Custom Recovery, Div. of Keystone Resources, Inc. v. N.L.R.B., 77-2490

• Decision Date: 02 July 1979
• Docket Number: No. 77-2490,77-2490
• Parties: 101 L.R.R.M. (BNA) 2784, 86 Lab.Cas. P 11,387 CUSTOM RECOVERY, DIVISION OF KEYSTONE RESOURCES, INC., Petitioner Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent Cross-Petitioner.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1041

597 F.2d 1041

101 L.R.R.M. (BNA) 2784, 86 Lab.Cas. P 11,387

CUSTOM RECOVERY, DIVISION OF KEYSTONE RESOURCES, INC., Petitioner Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent Cross-Petitioner.

No. 77-2490.

United States Court of Appeals, Fifth Circuit.

July 2, 1979.

John M. Capron, Erle Phillips, Atlanta, Ga., for petitioner cross-respondent.

Elliott Moore, Deputy Assoc. Gen. Counsel, John H. Ferguson, Peter Winkler, Attys., N. L. R. B., Washington, D. C., for respondent cross-petitioner.

Petition for Review and Cross Application for Enforcement of An Order of the National Labor Relations Board.

Before RONEY, TJOFLAT and HILL, Circuit Judges.

TJOFLAT, Circuit Judge:

This case is before us pursuant to sections 10(e) and 10(f) of the National Labor Relations Act (the Act), 29 U.S.C. § 160(e), (f) (1976). ¹ We are called upon by the employer-petitioner, Custom Recovery, Division of Keystone Resources, Inc. (the Company), to set aside a decision of the National Labor Relations Board (the Board), 230 NLRB 247 (1977), finding that the Company had violated section 8(a)(1) of the Act ² by questioning an employee concerning his union activities and by threatening him with discharge should he continue solicitation on behalf of the union during working time. In addition, the Company seeks to have the Board's order of a second election set aside. Conversely, the Board cross-petitions for the enforcement of its orders. Since the Board's findings on the section 8(a)(1) violations are not supported by substantial evidence, we set aside the portions of the order involving the 8(a) (1) violations. However, we dismiss the appeal from the ordering of the new election due to our lack of jurisdiction.

I. Facts

The Company is engaged in the business of recycling nonferrous metals in Greensboro, Georgia. During the time immediately preceding the events at issue here, the Company received shipments of scrap metal for reprocessing from its sole customer, Western Electric. In October 1975, the Company was advised that Western Electric planned to build its own recycling plant and phase out its use of the Company. By December 1975, there was a twenty-five percent reduction of scrap deliveries to the Company; accordingly, it reduced its work force through layoffs and began looking for other business.

Almost simultaneously a union organization campaign began at the Company. On January 8, 1976, the United Steelworkers of America, AFL-CIO-CLC (the Union) filed a petition for a representation election. A campaign ensued that included six anti-union speeches given by general manager Joseph Humphress to assembled workers, as well as active union solicitation by company employees. A January 27, 1976, Board representation hearing resulted in the issuance of a direction of election. The ordered election was held on March 19, 1976; the Company won, 37 to 33. The Union then filed objections to the election, which were consolidated with identical allegations of section 8(a)(1) violations made by the Regional Director for a hearing before an administrative law judge. ³

The administrative law judge found that the Company had not illegally threatened the shutdown of the plant, the elimination of profit sharing and other fringe benefits, or the loss of work. 230 NLRB at 248-50, 252. He did find, however, that Humphress threatened employee Sidney Waller with discharge because of Waller's union solicitation during working hours. Applying the Daylin doctrine, ⁴ the administrative law judge ruled that the threatened discharge of Waller was a violation of section 8(a)(1) because the Company had no valid rule against solicitation and had not made an affirmative showing of impairment of production. Id. at 253. In addition, an unlawful interrogation was found to have occurred between foreman Richard Ellis and Waller, although no violation was found in conversations between four other Company supervisors and employees.

In consequence of these violations the Company was ordered (1) to stop interrogating employees concerning their union activities, (2) to refrain from threatening employees with discharge unless they refrained from solicitation on behalf of the Union, and (3) to post notice of protected employee rights. In addition, the judge recommended a new election for a bargaining representative.

The Company filed exceptions to the decision, and the Board designated a three-member panel to review the proceeding. The Board affirmed the findings, conclusions and rulings of the administrative law judge and ordered a new election. ⁵ Id. at 247. The Company then petitioned this court for review, challenging the findings of unfair labor practices based upon (1) the threatened discharge of Waller under the no-solicitation rule and (2) the alleged interrogation of Waller. We now turn to these issues.

II. Threatened Discharge of Waller

About a week after the representation hearing, Company general manager Humphress conducted a tour of the plant. Accompanied by production manager John Reese, Humphress stopped in Waller's work area. The Board's decision relates the following account of what ensued: ⁶Reese accompanied Humphress that day on a tour of the plant for safety reasons. Reese testified that before they left Waller's area, Humphress called over Waller and told him he had been informed by two other foremen and some employees that Waller was campaigning on company time and passing out cards. Waller did not respond and Humphress proceeded to tell him, "If I see anybody campaigning during working time or passing out cards during working time I am going to terminate them on the spot." Humphress told Waller that he did not care what they did on breaks and lunch because that was their own time. In his testimony, Humphress said people had reported to him that Waller was leaving his area and going over the plant attempting to talk to groups of people and get them to sign cards, and that this was within the first 10 days of February after the hearing before the Board. On that day he saw Waller, called him aside, and told him it had been reported that he had been campaigning for the Union and that this was strictly illegal during company time. During that time he should be working. He told Waller that during lunch hour or break time it was his own business, but during hours that he was supposed to be working they expected him to do just that. Finally, Humphress said he told Waller that anyone found campaigning for the Union during working time would be terminated on the spot.

230 NLRB at 253. From this testimony the Board concluded that the Company was guilty of a section 8(a)(1) violation because there was no evidence of the Company having previously promulgated or enforced any no-solicitation rule and Humphress's hearsay references to reports as to Waller's worktime solicitation were insufficient to show an actual impairment of production. This finding is based upon an application of the Board's Daylin doctrine.

In its petition for review, the Company asks us to overturn the Board's application of the Daylin doctrine to employer no-solicitation rules. The Board defends its Daylin doctrine as an appropriate allocation of the burden of proof pursuant to its duty and authority to balance employee organizational rights against employer property rights. We need not and do not rule on the propriety of the Daylin doctrine however. Daylin dealt with the Discharge of employees for violating an overbroad no-solicitation rule. 198 NLRB at 285-86. There, the Board ruled that

if an employee is discharged for soliciting in violation of an unlawful rule, the discharge also is unlawful unless the employer can establish that the solicitation interfered with the employees' own work or that of other employees, and that this rather than violation of the rule was the reason for the discharge.

Id. at 281. Here, no discharge has occurred. Humphress's warning to Waller enunciated the Company's position that union solicitation was not to take place during working time, although such solicitation could occur during an employee's non-working time. Such a rule is not incompatible with the appropriate balance between the employer's rights in maintaining production and the employees' organizational rights.

"The Act, of course, Does not prevent an employer from making and enforcing reasonable rules covering the conduct of employees on working time. Working time is for work. It is therefore within the province of an employer to promulgate and enforce a rule prohibiting union solicitation during working hours. Such a rule must be presumed to be valid in the absence of evidence that it was adopted for a discriminatory purpose. It is no less true that time outside working hours, whether before or after work, or during luncheon or rest periods, is an employee's time to use as he wishes without unreasonable restraint, although the employee is on company property. It is therefore not within the province of an employer to promulgate and enforce a rule prohibiting union solicitation by an employee outside of working hours, although on company property. Such a rule must be presumed to be an unreasonable impediment to self-organization and therefore discriminatory in the absence of evidence that special circumstances make the rule necessary in order to maintain production or discipline."

Republic Aviation Corp. v. NLRB, 324 U.S. 793, 803, 65 S.Ct. 982, 988 n.10, 89 L.Ed. 1372 (1945) (quoting Peyton Packing Co., 49 NLRB 828, 843-44 (1943)) (emphasis added). This case does not present the situation requiring the Company to make an affirmative showing of impairment of production. ⁷ Thus, the Board's application of its Daylin doctrine in this case was unwarranted, and its finding of a section 8(a)(1) violation is not supported by substantial evidence.

III. The Alleged Interrogation

The Board found that supervisor Ellis unlawfully interrogated Waller, relying upon the...