# Petition for Writ of Certiorari — AutoZone, Inc. v. National Labor Relations Board

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1996
- **Citation:** 519 U.S. 948

## Text

Supreme Court, U.S.
= eS me.

96 116 JUL 22 1996,

No. OFFICE OF THE CLERK

In The

Supreme Court of the United States

October Term, 1995
2

AUTOZONE, INC.,

Petitioner,
versus

NATIONAL LABOR RELATIONS BOARD,

Respondent.
¢

Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Sixth Circuit

a

PETITION FOR WRIT OF CERTIORARI
¢

Cornewius R. Heuser

Tracy K. Hipatco

KULLMAN, INMAN, Bee, DOWNING
& BANTA

A Professional Corporation

P. O. Box 60118 (70160)

1600 Energy Centre

1100 Poydras Street

New Orleans, Louisiana 70163

Telephone: (504) 524-4162

Counsel for Petitioner
AutoZone, Inc.

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831

Q~ .

QUESTIONS PRESENTED

1. Did the Court of Appeals err when it ruled that the
failure, during a union election campaign, to grant a
wage adjustment which was undetermined at the incep-
tion of union organizing activities constituted an unfair
labor practice under the National Labor Relations Act,
particularly where employees were never guaranteed a
specific adjustment and the employer acted in good faith,
upon advice of counsel, and in an effort to avoid influ-
encing the outcome of the election?

2. Did the Court of Appeals err when it ruled that an
employer violates the Act when it merely informs
employees of its previous experiences with strikes, parti-
cularly where the employer informs employees of striker
reinstatement rights?

il

LIST OF PARTIES TO THE PROCEEDINGS
IN THE COURT BELOW

The parties and attorneys involved in the proceed-
ings in the court below, the Court of Appeals for the Sixth
Circuit, are AutoZone, Inc., the Petitioner, and the
National Labor Relations Board, the Respondent.

lil

TABLE OF CONTENTS

Page
RUPE MPEG NW MUOCIW EEO secs cee esscnccastvcaucads i
LIST OF PARTIES TO THE PROCEEDINGS IN THE
SEY SEEMING CCUM Ww iv aS GeV beRS EA Gh isos cen ee ii
EIEN RED xo oie 0 ose Ma waceew a s00ct woni's iii
RETR GD PUN EMME 6 sv okey cence evs vvacss eben. Vv
RAE TE POAP TRUDE L TS oobi cveniecnsvepericees vi
TE EPO ono dev wh ent no's 8 ¥K6s vos ved evarses 1
STATEMENT OF JURISDICTION................... 1
STATUTORY PROVISIONS INVOLVED............. 2
EE MEMO paket ices ecekbbievepsecnsneeneese 2
EINES GOW’ REGE MOINGIS oon van ctccveessiseveacs 3
A. Reasons for Granting Petitioner’s Writ....... 3
S. Procedural Background ...............0.00005 +
errr ere 5
i EES EAT ETE Ore re ire ee 6

A. Petitioner Lawfully Refrained From Making a
Decision as to the Timing and Amount of a
Wage Adjustment to Avoid Influencing the
Outcome of the Election, While Explaining to
Employees the Legal Basis for Its Decision... 6

(1) Summary of the Argument.............. 6

(2) History of General Adjustments at Peti-
tioner’s Distribution Centers............ 7

(3) The Court Below Erred in Concluding That
Petitioner Violated the Act Where Petitioner
Merely Informed Employees of the Legal
Restrictions Guiding Its Decision With
Regard to Wage Adjustments............. 11

iv

TABLE OF CONTENTS - Continued
Page

(4) The Court’s Imposition of 8(a)(3) Liability
Was Clearly Unwarranted Because Peti-
tioner Had No Established Past Practice
of Granting Wage Adjustments.......... 15

B. The Court Below Improperly Disregarded the
Written Text of a Campaign Speech to Find
That Petitioner’s Noncoercive Expressions of
Opinion on Union Matters Violated the Act.. 25

C. Employees Were Informed of Striker Reinstate-
ment Rights; Therefore, the Court Below Was
Clearly Wrong in Concluding That Petitioner’s
References to Strikes Constituted a Violation of
NG DUN isan dF dans chvt ee cs he kane Meeensanes 28

ee MRL os | errr rere re. ee ret 30

Vv

INDEX TO APPENDICES

Opinion of the Court of Appeals for the Sixth
Circuit

SAV dS Noe ew RRS gh iN dae Kena cw Ohun Eas App. 1
Decision, Order and Direction of Second Election
by National Labor Relations Board........... App. 25

vi

TABLE OF AUTHORITIES
Page

CASES

Atlantic Forest Prod., Inc., 282 N.L.R.B. 855 (1987) 11, 13

Bowling Green-Warren County Community Hosp.
Corp. v. NLRB, 756 F.2d 41 (6th Cir. 1981)..14, 22, 23

Cutter Lab., tnc.,.221 NASB. 160 CES7OR sie ceecssnee 11
Emory Convalescent Home, 260 N.L.R.B. 540 (1992) .... 27

Florida Steel Corp. v. NLRB, 587 F.2d 735 (5th Cir.
IST) kas sce hbepedechbcenese eens ee 26, 29

Free-Flow Packaging Corp. v. NLRB, 566 F.2d 1124
(Ol Cle. BOP Ge ew ihn cakes ccc viasvieaasves 18, 19, 20

Gossen Co., 254 N.L.R.B. 339 (1981), modified on
other grounds, 719 F.2d 1354 (7th Cir. 1983)........ 29

Great Atl. & Pac. Tea Co., 192 N.L.R.B. 645 (1971) 12, 13

Honey Elec., Inc., 138 LRRM 1014 (1991), aff'd in
part, rev'd in part, 964 F.2d 543 (6th Cir. 1992). .13, 14

].J. Newberry Co. v. NLRB, 645 F.2d 148 (2d Cir. .
SOR R i c v ask koiad da 5aa cee whey bik banat 15, 17

NLRB v. Big Three Indus. Gas & Equip. Co., 441 F.2d
re Ye Ag | prererrrear yee Pre rey Pee yee 14

NLRB v. Cleveland Trust Co., 214 F.2d 95 (6th Cir.
SO ois. tank dae hs ohn da bbb eee eee 22

NLRB v. Planter’s Peanuts, 574 F.2d 400 (8th Cir.
SDFG so ininscdévsinestiacistati eee eee 24, 25

a

Vii

TABLE OF AUTHORITIES - Continued

Page
NLRB v. Service Garage, Inc., 668 F.2d 247 (6th Cir.
oe SE Ey ee ee OO ET re ene 14, 17, 23, 24
Otis Hosp., 222 N.L.R.B. 402 (1976), aff'd, 545 F.2d
Rt a Re eee e pep eye penn ee 15, 16
Peabody Coal Co. v. NLRB, 725 F.2d 357 (6th Cir.
a EPUET EEE TEES TT EERE eos Pree Pe eT eee 21
Plasticraft, Inc. v. NLRB, 586 F.2d 185 (10th Cir.
SPS AERGA Wee RELIG phew wad wie choad ¥ankaae Hib adc aa: 18
PPG Indus., 247 N.L.R.B. 941 (1980) ................. 29

Rosaeurs Supermarkets, Inc., 300 N.L.R.B. 709 (1990) .... 13
Stokely-Van Camp, Inc. v. NLRB, 722 F.2d 1324 (7th

RAE SUE nih cha Nar de Wea tee we ere tis ee 20
STATUTES
ee Se EEE ok chk ba 5a as eve 1
NLRA § 10(f), as amended, 29 U.S.C. hs Bee 1

NLRA § 8(a)(1), as amended, 29 U.S.C. § 158(a)(1) passim

NLRA § 8(a)(3), as amended, 29 U.S.C. § 158(a)(3)
1S EEE SCR Rie HR EEE Rae eee 2, 15, 18, 21, 24

NLRA § 8&(c), as amended, 29 U.S.C. Bf. See a, a

1
OPINION BELOW

The opinion of the Court of Appeals for the Sixth
Circuit, which is unpublished, appears in the Appendix
at App. 1.

STATEMENT OF JURISDICTION

The Court of Appeals for the Sixth Circuit entered its
opinion and judgment on April 24, 1996. On June 14,
1996, the Court of Appeals for the Sixth Circuit entered
an Order to stay the mandate pending this Court's dispo-
sition of this Petition for Writ of Certiorari. Petitioner
filed its Petition for Writ of Certiorari within ninety days
of the Notice of Entry of Judgment. This Court's jurisdic-
tion is invoked under 28 U.S.C. § 1254(1).

The Court of Appeals for the Sixth Circuit had juris-
diction to hear Petitioner’s Petition for Review of the
decision of the National Labor Relations Board, which is
a final agency action that disposes of all claims to all
parties, pursuant to Section 10(f) of the National Labor
Relations Act as amended, 29 U.S.C. § 160(f). That section
provides in pertinent part:

Any person aggrieved by a final order of the

Board granting or denying in whole or in part

the relief sought may obtain a review of such

order in any United States Court of Appeals in

the circuit wherein . . . such person resides or

transacts business .. .

Petitioner’s corporate headquarters is located in
Memphis, Tennessee, and it transacts business in Ohio.
Therefore, this matter was within the jurisdiction of the
Court of Appeals for the Sixth Circuit.

2

STATUTORY PROVISIONS INVOLVED

The text of the following pertinent statutory provi-
sions is set forth below:

29 U.S.C. § 158

Unfair labor practices

(a) Unfair labor practices by employer
It shall be an unfair labor practice for an employer —

(1) to interfere with, restrain, or coerce
employees in the exercise of the rights guaran-
teed in section 157 of this title;

(3) by discrimination in regard to hire or
tenure of employment or any term or condition
of employment to encourage or discourage
membership in any labor organization: Provided,
That nothing in this subchapter, or in any other
statute of the United States, shall preclude an
employer from making an agreement with a
labor organization (not established, maintained,
or assisted by any action defined in this subsec-
tion as an unfair labor practice) to require as a
condition of employment membership therein
on or after the thirtieth day following the begin-
ning of such employment or the effective date of
such agreement, whichever is the later, (i) if
such labor organization is the representative of
the employees as provided in section 159(a) of
this title, in the appropriate collective-bargain-
ing unit covered by such agreement when made,
and (ii) unless following an election held as
provided in section 159(e) of this title within one
year preceding the effective date of such agree-
ment, the Board shall have certified that at least
a majority of the employees eligible to vote in
such election have voted to rescind the authority
of such labor organization to make such an

iia aii

3

agreement: Provided further, That no employer
shall justify any discrimination against an
employee for non-membership in a labor organi-
zation (A) if he has reasonable grounds for
believing that such membership was not avail-
able to the employee on the same terms and
conditions generally applicable to other mem-
bers, or (B) if he has reasonable grounds for
believing that membership was denied or termi-
nated for reasons other than the failure of the
employee to tender the periodic dues and the
initiation fees uniformly required as a condition
of acquiring or retaining membership;

(c) Expression of views without threat of reprisal or
force or promise of benefit

The expressing of any views, argument, or opinion,
or the dissemination thereof, whether in written, printed,
graphic, or visual form, shall not constitute or be evi-
dence of an unfair labor practice under any of the provi-
sions of this subchapter, if such expression contains no
threat of reprisal or force or promise of benefit.

STATEMENT OF THE CASE
A. Reasons for Granting Petitioner’s Writ.

The decision of the Sixth Circuit Court of Appeals,
which found that Petitioner violated the Act by withhold-
ing in good faith, and upon advice of counsel, a wage
adjustment which was undetermined at the inception of
union organizing activities, is contrary to Board law and
circuit law. Employers are regularly placed in the precar-
ious position Petitioner faced during the course of the
union organizing campaign conducted here. Due to the
frequency of such dilemmas occurring and the often con-
flicting guidelines developed in Labor Board and circuit
court decisions, elucidation by this Honorable Court on
the issue of wage adjustments in the context of a union
campaign is appropriate and warranted.

4

B. Procedural Background.

This appeal is the culmination of events arising out of
an unsuccessful organizational attempt conducted by the
General Drivers, Warehousemen and Helpers, Local No.
28, International Brotherhood of Teamsters, AFL-CIO
(hereinafter the “union”) among employees of Peti-
tioner’s Greenville, South Carolina Distribution Center.
Pursuant to a Stipulated Election Agreement, an election
was held on March 5, 1993. In a unit of more than 200
voters, 135 votes were cast against union representation
and only 57 votes were cast in favor of representation.
Two challenged ballots were cast.

The union filed objections which were consolidated
with certain complaints issued by the Regional Director
regarding various unfair labor practice charges filed by
the union. A hearing took place on December 6 and 13-16,
1993, and the Administrative Law Judge (hereinafter
“ALJ”) rendered his decision on March 28, 1994.

The ALJ dismissed numerous objections, finding
them to be without merit. However, the ALJ found that
AutoZone unlawfully withheld a wage increase during
the union campaign. Petitioner then filed exceptions to
the ALJ’s decision with the Nationa! Labor Relations
Board (hereinafter “Board”) on May 12, 1994. The Board,
without explanation, affirmed the ALJ’s decision and
order. 315 N.L.R.B. No. 21 (1994). Based on serious errors
contained in the ALJ’s decision and order, Petitioner filed
a petition for review to the Court of Appeals for the Sixth
Circuit (hereinafter “court below”) on October 12, 1994.

The court below rendered its decision on April 24,
1996, denying AutoZone’s petition to set aside the deci-
sion of the Board and granting in full the Board’s cross-
application for enforcement of its order. Based on serious
errors contained in the decision of the court below and
the need for guidance in this important area of national
labor relations policy, Petitioner filed the instant Petition
for Writ of Certiorari to this Court.

5
C. Factual Background.

Petitioner is engaged in the distribution and sale of
automotive parts. During 1993, Petitioner operated five
distribution centers located one each in Arizona, Texas,
Louisiana, Tennessee, and South Carolina. The union
waged its campaign in the Greenville, South Carolina,
Distribution Center by distributing literature and para-
phernalia to Petitioner’s. employees, holding meetings,
and soliciting support. A representation petition was
filed on January 7, 1993.

During the period preceding the election, which was
held on March 5, 1993, Petitioner instructed its super-
visors not to threaten, intimidate, make promises, or sur-
veil employees. In addition, Petitioner presented written
campaign speeches to enable employees to make an
informed decision regarding union representation. Fer-
guson, the Greenville Distribution Center Manager, and
Roberts, the Vice President of Distribution, sought legal
advice during the course of the campaign to ensure com-
pliance with the Act.

In January 1993, Petitioner became concerned with
the legality of moving forward with any wage adjust-
ments during the course of the campaign. Petitioner's
concerns were magnified by the fact that the amount of
any wage adjustment, which had been sporadic in nature,
was not finalized prior to the filing of the union’s peti-
tion, and thus communicated same to legal counsel.
Under the circumstances, Petitioner was in a dilemma: If
Petitioner proceeded with a wage adjustment during the
height of the union campaign, it would most certainly
have been accused of “vote buying.” In an effort to avoid
the filing of unfair labor practice charges and “vote buy-
ing” allegations by the union, a decision was made not to
proceed with a decision regarding any wage adjustments
at the Greenville Distribution Center.

6
ARGUMENT

A. Petitioner Lawfully Refrained From Making a
Decision as to the Timing and Amount of a
Wage Adjustment to Avoid Influencing the
Outcome of the Election, While Explaining to
Employees the Legal Basis for Its Decision.

(1) Summary of the Argument.

In its decision, the court below found that: (1) Peti-
tioner’s past practice of granting wage adjustments in its
Greenville facility has historically been erratic both in
timing and in amount (App. 3-4, 101); (2) there is no
guarantee that employees at any of Petitioner’s facilities
will receive a wage adjustment (App. 3-4, 101); (3) wage
adjustments are not dependent upon inflation rates, but
instead upon a market analysis of the areas in which the
individual distribution centers are located (App. 3-4,
101-02); (4) wage adjustments among the individual facil-
ities, as well as among the individual classifications of
employees, vary across the board (App. 3-4, 105-06); (5)
employees in Greenville were never guaranteed a specific
wage adjustment for 1993 (App. 3-4, 101-02); and (6)
Petitioner had not finalized a decision regarding a wage
adjustment for Greenville employees when the union
filed its petition. (App. 4-5, 103.)

Despite the erratic nature of wage adjustments at
Petitioner’s facilities, the court below nevertheless con-
cluded that Petitioner unlawfully withheld a wage adjust-
ment. Petitioner shows it did not violate the Act when it
merely informed employees of the legal restrictions guid-
ing its decision during the representation proceedings
with regard to wage adjustments. As a result, the appel-
late court’s decision must be reversed.

7

(2) History of General Adjustments at Peti-
tioner’s Distribution Centers.

Petitioner’s past practice with regard to wage adjust-
ments is undisputed. Petitioner maintains two types of
wage adjustment programs for its employees: (1) normal
progression raises where employees receive established
“step” raises during the first two years of their employ-
ment;! and (2) general adjustments, given sporadically
not in predetermined amounts, which vary across the
board among the different job classifications to
employees with more than two years of service. (App.
60.) The second category of wage adjustments is the
category in dispute.

Unlike the normal progression raises, general adjust-
ments are given sporadically and are directly tied to a
market analysis of the area in which each distribution
center is located.2 (App. 3-4, 60.) There is no guarantee
that an adjustment will be given on a yearly basis. (App.
3, 61.) The history of general adjustments at the Green-
ville Distribution Center illustrates the sporadic nature of
wage increases. That facility opened in October 1986. It
was not until 1990 that employees received a general
adjustment; they did not receive one in 1987, in 1988 or
until late in 1989. (App. 20, 101.)

1 For example, at the Greenville Distribution Center, new
employees are reviewed at intervals of six months, one year,
one-and-a-half years, and two years, receiving a set increase
after each review. Before, during, and after the union campaign,
employees with less than two years of service were given their
normal progression raises in accordance with the pay scale in
place at the Greenville Distribution Center.

2 As the Board correctly observed, general adjustments are
not “cost of living adjustments” because (1) not everybody gets
the same increase, if any; and (2) the general adjustment is
based on the results of a market analysis, or area wage survey,
rather than some COL index. (App. 60.)

8

In November 1989, a general adjustment was
announced at the Greenville Distribution Center for the
year 1990. (App. 20, 101.) This general adjustment consis-
ted of a 3'/2% change to the pay scale; the individual pay
categories each received a different percentage increase.
(App. 20, 101.) In 1991, some, but not all, Greenville
employees with over two years of service received a 0.9%
adjustment to the pay scale. (App. 101.) For example, one
category of employees received a 50¢ per hour adjust-
ment, while another category received a 15¢ per hour
adjustment. The “net” increase for 1992 for all pay ranges
across the scale constituted a 4.3% change to the pay
scale.

Moreover, general adjustments given to employees at
each of Petitioner’s five facilities vary both in amount
and distribution among the individual pay grades of
employees. In fact, there is no instance of any across-the-
board percent increase being given to all employees at a
distribution center. Thus, the mere fact that one pay
grade receives an adjustment does not mean that all other
pay grades will receive the same cents-per-hour increase
or the same percent increase. Petitioner now turns to
events from November of 1992 through January of 1993.

In November 1992, Roberts was on a routine visit in
the Greenville Distribution Center when he was
approached by several employees who asked whether
there would be an adjustment for the year 1993, and if so,
what that increase would be. (App. 4, 101.) At that time
no recommendations had been made regarding a general
adjustment for 1993. However, based on the 4.3%
weighted average adjustment made in 1992, Roberts
responded that, “to the best of our knowledge, we
expected there to be an annual increase in the range of 4%
to 5%, but that was not confirmed.” (App. 4, 101.)
(Emphasis added.)

Around the first part of December 1992, Roberts trav-
eled to the Greenville facility to inform all of the

9

employees of the same information. (App. 4, 101.) Speci-
fically, Roberts told employees “at that time our assump-
tion was that there might be an annual increase in the
range of four to five percent”; however, because the com-
pany was awaiting some market analysis data, no deci-
sion had been made regarding the giving of an
adjustment, if any.? Thus, the employees were given no
guarantees that a general adjustment would be given in the
year 1993. In fact, there was no further mention to
employees of any adjustment until January 22, 1993.

Roberts subsequently received the Hay Report in
mid-December 1992, which revealed that Phoenix’s pay
scale was not competitive. (App. 4, 102.) As such, each of
the distribution center managers, including Ferguson,
undertook wage surveys in their respective areas. (App.
4-5, 101-02.) As late as January 6, 1993, the day before the
union’s petition was filed, Ferguson was gathering wage
data from loca! competitors. id. This information would
be forwarded to Roberts so that he could formulate a
recommendation to present to Petitioner’s president for
review, modification, and, ultimately, decision. Id.

As of January 8, 1993, no decision had been made
regarding amounts for general adjustments in any of
Petitioner’s five facilities. However, by this time,

3 In the summer of 1992, Petitioner engaged the services of
the Hay Group to conduct a market analysis for its Phoenix
Distribution Center. (App. 4.) The Hay Group’s findings would
impact the pay scales in all of Petitioner’s facilities because the
pay progression in the five facilities was generally in “the same
ball park.” Thus, if the Hay Group found Phoenix’s pay scale
competitive, Petitioner could assume that Greenville’s pay scale
was also competitive. Conversely, if the Hay Group showed
Phoenix’s pay scale was not competitive, a market analysis
would have to be conducted for each of the distribution centers
to determine the appropriate adjustments for the individual
facilities. (App. 4, 101-02.)

10

AutoZone became aware that the union had filed its
petition for an election.* (App. 103.) Based on Roberts’
cursory review of wage information sent to him by Fer-
guson on the afternoon of January 6, 1993, Roberts
expected the adjustment would be greater than the 4% to
5% previously forecasted for Greenville. (App. 5, 19.)

In light of the union’s demand for recognition, cou-
pled with the fact that a decision regarding Greenville’s
general adjustment had not been finalized nor disclosed to
employees, Roberts contacted and apprised legal counsel
of the above considerations, including the fact that the
adjustment might be larger than normal. (App. 102-03.)
Based on this information, counsel advised that it would
be unlawful to implement an as-of-yet undecided-upon
raise. (App. 103.) Therefore, a recommendation for a gen-
eral adjustment to Greenville’s pay scale for 1993 was
never prepared. (App. 103.)

On January 11, 1993, Petitioner’s president reviewed
the recommendations presented to him for the other facil-
ities. (App. 5.) After making some modifications to
Roberts’ recommendations, Petitioner’s president gave
final approval for adjustments in the other distribution
centers on the evening of January 11, 1993. (App. 5.)
Significantly, the general adjustments varied greatly
among the facilities, ranging from 3.3% to 10.24%. Again,
not every employee received the same raise. To the con-
trary, each “class” of employees received a different
amount. To this day, a decision regarding a general
adjustment to Greenville’s pay scale has not been final-
ized. (App. 103.)

4 The Petition was filed on January 7, 1993. However, at
5:29 p.m. on January 6, 1993, the union sent a telegram to
Ferguson demanding recognition, a practice commonly
heralding the arrival of a formal NLRB petition. (App. 103.)
Upon receipt of the telegram, Ferguson immediately contacted
Roberts. (App. 103.)

11

(3) The Court Below Erred in Concluding That
Petitioner Violated the Act Where Peti-
tioner Merely Informed Employees of the
Legal Restrictions Guiding Its Decision
With Regard to Wage Adjustments.

In its decision, the court below affirmed without
discussion the Board’s mechanical application of factors
set forth in Atlantic Forest Prod., Inc., 282 N.L.R.B. 855, 858
(1987), to find that Petitioner violated the Act during a
presentation given to employees on January 22, 1993.
(App. 65.) However, this mechanical approach was previ-
ously rejected in Cutter Lab., Inc., 221 N.L.R.B. 161 (1975),
wherein the Board stated: “No aspect of [Petitioner’s]
conduct can be viewed in isolation. The totality of the
circumstances must be considered to avoid a mechanistic
and unrealistic application of the Act.” Cutter, 221
N.L.R.B. at 168. This decision, Atlantic Forest Products,
which is contrary to previous Board law and the law of
the Sixth Circuit, must not be permitted to control the
outcome of this case.

On January 22, 1993, Roberts addressed the
employees of Greenville to explain the legal status of a
general adjustment. All parties stipulated to the prepared
text read to employees on that day:

The other issues I want to discuss have to do

with the status of pay increases at this DC. A

number of you have asked when or if the 4% to

5% increase we mentioned back in December

would be going through. You need to understand

that the numbers we mentioned in December were a

tentative forecast only. After that time we decided

5 In Cutter Lab., Inc., supra, the Board reversed a finding of
8(a)(i) liability under similar circumstances, concluding the
respondent did not violate the Act by informing employees of
its decision to withhold wage increases during a union
campaign.

12

to reevaluate the pay situation in this market.
Before we were able to gather all the data we
needed and reach a final decision, however, the
Teamsters’ Petition came in. Our understanding of
the law is that we cannot make changes in the pay
scale or benefits once the Petition comes in unless the
decision has been finalized beforehand. We very
much regret that the union’s poor timing has now
tied our hands, but we do not intend to violate the
law. The thing to keep in mind, though, is that
once the union is beaten in the election —- and we
feel confident that that is exactly what is going
to happen here, then we will be able to move
forward, free of the restrictions that we now live
under. We are sorry we cannot be more specific
than that now, but we wanted you to under-
stand the legal status of your pay increase at the
time.

(Emphasis added.)

The text of the speech shows that Roberts was merely
informing employees of Petitioner’s obligation under the
Act, which is lawful. In Great Atl. & Pac. Tea Co., 192
N.L.R.B. 645 (1971), the Board reversed the ALJ’s finding
that 8(a)(1) liability existed because the company with-
held employee raises during the union campaign. In that
case, like here, at the time the petition was filed, the
company had not completed its wage survey. Therefore,
no decision had been reached concerning a wage
increase. Once the petition was filed, the company con-
sulted its attorney, who advised the withholding of any
raise. At trial the company argued that, because it could
not designate any particular date or amount for a wage
increase which could be definitely shown as that which
would have occurred absent the campaign, it decided not
to give any increase.

The Board dismissed the charge, finding significant
the fact that employees were not promised any type of

:
:

13

wage increase, notwithstanding the fact that employees were
aware increases had been given in the past around this time.®

The company, when asked about a raise during the
campaign, told employees that it “would be an unfair
labor practice charge to give a raise while the union is
organizing. .. . We intend to obey the law.” 192 N.L.R.B. at
650. Because the company did not seek to capitalize on
the absence of the wage increase, no violation was found.

Petitioner, in its speech on January 22, 1993, repeat-
edly referred to its legal obligations, and its intent to
“obey the law.” In Honey Elec., Inc., 138 LRRM 1014
(1991), aff'd in part, rev'd in part, 964 F.2d 543 (6th Cir.
1992), the Board reversed the ALJ’s finding of 8(a)(1)
liability for those very reasons:

Contrary to the Judge, we find that Respon-
dent’s stated reason for not announcing the
[wage] plan did not shift the onus to the union.
Rather, Respondent simply informed its

6 Herein, the Board erroneously likened the situation in
Atlantic Forest Prod., supra, to the instant case. However, in
Atlantic Forest Prod., the employer withheld regularly scheduled
pay raises given to employees every year in January and July.
Petitioner does not maintain such an established practice, nor
did Petitioner ever guarantee a wage increase to its employees.
To the contrary, employees were specifically informed that a
wage adjustment would be dependent upon the outcome of a
market analysis not yet completed. (App. 4.) In Rosaeurs
Supermarkets, Inc., 300 N.L.R.B. 709 (1990), the ALJ dismissed
the 8(a)(1) violation, stating: ”. . . . I find that [the company]
outlined the proposed new wage program and the employees
interpreted this to mean, mistakenly or not, that the program
would have resulted in immediate wage increases. Whether the
new program would have resulted in immediate wage increases
cannot be determined on this record. It is clear from all
testimony, however, that no specific amount of increases were
announced. Rather, only that the new wage program would be
implemented January 1.” 300 N.L.R.B. at 712.

14

employees it would not do anything that could
be interpreted as a violation of the Board’s rules.
Such a statement merely indicated to employees
that the Respondent wanted to be sure that it
acted in a lawful manner and did not attribute
the decision to the union or the union campaign.

138 LRRM at 1016. (Emphasis added.)

Herein, instead of viewing the speech in its entirety,
and according weight to the written words, the Board
selectively focused on disjointed phrases contained in the
speech to sustain the violation. (App. 19-20, 65.) Inter-
preting these statements out of context, the Board con-
cluded, “The subliminal message is that a ‘yes’ vote will
doom any pay adjustment.” (App. 65.)

Petitioner excepts to the Board’s selective and dis-
jointed interpretation oi the campaign text and the lower
court’s deference to the Board on this issue. “In assaying
the legality of words spoken or written in connection
with a union campaign, the language should neither be
isolated nor analyzed in a vacuum, but must be consid-
ered in light of the surrounding circumstances in which it
was written.” NLRB v. Big Three Indus. Gas & Equip. Co.,
441 F.2d 774, 777 (5th Cir. 1971). Herein, while Petitioner
expressed its hopes of winning the election, it did not tell
employees that adjustments would not be given if the
union were selected as their collective bargaining repre-
sentative. Rather, the speech fairly and correctly inter-
preted the law applicable to the situation. The speech,
when viewed in its entirety, does not constitute a viola-
tion of Section 8(a)(1) of the Actu

7 See also NLRB v. Service Garage, Inc., discussed infra, and
Bowling Green-Warren County Community Hosp. Corp. v. NLRB,
infra.

15

(4) The Court’s Imposition of 8(a)(3) Liability
Was Clearly Unwarranted Because Peti-
tioner Had No Established Past Practice of
Granting Wage Adjustments.

In its decision, the court below focused on what it
perceived as Roberts’ unlawful motives (App. 19-20,
108-09), rather than on objective evidence regarding Peti-
tioner’s past practice, or lack thereof, in granting wage
adjustments, to conclude that Petitioner violated Section
8(a)(3). (App. 19-20, 159.) In so doing, the court below
completely disregarded the perils faced by employers
such as Petitioner in granting or withholding benefits
during a union campaign.® Because the decision below is
based solely upon the subjective belief that Petitioner did
not finalize an amount of any adjustment due to anti-
union animus, it must be reversed. Consideration of
objective factors guiding Petitioner’s decision to withhold
wage increases shows that liability was wrongly imposed.

Relying on Otis Hosp., 222 N.L.R.B. 402 (1976), aff'd,
545 F.2d 252 (1st Cir. 1976), the Board erroneously con-
cluded that: “AutoZone artificially interrupted its pro-
cessing of the wage adjustment process for its Greenville,
South Carolina Distribution Center, while continuing
with it for its other distribution centers because on Janu-
ary 7, 1993, the Union filed a representation petition in
Case 11-RC-5844.” (App. 159.) The Board’s reliance on
Otis Hosp. is misplaced. In that case, the Board found that
the employer violated Sections 8(a)(1) and 8(a)(3) of the
Act by withholding a regularly scheduled wage increase. The

& This dilemma was best summarized by the court in J.J.
Newberry Co. v. NLRB, 645 F.2d 148 (2d Cir. 1981): “Having
previously decided to increase wages, the employer in August
1977 was in a position of being forced to tread on eggshells,
being caught in a potential ‘damned if you do, damned if you
don’t’ situation.” 645 F.2d at 151.

16

Board’s decision was premised upon several aggravating
factors not present in the instant case.

Unlike Petitioner, the employer in Otis Hosp. main-
tained an established practice of granting wage increases.
The wage increase was nevertheless withheld in the face of
a union campaign, despite encouragement from the union
to implement the raise. The employer further instructed an
employee to tell all other unit employees that no raise
would be given because of the union. Finally, there was no
testimony that the employer withheld raises because of its
concern over the filing of unfair labor practice charges. As
such, the violations were sustained.

Also unlike the employer in Ofis Hosp., Petitioner did
not have the benefit of union approval regarding imple-
mentation of an increase.? Additionally, Petitioner did
not, as the employer did in Ofis Hosp., instruct an

9 In its decision, the Board noted: “By letter dated January
19, the union encouraged AutoZone to give employees pay
raises ‘currently due’ to some employees, and warned that
charges would be filed for numerous violations of the Act.
AutoZone did not formally respond to the Union’s letter.” (App.
43.) The letter referred to by the Board lacks significance for two
reasons: (1) the raises referred to therein concern the normal
progression raises which were given to employees during the
campaign; and (2) the union’s “promise” would not prevent the
filing of unfair labor practice charges by someone other than the
union. Moreover, Dave Barry, an international organizer for the
Teamsters, testified that he allegedly spoke to Ferguson
subsequent to sending this letter. During this conversation,
Ferguson did not state that a final decision had been made
regarding a general adjustment for Greenville employees.
Additionally, Petitioner did “respond” to this letter in the sense
that employees were given their normal progression raises
thereafter. Finally, the letter confirmed Petitioner's concern over
the filing of unfair labor practice charges because the union
expressly stated that it intended to file charges for “numerous
violations of the Act.” (App. 43.)

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17

employee to “spread the word” that a raise was being
withheld “because of the union.” Finally, the unrebutted
testimony of Roberts established that Petitioner pro-
ceeded cautiously, after consultation with legal counsel,
and in an effort to avoid unlawfully interfering with the
outcome of the election. (App. 102-03.) Under these cir-
cumstances, Petitioner’s actions did not violate the Act.

According to the law of the Sixth Circuit, because the
Board places on employers the burden of proving that
wage increases granted during an organizing campaign
are not motivated by a desire to influence the campaign, a
reviewing court must examine the evidence closely where
the charge is that failure to grant a wage increase during
a campaign is an unfair labor practice. NLRB v. Service
Garage, Inc., 668 F.2d 247, 249 (6th Cir. 1982).

The undisputed evidence presented at trial clearly
demonstrates that the company was in the process of
determining general adjustments when the petition was
filed. (App. 102-04.) In fact, Ferguson was gathering com-
petitive wage data on January 6, 1993, the day before the
petition was filed. (App. 102-03.) Absent a final deter-
mination on the amount of a general adjustment prior to
the union’s petition, Petitioner could not lawfully pro-
ceed with an increase.

Nevertheless, the Board found and the court below
agreed that “AutoZone has failed to show that it would
have postponed its analysis notwithstanding the fact of
union activities and solely over the concern that to pro-
ceed in the face of an election petition, when no pay raise
decision had been finalized, would have been unlawful.”
(App. 107.) This per se approach was rejected in J.J. New-
berry Co. v. NLRB, 645 F.2d 148 (2d Cir. 1981), where the
court noted:

20-20 hindsight supports the view that because

the employer’s decision to increase wages was
made prior to and independently of any union

18

activity, it could have gone ahead and imple-
mented the increase in the face of the union
drive. But if the employer did so, it faced the
serious risk, as its attorneys recognized, that an
increase in wages so soon after the union peti-
tioned for an election would lead to an unfair
labor practice charge.

645 F.2d at 152.

In reversing the Board’s finding of 8(a)(1) and 8(a)(3)
liability, the court took into consideration the
“employer’s inability to predict with any degree of cer-
tainty whether an implementation in August of its previ-
ously adopted raise would be viewed by the Board as
lawful. ...” Id. This very “inability to predict” how the
Board would view Petitioner’s actions if it moved for-
ward with an increase in the absence of an established
practice regarding adjustments, coupled with the facts
that an amount was not finalized before the petition was
filed and counsel advised against implementation,
guided Petitioner’s decision to refrain from completing
the work necessary to make a wage adjustment. The
hindsight approach utilized by the Board and the court
below unfairly penalizes employers like Petitioner who
attempt to comply with the Act, by leaving them in an
indefensible or “damned if you do, damned if you don’t”
position. !°

In Free-Flow Packaging Corp. v. NLRB, 566 F.2d 1124
(9th Cir. 1978), the employer withheld wage increases
during a union campaign based on its perception that it
lacked a discernible program for granting adjustments. In

10 In Plasticraft, Inc. v. NLRB, 586 F.2d 185, 188 (10th Cir.
1978), the court stated: “That an ALJ with the benefit of
hindsight and complete data might later ‘find’ that there was a
status quo would be irrelevant. The focus is whether the status
quo would have been clearly apparent to an objectively
reasonable employer at the time.” (Emphasis added.)

Woon a dab tay SAB

19

the past, the employer, like here, had granted increases,
but these increases were sporadic in nature and were
never given across the board, but instead varied among
individual classifications of employees. When the union
petition was filed, the company contacted legal counsel
who advised against giving the raise. The company relied
on counsel’s advice and in turn informed employees that
no raise would be given because it would constitute an
unfair labor practice.

The ALJ sustained the violation based upon the
employees’ “reasonable expectation of an increase.” 566
F.2d at 1130. In reversing the ALJ’s decision, the court
initially noted that “it is not always clear to an employer
whether a wage increase would conform to the status quo
or depart from it.” 566 F.2d at 1129. The court went on to
state:

The employer’s dilemma, then, persists, save
when the status quo - the state of existing con-
ditions of employment with respect to wage
increases — is clearly apparent and it can with
assurance be said that grant or denial of a wage
increase would constitute a change from those
conditions. In a case where status quo is not
clearly apparent, and accordingly the
employer’s dilemma persists, no inference of
antiunion motive can be said to flow from an
after-the-fact determination of what the status
quo in fact was. There is no rational basis for
such an inference unless the status quo is clearly
apparent and it can be reasoned that the
employer willfully chose to depart from it.

566 F.2d at 1129.

Based upon the employer’s past practice with regard
tu wage adjustments, the court held that “the status quo
was not so clearly apparent as to dissipate the employer’s
dilemma. . . . and give rise to an inference of antiunion
motive.” Id. at 1130. In the instant case, Petitioner’s past

20

practice with regard to wage adjustments falls squarely
within the dilemma described in Free-Flow Packaging. The
court’s subjective belief that Petitioner’s actions were
unlawfully motivated is unsupportable.

The courts have consistently recognized an
employer’s predicament in situations where wage adjust-
ments are not automatic but rather contain elements of
discretion and uncertainty. Thus, the inference of unlaw-
ful motive is not to be lightly drawn, and it must be
based upon substantial evidence in the record and not on
conjecture. Stokely-Van Camp, Inc. v. NLRB, 722 F.2d 1324,
1329 (7th Cir. 1983). Herein, inferences drawn by the
court below and the Board are not supported by substan-
tial evidence. Instead of according weight to evidence
presented with regard to the sporadic nature of wage
adjustments, Petitioner’s reliance on advice of counsel
(App. 103), and its stated concern to comply with the Act
(Id.), the Board focused on what it perceived to be
Roberts’ lack of credibility as a witness and the court
below adopted the Board’s perceptions. (App. 105-06.)

According to the Board, “to the extent it is necessary,
[we] do not credit Vice President Roberts.” (Id.) The
Board erroneously formed this “opinion” by pointing to
alleged “inconsistencies” between the testimony of
Roberts and a lower-level supervisor. (Id.) Specifically,
Roberts testified that he was involved in TIPS!! training
in Greenville after the Petition was filed in January 1993.
(Tr. 861-862.) The Board then compared this testimony to
that of supervisor Schlicting, who stated that Ferguson
began the TIPS instructions in late December 1992. From
this, the Board concluded that Roberts must have known
that the TIPS training was occurring in December 1992.
(App. 104.) Certainly, the Board’s conclusion is strained

11 During the campaign, supervisors were instructed not to
threaten, interrogate, promise, or surveil employees. (App. 104.)

:
%

21

at best. Just as plausible a conclusion is that there were
two sessions, one during the pre-petition period and the
second, more comprehensive session after the petition
was filed when conduct was now within the “critical”
period, post-petition and pre-election.

Additionally, the Board relied on a one-line answer
given by Roberts during a lengthy question-and-answer
session held on January 22, 1993, where Roberts was
bombarded with questions by employees pertaining to
the union campaign. Specifically, in response to a ques-
tion regarding wage adjustments given in the different
facilities, Roberts stated that the pay increases averaged
anywhere from 12% to 15%. While the Board conceded
that this answer was correct with respect to pay increases
given at the Phoenix Distribution Center (App. 104), it
took exception to Roberts’ “failure” to explain the
“weighted” increases given in each of the other four
facilities.12 The court below agreed with the Board.

In hindsight, perhaps Roberts could have more fully
explained the different percentages assigned to each class
of employees at each of the distribution centers; however,
to discredit this testimony, while conceding that it was
correct, is unsupportable. Moreover, during the question-
and-answer session, Roberts reiterated that Petitioner
intended to obey the law, and further, that it would not
imply promises because that would “violate the law.”

In Peabody Coal Co. v. NLRB, 725 F.2d 357 (6th Cir.
1984), the Court of Appeals stated that 8(a)(3) discrimina-
tion in the context of wages violates the law only if it
stems from improper motives. 725 F.2d at 367. That court

12 Formulation of a “weighted increase” involves
multiplying the number of employees in each classification by
the percentage adjustment given in that class. This number is
then divided by the total number of employees at the facility to
yield a weighted increase. (App. 106.)

22

went on to explain, “When an employer can demonstrate
some other lawful rationale for such disparate treatment,
such as a substantial and legitimate business purpose, or
even a desire to avoid the risk of an additional 8(a)(3) charge, it
has not engaged in forbidden conduct.” Id. (Emphasis
added.)!> The unrebutted testimony and documentary
evidence show that Petitioner acted lawfully, by refrain-
ing from making a decision as to the amount of a wage
adjustment, after consultation with counsel and in an
effort to comply with the Act.

In Bowling Green-Warren County Community Hosp.
Corp. v. NLRB, 756 F.2d 41 (6th Cir. 1981), the employer
commissioned a wage survey in early 1981 to ascertain
whether a wage adjustment was necessary. The union
filed a petition for representation in March of that year.
Immediately thereafter, the employer contacted legal
counsel to determine whether the proposed wage review
could be implemented. Because employees had been
informed of the wage study, but no firm date or dollar
amount of the adjustment had been finalized, legal coun-
sel advised against giving the raise to unit employees.

Relying on counsel’s advice, the employer withheld
unit employee increases while granting increases to non-
unit employees. Following the election, which the union
won, the company offered to implement a wage increase
if the union did not object. The union agreed, but
demanded that the employer grant the raise retroactively
to the date non-unit employees received raises. The
employer refused, so the union filed charges contending
that the company unlawfully withheld wage adjustments
during the campaign.

13 See also NLRB v. Cleveland Trust Co., 214 F.2d 95 (6th Cir.
1954) (holding the Board is not authorized to ignore material,
uncontradicted facts).

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23

The Board concluded that the wage increase had not
been made definite in time or in amount. Thus, because
the raise did not constitute a “scheduled increase,” its
withholding was not violative of the Act. However, the
Board found that the employer’s action in granting
increases to non-unit employees, while withholding
increases from unit employees, violated the Act, “evi-
dencing a discriminatory motive on the part of the
employer.” 756 F.2d at 43.14

The Sixth Circuit reversed the Board's finding that the
employer unlawfully withheld wage adjustments to unit
employees while granting increases to non-unit
employees, noting that the employer was in a precarious
position when it announced the wage study which was
subsequently followed by the union’s petition:

Thus, Medical Center was truly confronted with

a dilemma; it was likely to be damned whether

or not it granted an increase to the [unit] as of

April 1. . . . Similarly, it is not so clear that had

Medical Center attempted to explain the reason

for the less than uniform increase it would have

escaped Board action. . . . We therefore are not

persuaded by the Board’s hindsight in this case.

The choice made by Medical Center appears to

have been a logical one. . . .

756 F.2d at 43-44.

A similar conclusion was reached by the same circuit
in NLRB v. Service Garage, Inc., 668 F.2d 247 (6th Cir. 1982),
where the employer withheld a wage adjustment during
a union campaign. There, the ALJ found the employer
maintained no discernible practice of granting wage
adjustments, despite employee rumors that a 7% COL

‘4 The Board speculated that the petitioner could have
complied with the Act by either (1) withholding the increase in
its entirety; or (2) explaining to unit employees the reason an
increase was being withheld. 756 F.2d at 44.

24

adjustment was expected in January. When asked about a
raise, however, the company stated that it was being
withheld because of the union. Citing the ALJ, who con-
cluded that the employer did not violate Section 8(a)(1) or
(3), the court wrote:
Under Board policy, there is a presumption that
the purpose of a wage increase granted during a
union campaign is to interfere with the cam-
paign and the employer bears the burden of
rebutting this presumption, perhaps by showing
the increase was consistent with past practice.
668 F.2d at 248.

Consideration of the employer’s past practice with
regard to wage adjustments led to the ALJ’s conclusion
that, had the employer granted the 7% adjustment, it
could not have rebutted this presumption. The Board
reversed the ALJ based solely upon the supervisor’s
statement, which placed the onus on the union for the
withheld wage adjustment. According to the Board, the
supervisor’s statement made the company’s past practice
with respect to wage increases “immaterial.” 668 F.2d at
249. Reversing the Board’s decision, the Court of Appeals
noted: “It [the Board] concluded somewhat simplistically
that the company did not face the dilemma outlined by
the ALJ because it was only required to act as if there was
no union.” Id. at 249. The Court of Appeals denied
enforcement of the Board’s make-whole remedy, stating:

Since the Board has placed on employers the

burden of proving that wage increases granted

during an organizing campaign are not moti-

vated by a desire to influence the campaign, we

must review the evidence closely where the

charge is that failure to grant a wage increase

during a campaign is an unfair labor practice.
Id. at 249.

Another analogous case is NLRB v. Planter’s Peanuts,
574 F.2d 400 (8th Cir. 1978), where the court denied

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25

enforcement of the Board’s order. In Planter’s, the
employer computed wage increases by conducting yearly
local wage surveys. Id. at 402. The wage survey for the
following year’s increase was complete and increases
were being considered when the union filed its petition.
Id. at 403. However, no final decision to implement an
increase had been made. Id. at 404. The court, recognizing
the employer’s precarious position, held that the
employer did not violate the Act by not moving forward
with a wage increase. Id. at 406.

Considering the foregoing, the court below was
clearly wrong in finding that Petitioner violated the Act.
Had Petitioner moved forward with a wage adjustment,
which was historically sporadic in nature and undeter-
mined at the inception of the union campaign drive,
Petitioner would, in all likelihood, be defending against
unfair labor practice charges, including a bargaining
order, for granting an increase. Board precedent has
repeatedly failed to recognize the precarious position
faced by employers like Petitioner. Under the circum-
stances, Petitioner cannot be unfairly penalized for its
good-faith efforts to comply with the Act.

B. The Court Below Improperly Disregarded the
Written Text of a Campaign Speech to Find
That Petitioner’s Noncoercive Expressions of
Opinion on Union Matters Violated the Act.

The court below determined that Petitioner
unlawfully threatened employees with closure of the
Greenville facility based not upon the words contained in
a written text delivered verbatim to employees, but upon
unfounded assumptions and mere speculation. The pre-
pared speech was stipulated into evidence by all parties and
states in pertinent part:

1 know, as sure as I am standing here, that if I let

anyone — here or anywhere else in this company

— think the Teamsters’ union is in charge, I

26

might as well close the doors, put a lock on the
gate and throw away the key. I will not let the
Teamsters, with their record and their own
agenda, destroy what you and I have built.

Significantly, the Board correctly pointed out in its
decision that the speaker did not state he would close the
doors if the union was voted in. Inexplicably, however,
the Board sustained the violation based upon its subjective
belief that the words contained in the speech “implied”
closure of the facility and the court below agreed with
this subjective belief. (App. 17.) According to the Board:

His message is that if the union gets in, and

secures such favorable contract terms (to which,

of course AutoZone would have to agree), so

that someone at AutoZone could ‘think’ that if

the union was in charge, then [the speaker]

‘might as well’ close the Greenville plant. And he

would do so because ‘I will not let the Team-

sters, with their record and their own agenda,
destroy what you and I have built.’ That, I find

is the message.

(App. 86.) (Emphasis added.) The court below agreed
with this conclusion. (App. 17.)

Petitioner submits that the court’s disregard of the
written text constitutes reversible error. The interpreta-
tion of a written instrument is a question of law to be
decided by the courts. Florida Steel Corp. v. NLRB, 587 F.2d
735, 751 (5th Cir. 1979). Accordingly, “the interpretation
and construction of such an instrument by an administra-
tive agency, such as the Board in this case, is not binding
on the court.” Id.

The Court of Appeals for the Sixth Circuit previously
rejected the Board’s interpretation of a campaign speech
in NLRB v. Pentre Elec., Inc., 998 F.2d 363 (6th Cir. 1993). In
that case, the company’s vice president told employees,
“we would not have the jobs we have now if we had been
union, and it would have been very difficult to get work

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27

if we were union.” 998 F.2d at 367. The Board found this
language violated the Act, reasoning that the “effect of
those statements was to convey to employees that union-

ization would result in the company’s closing its doors.”
Id. at 368.

On appeal, the Sixth Circuit rejected the Board’s
approach, noting that “the right to free speech in a union
organizational campaign is not to be narrowly restricted.”
Id. at 368. Thus, the Board’s decision was vacated because
its conclusions were not supported by substantial evi-
dence.

Herein, the speech falls squarely within the purview
of Section 8(c) of the Act.!° When the allegedly unlawful
statement is viewed in the context of the entire speech, it
is evident that it was only intimating the fact that Peti-
tioner had no intentions of allowing the union to control
its policies by forcing unreasonable demands upon the
company.

In Emory Convalescent Home, 260 N.L.R.B. 540 (1992),
the Board correctly held that the mere reference to closure
of a nursing home in a company speech discouraging
unionization did not constitute unlawful employer con-
duct. In that case, the employer’s representative stated,
“We do not want to see this convalescent home forced to
close.” Id. at 554. The Board held that this was not a direct
threat of closure and therefore protected campaign
speech under Section 8(c) of the Act. Id.

15 29 U.S.C. § 158(c) states “The expressing of any views,
argument or opinion, or the dissemination thereof, whether in
written, printed, graphic, or visual form, shall not constitute or
be evidence of an unfair labor practice under any of the
provisions of this subchapter, if such expression contains no
threat of reprisal or force or promise of benefit.”

28

A fortiori, the speech, which in no way threatened or
coerced employees by linking the unionization of Peti-
tioner’s employees with the closure of the Greenville
Distribution Center, is also lawful under the Act.

C. Employees Were Informed of Striker Reinstate-
ment Rights; Therefore, the Court Below Was
Clearly Wrong in Concluding That Petitioner’s
References to Strikes Constituted a Violation of
the Act.

The court below improperly focused on another part
of the referenced speech to find that Petitioner unlawfully
threatened employees with loss of their jobs. Specifically,
it was stated:

Nobody wins a strike. In each of the cases I

mentioned, both the company and the Teamsters

survived the strike and are still around.

Nashville is still operating full bore. So is

Sikeston and so is Memphis. The only part of

the equation not still there are the employees

who allowed the Teamsters to call them out on

strike. As Rick and Dennis told you, the 185

strikers at our Nashville warehouse who walked

out on an illegal wildcat strike were all fired.

Those 185 employees did not get to vote. Not

one of them has ever gotten his job back. The

strikers in Memphis and Sikeston were all
replaced, and none of them have gotten their
jobs back to this day. In fact, there is no union
today in the Nashville DC, the Sikeston DC, or

the Memphis DC.

Significantly, in sustaining the violation, the court
below and the Board relied not on statements made in the
speech, but rather on Petitioner’s alleged “omissions.”
Specifically, the Board correctly noted that “the statement
about fired illegal strikers never getting their jobs back is
lawful.” (App. 84.) (Emphasis added.) According to the

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10.

11.

12.

App. 31

Eddie Massey, Timothy Schlichting, and

Jim Wartinger - January 20, 1993...........
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Barbara Cunningham - January 21, 1993....

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Dennis Roberts - January 22, 1993..........
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Martin Nelson — February 2, 1993...........
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Rick Ferguson — February 11, 1993..........
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Timothy Schlichting - February 15, 18, 1993...
IN A OS ear

Timothy Schlichting - Mid-February 1993...

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J.R. Hyde III - February a
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Timothy Schlichting — mid-February 1993... .
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26

en

App. 32
13. Jerome Flowers — February 24, 1993......... 32
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14. Barbara Cunningham - March 5, 1993....... 34
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15. Rick Ferguson — March 16, 1993............ 35
A) IS Ao ca ROLE haa he eee xkaeens 35
i: eR, Coc cos Panwtdaeabaeaeas cinewaes 37
F. Section Glas} AIMGAIOOE,. 6 oso cc cece cee deecucnees 38
1. Withholding pay increase — January 22, 1993... .38
ic PERS, che nc oan wk wu dle we wee 38
Ms Te Sh eon ead ea ae oe 40

2. Jackie McGinnis denied cutter position

ee a ee wi o es Cus ah uel ca wre dhs ewan 43
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RS ge ee Seba ry be aan Sibel 45
3. James Andrews warned July 9, 1993......... 47
OS Sree i cidd ns doen dders onenan seen aneres 47
i Ee oa ga Be ale bin baal ha Mes Ware 52

4. Stanley Phillip Wilson fired September 13,

RRS POS Te a ee Tey Ca Pepe sy 53
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S. SI, on isc np deskuanavceeereesdetees 63 |
IV. THE UNION’S OBJECTIONS 64
A. Sem 5 a Fis hoa bine Aa eke toeenas 64 |
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at. Sf rr er Prereroy rrr Ter rest 65
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PRNIMED bireais kenhl reins sixdian cub diel oicuia bain, 71
EH a ne8 eh uaa ous die hee ue He 71
Appendix — Notice To Employees

UNITED STATES OF AMERICA

BEFORE THE NATIONAL LABOR RELATIONS
BOARD DIVISION OF JUDGES
ATLANTA BRANCH OFFICE

AUTOZONE, INC.

and Cases 11-CA-15357
GENERAL DRIVERS, 11-CA-15559
WAREHOUSEMEN AND 11-CA-15665
HELPERS, LOCAL UNION NO. 11-RC-5894

28, INTERNATIONAL
BROTHERHOOD OF
TEAMSTERS, AFL-CIO

Michael W. Jeannette, Esq. (NLRB Region 11),
Winston-Salem, NC, for the General Counsel.

James F. Wallington, Esq. (Baptiste & Wilder),
Washington, D.C., for Teamsters Local 28.

Cornelius G. Heusel, Esg. and Tracy K. Hildago, Esq.
and, only on brief, Robert F. Spencer Jr., Esq.
(Kuilman, Inman, Bee, Downing & Banta),
New Orleans, LA, for AutoZone.

App. 34

DECISION
RICHARD J. LINTON, Administrative Law Judge

Statement of the Case

Although discrimination allegations here are impor-
tant, especially to the individuals, the principal issue
probably is whether AutoZone unlawfully announced to
employees that, under the law, it could not reach a final
decision on a pay raise at Greenville, South Carolina
because the Union had filed an election petition to repre-
sent the Greenville employees. Finding that announce-
ment unlawful, and AutoZone’s freezing of its decision
process likewise illegal, | order AutoZone to make that
decision and to implement the wage increase retroactive
to January 3, 1993, with interest. Based on these and
related findings, I recommend that the Board sustain
several of the Union’s objections, set aside the March 5,
1993 election (which the Union lost by a substantial mar-
gin), and direct that a second election be conducted. I
dismiss several allegations, including those of discrimina-
tion against named individuals.

I presided at this 5-day trial in Greenville, South
Carolina, opening December 6, 1993 and closing Decem-
ber 16, 1993, pursuant to the November 9, 1993 Third
Order Consolidating Cases, Consolidated Complaint And
Notice Of Hearing (complaint) issued by the General
Counsel of the National Labor Relations Board through
the Regional Director of Region 11 of the Board.! The
complaint is based on a charge filed and served, in the

1 All dates are for 1993 unless otherwise indicated.

pia ae Deel lla

St aH Ahh LU A ees een ah SA i ie bad Be it A nc si EC

App. 35

first case, on March 15, 1993 by General Drivers, Ware-
housemen and Helpers, Local Union No. 28, International
Brotherhood of Teamsters, AFL-CIO (Union or Teamsters
Local 28), International Brotherhood of Teamsters, AFL-
CIO (Union or Teamsters Local 28). That charge was
amended later, and charges were filed later in the other
cases. The charges were filed against AutoZone, Inc.
(AutoZone, Company or Respondent).

Issues from the representation case are embodied in
the Regional Director’s April 29, 1993 Report On Objec-
tions, Order Directing Hearing, And Order Consolidating
Cases (report on objections, or report). On March 5, 1993
a secret ballot election was held in Case 11-RC-5894
under the supervision of the Regional Director. The
Union lost by a vote of 135 to 57. Although the two
challenged ballots were insufficient in number to affect
the outcome, Teamsters Local 28 filed 13 specific objec-
tions with objection 14 protesting “other conduct” by
AutoZone. As the Regional Director’s April 29 reflects,
the Union withdrew objections 4, 9, 10, 12, and 13, and
the Regional Director consolidated the remaining objec-
tions (1, 2, 3, 5, 6, 7, 8, 11, and 14) with the complaint for
hearing. Most of the objections to be heard parallel alle-
gations of the complaint.

In the Government's complaint the General Counsel
alleges that AutoZone violated Section 8(a)(1) of the Act,
29 USC 158(a)(1), by various economic threats, promises,
interrogation, and other conduct between about Novem-
ber 18, 1992 and about March 16, and that AutoZone
violated Section 8(a)(3) of the Act, 29 USC 158(a)(3), by
withholding a scheduled wage increase since about Janu-
ary 22, by failing about March 18 to offer a cutter position

App. 36

to Jacqueline McGinnis, by issuing a (written) warning to
James Andrews about July 9, and by firing Stanley Phillip
Wilson about September 13, 1993.

By its answer AutoZone admits certain facts but
denies violating the Act.

On the entire record, including my observation of the
demeanor of the witnesses, and after considering the
briefs filed by the General Counsel (who attached a pro-
posed order and notice to the Government's brief), Team-
sters Local 28 (the Union adopts the Government's brief
respecting the unfair labor practice portion of the case),
and AutoZone, I make the following:

Findings of Fact
I. JURISDICTION

A Nevada corporation, AutoZone has an automotive
parts warehouse at Greenville, South Carolina. During
the past 12 months, AutoZone purchased and received at
its Greenville facility goods and materials, valued at
$50,000 or more, direct from points outside South Caro-
lina. At all material times, I find, AutoZone has been an
employer engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.

Il. LABOR ORGANIZATION INVOLVED

Complaint paragraph 6 alleges that Teamsters Local
28 is a labor organization within the meaning of Section
2(5) of the Act. In its answer to complaint paragraph 6,
AutoZone asserts that the allegation “is a legal conclusion

ERM eet Bio nk BOK was.

App. 37

which the Respondent is not required to admit or deny.”
The General Counsel did not move to deem this response
as an admission. At trial neither the General Counsel nor
the Union adduced direct evidence on this allegation.
Thus, when the Union called the organizer, David M.
Barry, the examination (although adducing evidence
about employees Participating in the organizing) was not
expressly directed toward establishing labor organization
Status. (2:265).2 On brief the parties advance opposing
arguments, with AutoZone going beyond the position in
its answer to argue that the parties were on notice by that
answer that the Union’s status as a labor organization
was in dispute.

Under Section 2(5) of the Act, only three simple
requirements have to be met to establish labor organiza-
tion status. First, an organization or group of any kind.
Second, that employees Participate in the organization.
And third, that the organization exists, at least in part, for
dealing with employers concerning such matters as
wages, hours, or working conditions. These requirements
are interpreted liberally. NLRB v. Cabot Carbon Co., 360
U.S. 203, 79 S. Ct. 1015 (1959); South Nassau Commu-
nities Hospital, 247 NLRB 527, 529-530 (1980). The three
prerequisites are purely factual matters, and the conclu-
sion of labor organization status which flows from these
three basic facts is likewise a factual conclusion — even

* References to the five-volume transcript of testimony are
by volume and page. Apparently because the transcript for
December 15, 1993 (the fourth day of the hearing) is a bit large at
309 pages, the court reporting service divided the day into two
volumes. I have restrung the day as a single volume, volume 4
of the transcript.

App. 38

though the factual conclusion also coincides with the
definition set forth in Section 2(5) of the Act and may be
expressed as a legal conclusion. Thus, AutoZone was
required by 29 CFR 102.20 to admit, deny, explain, or
state that it lacked knowledge.

Ample evidence in the record shows that the Union
meets the first and third requirements. Only as to the
second condition is there any question, and even then
only if participation “in the organization” means mem-
bership rather than such activities as signing union
authorization cards or serving on an organizing commit-
tee. As the Board has found that the mere act of signing
authorization cards constitutes the required participation,
it is clear that membership is not required.

Electrical Construction & Maintenance, 307 NLRB 1247
fn. 1 (1992). Serving, as employees did here, on the
Union’s organizing committee, also constitutes, I find, the
participation required by the statute. Thus, I find that the
Union satisfies the three prerequisites. Moreover, Auto-
Zone was well aware of the three basic facts as of the time
it filed its answer. Common sense dictated that it form the
factual conclusion and admit complaint paragraph 6 — in
the same manner that it admitted to the Section 2(11)

status of the supervisors alleged in complaint paragraph
7.

In this case we do not have some employee commit-
tee whose status as a labor organization might, in good
faith, be questioned. We have here the Teamsters. In
addition to its own status, the Teamsters is affiliated with
the AFL-CIO. C.D. Gifford, Directory of U.S. Labor
Organizations 3, 53, 57-59 (1992-1993 ed., BNA). No

ee ee

Saye eee
ee ee nd

Se ny thee Gis ie sepia erties

Ae se eno lay t:

POPS ASA AB AIT Re ede

iS tis ees

App. 39

doubt there are thousands of Board cases in which Teams-
ters locals, and the International, have been found to be
statutory labor organizations. These include cases where |
have presided, such as Browning-Ferris Industries, 306
NLRB 682, 683 (1992). Finally, the board has held that a
local of the International Teamsters is a statutory labor
organization by virtue of its status as a local. Story Olds-
mobile, 244 NLRB 835, 836 fn. 1 (1979) (with representa-
tion documents there similar to those here). I find that
Teamsters Local Union No. 29 is a labor organization
within the meaning of Section 2(5) of the Act.

In light of the foregoing, and AutoZone’s refusal to
answer the allegation of labor organization status, Auto-
Zone’s continued litigation of the matter appears akin to
requiring NLRB Region 11 to prove that it is part of the
Agency. AutoZone’s continued resistance to admitting
what it obviously knows amounts to nothing more than
an effort to be argumentative — at the expense of the
taxpayers who are funding this proceeding. (A stipula-
tion in the briefs would have served nicely.) In a similar
context, respecting resistance to a subpena [sic] duces
tecum, the Supreme Court wrote, “A subpoena has never
been treated as an invitation to a game of hare and

hounds, in which the witness must testify only if cor-

nered at the end of of the chase.” U.S. v. Bryan, 339 U.S.
323, 331, 70 S.Ct. 724, 730, 94 L.Ed. 884 (1950). That, plus
additional language, the Sixth Circuit described as “this
guiding philosophy of the Supreme Court.” NLRB vy,
Strickland, 321 F.2d 811, 813, 53 LRRM 2994 (6th Cir.
1963). Lawyers appearing in Board Proceedings should
follow that “guiding Philosophy of the Supreme Court.”

App. 40

The General Counsel now requests (Brief at 4 fn.3)
that I assess the facts here under Graham-Windham Ser-
vices, 312 NLRB No. 199 fn. 2 (1993) (sanctions of strong
disapproval and warning under 29 CFR 102.21). Lawyers
must pay attention to the topic of possible sanctions in
Board proceedings, for it is clear that the Board is serious
about sanctioning lawyers who act in bad faith in Board
proceedings, such as filing frivolous pleadings which
consume Agency time and the taxpayers’ money without
legitimate cause. Thus, in addition to Graham-Windham
Services, see National Football League, 309 NLRB 78, 86
(1992) (104.44 sanctions hearing directed over possible
trial misconduct); Worldwide Detective Bureau, 296
NLRB 148 fn. 2 (1989) (102.21 sanctions of strong disap-
proval and warning); and M.J. Santulli Mail Service, 281
NLRB 1288 fn. 1, 1289-1290 (1986) (102.21 sanctions of
strong disapproval and warning).

The General Counsel does not affirmatively move for
any specific sanctions. AutoZone does not address the
matter, perhaps because it may not have read the General
Counsel’s brief. That is one reason a request for sanctions
should be by separate document, a motion, served on the
opponent, requesting a specific order. I also consider the
fact that neither the General Counsel nor the Union
expressly covered the matter at trial. Although I therefore
decline to address the issue of possible sanctions, I
express confidence that AutoZone’s attorneys will give
due attention to this area in future cases before the Board.

Ns na A aie BORE aS

App. 41

Ill. THE ALLEGED UNFAIR LABOR PRACTICES

A. AutoZone’s Business

AutoZone sells automotive parts in its retail stores
across the country. To supply these stores, AutoZone (as
of early 1993) operates a distribution center in each of
five cities: Phoenix Arizona, San Antonio Texas, Lafayette
Louisiana, Memphis Tennessee, and Greenville South
Carolina. The Greenville DC (distribution center), the
facility involved here, serves AutoZone’s retail stores in
Georgia, North Carolina, and South Carolina. (4:683,
812-813). There is some reference in the record to ware-
houses at other locations. (4:603; GCX 3 at 6; CPX 8).3 It is
unclear whether a warehouse may be something different
from a DC.

For some years AutoZone was a division of Malone &
Hyde, but since 1989 AutoZone has been an independent
company. AutoZone’s corporate headquarters is located
at Memphis. J.R. Hyde (apparently J.R. Hyde III) is Auto-
Zone’s chairman and CEO, Peter Formanek president and
COO, and Tom Hanemann executive vice president of
stores and distribution. [A news item in the March 17,
1994 Wall Street Journal, at B8, reports that Formanek is
resigning effective April 30, with Hanemann succeeding
to his post.] Each has his office at the Memphis corporate
office. Within the corporation the retail stores are a sepa-
rate division from the distribution centers until they
reach Hanemann’s level. Thus, Dennis Edward Roberts is

* Exhibits are designated GCX for the General Counsel’s,
CPX for the Charging Party Union’s, and RX for those of the
Respondent, AutoZone.

App. 42

vice president of distribution, and he reports to Hane-
mann. Reporting to Roberts are regional operation man-
agers (ROMs), who are not named in the record. The
individual DC managers report to the ROMs who, as
noted, report to Roberts. (4:810-812, 883).

Rick Ferguson has been manager of the Greenville
DC since October 1991, (2:96; 3:520), and during the rele-
vant time Ferguson had a number of supervisors report-
ing to him. Although Ferguson normally reports to a
ROM rather than to Roberts, it is clear the during the
Union’s organizing campaign here that Ferguson fre-
quently worked directly with Dennis Roberts. (3:506,
516-517; 4:813, 854; 5:938). As we shall see, for example,
they made joint speeches to the Greenville employees.
(GCX 2; RX 17; CPXs 7,10).

B. Overview of the Organizing Campaign

The Union’s organizing campaign at AutoZone’s
Greenville DC began around October-November 1992,
and some employees openly began wearing Union pins
by November and early December 1991. (1:31, 35; 3:350,
453-454, 467). DC Manager Rick Ferguson acknowledges
learning of the activity about early December. (2:98). By
mid-December or so Ferguson began a training program
for his supervisors as to what they were not to do in a
campaign. (4:660). Ferguson instructed Supervisors
(“advisors” at AutoZone) that, respecting employees’
union activities, they were not to threaten, interrogate,
promise, or spy. The first letters of the four forbidden
activities give rise to the acronym by which the instruc-
tions are called: TIPS. The TIPS training occurred almost

App. 43

daily. (4:610-611, 665-666, 689, 775, 862, 888; 5:908; CPX 11
at 4).

By January 6 the Union’s campaign reached the point
where the Union sent a telegram (RX 13) demanding
recognition and offering to demonstrate its majority sta-
tus. [Although no party objected to the offer of RX 13
(4:850), I failed to receive it in evidence. I do so now.] The
following day, January 7, the Union filed its petition (CPX
4) for a representation election in a unit of warehouse
employees. By letter dated January 8 (RX 14) Ferguson
declined the Union’s demand for recognition. On January
11 Ferguson posted a notice (TX 15) to all personnel
advising them of the petition and AutoZone’s opposition.
By letter of January 19 the Union encouraged AutoZone
to give employees pay raises “currently due” to “some”
employees, and warned that charges would be filed for
numerous violations of the Act. (GCX 5). AutoZone did
not respond to the Union’s letter. (4:858-859).

During the campaign AutoZone’s management deliv-
ered prepared-text speeches to groups of employees as
one means of communicating AutoZone’s position on the
issues. Vice President Dennis Roberts describes the pur-
pose of the meetings as “educational,” to present the facts
concerning union representation. (4:863, 881). DC Man-
ager Ferguson testified that six speeches were given, with
each speech delivered, on average, to 15 small groups of
employees in order to cover all employees. (5:924-925,
979-980). Each meeting lasted about an hour. (5:926).

On January 22 AutoZone gave the first (so far as the
record shows) of its speeches by management to groups

App. 44

of employees. Ferguson and Roberts divided this rela-
tively short speech (GCX 2) of eight double-spaced pages.
This was followed by a lengthy question and answer
session. As with the other speeches in evidence,
employees tape recorded the question and answer ses-
sion, a transcript of which (pages 6-33) is in evidence as
CPX 1. (2:336-340). Ferguson and Roberts delivered a
second speech on January 25 (RX 17;4:873).

On January 27, in Case 11-RC-5894, the Regional
Director for NLRB Region 11 approved a stipulation (CPX
5) by the parties to conduct an election on March 5 in the
following bargaining unit: ;

All full-time and regular part-time warehouse,

maintenance, and housekeeping employees, and

all full-time and regular part-time truckdrivers

employed by the Employer at its Greenville,

South Carolina location; excluding all office

clerical employees, line leaders, guards, and
supervisors as defined in the Act.

On February 1 Ferguson and Roberts delivered the
third speech (CPX 7). By letter (GCX 4) of the same date,
the Union sent AutoZone a list of 32-named employees
serving as the Union’s organizing committee. The letter
warns AutoZone not to violate federal law respecting the
statutory rights of employees to organize. Beginning with
the February 1 speech, AutoZone excluded employees
wearing union insignia on the basis their minds were
closed to AutoZone’s educational training. (2:112-113;
4:881; 5:925, 974, 979). Ferguson and Roberts delivered
their fourth speech (CPX 10) on February 8.

By two-page letter (CPX 8) dated February 16 Roberts
wrote employees describing past strikes by the Teamsters

DE a Eg es > VR Ee Pee) ee eke

ee a a ee ae ee, ee er es

So ings sat

re OR eS ee = Pes ae gee T ee ree i

See Pees

App. 45

at other warehouse locations and urging employees to
vote NO on March 5. (3:534). On February 19 J.R. Hyde
Ill, AutoZone’s chair and CEO, delivered a speech (GCX
3) to employees in which, on the last of 12 double-spaced
pages, he urges them to vote No on March 5. (2:292, 325).
The Hyde speech is the fifth one so far as the record
shows. If a speech was given the Preceding week (the
week of February 11), it is not identified and no text is in
evidence. Moreover, if a speech was given the week of
February 22 or the following week on March 1, 2, or 3, its
text is not in evidence. The text of a sixth speech (CGX
14), a short address by Ferguson on March 16, is in
evidence. That speech came after the election, but during
the objections period.

The March 5 election was held in two sessions, 8:30:
a.m. to 11 a.m. and 1 p.m. to 2:30 p-m. (CPX 5; 3:400). Of
approximately 203 eligible voters, 125 employees voted
No, 57 voted Yes, and only 2 ballots were challenged. The
Union had lost. Thereafter the Union filed objections, and
on April 29 the Regional Director for NLRB Region 11
issued his Report On Objections (GCX 1i) approving the
Union’s withdrawal of several objections and directing a
hearing on Objections 1, 2, 3, 5, 6, 7, 8, 11, and 14. (GCX 13
at 8). For the most part these nine objections parallel
allegations in the complaint.

C. Overview of the Allegations and Objections

Complaint paragraph 8 contains the allegations of
independent violations of Section 8(a)(1) of the Act (the
other 8(a)(1) alleged derives from alleged violations of

App. 46

Section 8(a)(3) of the Act). The alleged independent viola-
tions begin with an alleged threat by Eloise Ruth about
November 19, 1992 and continue with other economic
threats, interrogations, promises, and other conduct
through about March 16 when DC Manager Ferguson
allegedly threatened to withhold pay raises due
employees because of their support of the Union. The
8(a)(3) paragraphs allege that since January 22 AutoZone
has withheld scheduled pay increases due unit employees
because the Union filed a representation petition, that
since about March 18 AutoZone has failed to offer a
cutter position to Jacqueline McGinnis, that about July 9
AutoZone issued a written warning to James Andrews,
and that about September 13 AutoZone fired Stanley
Phillip Wilson. AutoZone denies all the 8(a)(1) allegations
and the first of the 8(a)(3) allegations (withholding a
scheduled pay increase), but admits that it did not offer
McGinnis a cutter’s job, that it warned James Andrews on
July 9, and that it fired Stanley Phillip Wilson on Septem-
ber 13. AutoZone denies any unlawful motivation. As
noted, most of the Unions’ objections parallel allegations
of the complaint and, in some instances, expand on them.

At trial the General Counsel withdrew one of the
independent allegations, paragraph 8(p), as unsupported
by any evidence. I granted the motion. (3:550-552). On
brief (at 6 fn.5) the General counsel also moves to with-
draw a related allegation, paragraph 8(q), apparently for
the same reason as AutoZone observes in its brief (at 9 fn.
5). I grant that motion also.

App. 47

D. AutoZone Waives Motion to Dismiss

After the General Counsel (3:500) and the Union
(3:536) had rested their cases in chief, AutoZone made a
lengthy motion to dismiss the complaint. (3:536-553).
When I denied its motion to dismiss, AutoZone pro-
ceeded with its defense. (3:553). A respondent tests the
sufficiency of a prima facie case by resting on its motion
to dismiss the complaint. It must elect whether to rest or
to proceed, for if it proceeds it waives the motion. By
proceeding with its own case in chief rather than resting
on its motion to dismiss, AutoZone waived the motion to
dismiss. Peter Vitalie Company, 313 NLRB No. 162, JD
slip op. at 3-4 (Mar. 2, 1994). I therefore shall consider all
the evidence in the entire record in reaching my decision.
Peter Vitalie, id.

E. Section 8(a)(1) Allegations
1. Eloise Ruth - November 18, 1992

a. Facts

Complaint paragraph 8(a) alleges that on November
18, 1992 Eloise Ruth threatened employees with more
onerous working conditions if they selected the Union as
their collective bargaining representative. Reuben Rice
testified in support of the allegation, with Ruth support-
ing AutoZone’s denial.

Rice, who left AutoZone in June 1993, worked as an
order selector pulling parts such as starters and alterna-
tors. (3:452, 475). About October 1992 Rice had his first
contact with union representatives or supporters, and in
November he began wearing, occasionaily, a union pin.

App. 48

Eventually Rice served as an observer for the Union at
the March 5 election. (3:453-454, 467-468).

Rice apparently worked in the section where Eloise
Ruth is the line leader. Although line leaders later were
excluded from the stipulated bargaining unit (CPX 5),
line leaders are hourly paid and, as Rice concedes, serve
as the lowest level supervisors. (3:454, 470; 4:690). The
complaint lists Ruth among the statutory supervisors,
and in its answer AutoZone admits that allegation of
supervisor status.

Rice testified that, apparently in November 1992, he
would tell Ruth why he was supporting the Union.
(3:469). At that time he considered Ruth a friend and he
confided in her on occasion. They voluntarily discussed
union matters. (3:471). In mid-November, Rice testified,
Ruth, in the same sentence, told Rice that if he continued
his support of the Union and his dating of a specific
(unnamed in the record) white woman that Ruth would
make Rice’s job harder on him. (3:454, 471-472). Both Rice
and Ruth are black. (3:471, 474). Rice initially admitted
that he, in one or more conversations, had told Ruth that
she should support the Union rather than siding with
whites (3:472), but, reversing position and denying that
statement, testified he told Ruth that if the employees
voted in the Union it would produce an equal oppor-
tunity for everyone. (3:473-474).

Line Leader Ruth asserts that Rice would initiate
conversations with her about the Union, promising that
the Union couid get better benefits for her on insurance,
uniforms, and the like. Ruth denies telling Rice that she
would make his job harder if he “voted” for the Union,

App. 49

and she denies threatening Rice in any way. (4:693-694).
Ruth does not expressly address the matter of a conversa-
tion with Rice about his dating of a white woman.

b. Discussion

Crediting Ruth rather than Rice, I find that Rice
seized the occasion of this case to retaliate against Ruth
because she disapproved of his interracial dating. To
accomplish this, Rice simply modified Ruth’s threat about
dating to include a reference to the Union. I shall dismiss
complaint paragraph 8(a).

2. Barbara Cunningham - January 13, 1993

a. Facts

Complaint paragraph 8(b) alleges that on January 13
Supervisor Barbara Cunningham threatened to withhold
pay increases due employees because of their support for
the Union. Robin Delk is the Principal supporting wit-
ness, with Cunningham Supporting AutoZone’s denial.

Robin Delk worked for AutoZone from July 1991 to
April 1993. (3:349). Delk worked as an order selector
under Barbara Cunningham and was an early and open
supporter of the Union. (3:349-350). Supervisor Cun-
ningham held a sectional meeting in the warehouse after
lunch on January 13, Delk testified, with some 100
employees attending. (3:350-351, 364). Delk was standing
in a group to one side which included Janette Hanson,
Paul Henry, Jackie McGinnis, Reuben Rice, and others.
(3:351, 370). At one point during the meeting Delk, as she

App. 50

testified, asked Cunningham when she would receive her
(regular progression) pay increase which then was about
due. Cunningham said that Delk would not receive a
raise because of the support of the Teamsters by the
warehouse employees. Delk responded that her raise
should depend on her evaluation, and her job perfor-
mance, not on the level of union support in the ware-
house. Cunningham replied that Delk needed to talk to
her fellow employees about the union support. (3:351,
369). Cunningham had turned to face Delk and Delk does
not know whether employees on the other side of the
area could hear the exchange, particularly since some of
the employees were talking among themselves. (3:365,
369-372). Following the exchange, and while she was still
standing at the meeting, Delk made some notes about the
exchange, but she did not bring those notes to the hear-
ing. (3:363, 376-377). Within 10 days Delk was evaluated
by Cunningham and received her progression increase.
(3:351-352, 364, 367-368, 372). Cunningham recalls the
evaluation review as being about January 21, her birth-
day. (4:777-778).

Jackie McGinnis recalls Delk’s question coming as the
meeting (in late January) ended and as employees were
leaving the area, with Cunningham telling Delk to ask the
Union where her raise was. Delk just turned and laughed.
McGinnis asserts that the only ones then present were
Delk, McGinnis, Hanson, and Cunningham. The three
employees, open supporter of the Union, were wearing
their Union insignia. (2:233-235, 256-259). Disagreeing
with McGinnis, Delk firmly states that the meeting had
not ended. (3:364). Janette M. Hanson describes a refer-
ence to a question, by someone, of when employees were

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App. 51

going to receive their raise, with Cunningham replying
that the raise was frozen until after “all this was over.”
(1:16-17). Hanson does not describe any specific exchange
between Delk and Cunningham, nor does Reuben Rice.
Paul Henry, also named by Delk, did not testify.
McGinnis asserts that it was employee Joe Smith who,
during the meeting, asked Cunningham whether she had
heard anything on their raises, with Cunningham
answering “No.” (2:257).

Hired as the first employee when the facility opened
in October 1986, Barbara Cunningham began as the cen-
ter’s receptionist. She progressed through a series of posi-
tions, including personnel manager (1988-1989), then to
order selector advisor, and finally, about March 1, 1993, to
Assistant DC Manager. (4:771, 796-797). Cunningham
recalls no question at a group meeting by Delk about a
pay raise, denies telling her at a meeting that Delk should
ask the Union about her pay raise, asserts that she would
not have said. “Go ask the Union,” and denies discussing,
immediately following a group meeting, a pay raise with
Delk, Hanson, and McGinnis. (4:773-776, 779).

b. Discussion

Differences by corroborating witnesses on details are
not unusual, but the differences here are substantial. The
General Counsel does not suggest how the differences are
to be reconciled. In vizw of the TIPS training Cun-
ningham had received, the fact that some 100 employees
were present, with several, perhaps many, wearing insig-
nia of the Union, the Hanson version certainly seems to

App. 52

support Cunningham. Unable to credit Delk or McGinnis,
I shall dismiss complaint paragraph 8(b).

3. Eddie Massey, Timothy Schlichting, and
Jim Wartinger - January 20, 1993

a. Facts

Complaint paragraph 8(d) alleges that on January 20
Eddie Massey, Timothy Schlichting, and Jim Wartinger
removed prounion literature from canteen bulletin boards
while leaving antiunion literature posted. Reuben Rice
testified in support of the allegation, with Massey and
Schlichting supporting AutoZone’s denial. Massey is
AutoZone’s transportation advisor (4:695) and Schlicht-
ing was then an advisor [supervisor] over three depart-
ment, Returns, Maintenance, and Housekeeping
Schlichting left AutoZone for another cOmpany about
August 1, 1993. (4:608-610).

According to the distance estimate by Reuben Rice,
the beginning of his first floor work area is some 30 feet
from the canteen, or employee breakroom, which is situ-
ated at the second floor level. A large clear glass window
forms the top portion of the canteen wall and faces out
onto the warehouse floor. The bottom portion of the
canteen wall is concrete and reaches up to a point above
waist level. (3:456-457, 475-482, 638). There are several
company bulletin boards inside the canteen, and on one
of them employees may post classified sales and other
personal notes. (4:636, 696, 866, 892). From the glass wall
to the employee bulletin board is about 20 feet. (3:481).

App. 53

As he was standing at the front of his work area on
January 20, Rice testified (3:456, 475), and looking up
through the second floor glass portion of the canteen wall
and across the canteen to the bulletin board, he observed
Massey, Schlichting, and Wartinger standing at the
employee bulletin board. As Rice watched, he saw
Schlichting remove three or four letter-size union flyers
which, previously posted by Rice, addressed such matters
as management salaries. Although antiunion matter also
was posted on the board, Schlichting left the antiunion
matter posted. (3:455-457, 484-486). When Vice President
Dennis Roberts came by about 30 minutes later, Rice
complained to him about the removal. Roberts said he
would take care of it. By the end of the shift, about 3
hours later, Rice observed that the flyers had been
reposted. Roberts apologized to Rice for the removal.
(3:486-487).

Schlichting denies removing any union flyers, or see-
ing anyone do such. (4:637). Massey denies that any of
the three removed any union items. (4:697). Schlichting
(4:637) and Massey (4:697) claim they saw a cardboard
poster fall to the floor (blown down by wind from a fan)
while they stood there. In his testimony Roberts does not
address the report by Rice that Roberts said he would
take care of the matter, that the flyers were reposted
within 3 hours, and that Roberts apologized.

Ferguson testified that following Rice’s testimony he
measured the distance required to view the canteen bulle-
tin board from the warehouse floor. At 6 feet 2 inches,
Ferguson had to stand 132 feet from the bulletin board in

App. 54

order to see the posted items. As Ferguson’s measure-
ment apparently was made on the floors of the ware-
house and the canteen, rather than measuring the line of
sight, the measurement does not include whatever extra
distance would be added to the warehouse floor distance
in order to raise it up and link it to a line-of-sight straight
line. (5:909-910). No witness was called in rebuttal to
contradict Ferguson’s measurements. Ferguson concedes
that he and Roberts did not question Rice’s line of vision,
or that he observed what he protested, on the day in
question. (5:972). I estimate that Rice stands about 5 feet
11 inches, or slightly under 6 feet, in work shoes.

No expert in mathematics testified concerning
whether, calculating the math of distance and angles, a
person in Rice’s position could have looked over the
second floor concrete wainscot [apparently anywhere
from 42 to 48 inches high], through the glass portion of
the wall, across the 20 to 24 foot canteen, and have seen
the level at which items were posted on the bulletin
board. Moreover, there is no estimate for the height of the
first floor wall. Whether the wall measures 9 feet, 10 feet,
or something different, is not shown in the record.

b. Discussion

I need not resolve this question of geometry (there
are not enough measurements in any event), for Vice
President Roberts, in effect, admits Rice’s version.
Indeed, after Roberts reassured Rice the matter would be
taken care of, the items were reposted that afternoon.
Moreover, Ferguson admits that Roberts told him about
Rice’s protest, and they did not question Rice’s version

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App. 55

on the day of the event. Accordingly, whether Rice actu-
ally saw the removal, or someone in the canteen reported
it to him, is immaterial. Crediting Rice’s account, as
admitted by AutoZone, I find that AutoZone violated
Section 8(a)(1) of the Act as alleged. I further find that the
reposting did not effectively disavow the effects of the
discriminatory removal under Passavant Memorial Area
Hospital, 237 NLRB 138 (1978).

4. Barbara Cunningham - January 21, 1993
a. Facts

Complaint paragraph 8(e) alleges that on January 21
Barbara Cunningham interrogated employees regarding
their union sympathies and desires. Robin Delk testified

in support of the allegation, with Cunningham support-
ing AutoZone’s denial.

As earlier noted, Robin Delk testified that a week to a
week and a half after Cunningham's January 13 sectional
meeting, during which Delk asked about her progression
wage increase, Cunningham conducted her evaluation inter-
view. (3:351-352, 367-368, 372). Cunningham recalls that it
occurred about her birthday, January 21. (4:778, 782). Delk
considered the evaluation good, and she was told that she
was getting a pay raise and the amount of her pay increase.
(3:352, 372-373; 4:777). There is no dispute that before the
January 21 evaluation interview Cunningham knew of
Delk’s open and outspoken (wearing union pin, union jacket,
and handbilling) support of the Union, and Delk was wear-
ing her union pin during the January 21 interview. (3:368,
372). Cunningham suggests that Delk had expressed her

EE ee

App. 56

union support to Cunningham in earlier conversations
(4:776, 778), and (on a leading question) that the positicn was
unsolicited by Cunningham (4:779). Denying any prior con-
versations with Cunningham about the Union (3:375), Delk
observes that her father, a 25-year member of the Union,
makes regular stops at the Greenville warehouse, she visits
with him on some of those occasions, and that his union
membership in the Teamsters is common knowledge. (3:375).

Delk testified that after the evaluation portion of the
interview, Cunningham, changing the subject, asked Delk
how she felt about the Union and why she supported the
Union. (3:352-353, 374). (Although Delk later testified,
3:373, that she did not recall at what point the union topic
arose, her initial description, 3:352, puts it after at least
some, perhaps all, of the evaluation portion.) Although
Delk was wearing a union pin, Cunningham did not
explain why she was asking how Delk felt about the
Union. (3:374-375).

To Cunningham's questions, Delk replied that she
was raised with the Union, that it was strong in her
family, and that she believed in the Union. Her father has
been a member of the Union for over 25 years, and Delk
values the union benefits her father has received. Cun-
ningham responded that she grew up in the North, that
she remembered the Teamsters and Jimmy Hoffa, and
that she remembered the Teamsters as being violent peo-
ple who would overturn cars and set fire to property.
(3:352, 374, 393-394).

Cunningham’s initial description of the interview
was in terms of what the customary sequence was rather
than what actually occurred. (4:778). Cunningham denies

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App. 57

there was any discussion between them about their opin-
ions on the Union. In answer to a leading question (“Did
she [Delk] volunteer .. . “), Cunningham testified Delk
volunteered how she felt about the Union, that her father
was part of the Union, that she had grown up with it, and
that is why she felt that way. To another leading question
of whether this was in response to Cunningham’s asking
a question, Cunningham testified “No.” (4:782-783).

b. Discussion

Without hesitation I credit Delk rather than Cun-
ningham. Indeed, Cunningham’s answers to the leading
questions tend to corroborate Delk’s version. Although
asking an open supporter of the Union how she feels
about the Union seems silly and strange, and therefore
not credible, oral statements in conversation generally are
not prepared in advance and not as Precise and logical as
are expressions reduced to writing. In any event it is not
the first time such a question has been asked of an open
union supporter. See Pilliod of Mississippi, 275 NLRB
799 fn. 2 (1985).

AutoZone relies on Pilliod to argue that even if Delk
is credited the allegation must be dismissed. I agree. Had
Cunningham asked the questions before the evaluation, I
would find a violation. Even an open union supporter
might well be coerced by such questions occurring at the
beginning of a performance evaluation. And whether
Delk in fact was, or would be, is immaterial, for actual
impact is not the test. Here, however, the questions came
after Delk was informed of her good evaluation and of
the amount of her pay increase. The questions which

App. 58 \

followed merely launched brief position statements by
two persons with opposing views.

The General Counsel also argues that Cunningham’s
reference to violence by the Teamsters under Jimmy
Hoffa “is naturally coercive and would cause a reason-
able person to reconsider supporting the Union. Thus,
Cunningham’s remarks to Delk amounted to unlawful
interrogation and are violative of the Act.” The General
Counsel does not assert that Cunningham’s description of
her experience with the violent acts in the North, such as
the overturning of cars and setting fire to property, is
untrue. It therefore is no surprise that such violence
“would cause a reasonable person to reconsider support-
ing the Union.” But such fact does not make Cun-
ningham’s description of her experience in the North
unlawfully coercive. By contrast, Delk’s experience with
the Union, its representatives, as well as her father, has
been just the opposite — everything she has seen has been
good. And she expressed her view very well to Cun-
ningham, supporting it with the specific benefits she has
observed. Robin Delk’s father can be justly proud of his
daughter’s articulate defense of the Union. For the rea-
sons stated, I shall dismiss complaint paragraph 8(e).

5. Dennis Roberts - January 22, 1993

a. Introduction

Complaint paragraph 8(f) alleges that on January 22
Vice President Dennis Roberts told employees “that a pay
raise was being withheld because the Union had filed a
representation petition.”

App. 59

The question here is whether the final paragraph of
the text of the January 22 joint speech (GCX 2) by Roberts
and DC Manager Rick Ferguson (they alternated in deliv-
ering portions) rises to the violation alleged in paragraph
8(f). (2:325). The final text paragraph of the speech, deliv-
ered by Roberts, reads (GCX 2 at 7-8):

The other issue I want to discuss has to do with
the status of pay increases at this D.C. A number
of you have asked when or if the 4% to 5%
increase we had mentioned back in December
would be going through. You need to under-
stand that the numbers we mentioned in Decem-
ber were a tentative forecast only. After that
time, we decided to re-evaluate the pay situa-
tion in this market. Before we were able to
gather all the data we needed and reach a final
decision, however, the Teamsters’ petition came
in. Our understanding of the law is that we
cannot make changes in the pay or benefits once
a petition comes in, unless the decision had been
finalized beforehand. We very much regret that
the union’s poor timing has now tied our hands,
but we do not intend to violate the law. The
thing to keep in mind, though, is that once the
union is beaten in the election - and we feel
confident that that is exactly what is going to
happen here - then we will be able to move
forward, free of the restrictions that we now live
under. We’re sorry we cannot be more specific
than that now, but we wanted you to under-
stand the legal status of your pay increase at
this time.

In this speech, and others, AutoZone vigorously
opposes the unionization of its Greenville facility. Clearly
and expressly AutoZone (Ferguson speaking), as is its

App. 60

right, told the employees that AutoZone does not want
“the Teamsters or any other union in our operation. We
are completely and entirely against this union getting in
here and we will take every legal step available to us to
keep it out!!” (GCX 2 at 2-3).

Complaint paragraph 9 alleges that AutoZone has
violated Section 8(a)(3) of the Act since January 22 by
withholding “scheduled pay increases due to its unit
employees because the Union filed a representation peti-
tion.” AutoZone denies the allegation.

The pay increase allegations constitute a principal
part of the case. I do not treat the paragraph 9 allegation
until later. Paragraph 9 is relevant here, however, because
it provides context for the paragraph 8(f) allegation about
Roberts’ remarks of January 22.

b. Facts

Vice President Dennis Roberts testimonially
described AutoZone’s pay increase procedure and its
background. First, AutoZone has two types of pay
increases for its DCs (distribution centers). One is a wage
progression advance for an employee's initial 2 years:
evaluations and increases at (90 days at Greenville), 6
months, 12 months, 18 months, and 24 months. (4:815,
826). The second is an annual adjustment, inaccurately
called a cost of living (COL) increase. (4:815). It is not a
true COL because (1) not everyone gets the same
increase, and (2) the annual adjustment is based on the
results of a market analysis, or area wage survey rather
than some COL index. The wage survey is conducted by

App. 61

the local management. The data collected is passed to the
ROM (Regional Operations Manager), and thence to
Roberts who, with accounting support, assembles the
analysis, forms, and recommendation for AutoZone’s
president who typically makes a decision based on the
data and recommendation submitted. (4:815-816, 839).
Because the wage surveys are based on the DCs’ geo-
graphic areas, the DCs have different pay scales. (4:824).
An annual adjustment is a bit of a misnomer, for the
adjustments are not guaranteed if the wage survey shows
that a DC’s payscale is competitive for its area. (4:831).

For several years AutoZone performed its wage sur-
veys, or market analyses, in November with any adjust-
ments implemented in December. AutoZone changed its
procedure in late 1991, shifting the survey to December
with adjustments made in the following January, the first
being January 1992. (4:820-821; GCX 6).

On a routine visit to the Greenville DC in late
November 1992, Roberts testified, several employees
approached him and asked whether there would be an
annual increase and if so how much. Roberts answered
that to the best of his knowledge he expected that there
would be an increase in the range of 4 percent to 5
percent. He told them that this was not yet confirmed.
(4:835-836, 885). To be fair to other employees, Roberts
testified, he returned some 2 weeks later, around Decem-
ber 8, 1992, and management held meetings with smal]
groups of employees sharing that same information
(there “might” be an annual increase in range of 4 percent
to 5 percent) with all employees. The employees also
were told that AutoZone was awaiting the results of a
market analysis being done in the Phoenix area by the

App. 62

Hay Group. (4:836-837, 885-886). The day he left Green-
ville, Roberts received, by overnight mail, an advance
copy of the Hay Group’s survey, dated December 15, for
his review on his return flight to, presumably, Memphis.
(4:837-838).

The Hay Group’s report indicated to Roberts that
AutoZone was no longer competitive in the Phoenix area.
That led him to instruct Ferguson, the Greenville man-
ager, to begin a wage survey for the Greenville area. This
was done by Ferguson and Personnel Mariager Jim War-
tinger. They contacted such firms as Wal-Mart which has
a warehouse some 20 miles from AutoZone’s Greenville
DC. (4:839-841). By Friday, January 8, or Saturday, Janu-
ary 9, 1993, Roberts testified, Roberts had received all of
the wage survey data. He did not have it before Ferguson
met with Wal-Mart on January 6. He made his analysis,
with accounting staff support, and gave his recommenda-
tion on all DCs, except Greenville on Monday, January 11,
to AutoZone’s president, who approved it that afternoon
with some modification. (4:844-845, 847-848). Although
Roberts had all the wage survey data for Greenville, he
did not perform his analysis nor finalize a recommenda-
tion respecting a pay adjustment at Greenville. (4:845,
848, 862, 884-885, 387, 898).

According to Roberts, he did not learn of the Union’s
organizing activities at Greenville until Ferguson called
him on receiving the Union’s telegram (RX 13) after 5
p-m. on Wednesday, January 6, in which the Union
demanded recognition. (4:842, 854). After consulting its
attorneys, AutoZone concluded that it would be unlawful
to implement a pay increase at Greenville. He therefore

_ssse

App. 63

put the Greenville data aside, did not complete the anal-
ysis for Greenville, and has not done so. (4:846, 848, 862,
885). The analysis was stopped because of concern over
legality, and not for the lack of any data. (4:846). Extrapo-
lating from the wage surveys for the other DCs, Roberts
testified that the adjustment for Greenville, had it been
made, would have been greater than 5 percent. (4:841,
| 885). Had the analysis been made and an adjustment
implemented at Greenville, as it was elsewhere, it would
have been effective for the pay period beginning Sunday,
! January 3, 1993, with the increase reflected in the pay-
checks issued January 22. (4:842-843).

c. Discussion

The law is settled on this issue. “It is well established
that an employer is required to proceed with an expected
wage or benefit adjustment as if the union were not on
the scene.” Atlantic Forest Products, 282 NLRB 855, 858
(1987). In Atlantic Forest the Board, continuing, observes
that an exception to the rule allows the employer to
postpone the wage or benefit adjustment so long as it
makes clear to employees that the adjustment would
occur whether or not they select a union, and that the
“sole purpose” of the postponement is to avoid the
appearance of influencing the election’s outcome. In mak-
ing such announcements, however, the employer must
avoid attributing to the union the onus for postponement
of adjustments in wages or benefits, or disparaginz and
undermining the union by creating the impression that it

stood in the way of their getting planned wage increases
and benefits. Atlantic Forest, id.

App. 64

In Atlantic the Board found that the employer’s
announcement unlawfully attributed to the union the
withholding of a regularly scheduled semi-annual wage
increase. The statement in issue here is very similar to the
employer’s announcement in Atlantic. Thus, although
Roberts tells employees that the 4 percent to 5 percent
was a tentative forecast, it is based on employees’ knowl-
edge of an annual adjustment decision. The December
forecast by Roberts, as he asserts, was 4 percent to 5
percent. Thus, an adjustment of some kind, forecast to be
in the range of 4 percent to 5 percent, would be made.
After the December “tentative forecast,” Roberts states,
AutoZone decided to reevaluate wage rates in the Green-
ville market. Before that could be completed and a final
decision reached, the Union filed its petition.

Now as we know from Atlantic Forest Products, the
Union’s petition is irrelevant — but for one exception.
Other than the one exception, an employer, election peti-
tion or no, is to proceed as if there is no union on the
scene. That is, AutoZone was required to complete its
wage survey, to make a final decision, and to implement
that final decision — all as if the Union were not there. By
one permitted exception, the employer may announce a
postponement provided it makes clear to employees, (1)
the adjustment eventually will occur regardless of the
election results; (2) the sole purpose of the postponement
is to avoid the appearance of influencing the election’s
outcome; and (3) in making the announcement, the
employer must avoid attributing to the union the onus
for the postponement, or disparaging or undermining the
union by creating the impression that the union stands in
the way of the employees getting the planned adjustment.

App. 65

So stated, Atlantic Forest establishes (reiterates, actually)
the three tests to be applied.

How does AutoZone fare on the three tests? The
answer is easy. AutoZone, after a fashion, passes test one,
but it fails tests two and three. First, the understanding it
expressed about the law is wrong, for, as I have noted,
filing of the petition is an irrelevant event, save for one
exception. Second, there is no requirement that a decision
have [sic] been finalized. (Not misstating the law perhaps
is an implied fourth test of Atlantic.)

Consideration of tests two and three show very
clearly that the sole purpose of Roberts’ announcement
was just the opposite of the Atlantic test two, for the
purpose was to encourage a vote NO. A negative vote
would be encouraged because Roberts blamed the
Union’s “poor timing” for the postponement. Incited
anger needs an outlet, and voting against the Union in
the election would provide that outlet. Not only would
Roberts’ words incite anger against the Union, and
remind employees how to take revenge (beat the Union in
the election), but they promise the thrill of victory, after
the Union is beaten, in the form of AutoZone’s being able
“to move forward, free of the restrictions that we now
live under.” That is, AutoZone would be able to proceed
with its pay adjustment process when the Union loses the
election. (The subliminal message is that a YES vote will
doom any pay adjustment.) His overt message is the same
as that found unlawful in Atlantic Forest Products. It is
the “carrot or the stick” approach condemned in DTR
Industries, 311 NLRB 833, 836 (1993). I find that Auto-
Zone, by Vice President Roberts’ speech, violated Section
8(a)(1) as alleged by complaint paragraph 8(f).

App. 66

6. Martin Nelson — February 2, 1993

a. Facts

Complaint paragraph 8(h) alleges that on different
dates two supervisors, Marty Nelson (on February 4) and
Tim Schlichting (mid-February), threatened employees
with unspecified reprisals if they selected the Union as
their bargaining representative. Respecting Nelson, James
Andrews is the General Counsel’s supporting witness,
with Nelson opposing. I address the Schlichting allega-
tion under separate heading.

James Andrews began working for AutoZone in
August 1992. He works in housekeeping. He became a
member of the Union’s organizing committee, and in late
January 1993 he began wearing a Teamsters pin on his
collar. (2:273). Martin Nelson also joined AutoZone in
August 1992, as assistant manager of the San Antonio
DC. (4:602). As were some managers from other locations,
Nelson arrived at the Greenville DC in late January or
early February for some training. (4:598, 602).

Andrews testified that in the latter part of February,
in the rear of the warehouse, Nelson approached him
and, seeing the Union pin on Andrews’ collar, asked,
“What are you going to do when you lose this election?”
Andrews replied that he would just continue doing his
job. Nelson did not respond specifically to that, but they
did have some general conversation following the initial
exchange. (2:278-279, 297-298). At some point Nelson
introduced himself. (2:299). Andrews concedes (no objec-
tion registered) that Nelson did not say Andrews would
lose his job nor was he threatened in any other way.

App. 67

(2:298-299). However, Andrews asserts, Nelson used a
“threatening tone” when he asked what Andrews was
going to do after losing the election. (2:299).

Nelson places the conversation as occurring about
February 2, the very morning he arrived at the facility.
(4:598, 602, 604). Before leaving San Antonio, Nelson was
informed of the union campaign at Greenville.
(4:602-603). On his arrival at Greenville Nelson was told
by Bob Flynn, the assistant manager from the Lafayette
DC also there for training, not to engage in any “pro-
longed” conversations with employees about the Union;
just do not talk with them about the union campaign.
(4:601, 602). Some days later, after his conversation with
Andrews, Nelson, as all members of management,
received “guidance” from Ferguson and Roberts not to
engage in “prolonged” conversations (4:603-604), or in
“any” conversations (4:605) with employees about the
Union. This guidance was imparted in an unscheduled
meeting with some other managers on the warehouse
floor. (4:605-606).

On this morning, Nelson testified, he decided to take
an inspection walk around the facility while the local
management was in a meeting. (4:598). Nelson was wear-
ing an AutoZone jacket, giving San Antonio as the facil-
ity, but not bearing his name. Nelson was aware that
AutoZone had certain pins that employees wore,
although he was not familiar with all of them at that time.
(4:599-600). As Nelson walked by a maintenance area,
James Andrews stopped him and asked his identity.
Nelson introduced himself. Observing Andrews’ pin, he
thought it was an AutoZone pin, although he did not
recognize it. He could not read the inscriptions because

App. 68

he was not wearing his reading glasses. (4:599-600, 601).
[Nelson appears to be in his fifties, or well past the age
when many persons require corrective glasses to read.]
“In the course of the conversation,” Nelson testified, he
told Andrews that he had never seen [that type] pin
before. He therefore asked Andrews, “What is that?”
Andrews said it was a Teamsters pin. Realizing that
Andrews was a [sic] one of the prounion employees,
Nelson decided it was best to move along and he began
to walk. Andrews asked what Nelson thought about the
“whole business,” or the “proceedings.” Turing to answer
as he was walking, Nelson replied, “I hope it all comes
out well.” Nelson denies threatening Andrews in any
way, denies telling Andrews he would lose his job once
the election was over (adding that he had no reason to
say that), and asserts that this was the only conversation
he ever had with Andrews. (4:600).

b. Discussion

The versions of Andrews and Nelson are consistent
up to a point. Where they differ, I credit Andrews.
Although the General Counsel views Nelson’s inquiry as
threatening (“What are you going to do when you lose
this election?”), I see it as ambiguous, subject to different
interpretations. Accordingly, I shall dismiss complaint
paragraph 8(h) as to Martin Nelson.

App. 69

7. Rick Ferguson - February 11, 1993

a. Facts

Complaint paragraph 8(n) alleges that on February
11 AutoZone, by DC Manager Rick Ferguson, “promul-
gated a rule which prohibited employees from discussing
the Union during working time.” Several employees,
including Reuben Rice, testified in support. Dennis
Roberts and Rick Ferguson testified for AutoZone’s
denial of a violation.

Several of the central facts are not in dispute. All
agree that the morning of Thursday, February 11, several
members of the Union’s organizing committee, including
Reuben Rice, approached Ferguson and Roberts in the
upstairs conference room. Rice read (2:122, 235, 274;
3:461, 495; 5:936) a short handwritten note (CPX 3) which,
in essence, protests a discriminatory practice by Auto-
Zone of allowing antiunion employees, such as Debra
Phillips, to walk around during work time talking anti-
union, and interrupting others at work (2:255), while
prohibiting union supporters from campaigning for the
Union during work time. Ferguson said he was unaware
that was occurring and that he would put a stop to
employees talking either for or against the Union during
working time. (3:462, 496; 4:864). Ferguson recalls that he
simply said he would handle the situation. (5:936).

After lunch that same day all employees were assem-
bled and Ferguson told them that henceforth there would
be no talking for or against the Union during working
time, that it was hampering production, and that viola-
tors would be subject to discipline up to and including
discharge. (2:122-123, 256; 3:462). Stanley Phillip Wilson

App. 70

testified that Ferguson made it clear that employees could
discuss union or anything else during their personal time
at breaks, lunch, and before or after work. Wilson testi-
fied that this satisfied the union supporters because it
stopped the antiunion supporters from walking around
talking against the Union. (2:158). Rice, too, testified that
he was satisfied with Ferguson’s presentation to the
assembled employees. (3:497). Although the accounts by
Roberts (4:864-865) and Ferguson (5:936-937) do not
include the warning of discipline for any violation, I find
that such warning was given.

Company policy, as Vice President Roberts acknowl-
edges, has been to permit employees to carry on conver-
sations during work so long as their talking does not
interfere with the work to

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386004_1180%3A1. Public record. Not legal advice.