939 F.2d 361 (6th Cir. 1991), 89-6407, Hyatt Corp. v. N.L.R.B.

Docket Nº:89-6407, 90-5697.
Citation:939 F.2d 361
Party Name:HYATT CORPORATION, Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner.
Case Date:July 22, 1991
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit

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939 F.2d 361 (6th Cir. 1991)

HYATT CORPORATION, Petitioner/Cross-Respondent,


NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner.

Nos. 89-6407, 90-5697.

United States Court of Appeals, Sixth Circuit

July 22, 1991

Argued Feb. 11, 1991.

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[Copyrighted Material Omitted]

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Roger K. Quillen (argued), Fisher & Phillips, Atlanta, Ga., for petitioner cross-respondent.

Aileen A. Armstrong, Deputy Associate Gen. Counsel, Peter Winkler, Charles P. Donnelly, Jr. (argued), David Seid, N.L.R.B., Office of the Gen. Counsel, Washington, D.C. and Gerald P. Fleischut, Director, N.L.R.B., Region 26, Memphis, Tenn., for respondent cross-petitioner.

Before NELSON and SUHRHEINRICH, Circuit Judges, and HACKETT, District Judge. [*]

HACKETT, District Judge.

Petitioner, Hyatt Corporation (Hyatt or Petitioner), seeks review and the National Labor Relations Board (NLRB or Board) seeks enforcement of the Board's decision and order finding the petitioner to have violated sections 8(a)(1), (3), (4), and (5) of the National Labor Relations Act (NLRA or the Act), 29 U.S.C. Secs. 158(a)(1), (3), (4), and (5), during and after the successful union campaign at the Hyatt Regency Hotel in Memphis, Tennessee. See, Hyatt Hotels Corp., 296 N.L.R.B. No. 36, 132 L.R.R.M. 1131 (August 25, 1989). We find, with one exception, that the decision and order of the Board is supported by substantial evidence and, accordingly, we affirm.


The Hyatt Regency Memphis has operated a hotel in Memphis, Tennessee, since September, 1975. Hyatt used "timesheets"

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to compute pay for its hourly employees. The employee handbook explained the procedure for these time records which were to be completed by employees on a daily basis. Employees were to enter the time they arrived for work, took a lunch break, or departed from work, and to sign their name next to each entry. Employees received a thirty-minute lunch break for which they were not paid. The actual practice and procedure for completing time

sheets varied somewhat by department, and between individuals, with some individuals making all entries at the end of the day while others made each entry separately. The handbook further provided that employees:

may not alter or falsify any control card or time sheet, nor pull another employee's control card, or knowingly allow another employee to pull your card or fill in your time on the sign in sheet. Violation of this rule will be cause for immediate disciplinary action.

Employees were inconsistently and infrequently disciplined for making incorrect entries on time sheets. The falsified time sheets were, in many instances, simply corrected by individual managers who did not initiate disciplinary action. Between 1975 and April, 1981, Hyatt had disciplined a total of eighteen employees for falsifying time records. Of this number, ten employees were fired for the initial violation, five others were discharged after having received prior warnings, one employee was suspended, and two were fired for other reasons after having received warnings for falsifying time records. Employees also routinely disregarded the rule and signed in and out for one another, often in the presence of supervisors. No employee had been disciplined for signing in or out for a fellow employee.

The employee handbook also reflected Hyatt's pre-1981 compensation policy. Prior to 1981, Hyatt usually reviewed wages in May and November coincidental with its semi-annual performance evaluations. Hyatt gave wage increases, if any, at its discretion. The factors taken into account were employee merit, the federal minimum wage, and a yearly survey of wages among its competitors, as well as the performance of the hotel. All hourly employees who had completed their probationary periods were considered for wage increases.

On April 1, 1981, the hotel's parent corporation published "Policy 302," a wage review and adjustment policy which instructed individual hotels to maintain, review, and update a written wage plan. The policy provided that the amount of a wage increase in each job classification during the first three years of service was to be based on longevity. Employees would automatically receive longevity increases, unless their performance was unsatisfactory. Hourly employees, whose work performance was superior, were to be given merit increases. In order to determine entry level wages, as well as the amount of the yearly longevity and any merit increases, the company was to rely upon the minimum wage and bi-annual surveys of competitor's rates. Policy 302 left to the discretion of local management the amount of any longevity differentials; the circumstances in which wage rates should be adjusted in response to surveys; and the method to be used in determining the amount and frequency of merit increases.

Hyatt did not develop or publish a written plan as required by Policy 302, but did take some action in compliance with the policy in mid-1981. In July, 1981, Hyatt gave out longevity differentials and raised starting rates based on its survey of area wages. Following the first wage survey, the company revised its entry level wage in July, 1981, and also implemented a "10 cent policy" for longevity increases. Under this policy, employees received a ten cent per hour increase at the end of their first year, an additional ten cents at the end of the second year and a final ten cent longevity increase at the end of their third year of service.

In July, 1981, the Highway and Local Motor Freight Employees Local Union 667 (Union), affiliated with the Teamsters, began an organizational campaign among Hyatt's employees. A Board representation hearing was conducted at which Ruthie

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Myles, a Hyatt employee, appeared on behalf of the union. An election was scheduled for September 9, 1981.

During the six months preceding the September election, Hyatt took no disciplinary action for violations of its timesheet rule. In fact, during that period, Hyatt's Executive Chef, Anthony Pologruto, regularly changed timesheets for employees when he compiled records from the timesheets. These changes included altering the employee's arrival or departure time and changing the timesheets to indicate that employees had taken a lunch break. Pologruto warned Ruthie Myles, however, that employees were "getting away with" a lot, and that things would change "if the union got in." During that same period, supervisor Greg Goosman changed employee John Scott's timesheet approximately 10-15 times without imposing any discipline. David Morgan, Hyatt's Assistant Chief Engineer, ignored incorrect sign-in times and instructed employee Scott Monson and other employees to falsify timesheets in order to minimize "headaches."

On July 24, 1981, Hyatt's General Manager Cody Plott held a general meeting for all employees at which he announced that he was "tearing up all employee warning notices," and that employees could come to him personally with problems because his door was always open. During the same month, Hyatt's Executive Housekeeper Bruce Nelker required eight to ten employees under his supervision to tell him how they felt about the union.

During the month of August, Hyatt's Director of Engineering Robert Poole twice interrogated employee Dion Mathis about his union sentiments. Poole also interrogated employee Linda Shirley about her union sentiments and told her "if [she] had a problem, feel free, [my] door is always open." Poole ordered Monson to remove a union button and told him that wearing a union belt buckle would get him "in trouble."

In September, 1981, immediately preceding the election, Nelker directed employees Linda Shirley and Carey Tucker to remove their union buttons. Reuben Criswell, Hyatt's Executive Sous Chef and a company supervisor, nominated employee Essie Butler for a raise and told her to "vote no" for the union. Criswell also told employee Mary Lott to "vote no" for the union and warned that once the union got in, employees would be "automatically fired" for eating while setting up lunch. Pologruto interrogated Ruthie Myles and told her that if the union came in, there would be a lot of changes and employees would lose benefits. Dannye Chapman, Hyatt's Assistant Director of Housing and a company supervisor, told employees Levy Harrison and Betty Lewis to vote for the union because "[i]t will make it easier for the company to kick [those employees] out the door."

During the union election held on September 9, 1981, Ruthie Myles and Linda Shirley acted as union observers. The union was certified as the employees' bargaining representative on November 27, 1981. Shortly after the election, Hyatt began strictly enforcing its timesheet rules. Scott Monson, an employee, was warned by his supervisor to be "real careful" and mark the actual time he started work because Director of Engineering Poole "was looking for mistakes." A few weeks after the election, Pologruto held a meeting with employees and announced that they could no longer sign in and out for each other.

A total of twelve employees were discharged for first-time violations of the timesheet rules in the seven months from September 11, 1981, to April 14, 1982. Among the discharged employees was Ruthie Myles, the employee who had requested that an election be certified, and Linda Shirley, who had distributed union literature and acted as a union observer at the election. Levy Harrison, a union supporter who had signed a union authorization card, became the first employee ever disciplined because someone else signed her out. She was also discharged.

Following union certification, Hyatt was advised by its attorneys not to grant any future wage increases pursuant to Policy 302. No wage surveys were conducted until the autumn of 1982, and no employee received an hourly wage increase after the

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union election in September, 1981....

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