Contemporary Cars, Inc. v. Nat'l Labor Relations Bd.

• Decision Date: 26 February 2016
• Docket Number: Nos. 14–3723,15–1187.,s. 14–3723
• Parties: CONTEMPORARY CARS, INC. doing business as Mercedes–Benz of Orlando and AutoNation, Inc., single and joint employers, Petitioners/Cross–Respondents, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross–Petitioner, and International Association of Machinists and Aerospace Workers, Intervening–Respondent.
• Court: U.S. Court of Appeals — Seventh Circuit

814 F.3d 859

CONTEMPORARY CARS, INC. doing business as Mercedes–Benz of Orlando and AutoNation, Inc., single and joint employers, Petitioners/Cross–Respondents,

v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross–Petitioner,andInternational Association of Machinists and Aerospace Workers, Intervening–Respondent.

Nos. 14–3723

15–1187.

United States Court of Appeals, Seventh Circuit.

Argued Sept. 24, 2015.

Decided Feb. 26, 2016.

Steven M. Bernstein, Attorney, Fisher & Phillips LLP, Tampa, FL, for Petitioners/Cross–Respondents.

Rafael Aybar, National Labor Relations Board Office of the General Counsel, Tampa, FL, Linda Dreeben, Attorney, Julie B. Broido, Attorney, Gregory P. Lauro, Attorney, National Labor Relations Board Office of the General Counsel, Washington, DC, for Respondent/Cross–Petitioner.

William Hugh Haller, Attorney, International Association of Machinists & Aerospace Workers Legal Department, Upper Marlboro, MD, for Intervening–Respondent.

Before MANION, ROVNER, and HAMILTON, Circuit Judges.

HAMILTON

, Circuit Judge.

This case involves a car dealership and its parent company's efforts to frustrate their employees' rights to organize. An administrative law judge found that the petitioner-employers engaged in a series of unfair labor practices aimed at coercing their employees' choices in the run-up to a December 2008 union election and frustrating their employees' protected concerted activities after the election. The judge also found that petitioners fired an employee due to anti-union animus and after the election unlawfully made multiple changes to employees' working conditions without bargaining with the union. The National Labor Relations Board largely affirmed the judge's order. It adopted the judge's findings of fact and all but one conclusion of law, and it expanded one remedy the judge ordered.

The employers have petitioned for judicial review. The Board has cross-petitioned for enforcement of its order. Having reviewed the extensive record of the numerous charges in this case, we deny the employers' petition and enforce the Board's order in its entirety.¹

Specific issues are numerous. In Parts I and II, we lay out the factual and legal backgrounds relevant to this case. In Part III we review the findings that petitioners violated § 8(a)(1) of the National Labor Relations Act ("the Act") by interfering with their employees' rights to organize a union and to engage in concerted activity for mutual aid or protection. In Part IV we review the finding that petitioners violated § 8(a)(3) of the Act by firing an employee due to anti-union animus. Finally, in Part V we review the findings that petitioners violated § 8(a)(5) of the Act by failing to bargain with the union over changes they made to terms and conditions of employment.

I. Factual and Procedural Background

Petitioner Contemporary Cars, which we call the "dealership," does business as Mercedes–Benz of Orlando and sells and services cars in Maitland, Florida. Bob Berryhill, the dealership's general manager, is responsible for the dealership's overall operations. Petitioner AutoNation owns the dealership, as well as over 200 other dealerships throughout the United States.

This case focuses on the dealership's service department. The service department had thirty-seven technicians as of October 2008, although it has since shrunk to twenty-five. The dealership divided technicians into three teams, each supervised by a team leader. The dealership paid technicians by the job rather than by the hour: it assigned each service task a specific number of hours—a "book time"—and paid a technician for those hours regardless of how long the job actually took. Thus, if business in the service department was slow, technicians sat idle and took home less pay. A technician's "skill rating," a letter grade from D to A with "diagnostic" technician above A as the highest level, determined earnings per book hour.

Rumors of union organizing at the dealership had been circulating for years. In the summer of 2008, the International Association of Machinists began a campaign in earnest to organize the service technicians. Over the summer, the technicians talked among themselves and held off-site meetings. Technician Anthony Roberts emerged as one leader of this campaign, frequently talking to his fellow employees about the union. The union supporters kept their meetings relatively quiet. Higher levels of dealership management seem not to have known about the union effort, but team leader Andre Grobler must have known. On two occasions over the summer, Grobler commented to a technician that the technician must have been in a rush to get to a union meeting.

In late September 2008, general manager Bob Berryhill found out about the organizing drive. On September 25, he began calling service technicians into his office for individual meetings. During those meetings, Berryhill asked the technicians about the union activity. He also asked them if they had any problems with how things were run at the dealership. According to one technician, Berryhill said he was working on the problems the technician brought up.

On October 3, 2008, the union filed its representation petition. The Board's Regional Director held a hearing, approved the proposed bargaining unit, and an election was scheduled for December 16. The dealership sought review of this determination, and a two-member panel of the Board summarily denied the request.

In the weeks before the election, Berryhill and AutoNation vice president and assistant general counsel Brian Davis held group meetings and distributed literature to "educate" the technicians on the effects of having a union. At one of these meetings, Davis encouraged employees to call him if they had any concerns that management was not addressing. In the run-up to the election, Davis visited the dealership often. Shortly before the election, he approached one technician to ask how he felt about the union's chances. Team leader Grobler's interrogation of employees also continued. On December 9, one week before the election, general manager Berryhill held an unscheduled meeting on the service shop floor. He announced that the dealership was working on fixing problems the technicians had and that he was replacing two team leaders, Grobler and Oudit Manbahal, with new team leaders.

Like many businesses, the dealership encountered tough economic times in the second half of 2008. From October to November, the service department's gross profit dropped from $414,000 to $295,000. November 2008's profits were the worst the dealership's controller could recall. Sometime in 2008, AutoNation area manager Pete DeVita began talking with Berryhill about "right-sizing" the dealership. In October or November 2008, Berryhill began talking with other managers at the dealership about laying off technician Anthony Roberts, who was then playing a leading role in the union organizing. On December 8, 2008, about a week before the union election, the dealership laid off Roberts, though Roberts had a higher skill rating, more hours, and more seniority than many other technicians. The dealership also laid off one tire technician and one alignment technician at that time.

Throughout the union campaign, one pro-management technician, James Weiss, reported to Berryhill regarding the union effort. The administrative law judge did not credit Weiss's testimony that he engaged in anti-union activity at management's request, but the judge did credit, and substantial evidence supports, that Weiss reported information to management whether management asked for it or not.

On December 16, 2008, the technicians voted in favor of unionizing, but as explained below, the dealership contested the result. The economic woes continued into 2009, and the service department's decline in business accelerated. In February, without attempting to bargain with the union, the dealership reduced the "book times" for some pre-paid maintenance jobs. According to the dealership, these were "technical corrections" because, previously unnoticed by the dealership, new pre-paid maintenance plans reduced the amount of work required for each job as compared to the prior plans. That spring, also without bargaining, the dealership temporarily suspended the technician skill level reviews it had used to determine rates of pay. Finally, again without bargaining, the dealership laid off four more service technicians in April 2009.

Litigation of the union election has reached the United States Courts of Appeals twice already. After the election, the dealership challenged the certification of the union as the exclusive representative of a bargaining unit consisting of service technicians. In 2009, a two-member panel of the Board affirmed the certification. Contemporary Cars, Inc., 354 NLRB No. 72 (2009)

. The dealership petitioned for judicial review. The D.C. Circuit held the appeal in abeyance pending the Supreme Court's decision on actions by two-member panels of the Board. In 2010, after the Supreme Court held that the Act requires the Board to decide cases with a minimum of three members, New Process Steel, L.P. v. NLRB, 560 U.S. 674, 676, 130 S.Ct. 2635, 177 L.Ed.2d 162 (2010), a three-member panel of the Board set aside the 2009 two-member Board ruling. Six days later, the original two members plus a third issued a new order affirming the Regional Director's determination. Contemporary Cars, Inc., 355 NLRB 592 (2010). In 2012, the Eleventh Circuit enforced the 2010 Board order. NLRB v. Contemporary Cars, Inc., 667 F.3d 1364, 1373 (11th Cir.2012).

These unfair labor practice proceedings began in 2010 when the Board's general counsel filed a complaint alleging that the dealership and AutoNation had violated sections 8(a)(1), (3), and (5) of the National Labor Relations Act. 29 U.S.C. § 158(a)(1), (3), (5)

. In 2011, an administrative law judge found after an evidentiary hearing that the dealership and AutoNation had indeed violated the Act...