decide.” NLRB v. Labor Services, Inc., 721 F.2d 13, 18 (1st Cir.1983) (Breyer, J., dissenting).
In rejecting the Board’s determination here, the majority places this court at odds with the positions taken by our sister courts. The Third Circuit considered this precise *280 issue in NLRB v. L & J Equipment Co., 745 F.2d 224 (1984), and, despite the majority’s attempt to distinguish it, found the policy to represent a reasonable exercise of its powers. The majority states that the crucial difference between that ease and the one before us today is that the Board there made a fact finding that the purpose of the election was to celebrate victory and “lay the groundwork for a productive employee-union relationship.” In so distinguishing it, however, the majority by-passes precedent of our court that specifically rejects the “intent to influence” test in favor of the “tendency to influence” test that the Board argues before us today. See NLRB v. McCarty Farms, 24 F.3d 725 , 731 n. 5 (5th Cir.1994) (discussing the standard). The Third Circuit, incidentally uses the same standard we use, NLRB v. Clearfield Cheese Co., 322 F.2d 89, 93-94 (3d Cir.1963), making it rather difficult to distinguish its opinion there on the basis that it relied upon the “purpose” as being a satisfactory one. Because the Third Circuit’s decision is, therefore, indistinguishable from the situation here, the majority’s opinion creates a split with our colleagues on that court. The majority’s conclusion also conflicts with favorable commentary on the Board’s position on this issue from the First Circuit. Labor Services, 721 F.2d at 17 (Board “properly held” in Movsovitz that promise to buy beer and wine after election “could not reasonably be expected to have influenced the employees’ free choice.”)
Reviewed under the proper standard, the Board’s policy must stand. Its position has been uniform for decades, as the majority opinion clearly demonstrates. Maj. op. at 270-72 n. 2. Because Congress did not mandate an outcome here but expressly left it to the Board to decide, it cannot be said that its determination is “manifestly contrary to the statute.” Its determination is neither arbitrary nor capricious. We have previously recognized “that clinical asepsis is an unattainable goal in the real world of union organizational efforts,” and accordingly are “conscious of the ‘realities of industrial life’ in our application of the controlling standard.’ ” McCarty Farms, 24 F.3d at 728 n. 2 (citations omitted). The Board has distinguished money payments from parties on the ground that the former closely resembles a bribe, while it is highly unlikely employees will vote against their better interests merely on the promise of a party. As the majority recognizes in its discussion of the Board’s Midland decision, employees must be viewed as mature individuals. Maj. op. at 275-76. As such, the union organizer’s Texas-sized boasts about the party aside, the Board’s determination that the promise of the party was not one that destroyed the laboratory conditions of the election is entirely reasonable and should be upheld.
In sum, I believe that the Board’s opinion reflects the same argument it advances on judicial review, that its position is not foreclosed by any precedent of our court, and that the Board’s position is not “arbitrary, capricious, or manifestly contrary” to the Act. The employees’ 70-26 vote in favor of union representation should be upheld. Accordingly, I would deny Trencor’s petition for review and would grant the Board’s cross-petition for enforcement of its order.
. The 'majority's misinterpretation of this case carries over to its refusal to force Trencor to meet its burden of demonstrating that the alleged impropriety by the union influenced the outcome of the election, a requirement in ''laboratory conditions” cases such as this one. See, e.g., NLRB v. McCarty Farms, 24 F.3d 725, 728-30 (5th Cir.1994); Vicksburg Hosp. v. NLRB, 653 F.2d 1070, 1075 (5th Cir. Unit A 1981) ("[ejstab-fishing that the objectionable activities ‘either tended to or did influence the outcome of election' is especially difficult where, as in the case of the Vicksburg Hospital election, the union won by a wide [148-66] margin.”) (citations *279 omitted). As Lou Taylor is a section 8(a)(1) case, the remedy ordered there cannot be transplanted to a “laboratory conditions” case because a different standard applies. The Board almost invariably overturns an election where it finds unfair labor practices were committed during the pre-election period. Dal-Tex Optical Co., 137 NLRB 1782 (1962). See Sinclair Co., 164 NLRB 261 (1967), enforced, 397 F.2d 157 (1st Cir.1968), aff 'd sub nom. NLRB v. Gissel Packing Co. 395 U.S. 575 , 89 S.Ct. 1918 , 23 L.Ed.2d 547 (1969), for a discussion by the Board which separates the two standards within a particular case.
. The majority’s attempt to distinguish Nu Skin by noting it was a pre-election benefit is unpersuasive, as is the extended footnote in which it attempts to cast doubt upon forty years of Board precedent because of a difference between pre- and post-election benefits that it believes renders suspect the Board's citation of one in the context of the other. Maj. op. at 270-72 nn. 2-3.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9490158. Public record. Not legal advice.