Opposition — Willmar Electric Service, Inc. v. National Labor Relations Board

+ fr

LA)

TT

S &

ae

As te

:

p

r if

‘

ME OF

A}

WING PAGES

A

NT

HARD COPY

sa +

AND WHEN A

n

A NEW FICHE

No. 92-687 De Tae YL

Jn the Supreme Court of the Chuited States

OCTOBER TERM, 1992

WILLMAR ELECTRIC SERVICE, INC., PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD

ON PETITION FOR A WRI? OF CERTIORARI!

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUTLT

BRIEF FOR

THE NATIONAL LABOR RELATIONS BOARD

WIiLitAM C. BRYSON

Acting Solicsior General

Department of Justice

Washington, D.C. 205.80

(242) 514-2217

JERRY M. HUNTER

General Counsel

YVONNE T. DIXON

Acting Deputy General Counsel

NICHOLAS EF. KARATINOS

Deputy Associate General Cownse'

NORTON J. COME

Deputy Associate General Conus

;

/

j

LINDA SHER

Assistant General Counsel

National Labor Relations Loucd

Washington, D.C. 20570

QUESTIONS PRESENTED

1. Whether the National Labor Relations Board

reasonably concluded that a paid union organizer

applying for a job with an employer he intends to

organize is an “employee” within the meaning of Section

2(3) of the National Labor Relations Act and thus

protected against discrimination by that employer

because of his union activity and affiliation.

2. Whether the Board’s finding that petitioner

violated the Act by refusing to hire union organizer

Michael Hendrix because of his union activities is

supported by substantial evidence.

(I)

TABLE OF CONTENTS

Paye

Opinions below .........sscscesseeeseeseceseeeeseetneesenaecsssessretsetneens l

JUPisGiction ................ccccccssccsscccssscsseccesecceeesseeseseeseeseeseeseuens l

Stmtemment, .......ccccccccccccscsscccsccscccccccscccsscocsscasscesecesscnsscessnssens 2

Argument .........scccessseeeessssseneeessseseeseestneneenssnsesneeeenneeeeens ae 10

CONnclusiO#n .......cccccccocsccccssccssccrssccreccccsccscnssccceessccscscsoneseceenees 22

TABLE OF AUTHORITIES

Cases:

American Hosp. Ass’n v. NLRB, 111 S. Ct. 1589 (1991) .. 13

Beth Israel Hosp. v. NLRB, 437 U.S. 483 (are ll

Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 (1984) .........:cceeeeeeeennenerenen ees 7,11

Escada (USA), Inc. v. NLRB, 970 F.2d 898 (3d Cir.

1992), enforcing mem. 304 N.L.R.B. No. 109 (Aug. 27,

DOOD) ..ccccccccrecsccccccrccesscccncsscccccsccccscconccnsnscconcecscesscossosssoes 16

Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S.

DT (1GBT) ...cccccccccccrsrsssscescescscccccccccccccscnsnscscsccssssenccsssccces 11

H.B. Zachry Co., 289 N.L.R.B. 838 (1988), enforcement

denied, 886 F.2d 70 (4th Cir. 1989) ......--seseeeeereeeererereeees 4-5

H.B. Zachry Co. v. NLRB, 886 F.2d 70 (4th Cir. 1989) .. 16,

17, 18

Kelley v. Southern Pac. Co., 419 U.S. 1 Fo) | on 12

Lechmere, Inc. v. NLRB, 112 S. Ct. 841 (1992) ........----+++ 9,15

NLRB v. Babcock & Wilcox Co., 351 U.S. 105 (1996) ...... 9, 15

NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775

(1990) ......c.eccceesscesscccesssssccscsoseccesrssssceesorsesesensssesseesscnee® 11

NLRB v. Elias Brothers Big Boy, Inc., 327 F.2d 421 (6th

Ci, 19G4) ..c.ccccccccccccsccccsssscccncccccccssesenscsscnctcsnsscsssrseenseees 16, 18

NLRB v. Erie Resistor Corp., 373 U.S. 221 (1965) ......... 11

NLRB v. Food & Commercial Workers, 454 U.S. 112

PRUE D cccansnsnccssacscacancngencsccsnssnssncesnenessenesnenensonssssersessoesoos 11

NLRB v. Henlopen Mfg. Co., 599 F.2d 26 (2d Cir. 1979) 16

(111)

IV

Cases—Continued: Page

NLRB v. Local 1229, IBEW, 346 U.S. 464 (1958) ............ 20

NLRB v. Transportation Management Corp., 462 U.S.

Se AEE -csiciesinshisapiinh aeaithindesieeedulasianGaencnuaaeamNeanmaanabeinadges 6

Nationwide Mutual Insurance Co. v. Darden, 112 S. Ct.

EELS ON tt AL A 8, 12

Oak Apparel, Inc., 218 N.L.R.B. 701 (1975) ...........eeeeeeee 12

Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941).......... 7, 12, 13

Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945) ... 13

Sunland Construction Co., 309 N.L.R.B. No. 180 (Dec. 16,

1992), pet. for review pending sub nom. International

Bhd. of Boilermakers v. NLRB, No. 92-1667 (D.C. Cir.,

RE GRR, TR, GD sncecesteninvicsaccnininsesnessonsiscsonens 13, 14, 15, 19, 20

Sure Tan, Inc. v. NLRB, 467 U.S. 883 (1984) ................. 12

Town & Country Electric, Inc., 309 N.L.R.B. No. 181

(Dec. 16, 1992), pet. for review pending, No. 92-3911

CBE Cor. Tiled Dee. BB, IGDR) ..ccccrcsccessersrerscoseresosssesonsons 13, 19

Universal Camera Corp. v. NLRB, 340 U.S. 474 (1951) .. 21

Wright Line, 251 N.L.R.B. 1083 (1980), enforced, 662 F.2d

899 (1st Cir. 1981), cert. denied, 455 U.S. 989 (1982) ..... 6

Statutes:

Labor-Management Relations Act, § 302(c)(1), 29 U.S.C.

S| RAE A LE ie eee RN A MN SEL De RTT 4

National Labor Relations Act, 29 U.S.C. 151 et seq.:

§ 2(3), 29 U.S.C. 152(3) .......... 5, 6, 8, 10, 11, 13, 15, 18, 19, 22

i NE IE gic ork sccaicicdaenesnmadanereciveowadinavunanian 4

eR, Be TG, SIEGES svc ineteensisesesvecssnssesen 4, 10, 15, 20

fc Me iS 8 a |S + | eer 4, 10, 15, 20

Miscellaneous:

8, 12

Restatement (Second) of Agency (1958) .0......... cece

In the Supreme Court of the Cnuited States

OCTOBER TERM, 1992

No. 92-687

WILLMAR ELECTRIC SERVICE, INC., PETITIONER

Vv.

NATIONAL LABOR RELATIONS BOARD

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF FOR

THE NATIONAL LABOR RELATIONS BOARD

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. Al-

A8) is reported at 968 F.2d 1327. The decision and

order of the National Labor Relations Board (Pet.

App. A9-A14), including the recommended order of the

administrative law judge (Pet. App. A15-A47), is re-

ported at 303 N.L.R.B. No. 33.

JURISDICTION

The judgment of the court of appeals was entered on

July 21, 1992. The petition for a writ of certiorari was

filed on October 16, 1992. The jurisdiction of this

Court is invoked under 28 U.S.C. 1254(1).

(1)

2

STATEMENT

1. Petitioner is a multi-state electrical contractor

headquartered in Willmar, Minnesota. In the summer

of 1988, petitioner received an electrical subcontract

for a J.C. Penney store in a mall in Silverdale,

Washington. Pet. App. Al0, A17. Michael Hendrix is

a journeyman electrician. On June 23, 1988, Hendrix

became a full-time field organizer for the Interna-

tional Brotherhood of Electrical Workers, I.ocal

Union No. 46 (the Union). /d. at Al0, Al8. Shortly

thereafter, Hendrix contacted petitioner’s operations

manager, Timothy Imdieke, and asked whether

petitioner would enter into a labor agreement with

the Union for the Silverdale project. Hendrix sent

Imdieke a copy of the Union’s standard agreement.

On July 25, Imdieke informed Hendrix that petitioner

was not interested in signing an agreement, but

might be interested in hiring some of the Union’s

people. /d. at A18.

On August 30, Hendrix went to the Silverdale site

and introduced himself to Project Foreman Douglas

Rose. Hendrix asked about job prospects and whether

petitioner might sign an agreement with the Union.

Pet. App. Al8-A19. Rose responded that “things were

really slow.” Jd. at Al9. Following that conversation,

Rose wrote in his job log for that date that Hendrix

had given him the impression that the Union had

“targeted [petitioner] for the infiltration of Union

members.” /bid. Thereafter, Hendrix and Rose had

several conversations in which Hendrix continued to

ask about jobs. Rose advised Hendrix that petitioner

would get its applicants through the state employ-

3

ment service and that it was “nonunion and wanted to

stay that way.”' /d. at A20.

On October 14, Hendrix delivered his own and

another electrician’s completed job applications to

Rose. Pet. App. A20. Hendrix’s application listed his

present employer as the Union. His stated reason for

leaving was to “work in the field.” Pet. App. A3.

According to Hendrix’s credited testimony, it was

normal for field organizers to seek employment.

While union officials knew about his application for

employment with petitioner, he testified that he had

received no directions from the Union to seek that

employment. Hendrix further testified that he would

have to take a leave of absence from employment with

the Union if hired by petitioner, while retaining his

title as field organizer; that he would be paid by

petitioner for the work performed for it; and that,

while his wages with petitioner would be less than he

was currently receiving from the Union, he did not

know whether the Union would compensate him for

any shortfall in compensation. /d. at Al0-A11; C.A.

App. 34, 37-38, 39-39A.

Between November 30 and December 15, 1988,

Hendrix and two others picketed the Silverdale pro-

ject with signs stating that petitioner was paying

substandard wages. They also distributed leaflets at

the site. Pet. App. A22-A23.

1 Similarly, in interviewing electrician Jerry Jones for a job

at Silverdale, Rose asked about his union affiliation. When.

Jones replied that he was discontented with the Uniwii and was

no longer a member, Rose stated that Jones did not have to

worry because petitioner was “nonunion and it intends on

staying nonunion.” Pet. App. A22.

rarer ee ll

4

On December 80, Hendrix called Rose to ask

whether he was hiring and whether he had considered

Hendrix’s application. Rose responded that petitioner

was hiring, but had not considered Hendrix’s

application because “it’s kind of hard to hire you when

you're out there on the other side, picketing.” Pet.

App. AS. Hendrix replied that he was no longer

picketing, he was experienced in the type of work that

petitioner was doing, he would do a good job, and he

wanted Rose to consider his application seriously.

Hendrix also indicated that, if hired, he would perform

his duties as an electrician during working time and

would engage in organizing activities during the

lunch hour and after work. /d. at A25-A26. Petitioner

never offered Hendrix a job.’

2. The Board, in agreement with the administrative

law judge (ALJ), concluded that petitioner violated

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

Act, 29 U.S.C. 158(a)(3) and (1), by refusing to hire

Hendrix.’

The Board reaffirmed its position in H.B. Zachry

Co., 289 N.L.R.B. 838 (1988), enforcement denied, 86

¢ Petitioner also rejected the employment application of

union electrician Allen Haugen after interviewing him and

learning that he had previously worked for unionized em-

ployers. Pet. App. A23-A25.

$ Section 8(a)(1) makes it an unfair labor practice for an

employer “to interfere with, restrain, or coerce employees” in

the exercise of their right “to form, join, or assist labor

organizations.” 29 U.S.C. 158(a)(1), 157. Section 8(a)(3) makes

it an unfair labor practice for an employer to “discriminat[e] in

regard to hire or tenure of employment * * * to encourage or

discourage membership in any labor organization * * *.” 9 24

U.S.C; 158(a)(3).

Ks

D

I.2d 70 (4th Cir. 1989), that “individuals who are full-

time paid union organizers while applying for a job

are protected Section 2(3) employees who cannot be

discriminatorily denied employment simply on the

basis of that union activity or status.”* Pet. App.

A1l1-A12. While stating that an employer may rely on

a nondiscriminatory policy in refusing to hire an

organizer, such as a policy against hiring those who

seek short-term work or who work for other

employers, the Board agreed with the ALJ that

petitioner “did not prove that it refused to hire

Hendrix pursuant to any such nondiscriminatory

policy.” /d. at AlZ n.2.

The Board affirmed the AI.J’s finding that peti-

tioner had refused to hire Hendrix because of

Hendrix’s protected union activities. The AI.J’s

finding relied on, inter alia, petitioner’s “policy

* Section 2(3) of the Act, 29 U.S.C. 152(3), provides:

The term “employee” shall include any employee, and

shall not be limited to the employees of a particular

employer, unless this Act explicitly states otherwise, and

shall include any individual whose work has ceased as a

consequence of, or in connection with, any current labor

dispute or because of any unfair labor practice, and who

has not obtained any other regular and substantially

equivalent employment, but shall not include any

individual employed as an agricultural laborer, or in the

domestic service of any family or person at his home, or

any individual employed by his parent or spouse, or any

individual having the status of an independent contractor,

or any individual employed as a supervisor, or any

individual employed by an employer subject to the Railway

Labor Act, as amended from time to time, or by any other

person who is not an employer as herein defined.

6

against hiring known union members,” Pet. App. A37,

its intent to stay “nonunion,” and its perception of

Hendrix “as an organizational threat.” /d. at A38.

The ALJ further found that petitioner had not

sustained its Wright Line burden of showing that it

would have refused to hire Hendrix even in the

absence of his union activities.’ The testimony of

petitioner’s agents that they refused to take

Hendrix’s “application seriously” because he had

applied as a result of “his full-time union employment

responsibilities” constituted “an admission o[f] im-

proper motive.” Jd. at A39.°

The Board ordered petitioner, inter alia, to offer

Hendrix immediate employment and to reimburse him

for lost earnings and benefits. Pet. App. Al4, A42.’

3. The court of appeals rejected petitioner’s con-

tention that a paid union organizer is not an

“employee” covered by Section 2(3) of the Act, and it

enforced the Board’s order. Pet. App. Al-A8. The

5 Under the Board’s decision in Wright Line, 251 N.L.R.B.

1083 (1980), enforced, 662 F.2d 899 (Ist Cir. 1981), cert. denied,

455 U.S. 989 (1982), once the Board’s General Counsel has

shown that an anti-union motive animated the employment

decision, the employer can defend by showing it would have

made the same decision in any case. See also NLRB vy.

Transportation Management Corp., 462 U.S. 393 (1983)

(upholding Board’s Wright Line approach).

6 The ALJ found no substance to petitioner’s assertion that

it thought Hendrix was only interested in a foreman’s position.

Pet. App. A39.

7 The Board also affirmed other uncontested findings of the

ALJ with respect to other violations the Act, Pet. App. AQ,

A41-A42, which petitioner did not challenge in the court of

appeals, id. at A3, and does not challenge here.

ne

7

court first noted that applicants for employment are

employees within the meaning of the Act. Pet. App.

A4, citing Phelps Dodge Corp. v. NLRB, 313 U.S. 177

(1941). It further noted that, “despite Hendrix’s em-

ployment ties to the union, there is no real claim that

Hendrix’s hoped-for job with Willmar would have been

a sham,” and that, “[iJn most respects, Hendrix would

have been indistinguishable from a zealous volunteer

who resolved to use his free time during lunch and af-

ter work to advance the union’s interests.” Pet. App.

A4. The court acknowledged, however, that Hendrix’s

“then-current job with the union,” “his retention of a

vague union title,” and “his prospect of reemployment

by the union might have had various subtle (or per-

haps not so subtle) effects on his conduct as a Willmar

worker.” Jbid. Accordingly, the court stated that

“(t]he nub of the controversy is whether Hendrix’s

employment ties to the union disqualified him from

being a Willmar employee enjoying full protection of

the Act.” [bid.

Applying the analysis of Chevron U.S.A. Inc. v.

Natural Resources Defense Council, Inc., 467 U.S.

837 (1984), the court concluded that Congress had not

“clearly resolved the issue” of whether the term

“employee” as used in the Act encompasses paid union

organizers. Pet. App. A4. The court explained that,

“als moonlighting is widespread, it is plain that the

word ‘employee’ cannot exclude concurrent employ-

ment generally. Once that (obvious) step is taken, it

is hard to see how one could exclude employment by a

union as well as another employer except on grounds

either of some implication from the structure of the

Act or some powerful legislative history.” Jd. at A4-

8

A5. The court found no such evidence, however. On

the contrary, it found that “closely related legisla-

tion, the Labor Management Relations Act, manifests

a congressional assumption that an employee may be

employed by a union and another entity.” Jd. at A5.°

The court also noted that this Court had “recently

stated a presumption that a statutory use of the term

‘employee’ should be taken to have its common law

meaning unless Congress ‘clearly indicates other-

wise.” Pet. App. A5, quoting Nationwide Mutual

Insurance Co. v. Darden, 112 S. Ct. 1344, 1349 (1992).

Under common law principles, the court found, a

person can serve two masters, so long as “service to

one does not involve abandonment of the service to the

other.” Jd. at A6, quoting Restatement (Second) of

Agency § 226 (1958). The court added that, “[{u]ntil

such time as an employee ‘abandons’ the non-union

employer for the union employer, it is hard to see why

he should be denied the protection of the Act.” bid.

The court then rejected petitioner’s arguments

against applying Section 2(3) of the Act to paid union

organizers. First, in response to petitioner’s con-

tention that the organizer’s “employment relation to

the union would subject [the employer] to intolerable

risks of disloyalty,” Pet. App. A6, the court noted that

nothing in the Act prevents an employer from disci-

8 The court referred (Pet. App. A5) to Section 302 of the

Labor-Management Relations Act (LMRA), which, although it

generally prohibits payments from an employer to an employee

of a union, excepts from that ban payments made “to any * * *

employee of a labor organization, who is also an employee * * *

of such employer, as compensation for, or by reason of, his

service as an employee of such employer.” 29 U.S.C. 186(c)(1).

9

plining or discharging an employee for disloyalty.

The court emphasized, however, that if the disloyal

employee “is also a union member and proves that the

employer fired him for organizing activity, the

employer may not evade the Wright Line rule by

saying that [disloyal persons] are not ‘employees’; it

must prove that it would have fired [them] even if

[they] hadn’t been engaged in union-related activi-

ties.” Id. at AT.

Second, the court rejected petitioner’s claim that

the risk that an organizer might participate in a vote

on union representation constituted “a reason to deny

[him] the protection of the NLRA at the hiring

stage.” Pet. App. A7. The court observed that even if

the organizer qualified as an “employee” and was

hired, he may not be eligible to vote; “he could be

included in a bargaining unit only if found to share

the necessary community of interest with other

workers.” [bid.

Third, the court saw no conflict between according

“employee” status to a paid organizer who applied for

a job and the principle that nonemployee organizers

have only limited rights of access to employer

property for organizational purposes. See NLAB v.

Babcock & Wilcox Co., 351 U.S. 105 (1956); Lechmere,

Inc. v. NLRB, 112 S. Ct. 841 (1992). The court ac-

knowledged that the organizer’s “employment would

give him a better perch from which to propagandize,”

but pointed out that the same “would be true for any

% Saurlier in its opinion, the court noted that petitioner had

not swught to defend its refusal to hire Hendrix—which the

"“oeed found was motivated by his union activities—under the

¥': ght Line rule. Pet. App. A2; see also note 5, supra.

10

union zealot who got a job with [the employer].” Pet.

App. A7.

Accordingly, the court held that “the NLRB could

reasonably determine that Hendrix or anyone else

who is employed simultaneously by a union and a

company is an ‘employee’ under § 2(3) of the Act.”

Pet. App. A8. The court left “to another day the issue

of when employment ties to a union establish such a

risk of disloyalty that the (non-union) employer can

reject or dismiss the union employee on that ground.”

Ibid.

ARGUMENT

The court of appeals correctly upheld the Board’s

longstanding rule that a paid union organizer is an

“employee” within the meaning of Section 2(8) of the

Act, 29 U.S.C. 152(3), and is therefore protected

against discrimination because of his union activities

and affiliation. Because that principle has been

rejected by other courts, however, and because the

question is a recurring one in the administration of

the Act, we do not oppose this Court’s review of that

issue.'°

10 The third question presented by the petition is subsumed

within the issue of whether a paid union organizer is a

statutory “employee”; it simply recasts that issue in terms of

whether the treatment of a paid union organizer as an

employee (who is therefore protected against discrimination by

the employer) is consistent with the “policies underlying the

Act.” Pet. i. The second question presented, however, raises a

distinct issue: whether the perceived risks that a paid union

organizer would be disloyal to the employer may justify the

employer’s rejection of such a person’s job application on that

ground under Section 8(a)(3) and (1) of the Act. The court of

appeals correctly held, Pet. App. A8, that this case does not

11

1. Petitioner contends (Pet. 11-16, 19-21) that the

court of appeals erred in upholding the Board’s rule

that a paid union organizer is an “employee” within

the meaning of Section 2(3) of the Act, 29 U.S.C.

152(3). That contention is incorrect.

As this Court has often explained, Congress gave

the Board the “primary responsibility for developing

and applying national labor policy.” NLRB v. Curtin

Matheson Scientific, Inc., 494 U.S. 775, 786 (1990);

see, ¢.g., Beth Israel Hosp. v. NLRB, 437 U.S. 483, 500-

501 (1978); NLRB v. Erie Resistor Corp., 373 U.S. 221,

236 (1963). When the Act does not speak directly to an

issue, the Court accords “considerable deference” to

the Board’s interpretation and will uphold it if it is

“rational and consistent with the Act.” Curtin Math-

eson, 494 U.S. at 786-787; NLRB v. Food & Com-

mercial Workers, 484 U.S. 112, 123 (1987); Fall River

Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 42

(1987); see Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984). Under

those principles, the court of appeals correctly upheld

the Board’s rule in this case.

a. The statute does not specifically address the

application of the Act to paid union organizers who

apply for work with an employer, while retaining an

affiliation with the union and intending to engage in

organizational activity. The definition of “employee”

broadly includes “any employee,” 29 U.S.C. 152(3),

subject to six specific exclusions, see note 4, supra,

and there is no express exclusion for paid union

present that issue, see pp. 20-21, infra. We therefore do not

believe that review should be granted on the second question

presented.

12

organizers who apply for jobs with other employers.'!

This Court has indicated that common law principles

inform the interpretation of the term “employee”

unless Congress “clearly indicates otherwise.”

Nationwide Mutual Insurance Co. v. Darden, 112 S.

Ct. 1344, 1349 (1992) (construing ERISA; referring to

other statutes, including the National Labor

Relations Act). The common law, however, does not

impose a per se prohibition against dual employment.

As the court of appeals noted, “[uJnder common law

principles, ‘[a] person may be the servant of two

masters, not joint employers, at one time as to one

act, if the service to one does not involve abandonment

of the service to the other.’” Pet. App. A6, quoting

Restatement (Second) of Agency § 226 (1958), and

citing Kelley v. Southern Pac. Co., 419 U.S. 318, 324

(1974). Nothing in the text of the Act, therefore,

excludes paid union organizers applying for a job from

the class of “employees.”

b. The Board has determined, as an exercise of its

authority to interpret the Act’s provisions, that paid

union organizers do come within the scope of the term

“employee” under the Act. That position is of long

duration, see Oak Apparel, Inc., 218 N.L.R.B. 701

(1975), and has been adhered to consistently. In two

11 See Sure Tan, Inc. v. NLRB, 467 U.S. 883, 891 (1984) (the

“breadth of § 2(3)’s definition is striking; the Act squarely

applies to ‘any employee.’ The only limitations are specific

exemptions” in the statute). It is well established that an

applicant for work is considered to be an “employee” under the

Act, see Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941), and

is therefore entitled to the protection of the antidiscrimination

provisions of the Act.

13

recent decisions, the Board thoroughly reexamined

the issue and reaffirmed its view that the Section 2(3)

definition of “employee” covers paid union organizers.

Sunland Construction Co., 309 N.L.R.B. No. 180

(Dec. 16, 1992), pet. for review pending sub nom.

International Bhd. of Boilermakers v. NLRB, No. 92-

1667 (D.C. Cir., filed Dec. 30, 1992); Town & Country

Electric, Inc., 309 N.L.R.B. No. 181 (Dec. 16, 1992),

pet. for review pending, No. 92-3911 (8th Ciy., filed

Dec. 23, 1992).

As the Board explained in Sunland, affording the

Act’s protection to paid union organizers furthers the

policies of the Act. “The right to organize is at the

core of the purpose for which the statute was

enacted.” Sunland, slip op. 12; see American Hosp.

Ass’n v. NLRB, 111 S. Ct. 1539, 1541-1542 (1991). A

flat rule that an employer may reject an applicant

based on its hostility to that person’s desire to

organize the workforce is antithetical to that core

purpose. Sunland, slip op. 12.

The Board added that protecting paid union

organizers against discrimination based on their

union activity does not interfere with any legitimate

management right. Sunland, slip op. 12, citing

Phelps Dodge, 313 U.S. at 182. The Board noted that

the employer may prohibit any employee, including

paid organizers, from engaging in union activity

during working time, but “[o]utside work time, * * *

the organizer—like other workers—is free to solicit

for the union.” Jd. at 12-13, citing Republic Aviation

Corp. v. NLRB, 324 U.S. 793 (1945). The Board also

rejected the argument that its position could lead to

“unions packing bargaining units with their paid

14

functionaries.” Sunland, slip op. 13. Under Board

policy, “employee status is not synonymous with

voter eligibility,” and paid union organizers are

excluded from voting where they are “temporary

employees” or they do not share a community of

interests with fellow employees. Jbid. The Board

also reiterated that “employers may lawfully refuse

to hire individuals seeking temporary employment,

where the refusal is based on neutral hiring policies,

uniformly applied.” /d. at 13 n.33.

The Board further rejected the claim that

according employee status to paid union organizers is

incompatible with “the adversary relaticnship be-

tween employer and union.” Sunland, slip op. 13.

That argument assumes that “paid union organizers

will engage in union activities to the detriment of

work assigned by the employer or will embark on acts

inimical to the employer’s legitimate interests.” /d.

at 14. The Board explained, however, that:

The statute’s premise is at war with the idea that

loyalty to a union is incompatible with an

employee’s duty to the employer. The fact that

paid union organizers intend to organize the

employer’s workforce if hired establishes neither

their unwillingness nor their inability to perform

quality services for the employer.

Ibid. The Board emphasized that paid union organiz-

ers would be subject to the same disciplinary rules as

any other employee, and concluded that, absent

objective evidence, there was no reason for inferring

that, “if hired, paid union organizers will engage in

15

activities inimical to the employer’s operations.” Jd.

at 15.”

ce. In light of its careful weighing of the labor-

relations interests involved, the Board’s determina-

tion that paid union organizers are covered by Section

2(3) is certainly a rational one. It is also consistent

with the provisions of the Act. Contrary to peti-

tioner’s contention (Pet. 14-15), the Board’s rule in

this area does not conflict with NLRB v. Babcock &

Wilcox Co., 351 U.S. 105 (1956), and Lechmere, Inc. v.

NLRB, 112 S. Ct. 841 (1992). As the Board noted in

Sunland, those cases “address the lawful restric-

tions that employers can place on nonemployees” with

respect to access to private property; they do not

“interpret Section 2(3)” or suggest that property

rights can be used to justify invasion of otherwise-

protected activity by employees. Swnland, slip op. 14.

The court of appeals reached the same conclusion.

Pet. App. A7.

In sum, the court correctly deferred to the Board’s

rule that paid union organizers are Section 2(3)

employees. Two other circuits have upheld the

Board’s interpretation of the Act. Escada (USA),

12 The Board in Sunland went on to consider whether the

employer’s refusal to hire an organizer who applied for work

during a strike of the employer by his union violated Section

8(a)(3) and (1) of the Act. The Board held that, in the strike

setting, the refusal to hire was not unlawful discrimination.

Slip op. 16-17. Sunland thus illustrates that the Board’s

approach permits room for legitimate employer interests to

prevail against a discrimination claim by an union organizer

who applies for a job; petitioner’s approach, in contrast, would

resolve each and every case by denying the organizer

protection.

16

Inc. v. NLRB, 970 F.2d 898 (3d Cir. 1992), enforcing

mem. 304 N.L.R.B. No. 109 (Aug. 27, 1992); NLRB v.

Henlopen Mfg. Co., 599 F.2d 26, 30 (2d Cir. 1979)

(rejecting the claim that “ ‘a paid union infiltrator’ is

not a bona fide employee under the Act,” but denying

enforcement on substantial evidence grounds).

2. Petitioner contends (Pet. 8-11) that the court of

appeals’ decision conflicts with H.B. Zachry Co. v.

NLRB, 886 F.2d 70 (4th Cir. 1989), and NLRB v. Elias

Brothers Big Boy, Inc., 327 F.2d 421 (6th Cir. 1964).

Although those cases are factually distinguishable

from this one, we agree that the decisions rest on

irreconcilable principles, and create a conflict in this

field that warrants this Court’s review.

a. In Zachry, a paid union organizer applied for

work as a welder while intending to remain on the

union payroll and receive other benefits from the

union. The employer refused to hire him “because he

was a union organizer,” 886 F.2d at 72, and because he

was seeking employment in order to organize the

plant. The Board concluded that the employer had

committed an unfair labor practice, but the Fourth

Circuit denied enforcement. In rejecting “the reason-

ing of Oak Apparel[, 218 N.L.R.B. 701 (1975)] and its

progeny,” id. at 75, the court of appeals concluded that

a paid union organizer could not be considered a bona

fide “employee” for purposes of the Act because “[a]n

employee is a person who while on the job works

under the direction of a single employer,” and a paid

union organizer in effect works “for two different

employers at the same time and for the same working

hours.” Jd. at 73. Zachry also declared that to give

paid union organizers employee protection under the

17

Act would require the employer to subsidize and

permit use of its property to further a union’s

organizational efforts, contrary to Babcock & Wilcox,

supra. 886 F.2d at 74-75.

This case, of course, involves different facts than

Zachry.” Indeed, the Board’s opinion suggested that

those distinctions might have made a difference under

Zachry.'* The court of appeals, however, in enforcing

the Board’s order, put no weight on _ those

distinctions. Rather, the D.C. Circuit stated that

even if petitioner had “made out so powerful a case of

3 In Zachry, the Fourth Circuit stressed that the applicant

intended to remain “in the concurrent employment of another

employer,” viz., the union, and stated that its holding was a

“circumscribed” one, applicable to the situation in which the

“job applicant [would be] simultaneously paid and supervised by

another employer.” 886 F.2d at 75. Here, Hendrix would

have taken a leave of absence from the Union (while retaining

the position of “field organizer”); would not have been directed

by the Union during his working hours with petitioner; and

would not necessarily have resumed employment with the

Union at the conclusion of the organizing campaign. Pet. App.

All, A13.

‘4 The Board stated that it had reviewed Zachry and

determined to adhere to the position that paid union organizers

were “employees,” but it also noted “this case is factually

distinguishable from Zachry on points critical to the Fourth

Circuit’s determination that the paid union organizer there

should be excluded from the statutory definition of employee.”

Pet. App. Al2. The Board explained that “there is no affirm-

ative evidence that Hendrix planned to remain concurrently

employed, directed, or compensated by the Union for time

spent working for [petitioner],” and the facts therefore did not

raise the “same concerns about divided employment loyalties

and interests which underlay the Fourth Circuit’s conclusion in

Zachry.” Pet. App. A13.

18

| Hendrix’s] likely disloyalty” that the Board would

have been required to uphold a discharge for that

reason, Pet. App. A6, it would not have deprived

Hendrix of “employee” status under Section 2(3).

Pet. App. A7.

The D.C. Circuit’s disagreement with Zachry is

evident at every stage of analysis. While Zachry

stated that “the term ‘employee’ contemplates an

employee working under the direction of a single

employer,” 886 F.2d at 73, the D.C. Circuit concluded

the term “employer” can embrace dual employment.

Pet. App. A6. And, whereas Zachry believed that

extending “employee” status to an organizer would

conflict with Babcock & Wilcox, 886 F.2d at 74, the

D.C. Circuit saw “no conflict” between Babcock &

Wilcox and this case. Pet. App. A7. Finally, Zachry

expressed concern that a paid union organizer’s vote

might improperly tip the balance in favor of union

representation, 886 F.2d at 74-75, but the D.C. Circuit

recognized that the Board can address that concern in

defining the bargaining unit; it is not a basis to deny

coverage of the Act “at the hiring stage.” Pet. App.

A7. Accordingly, the analysis in Zachry cannot be

reconciled with the approach of the Board and the

rationale of the D.C. Circuit in this case.

b. In Elias Brothers, a union organizer was found

to have been employed by the union and to have sought

employment as a waitress for the purpose of organiz-

ing the employees; during her employment, the

waitress received $15 per week from the union. 327

F.2d at 423, 427. The Sixth Circuit stated that, on

those facts, the organizer “was not a bona fide

employee within the intent of § 2(3) of the Act” and

19

was therefore not entitled to protection against anti-

union discrimination in firing decisions. 327 F.2d at

427.'° The differences between Hendrix’s situation

and the organizer in Elias Brothers are differences of

degree rather than kind; both organizers retained (or

would have retained) affiliation with their unions, and

both sought the jobs because of their desire to engage

in organizing the employer’s workforce. Under Elias

Brothers, Hendrix would likely have been denied

“employee” status pursuant to the Act.

c. The discord in the circuits on this issue is likely

to persist absent this Court’s intervention. The

Board recently reexamined the issue in light of

Zachry, and made clear its rejection of that decision.

See Sunland, slip op. 11, 13-15; Town & Country,

supra. Moreover, while there are factual variations

in the decided cases, those variations do not undercut

the disagreement in the courts on the underlying

question whether paid union organizers qualify as

“employees.” Because the issue is a recurring one

that is important to the administration of the Act, we

do not oppose review of the question whether a paid

union organizer is an “employee” within the meaning

of Section 2(3) of the Act and thus entitled to the

Act’s protections.

3. Petitioner contends (Pet. 16-19) that, even if a

paid union organizer is an “employee,” an employer

'® The court of appeais also rested its decision on the ground

that the employee had left voluntarily, rather than being

discharged. The court concluded that the waitress so lacked

credibility that the court was justified in rejecting her

testimony and in finding that she had given notice to thc

employer. 327 F.2d at 427.

20

may nonetheless, without violating Section 8(a)(3) and

(1) of the Act, refuse to employ such an organizer on

the ground that his employment would entail too

great a risk of disloyalty. In our view, that issue is

not presented here."

The court of appeals sustained the Board’s finding

that petitioner rejected Hendrix’s application, not out

of concern that he would be a disloyal employee, but

simply because it was opposed to a union and union

efforts to organize its employees. The court of appeals

noted that under the Board’s Wright Line test, see

note 5, supra, petitioner could have defended its

refusal to hire Hendrix by showing that “it would

have rejected him without regard to those aspects of

his relation to the union that the Act protects (e.g.,

membership, protected union activities),” but it failed

to do so. Pet. App. A2. The court therefore left “to

another day the issue of when employment ties to a

union establish such a risk of disloyalty that the (non-

16 Petitioner’s contention is also incorrect. See Sunland, slip

op. 17 n.41 (“we would not permit an employer to presume

generally that paid organizers will be disloyal employees”). If

such a presumption were permissible, the logical next step

would be to allow an employer to presume that any committed

union member would be “disloyal.” A presumption “that

loyalty to a union is incompatible with an employee’s duty to

the employer,” however, is “at war” with the basic premise

underlying the Act. Jd. at 14. An employer must establish

particularized concerns of disloyalty to justify a refusal to hire.

“{S]eparable acts of insubordination, disobedience or disloyalty”

are not protected activity under the Act. NLRB v. Local 1229,

IBEW, 346 U.S. 464, 475 (1953) (handbills attacking employer's

product with no discernible relation to a labor dispute are

unprotected).

nn

21

union) employer can reject or dismiss the union

employee on that ground.” Jd. at A8.

This record, therefore, does not raise any issue

concerning whether an employer can justify its

refusal to hire an organizer because of concerns about

disloyalty. The only question presented respecting

petitioner’s motive for refusing to hire Hendrix is

whether substantial evidence supports the Board’s

finding that Hendrix was rejected solely because of

his union activities. That evidentiary issue does not

warrant further review. See Universal Camera

Corp. v. NLRB, 340 U.S. 474, 491 (1951).

22

CONCLUSION

The government does not oppose review of the

question whether a paid union organizer is an

“employee” within the meaning of Section 2(3) of the

National Labor Relations Act (Questions (1) and (3),

Pet i). As to second question presented, the petition

for a writ of certiorari should be denied.

WILLIAM C. BRYSON

Acting Solicitor General

JERRY M. HUNTER

General Counsel

YVONNE T. DIXON

Acting Deputy General Counsel

NICHOLAS E. KARATINOS

Deputy Associate General Counsel

NORTON J. COME

Deputy Associate General Counsel

LINDA SHER

Assistant General Counsel

National Labor Relations Board

JANUARY 1993