N.L.R.B. v. General Telephone Directory Co.
| Decision Date | 22 August 1979 |
| Docket Number | No. 78-1218,78-1218 |
| Citation | 602 F.2d 912 |
| Parties | 102 L.R.R.M. (BNA) 2487, 86 Lab.Cas. P 11,526 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. GENERAL TELEPHONE DIRECTORY COMPANY, Respondent. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Lawrence Blatnik (argued), Elliott Moore (on brief), N. L. R. B., Washington, D. C., for petitioner.
Renato J. Della Rocca, Marina Del Rey, Cal., on brief, for respondent.
On Application to Review Enforcement of an Order of the National Labor Relations Board.
Before TRASK and WALLACE, Circuit Judges, and HOFFMAN, * District judge.
Petitioner seeks enforcement of an order of the National Labor Relations Board against respondent General Telephone Directory Company (hereafter the company or employer), a subsidiary of General Telephone and Electric Company engaged in the compilation and sale of telephone numbers and street address directories. 1
Prior to the commencement of a union organizational campaign by the International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 2139 (hereafter the union), the National Labor Relations Board found, in accordance with most of the factual findings of the administrative law judge (ALJ), that respondent company, through a number of its supervisors, advised the sales representatives of budgeted wage increases scheduled for January 1976.
On August 4, 1975, the union filed a petition for a certification election in a unit composed of specific employees of the company. 2 From this date until the election, held November 7, 1975 on a secret ballot, 3 further statements of an alleged violative nature, indicating the company's position with regard to the scheduled wage increases relative to the advent of unionization, were made by various general managers and district sales managers to their employees. The Board's order deals with occurrences during this period which it found to be violative of the National Labor Relations Act (Unfair Labor Practices; Unfair Labor Practice Affecting Commerce), 29 U.S.C. § 158(a)(1): 4
1. General Telephone Directory threatened to withhold a promised wage increase in the advent of union organization;
2. General Telephone Directory threatened loss of pay increases through a district sales manager, such threats being of a coercive nature. 5
The order requires the company to cease and desist from the unfair labor practices found and to conduct a second election among the employees in the appropriate unit, thereby setting aside the election of November 7, 1975.
We conclude, for the reasons set forth below, that the application of the Board for the enforcement of its order should be denied, and the election of November 7, 1975 should stand.
It is a well established rule that the predictions or opinions of an employer, reasonably based on fact, relative to the possible effects of unionization within its company, are not violative of the National Labor Relations Act. This Court, following the Supreme Court in NLRB v. Gissel Packing Co., 395 U.S. 575, 89 S.Ct. 1918, 23 L.Ed.2d 547 (1969), enumerated the rule most distinctly in NLRB v. Lenkurt Electric Co., 438 F.2d 1102, 1105 (1971):
It is well established law that an employer has the right to express an opinion or predictions of unfavorable consequences which he believes may result from unionization. Such predictions or opinions are not violations of the National Labor Relations Act if they have some reasonable basis in fact and provided that they are in fact predictions or opinions other than veiled threats on the part of the employer to visit retaliatory consequences upon the employees in the event that the union prevails.
The Court in Gissel made it clear that the employer's First Amendment right of free speech falls within § 8(c) of the Act, and is as important, if not more so, than that of the union seeking to represent the employee. The careful balancing of interests and motives supply the rationale for concluding whether there has been, in fact, a violation under the Act. Gissel allowed statements by the employer as to unionism or a particular union in any form "so long as the communications do not contain a 'threat of reprisal or force or promise of benefit,' " 395 U.S. at 618, 619, 89 S.Ct. at 1942.
The recent case before us of Free-Flow Packaging Corp. v. NLRB, 566 F.2d 1124, 1129 (9th Cir. 1978), has refined further the balancing technique and guides in determining the highly subjective character of an employer's statements:
(A) presumption of illegal motives adheres to wage increases granted prior to an election . . ., (but) the cases make it crystal clear that the vice involved in both the unlawful increase situation and the unlawful refusal to increase situation is that the employer has Changed the existing conditions of employment. It is this Change which is prohibited and which forms the basis of the unfair labor practice charge. (emphasis in original)
It is not the intent of the Act 6 that the statements of an employer constituting unfair labor practice be considered in a vacuum, NLRB v. Lenkurt Electric Co., supra, at 1107:
In determining whether an employer's communications constitute permissible argument or prohibited threats, the statements must be considered in the context of the factual background in which they were made, and in view of the totality of employer conduct.
Thus, prior to a determination of the violative nature of an employer's epithet, we must look not only to the motive of such statements, but also to the context in which they were made, and whether they have been made with a reasonable basis in fact.
Lenkurt defines context in terms of the company's prior policies toward, and background of, union or antiunion sentiment before the proposed union election. In Lenkurt, the absence of antiunion sentiment led this court to conclude that, in the context of a previously neutral stance by a company toward a union, vigorous campaigning in the form of "predictions of possible disadvantages which might arise from economic necessity or because of union demands or union policies," were not communications of a prohibited nature. Lenkurt Electric Co., supra, at 1107. Don The Beachcomber v. NLRB, 390 F.2d 344 (9th Cir. 1968); NLRB v. Sonora Sundry Sales, Inc., 399 F.2d 930 (9th Cir. 1968); NLRB v. TRW-Semiconductors, Inc., 385 F.2d 753 (9th Cir. 1967); NLRB v. Laars Engineers, Inc., 332 F.2d 664 (9th Cir. 1964).
As stated in Free-Flow Packaging, 566 F.2d at 1129:
The employer's dilemma, then, persists, save when the status quo the state of existing conditions of employment with respect to wage increases is clearly apparent and it can with assurance be said that grant or denial of a wage increase would constitute a change from those conditions. In a case where status quo is not clearly apparent, and accordingly the employer's dilemma persists, no inference of antiunion motive can be said to flow from an after-the-fact determination of what the status quo in fact was.
Status quo is, therefore, in the context of the management-union dichotomy, a question of economics, particularly when the alleged unfair labor practice consists of statements involving wages, benefits, protections, etc., which are the essence of union involvement in the labor force of this country.
It is within these guidelines of employer motive, "reasonable basis in fact," context and status quo that we must turn to the facts before us, as determined by the ALJ and the Board, and to glean what inferences may be so established as to support or reverse the latter's conclusions. 7
According to findings of the ALJ, the western regional general manager of General Telephone, Richard Fick, informed a group of the company's clerical employees at a meeting in Ventura that they would receive a wage increase in January of 1976. The ALJ, in comparing Fick's testimony with that of other company supervisors who had participated in alleged threatening or coercive communications to employees, concluded that the statements made by Fick at that time were a hedge, and indicia of the company's intent to renege on its commitment to grant pay increases. Petitioner argued, and the ALJ accepted, that specific phrases communicated by Fick were retaliatory, retributory, and threatening; although the ALJ found many of Fick's statements "close to the line," it was his conclusion, and that of the Board, that general manager Fick had violated § 8(a)(1) of the Act. 8
The Board relies on such phrases as: "wage increases would become a negotiable term;" the company would start with a "blank piece of paper;" and unionization would initiate "horse-trading," in support of its inferences of threats of retaliatory action by the company in the advent of a union victory in the election. Taken out of context, inferences would indeed be drawn that Fick intended to relay an omen of economic consequence should the employees vote for union representation. We disagree with the inference drawn therefrom by the ALJ and the Board. As this court views Fick's statements, and those discussed, Infra, we find the communications not only innocuous in light of the circumstances, but well within the employer's "protected speech" under § 8(c) of the Act.
Predictions of economic consequences by an employer as we found them in Lenkurt Electric Co. fell within the purview of the "context" or "status quo" guidelines and were not violative of the Act. The statement that a wage increase had been "budgeted", as is herein the case, is a term in our business oriented society understood, we feel, to be subject to the ebbs and flows of the financial market and the stability of the dollar at any given time. Inherent in any "budgeted" or "scheduled" wage increase, assuming it has not been contracted for or a promised increase, is the economic status quo at the time of the proposed increase, and any Change which may have occurred in the market from its proposal to the time...
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