Gottfried v. Frankel

• Decision Date: 01 May 1987
• Docket Number: 86-1472,Nos. 86-1278,s. 86-1278
• Citation: 818 F.2d 485
• Parties: 125 L.R.R.M. (BNA) 2321, 55 USLW 2656, 106 Lab.Cas. P 12,378 Bernard GOTTFRIED, Regional Director of the Seventh Region of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner-Appellee, v. Samuel FRANKEL; et al., Respondents-Appellants.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 485

818 F.2d 485

125 L.R.R.M. (BNA) 2321, 55 USLW 2656,

106 Lab.Cas. P 12,378

Bernard GOTTFRIED, Regional Director of the Seventh Region of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner-Appellee, v. Samuel FRANKEL; et al., Respondents-Appellants.

Nos. 86-1278, 86-1472.

United States Court of Appeals Sixth Circuit.

Argued Feb. 17, 1987.

Decided May 1, 1987.

Arch Stokes, Atlanta, Ga., William K. Carmichael (argued), for respondent-appellant in No. 86-1278.

Amy Bachelder, Gen. Counsel, N.L.R.B., Detroit, Mich., Joseph E. Mayer, Asst. Gen. Counsel, John W. Hornbeck, Deputy Asst. Gen. Counsel, Ellen A. Farrell (argued), N.L.R.B., Office of the Gen'l. Counsel, Washington, D.C., for petitioner-appellee in No. 86-1278.

Amy Bachelder, Gen. Counsel, N.L.R.B., Detroit, Mich., Ellen A. Farrell (argued), Office of Gen. Counsel, N.L.R.B., Washington, D.C., for petitioner-appellee in No. 86-1472.

Arch Stokes, Jaffe, Snider, Raitt & Heuer, Atlanta, Ga., William K. Carmichael (argued), for respondent-appellant in No. 86-1472.

Before MARTIN and NELSON, Circuit Judges, and CONTIE, Senior Circuit Judge.

CONTIE, Senior Circuit Judge.

This petition for injunctive relief was filed pursuant to section 10(j) of the National Labor Relations Act (NLRA) and arises out of a series of unfair labor practice charges filed from April to September 1985 with the National Labor Relations Board (NLRB or Board) against appellants, owners and operators of Somerset Inn (hereinafter referred to collectively as Somerset). Once a complaint was filed, and after obtaining authorization from the Board, the Regional Director filed the instant petition in the United States District Court for the Eastern District of Michigan for and on behalf of the Board. The petition asserted that the Regional Director had reasonable cause to believe that unfair labor practices had occurred in violation of section 8(a)(1), (3) and (5) of the NLRA, 29 U.S.C. Sec. 158(a)(1), (3) and (5). Specifically, the petition alleged that Somerset had interfered with, restrained and coerced employees in the exercise of their section 7 rights, ¹ had discriminated against employees because of their union activities and had unilaterally instituted changes in work conditions without providing the union an opportunity to bargain. It was further asserted that, absent temporary injunctive relief pending the final outcome of Board proceedings, an effective remedy for these violations would not be obtainable. The district court granted the Board's request in all respects, and this appeal followed.

On appeal, Somerset asserts that the district court lacked jurisdiction over the subject matter and over Somerset personally, and that the district court abused its discretion in failing to hear oral testimony and in fashioning its order for injunctive relief. Somerset also appeals from the district court's denial of its motion to stay the injunction pending appeal.

For the reasons which follow, we modify the district court's judgment, and affirm the judgment as so modified.

I.

Somerset Inn is a hotel in Troy, Michigan which contains 250 guest rooms, two restaurants and several banquet rooms. The Frankel family has owned the hotel for a number of years, but only assumed the management of the hotel in 1983. Shortly thereafter, the Frankels hired Scott Frickman as the Director of Operations to oversee renovations and other changes instituted in the hopes of revitalizing the business.

Local 24 of the Hotel Employees and Restaurant Employees International Union (Union) is the recognized collective bargaining representative for the employees at Somerset, including employees in Somerset's many departments and subdepartments such as Housekeeping, Banquet, Food and Beverage, Front Desk and Reservations. The most recent collective bargaining agreement between Somerset and the Union expired on December 31, 1984. Negotiations for a successor contract extended from August or September 1984, to February 1985, at which time the parties reached an impasse. As a result of reaching an impasse, Somerset implemented its final offer on February 22, 1985 (hereinafter referred to as the Impasse Offer). It is not alleged that Somerset bargained in bad faith during those negotiations. Rather, the record reveals that both parties bargained vigorously, and in good faith, over terms believed to be vitally important; an agreement simply could not be reached. The Union does allege, however, that Somerset engaged in other activities designed to undermine union support.

Some of the most serious allegations relate to Somerset's treatment of two members of the Union's negotiating team: Carol Bronson, the Chief Steward, one of the most active union members and a server in the Banquet Department; and Sabrina Byrd, a union steward and a washer in the Laundry Department. With respect to Bronson, the Union alleged that the day after a tough negotiation session, Scott Frickman threatened to terminate or prosecute Bronson for fraud. The Union asserts that these threats were made because of Bronson's union activities. Second, in accordance with the Impasse Offer, Somerset implemented a new seniority system--where seniority was calculated based on continuous service within each job classification rather than with the employer--but allegedly did not implement it in every department. Bronson effectively lost at least ten years of seniority and the significant benefits attached thereto. Upon her request to be transferred back to Dining Room Service, where she had accumulated the majority of her seniority, she was informed that she had lost those years of seniority. Then, to supplement her income, Bronson accepted "pass down" assignments from other servers. Although banquet servers had previously been allowed to relinquish their work assignments, Frickman instructed the Banquet Manager to discontinue this practice after learning that Bronson's presence on the premises was directly attributable to this practice.

With regard to Sabrina Byrd, there are numerous allegations of harassment. For instance, it is alleged that the new position of Laundry Manager was primarily created to make it possible to conduct surveillance of Byrd's union activities. There is evidence that the Laundry Manager kept a diary of Byrd's activities and that Frickman wanted Byrd "out of the hotel." On more than one occasion, Frickman threatened to prosecute or fire Byrd for fraud; one such threat followed Byrd's announcement to run for steward of the Laundry Department. After becoming steward, Byrd received a disciplinary warning for conversing with the Union's business agent, and she was disciplined for failing to wear a nametag and for other minor infractions. Other similarly situated employees were not disciplined or did not receive warnings.

There are allegations that Somerset engaged in other antiunion activities as well. In April 1985, several employees decided to telephone the County Health Department to report the flooding of raw sewage in one of the kitchens. Stemming from this call, the health inspector issued a citation against Somerset. Subsequently, Somerset removed the two pay telephones reserved for employee use without first notifying the Union, allegedly in retaliation for contacting the Health Department.

On May 21, 1985, Union employees went on strike. They remained on strike until June 13, having accepted Somerset's unconditional offer to return to work. Numerous allegations of unfair labor practices arose out of Somerset's behavior immediately following the strike. It was alleged that returning strikers were required to attend lengthy orientation and training sessions, unlike their non-striking counterparts or the replacement workers who were retained. Further, all employees that had worked the first day of the strike were awarded a $100 cash bonus as part of the "Employee of the Month" award; in the past, this award was granted to only one individual, and consisted of $25 and a dinner for two at the hotel restaurant, valued at approximately $34. A picture of these employees was posted in the lobby, labelled "The Troops." In addition, Somerset unilaterally changed work rules, such as drinking, smoking and restroom privileges, without first informing the Union.

David Pardo, one of the strikers who was included in Somerset's unconditional offer to return to work, was not permitted to return but was replaced by a non-striker. Similarly, "on-call" maids Doris Littleton, Jean Vaughn, Kathy Johnson and Vickie Hardy, who had worked steadily in the weeks prior to the strike, had their hours drastically reduced since Somerset used strike replacements instead. Somerset also created two work schedules in each department subsequent to the strike: one for returning strikers, and one for non-strikers. Work was not assigned according to standard seniority since job assignments allegedly were made alternately between the two lists. As a result, Chief Steward Bronson, whose seniority had already been reduced because of the seniority changes previously implemented, was assigned virtually no work shifts. She was also informed to expect very few work assignments in the upcoming months. On July 5, 1985, Bronson resigned her position at the hotel to become business agent for the Union, stating that, because of the changes made in the work schedules, it was economically essential for her to seek full-time employment. It is alleged that she was constructively discharged by Somerset.

As previously noted, several unfair labor practice charges were filed with the Board during the course of these events. Following an investigation, the Regional Director issued a complaint against Somerset on June 27, 1985, and amended complaints on August 26 and October 11, 1985, alleging Somerset had violated section 8(a)(1), (3) and (5) of the NLRA, 29 U.S.C. Sec. 158(a)(1), (3) and (5). The instant petition...