522 U.S. 359 (1998), 96-795, Allentown Mack Sales & Service Inc. v. NLRB

Docket Nº:Case No. 96-795
Citation:522 U.S. 359, 118 S.Ct. 818, 139 L.Ed.2d 797, 66 U.S.L.W. 4100
Party Name:ALLENTOWN MACK SALES & SERVICE, INC. v. NATIONAL LABOR RELATIONS BOARD
Case Date:January 26, 1998
Court:United States Supreme Court
 
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Page 359

522 U.S. 359 (1998)

118 S.Ct. 818, 139 L.Ed.2d 797, 66 U.S.L.W. 4100

ALLENTOWN MACK SALES & SERVICE, INC.

v.

NATIONAL LABOR RELATIONS BOARD

Case No. 96-795

United States Supreme Court

January 26, 1998

Argued October 15, 1997

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Mack Trucks, Inc., sold its Allentown, Pennsylvania, branch to petitioner Allentown Mack Sales & Service, Inc. Allentown thereafter operated as an independent dealership, employing 32 of the original 45 Mack employees. Although the Mack branch's service and parts employees had been represented by Local Lodge 724 of the machinists' union, a number of Mack employees suggested to the new owners, both before and immediately after the sale, that the union had lost their support or the support of bargaining-unit members generally. Allentown refused Local 724's request for recognition and for commencement of collective- bargaining negotiations, claiming a good-faith reasonable doubt as to the union's support; it later arranged an independent poll of the employees, who voted 19 to 13 against the union. The union then filed an unfair- labor-practice charge with the National Labor Relations Board. Under longstanding Board precedent, an employer who entertains a good-faith reasonable doubt whether a majority of its employees supports an incumbent union has three options: to request a formal, Board-supervised election, to withdraw recognition from the union and refuse to bargain, or to conduct an internal poll of employee support for the union. The Administrative Law Judge (AL J) held, inter alia, that because Allentown lacked an "objective reasonable doubt" about Local 724's majority status, the poll violated §§ 8(a)(1) and 8(a)(5) of the National Labor Relations Act. The Board agreed and ordered petitioner to recognize and bargain with the union. The Court of Appeals enforced the order.

Held:

The Board's "good-faith reasonable doubt" test for employer polling is facially rational and consistent with the Act, but its factual finding that Allentown lacked such a doubt is not supported by substantial evidence on the record as a whole. Pp. 363-380.

(a) This Court rejects Allentown's contention that, because the "good-faith reasonable doubt" standard for polls is the same as the standard for unilateral withdrawal of recognition and for employer initiation of a Board-supervised election, the Board irrationally permits employers to poll only when it would be unnecessary and legally pointless to do so. While the Board's adoption of this unitary standard is in some respects puzzling, it is not so irrational as to be "arbitrary [or] capricious"

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under the Administrative Procedure Act. Although it makes polling useless as a means of insulating withdrawal of recognition against an unfair-labor-practice charge, there are other reasons why an employer would wish to conduct a poll. Similarly, although the Board's avowed preference for Board-supervised elections over polls should logically produce a more rigorous standard for polling, there are other reasons why that standard ought to be less rigorous; since it would be rational to set the polling standard either higher or lower than the threshold for a Board-supervised election, it is not irrational for the Board to split the difference. Pp. 363-366.

(b) On the evidence presented, a reasonable jury could not have found that Allentown lacked a "good-faith reasonable doubt" about whether Local 724 enjoyed continuing employee support. The Board's contrary finding rests on a refusal to credit probative circumstantial evidence, and on evidentiary demands that go beyond the substantive standard the Board purports to apply. Accepting the Board's concession that Allentown did receive reliable information that 7 of the 32 bargaining- unit employees did not support the union, the remaining 25 would have had to support the union by a margin of 17 to 8—a ratio of more than 2 to 1—if the union commanded majority support. The statements of various employees proffered by Allentown would cause anyone to doubt that degree of support, and neither the Board nor the ALJ discussed any evidence that Allentown should have weighed on the other side. The Board cannot covertly transform its presumption of continuing majority support into a working assumption that all of a successor's employees support the union until proved otherwise. Pp. 366-371.

(c) This Court need not determine whether, as Allentown asserts, the Board has consistently rejected or discounted similarly probative evidence in prior cases. Such a practice could not cause "good-faith reasonable doubt" to mean something more than what the phrase connotes, or render irrelevant to the Board's decision any evidence that tends to establish the existence of a good-faith reasonable doubt. Pp. 372-380.

83 F.3d 1483, reversed and remanded.

Scalia, J., delivered the opinion for a unanimous Court with respect to Part I, the opinion of the Court with respect to Part II, in which Stevens, Souter, Ginsburg, and Breyer, JJ., joined, and the opinion of the Court with respect to Parts III and IV, in which Rehnquist, C. J., and O'Connor, Kennedy, and Thomas, JJ., joined. Rehnquist, C. J., filed an opinion concurring in part and dissenting in part, in which O'Connor, Kennedy, and Thomas, JJ., joined, post, p. 380. Breyer, J., filed an opinion concurring in part and dissenting in part, in which Stevens, Souter, and Ginsburg, JJ., joined, post, p. 388.

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Stephen D. Shawe argued the cause for petitioner. With him on the briefs were Earle K. Shawe and Eric Hemmendinger.

Jonathan E. Nuechterlein argued the cause for respondent. With him on the brief were Acting Solicitor General Dellinger, Deputy Solicitor General Wallace, Linda Sher, Norton J. Come, and John Emad Arbab. [*]

Justice Scalia delivered the opinion of the Court.

Under longstanding precedent of the National Labor Relations Board, an employer who believes that an incumbent union no longer enjoys the support of a majority of its employees has three options: to request a formal, Board- supervised election, to withdraw recognition from the union and refuse to bargain, or to conduct an internal poll of employee support for the union. The Board has held that the latter two are unfair labor practices unless the employer can show that it had a "good-faith reasonable doubt" about the union's majority support. We must decide whether the Board's standard for employer polling is rational and consistent with the National Labor Relations Act, and whether the Board's factual determinations in this case are supported by substantial evidence in the record.

I

Mack Trucks, Inc., had a factory branch in Allentown, Pennsylvania, whose service and parts employees were represented by Local Lodge 724 of the International Association

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of Machinists and Aerospace Workers, AFL-CIO (Local 724). Mack notified its Allentown managers in May 1990 that it intended to sell the branch, and several of those managers formed Allentown Mack Sales & Service, Inc., the petitioner here, which purchased the assets of the business on December 20, 1990, and began to operate it as an independent dealership. From December 21, 1990, to January 1, 1991, Allentown hired 32 of the original 45 Mack employees.

During the period before and immediately after the sale, a number of Mack employees made statements to the prospective owners of Allentown Mack Sales suggesting that the incumbent union had lost support among employees in the bargaining unit. In job interviews, eight employees made statements indicating, or at least arguably indicating, that they personally no longer supported the union. In addition, Ron Mohr, a member of the union's bargaining committee and shop steward for the Mack Trucks service department, told an Allentown manager that it was his feeling that the employees did not want a union, and that "with a new company, if a vote was taken, the Union would lose." 316 N. L. R. B. 1199, 1207 (1995). And Kermit Bloch, who worked for Mack Trucks as a mechanic on the night shift, told a manager that the entire night shift (then five or six employees) did not want the union.

On January 2, 1991, Local 724 asked Allentown Mack Sales to recognize it as the employees' collective-bargaining representative, and to begin negotiations for a contract. The new employer rejected that request by letter dated January 25, claiming a "good faith doubt as to support of the Union among the employees." Id., at 1205. The letter also announced that Allentown had "arranged for an independent poll by secret ballot of its hourly employees to be conducted under guidelines prescribed by the National Labor Relations Board." Ibid. The poll, supervised by a Roman Catholic priest, was conducted on February 8, 1991; the union lost 19

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to 13. Shortly thereafter, the union filed an unfair-labor- practice charge with the Board.

The Administrative Law Judge (ALJ) concluded that Allentown was a "successor" employer to Mack Trucks, Inc., and therefore inherited Mack's bargaining obligation and a presumption of continuing majority support for the union. Id., at 1203. The ALJ held that Allentown's poll was conducted in compliance with the procedural standards enunciated by the Board in Struksnes Constr. Co., 165 N. L. R. B. 1062 (1967), but that it violated §§ 8(a)(1) and 8(a)(5) of the National Labor Relations Act (Act), 49 Stat. 452, as amended, 29 U.S.C. §§ 158(a)(1) and 158(a)(5), because Allentown did not have an "objective reasonable doubt" about the majority status of the union. The Board adopted the ALJ's findings and agreed with his conclusion that Allentown "had not demonstrated that it harbored a reasonable doubt...

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