Harborside Healthcare v. Nat'l Labor Rel., s. 99-6050

• Decision Date: 10 August 2000
• Docket Number: Nos. 99-6050,99-6250,s. 99-6050
• Parties: (6th Cir. 2000) Harborside Healthcare, Inc., Petitioner/Cross-Respondent, v. National Labor Relations Board, Respondent/Cross-Petitioner. Argued:
• Court: U.S. Court of Appeals — Sixth Circuit

Page 206

230 F.3d 206 (6th Cir. 2000)

Harborside Healthcare, Inc., Petitioner/Cross-Respondent, v. National Labor Relations Board, Respondent/Cross-Petitioner.

Nos. 99-6050, 99-6250

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

Argued: August 10, 2000

Decided and Filed: October 18, 2000

On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board. No. 8-CA-30592.

Lawrence B. Fine, Jennifer M. Calabrese, MORGAN, LEWIS & BOCKIUS LLP, Philadelphia, Pennsylvania, for Petitioner/Cross-Respondent.

Jeffrey Horowitz, Aileen A. Armstrong, Charles P. Donnelly, Jr., NATIONAL LABOR RELATIONS BOARD, APPELLATE COURT BRANCH, Washington, D.C., for Respondent.

Before: KRUPANSKY, WELLFORD, and BOGGS, Circuit Judges.

OPINION

HARRY W. WELLFORD, Circuit Judge.

Harborside Healthcare, Inc. ("Harborside") operates a 274-bed long-term care nursing home in Beachwood, Ohio. The Service Employees Union ("Union") petitioned the Regional Director of the National Labor Relations Board ("NLRB") seeking certification as the exclusive collective-bargaining representative of Harborside's service and maintenance employees at this facility, on August 5, 1998. One of Harborside's charge nurses, Robin Thomas, a licensed practical nurse ("LPN"), engaged in pro-union activity, as found by the hearing officer, even after being told that she held a supervisory position and must terminate her campaign efforts for the Union.

The Regional Director conducted a secret ballot election on October 1, 1998, which resulted in forty-nine votes in favor of union representation and thirty-six votes against. There were also two challenged ballots and one void ballot. A change of six votes (about seven percent of votes cast) would have brought about a different result. Harborside timely filed objections with the Regional Director who ordered a hearing on a portion of the first objections. Harborside now seeks review of the adverse decision of the hearing officer, as affirmed by the NLRB¹.

Thereafter, the Union requested bargaining, but Harborside refused. The Union then filed an unfair labor practice charge, and the General Counsel then filed a complaint alleging that Harborside violated 29 U.S.C. § 158(a)(5) and (1). Harborside answered, admitting its refusal to bargain but denying the validity of the Board's certification of the Union. Harborside then responded to the General Counsel's motion for summary judgment, which the NLRB granted on July 8, 1999, finding that Harborside violated § 158(a)(5) and (1) by refusing to bargain. Harborside filed the instant petition for review requesting reversal, while the NLRB filed a cross-application to enforce its July 8 order. This Court has jurisdiction pursuant to 29 U.S.C. § 160(e), (f)². We now REMAND the petition for review for the reasons stated.

I. DISCUSSION

Standard of Review

This court reviews the NLRB's "legal conclusions de novo and its factual findings under a substantial evidence standard." Kentucky River Community Care, Inc. v. NLRB, 193 F.3d 444, 449 (6th Cir. 1999), cert. granted, ___ U.S. ___, 121 S.Ct. 27, __ L.Ed.2d __ (Sept. 26, 2000). We review the Board's ultimate determination generally for abuse of discretion. See NLRB v. St. Francis Healthcare Ctr., 212 F.3d 945, 951-52, 963 (6th Cir. 2000); NLRB v. Kilgore Corp., 510 F.2d 1165, 1167 (6th Cir. 1975) ("This Court will set aside the Board's determination only if it has acted arbitrarily and abused its discretion.").

The Board's findings of fact are conclusive if supported by substantial evidence. Evidence is substantial when it is "'adequate, in a reasonable mind, to uphold the [Board's] decision.'" We must consider the record as a whole, including evidence that runs contrary to the Board's findings. Deference to the Board's factual findings is particularly appropriate where conflicting testimony requires the Board to make credibility determinations. The Board's application of law to facts is also reviewed under the substantial evidence standard, and "'the Board's reasonable inferences may not be displaced on review even though the court might justifiably have reached a different conclusion had the matter been before it de novo.'"

St. Francis Healthcare Ctr., 212 F.3d at 952 (quotations and citations omitted); see NLRB v. Main Street Terrace Care Ctr., 218 F.3d 531, 536-37 (6th Cir. 2000)³. "Courts . . . must respect the judgment of the agency empowered to apply the law 'to varying fact patterns,' even if the issue 'with nearly equal reason [might] be resolved one way rather than another.'" Holly Farms Corp. v. NLRB, 517 U.S. 392, 398-99 (1996), quoted in Grancare, Inc. v. NLRB, 137 F.3d 372, 377 (6th Cir. 1998) (Moore, J., concurring).

A party who seeks to overturn the results of a representation election bears the burden of demonstrating that the election was conducted unfairly. To meet this burden, "the objecting party must demonstrate that 'unlawful conduct occurred which interfered with employees' exercise of free choice to such an extent that it materially affected the result of the election.'" While the Board strives to achieve "laboratory conditions" during representation elections, we have recognized that this can be an elusive goal, and so "elections are not automatically voided whenever they fall short of perfection."

St. Francis Healthcare Ctr., 212 F.3d at 951 (quotations omitted). Harborside bears the burden of proving that the alleged campaign misconduct tended to prevent a fair election, contrary to the Board's determination.

Evergreen Healthcare, Inc. v. NLRB, 104 F.3d 867 (6th Cir. 1997), is the case most analogous to this dispute. Holly Farms, the Supreme Court case, involved a different situation: construction of regulations dealing with "agricultural labor employees." Holly Farms did not deal with supervisory status and whether supervisory actions during the election process on behalf of the Union preclude a fair election under NLRA.

Violation of rights by a supervisor

The NLRA gives employees "the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection." 29 U.S.C. § 157. The Act provides that an unfair labor practice includes an employer's interfering with, restraining, or coercing employees in the exercise of the rights guaranteed in § 157 or dominating or interfering with the formation or administration of any labor organization or contributing financial or other support to it. See 29 U.S.C. §158(a)(1), (2). The NLRA provides that the term "employee" "shall not include . . . any individual employed as a supervisor." 29 U.S.C. § 152(3). "The term 'supervisor' means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment." 29 U.S.C. § 152(11). In this case, the actions of a supervisor on behalf of the Union, rather than her employer, were the basis of controversy.

Harborside claimed that Robin Thomas was a supervisor within the meaning of § 152(11). The Hearing officer assumed her supervisory status in his opinion, and the Board does not dispute that finding. The Hearing officer and the NLRB, however may take into account the degree of her supervisory status. See Grancare, Inc. v. NLRB, 137 F.3d 372, 375 (6th Cir. 1998) ("The Board has the burden of proving that employees are not supervisors.").

Harborside contends that the hearing officer questioned important elements of the basis of Thomas' supervisory status and that the Board erred in relying on the Hearing officer's conclusions in this regard instead of making an independent determination. "In concluding whether substantial evidence supports the Board's decision, the court must consider the entire record. Evidence which the Board has ignored but is directly relevant cannot be disregarded." Id. (citation omitted).

Objectionable Conduct The participation of a supervisor in the campaign preceding a union election may undermine the employees' freedom of choice so much so that the election must be set aside. However, an election is not automatically invalidated when there has been pro-union activity by a supervisor. An election will be invalidated when the petitioner demonstrates that "the supervisor's conduct reasonably tended to have such a coercive effect on the employees that it was likely to impair their freedoms of choice in the election." The party challenging the election need not introduce proof of actual coercion.

Evergreen Healthcare, Inc. v. NLRB, 104 F.3d 867, 874 (6th Cir. 1997) (emphasis added, citations and quotation omitted). While the hearing officer and Board did not actually state that proof of actual coercion was required, Harborside contends that both erred by taking into account "that the conduct at issue 'did not have a coercive effect' and that there was no 'accompanying coercion.'"

To determine whether a supervisor's conduct reasonably tended to have such a coercive effect on the employees that it was likely to impair their freedoms of choice in the election, the Board and the circuit courts have considered the following two factors: (1) the degree of supervisory authority possessed by those who engaged in the pro-union activity; and (2) the extent, nature, and openness of the pro-union activity.

Evergreen, 104 F.3d at 874 (emphasis added).

Recently, the Board overturned a forty-three-year precedent and held that a union's use of a statutory supervisor as an election observer...