647 F.3d 435 (2nd Cir. 2011), 10-3616-ag, Service Employees Intern. Union, Local 32BJ v. N.L.R.B.

Docket Nº:10-3616-ag.
Citation:647 F.3d 435
Opinion Judge:HALL, Circuit Judge:
Attorney:Andrew L. Strom, Office of the General Counsel, SEIU Local 32BJ, New York, NY, for Petitioner. Ronald Meisburg, General Counsel, John E. Higgins, Jr., Deputy General Counsel, John H. Ferguson, Associate General Counsel, Linda Dreeben, Deputy Associate General Counsel (Robert Englehart, Supervisor...
Judge Panel:Before: KEARSE, SACK, HALL, Circuit Judges.
Case Date:August 01, 2011
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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647 F.3d 435 (2nd Cir. 2011)




No. 10-3616-ag.

United States Court of Appeals, Second Circuit.

August 1, 2011

Submitted: April 26, 2011.

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Andrew L. Strom, Office of the General Counsel, SEIU Local 32BJ, New York, NY, for Petitioner.

Ronald Meisburg, General Counsel, John E. Higgins, Jr., Deputy General Counsel, John H. Ferguson, Associate General Counsel, Linda Dreeben, Deputy Associate General Counsel (Robert Englehart, Supervisory Attorney, David A. Fleischer, Senior Attorney, on the brief), National Labor Relations Board, Washington, D.C., for Respondent.

Alan B. Pearl, Alan B. Pearl & Associates, P.C., Syosset, NY, for Intervenor AM Property Holding Corp.

Marvin L. Weinberg, Fox Rothschild LLP, Philadelphia, PA, for Intervenor Planned Building Services, Inc.

Martin Gringer, Franklin, Gringer & Cohen, P.C., Garden City, NY, for Intervenor Servco Industries, Inc.

Before: KEARSE, SACK, HALL, Circuit Judges.

HALL, Circuit Judge:

Petitioner Service Employees International Union, Local 32BJ (" Local 32BJ" or the " Union" ) seeks review of three decisions of the National Labor Relations Board (" NLRB" or " Board" ) affirming in part and reversing in part the Administrative Law Judge's findings with respect to allegations that AM Property Holding

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Corporation (" AM" ) participated in a scheme with two successive cleaning contractors, Planned Building Services, Inc. (" PBS" ), and Servco Industries, Inc. (" Servco" ), to avoid a bargaining obligation with Local 32BJ after AM purchased a building located at 80 Maiden Lane in Manhattan, New York City. The Union argues on appeal that the NLRB erred by finding that: (1) AM was not a joint employer with either PBS or Servco; (2) the Board was precluded from determining whether PBS was individually a successor employer to Clean-Right, the in-house cleaning division of the former owner of 80 Maiden Lane, because the General Counsel had not litigated a violation based on that theory; and (3) Local 32BJ was not entitled to additional remedies. We conclude that the NLRB adequately addressed its own precedents in finding that AM was not a joint employer with PBS or Servco and that this finding was supported by substantial evidence. We further conclude that the Board did not err by refusing to grant Local 32BJ extraordinary remedies. We hold, however, that the Board misunderstood its authority to determine whether PBS was individually a successor employer of Clean-Right, and thus we remand so that the Board may reconsider this issue.


I. Factual Background

The material facts are not in dispute. In April 2000, AM closed on the purchase of an office building at 80 Maiden Lane (" 80 Maiden Lane" or the " Building" ) in Manhattan from The Witkoff Group (" Witkoff" ). At the time of the sale, cleaning services for the Building were provided by twelve employees of Clean-Right, an in-house cleaning division of Witkoff. Witkoff was a signatory to a collective bargaining agreement between the Realty Advisory Board on Labor Relations (of which Witkoff was a member) and Local 32BJ, under which Clean-Right's employees earned approximately $16.00 per hour. Immediately following the sale, AM entered into a contract with PBS for cleaning services, which provided that employees would receive wages and benefits specified in a " union collective agreement," under which wages were set at $7.00 and $7.50 per hour. Within a week following the sale, PBS entered into a collective bargaining agreement with the United Workers of America (" UWA" ) covering the service employees at 80 Maiden Lane and 75 Maiden Lane (a building across the street), the terms of which ran from May 1, 2000 to April 30, 2003.

When Clean-Right's employees appeared for work the day after AM took possession of the Building, they were told they no longer had jobs because PBS was bringing in its own work force. Several days later, a group of Clean-Right employees went to 80 Maiden Lane and gave their names, addresses, and phone numbers to Jack Constantine, an AM official, who told them that he would contact PBS and " see what we could do." Constantine admitted that he did not follow through with PBS.

At AM's request, the contract between it and PBS provided that PBS would retain " one night supervisor @ $10.00/hr., with single health coverage, holidays and sick days," adding that " [a]ny employee that is retained from [AM's] staff at [ AM's ] request who is receiving wages and/or benefits in excess of those contained with the wage rates structure and benefits within union collective agreement, shall continue to receive said rates differential and/or other benefits." This language was inserted by PBS based on AM's recommendation that it hire Dennis Henry for a " supervisory role" at the Building; Henry had previously

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been employed by AM as a night porter at 75 Maiden Lane, and was transferred to 80 Maiden Lane following its sale to AM.1 When Henry first reported for work at the Building, he was told that his duties consisted of preparing the supplies for the cleaning personnel and checking to make sure that their work was completed. This entailed distributing keys and cleaning supplies to employees at the start of a shift, preparing and signing employee time cards, and instructing employees to redo their work if it was not done properly. Although Henry was placed on PBS's payroll incident to his transfer to 80 Maiden Lane, he continued to complain to Paul Wasserman, an AM official, about his wages and benefits, and on at least one occasion, Wasserman contacted PBS and arranged for Henry to receive a wage increase. Based on Henry's repeated complaints, Wasserman transferred Henry back to the AM payroll in July 2000 but his duties at 80 Maiden Lane remained the same.

In July 2000, PBS sent a written offer of employment to Zoila Gonzalez, a former Clean-Right employee. When Gonzalez reported to work at the Building, she was met by Henry, who presented her with a work cart and a mop. Gonzalez protested that she had not previously been required to perform this type of heavy work, and when Henry insisted that she had to mop, Gonzalez claimed she had a medical condition that prevented her from mopping. Henry then told Gonzalez that he had to go to the building office to explain " what was happening." Gonzalez accompanied Henry and waited outside the office, and when Henry emerged a few minutes later, he explained that if Gonzalez refused to mop, she could not work. Gonzalez testified that she did not know to whom Henry had spoken.

In April 2001, all of the PBS employees at 80 Maiden Lane went on strike. On May 15, 2001, AM sent a letter to PBS terminating its services at the Building effective June 15, 2001, and on May 31, 2001, AM entered into a contract with Servco to provide cleaning services at 80 Maiden Lane. Under the terms of that contract, Servco agreed that AM's " present night supervisor [wa]s to remain as night supervisor and compensated by AM," a provision which, it is undisputed, referred to Henry. On June 14 (while the strike was ongoing, but before Servco took over cleaning operations for 80 Maiden Lane), several PBS workers entered the Building and asked Henry to assist them in obtaining jobs with the new company. Henry told them, however, that " they [i.e., Servco] don't want anyone from the strike." Two of the PBS employees then separately asked for job applications from Constantine, who explained that he could " not do anything" for them because they had " made trouble." A few days later, Constantine gave a similar response to several of the striking PBS employees who had returned to the Building and asked for job applications, stating that it was a " bad decision" that they went on strike, and that striking was " not the best choice."

As for the non-striking PBS employees, Henry instructed them to report to 80 Maiden Lane on June 15 because Servco might offer them employment. When the employees arrived, they were joined by a number of Servco employees who were also applying for positions, and together, they were addressed by Mark Giacoia, Servco's Sales Manager, who warned the employees that " nobody better not fucking

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talk to the union because if you do, you'll be fired on the spot." Giacoia also told the employees that their salary would be $6 per hour. Henry urged, however, that because the employees had previously been paid $7 per hour by PBS, it would only be fair to continue their salary at that rate. Giacoia indicated that he would consider Henry's suggestion. Ultimately, Servco's President decided to pay the employees $7 per hour, but did not consult Henry in making this decision. After Servco took over operations at 80 Maiden Lane, Henry recommended that it retain certain employees. Servco later interviewed those employees and made its own hiring decisions.

II. Procedural History

In 2000 and 2001, Local 32BJ filed a series of unfair labor practice charges against PBS, AM, and Servco. Among other charges, the Union alleged that PBS and AM, as joint employers, violated Sections 8(a)(1), (2), (3), and (5) of the National Labor Relations Act (the " Act" ), 29 U.S.C. § 158(a)(1), (2), (3), and (5), by discriminating against Building service employees previously represented by Local 32BJ at 80 Maiden Lane to avoid successorship bargaining obligations; AM violated Sections 8(a)(1) and (3) of the Act by terminating Building service workers employed at 80 Maiden Lane in retaliation for their union activity; and AM and Servco, as joint...

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