N.L.R.B. v. So-Lo Foods, Inc.

• Citation: 985 F.2d 123
• Decision Date: 25 January 1993
• Docket Number: SO-LO,No. 91-1892,91-1892
• Parties: 124 Lab.Cas. P 10,521 NATIONAL LABOR RELATIONS BOARD, Petitioner, v.FOODS, INC., Respondent.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

Page 123

985 F.2d 123

124 Lab.Cas. P 10,521

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. SO-LO FOODS, INC., Respondent.

No. 91-1892.

United States Court of Appeals, Fourth Circuit.

Argued June 1, 1992.

Decided Oct. 30, 1992.

As Amended Jan. 25, 1993.

David A. Fleischer, N.L.R.B., Washington, DC, argued (Jerry M. Hunter, General Counsel, D. Randall Frye, Acting Deputy General Counsel, Aileen A. Armstrong, Deputy Associate General Counsel, N.L.R.B., on brief), for petitioner.

Peter David Guattery, Joseph Kres Pokempner, Whiteford, Taylor & Preston, Baltimore Before WILLIAMS, Circuit Judge, BUTZNER, Senior Circuit Judge, and GARBIS, United States District Judge for the District of Maryland, sitting by designation.

MD, argued (Larry M. Wolf, on brief), for respondent.

OPINION

GARBIS, District Judge:

The National Labor Relations Board ("the Board") seeks enforcement of its Order directing So-Lo Foods, Inc. (trading as and commonly referred to as Valu Food) ("the Company") to cease and desist from the unfair labor practices the Board found to violate sections 8(a)(1) and 8(a)(5) of the Labor Management Relations Act, 29 U.S.C. §§ 158(a)(1) and 158(a)(5) ("the Act") and from in any other manner interfering with, restraining, or coercing its employees in the exercise of their statutory rights. The Board also found that the employees at the Havre de Grace store were an appropriate bargaining unit, that a majority of the unit employees had signed valid authorization cards designating the Union ¹ as their bargaining representative, that the Company's unfair labor practices made a fair election unlikely, and that misconduct by the Union did not justify withholding a bargaining order. Accordingly, the Board further ordered the Company to bargain with the Union at the Havre de Grace store.

The Board now seeks enforcement of its orders. The Company disagrees with the Board's findings, the imposition of a broad remedial cease and desist order, and the issuance of the bargaining order. Reviewing the Board's orders under section 10(e) of the Act, 29 U.S.C. § 160(e), we conclude that there was substantial evidence to support the Board's conclusions that the Company committed unfair labor practices and that the bargaining order is appropriate. Accordingly, we affirm the Board's findings and grant enforcement.

I.

In 1988, the Denrich family owned 13 supermarkets in Maryland and one in Pennsylvania. Louis Denrich is the aggressive President of the Company who is largely responsible for the growth of the Company from a corner grocery owned by Steve Denrich (Louis' father) to a chain which employs approximately 1,000 employees. Valu Food's managerial organization consists of chain-wide and local store management.

Previously, the Union had twice attempted to unionize the Company, but had withdrawn its effort before an election was held. The Board's findings that the Company violated the Act arose from the Union's 1988 attempt to unionize employees at three of the Company's stores. ²

The violations the Board found the Company had committed at the Havre de Grace store can be placed into the four broad categories of interrogation, surveillance, grants and promises of benefits, and threats of closure and other reprisals. At the Elkton store, the Company required its employees to fill out a questionnaire that the Board found resulted in the unlawful interrogation of employees and implicit promise to rectify their grievances, in violation of the Act. ³

The Board's findings are entitled to affirmance when supported by substantial evidence on the record as a whole. 29 U.S.C. § 160(e). The reviewing court is not to substitute its own judgment for that of the Board, even when it might have drawn a different conclusion had it decided the issue de novo. Owens-Corning Fiberglass Corp. v. NLRB, 407 F.2d 1357, 1360-61 (4th Cir.1969). We have considered the reasons advanced by the Company as to why the Board's findings are not supported by substantial evidence, and find them to be without merit. Because there is substantial evidence in the record as a whole to support each of the Board's findings, we affirm those findings and grant the Board its application for enforcement of its remedial order. ⁴

II.

The Company also challenges the Board's issuance of a bargaining order, requiring the Company to bargain with the Union at its Havre de Grace store. For the reasons discussed below, we find that a bargaining order is appropriate.

A.

In NLRB v. Gissel Packing Co., 395 U.S. 575, 610-16, 89 S.Ct. 1918, 1938-41, 23 L.Ed.2d 547 (1969), the Supreme Court upheld the Board's authority to issue a bargaining order when, after a union achieves an authorization card majority, an employer destroys that majority by engaging in unlawful conduct. The Board may only issue a bargaining order upon finding:

(1) that the Union once had a majority status, (2) that such status has been dissipated by pervasive misconduct on the part of the employer, (3) that the possibility of erasing the effects of [these] past [pervasive] practices and of ensuring a fair election [or a fair rerun] by the use of traditional remedies, though present, is slight, and (4) that employee sentiment once expressed through cards would, on balance, be better protected by a bargaining order.

NLRB v. Appletree Chevrolet, Inc., 608 F.2d 988, 996 (4th Cir.1979) (citations omitted). While "an election, not a bargaining order, remains the traditional, as well as preferred, method" for determining the employees' bargaining agent, id. at 996, the Board's "choice of remedy must ... be given special respect by reviewing courts" considering the Board's "fund of knowledge and expertise all its own." Gissel, 395 U.S. at 612 n. 32, 89 S.Ct. at 1939 n. 32.

Certain violations, commonly called "hallmark violations," are so coercive that their presence:

will support the issuance of a bargaining order unless some significant mitigating circumstance exists.... In such cases the seriousness of the conduct ... justifies a finding without extensive explication that it is likely to have a lasting inhibitive effect on a substantial percentage of the workforce.... [It] may reasonably be calculated to have a coercive effect on employees and to remain in their memories for a long period.

NLRB v. Jamaica Towing, Inc., 632 F.2d 208, 212-13 (2d Cir.1980); NLRB v. General Wood Preserving Co., 905 F.2d 803, 822-23 (4th Cir.), cert. denied, 498 U.S. 1016, 111 S.Ct. 590, 112 L.Ed.2d 595 (1990). Threat of plant closure is a hallmark violation. Jamaica Towing, 632 F.2d at 212 & n. 2, 213. Such threats, standing alone, may support a bargaining order. Gissel, 395 U.S. at 615, 89 S.Ct. at 1940-41. ⁵

In this case, the Company not only committed a hallmark violation by threatening plant closure, but also committed numerous and extensive other violations. The Board determined that the "lingering effects of [the Company's] unfair labor practices" rendered "the likelihood of conducting a fair second election in the foreseeable future so slight that, on balance, it is preferable to rely on the majority employee preference expressed through valid authorization cards." So-Lo Foods, Inc., 303 NLRB No. 116 n. 3 (July 19, 1991). The reasons why the Board reached this conclusion are easily ascertainable from the record, Impact Industries, Inc. v. NLRB, 847 F.2d 379, 383 (7th Cir.1988), providing us with sufficient basis to make an informed review of its decision. NLRB v. Maidsville Coal Co., 718 F.2d 658, 660-61 (4th Cir.1983) (en banc), cert. denied, 465 U.S. 1079, 104 S.Ct. 1441, 79 L.Ed.2d 761 (1984). The finding of numerous violations committed by the Company clearly supports the issuance of a bargaining order in this case.

B.

The Company suggests that the Havre de Grace store is not an appropriate bargaining unit, but rather that only a single, company-wide unit is appropriate for collective bargaining purposes. The Board denied the Company's attempt to present evidence to that effect because, prior to the Board election, the Company stipulated that the Havre de Grace store was an appropriate unit. The Company asserts that where a stipulation is in contravention of Board policy or statutory proscriptions, or where changed circumstances render the stipulation no longer appropriate, an employer cannot be bound to those stipulations in a subsequent unfair labor practice proceeding. NLRB v. KVP Sutherland Paper Co., 356 F.2d 671, 674 (6th Cir.1966).

A stipulation such as the one at issue is not in contravention of Board policy. The Board's policy is that a "single store in a retail chain ... is presumptively an appropriate unit for bargaining." Haag Drug Co., 169 NLRB 877, 877 (1968) (emphasis in original). The Board should permit rescission of a stipulation if "substantial changed circumstances mak[e] the performance under the stipulation unfair or inequitable." Methodist Home v. NLRB, 596 F.2d 1173, 1177 (4th Cir.1979). In this case, however, the Board determined that rescission would be improper after considering the fact that the Company was seeking to avoid the bargaining obligation created by its improper conduct on the basis of its own organizational changes. We agree. To decide otherwise would allow the Company to "nullify unfavorable elections simply by modifying the job responsibilities of a particular position." St. Anthony Hosp. Sys., Inc. v. NLRB, 884 F.2d 518, 524 (10th Cir.1989).

C.

The Company also contends that the authorization cards used by the Union do not suggest that the Union enjoyed the majority support of Havre de Grace employees because Union organizing leaflets distributed to the employees stated that the only purpose for signing the cards was to secure an election.

In Gissel, the Supreme Court found that where an authorization card unambiguously designates a union as the signer's bargaining representative, the card is valid "unless that language is deliberately and clearly canceled by a...