Sam's Club, a Div. of Wal-Mart Stores, Inc. v. N.L.R.B.

Decision Date17 November 1998
Docket NumberWAL-MART,Nos. 97-2721,98-1085,AFL-CI,CL,I,s. 97-2721
Citation160 F.3d 191
Parties159 L.R.R.M. (BNA) 2833 SAM'S CLUB, A DIVISION OFSTORES, INCORPORATED, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, and United Food and Commercial Workers Union, Local 400,ntervenor-Respondent. NATIONAL LABOR RELATIONS BOARD, Petitioner, and United Food and Commercial Workers Union, Local 400,ntervenor, v. SAM'S CLUB, A DIVISION OFSTORES, INCORPORATED, Respondent.
CourtU.S. Court of Appeals — Fourth Circuit

ARGUED: Paul Michael Thompson, Hunton & Williams, Richmond, Virginia, for Petitioner. Jill Ann Griffin, National Labor Relations Board, Washington, D.C., for Respondent. George Wiszynski, Butsavage & Associates, P.C., Washington, D.C., for Intervenor. ON BRIEF: Michael P. Oates, Hunton & Williams, Richmond, Virginia, for Petitioner. Frederick L. Feinstein, General, Linda Sher, Associate General, Aileen A. Armstrong, Deputy Associate General, Fred L. Cornnell, Supervisory Attorney, National Labor Relations Board, Washington, D.C., for Respondent. Carey R. Butsavage, Butsavage & Associates, P.C., Washington, D.C., for Intervenor.

Before LUTTIG, WILLIAMS, and MICHAEL, Circuit Judges.

Petition for review granted and cross-application for enforcement granted in part by published opinion. Judge WILLIAMS wrote the majority opinion, in which Judge LUTTIG joined. Judge MICHAEL wrote a dissenting opinion.


WILLIAMS, Circuit Judge:

Sam's Club, a division of Wal-Mart Stores, Inc., (Sam's) petitions for review from the National Labor Relations Board's (the Board) final order determining that it had committed violations of §§ 8(a)(1)and (a)(3) of the National Labor Relations Act (the Act). See 29 U.S.C.A. § 158(a)(1) & (a)(3) (West 1973 & Supp.1998). The Board cross-petitions for enforcement of its order. For the reasons stated herein, we grant Sam's petition for review, grant the Board's cross-petition for enforcement in part and deny it in part.


This case involves a series of unfair labor practice charges arising out of Local 400, United Food and Commercial Workers Union's (the Union) attempt to organize the workers at Sam's in Landover Crossing, Maryland. The campaign culminated in an election held on July 8, 1994, during which the Sam's workers cast votes indicating whether they desired Union representation. 1 The factual discussion that follows is drawn from the ALJ's findings, the record, and the parties' briefs.

In January 1994, Sam's, a wholesale warehouse that sells goods at discount prices to fee-paying members, purchased a store that had been operating as a Pace Membership Warehouse (Pace). Sam's took over the store, retained 95% of the employees, and swiftly began to implement policies and procedures mandated by its parent company, Wal-Mart. Prior to Sam's purchase of Pace, the Union unsuccessfully had attempted to organize the workers at Pace. Several of the employees retained by Sam's harbored strong pro-union sentiment. As a result, after Sam's opened, the Union began organizing a new. 2 During the course of the Union's attempt to organize Sam's, three incidents relevant to this petition for review allegedly occurred.


As employees and management at Sam's were gearing up for the election, Union matters were a frequent topic of conversation. During one such conversation, in April 1994, a front-end employee, Danielle Porter, commented to the front-end supervisor, Debra Belt, while they were alone in an office that she hoped that the Union won the election. One of the women, either Porter or Belt, thereafter commented that Sam's would likely close the Landover store if the Union won the election, and the other woman agreed with that statement. It is not clear from the record which of the two women actually made the statement that she thought Sam's would close. The Union filed an unfair labor practice charge alleging that in this encounter Belt had threatened an employee by stating that the store would close if the Union won the election.


On March 30, 1994, Lawrence Perez, a member of the Union's organizing committee, asked his manager whether he could take his fifteen minute break. The manager told him to wait until another employee returned from break. Nevertheless, Perez immediately took his break. As a result, the manager issued a written warning for his insubordination. Subsequently, Perez refused to sign the warning form and claimed that he had done nothing wrong. Considering this refusal to sign the warning to be a further act of insubordination, the supervisor issued the next level of discipline, a "Day of Decision," a one-day suspension with pay during which Perez was instructed to think about what he had done wrong and return with a written plan of action on how to correct the behavior in the future. The Union filed an unfair labor practice charge asserting that Perez was unlawfully and discriminatorily suspended for supporting the Union.


During the course of the Union's election-related activities at Sam's, two special union representatives (SPURS), Tracie Burris and Terry Adgerson, were assigned to work at Sam's from late May 1994 through the election in July. Their purpose was to canvass the workers and speak to them about the benefits of unionization. Frequently, Burris and Adgerson would discuss Union matters in front of Sam's in the parking lot during shift change when the employees would be entering and exiting the store. Often, the operations manager, Stan Harris, would encounter the SPURS on his routine front-end safety checks. Harris would exchange friendly greetings with Burris and Adgerson while they were discussing the Union with employees, and according to the testimony of Burris and Adgerson, occasionally would comment that Wal-Mart was a powerful company that would not tolerate a union. No unfair labor practice charge was filed as a result of these encounters between the SPURS and Harris, however,the General Counsel litigated this charge before the ALJ.


As a result of the foregoing events, as well as others not relevant to this petition, the Union filed three charges, each listing numerous objections to election activity 3 and unfair labor practices. 4 As a result, complaints were issued, consolidated and heard before an ALJ for several days in the spring of 1995.

During the course of the hearing, the General Counsel discovered two witnesses of whom it previously had been unaware, the SPURS. Burris and Adgerson appeared at the hearing and presented testimony that Sam's operations manager, Harris, had on several occasions made threats that Wal-Mart would close the store if the Union were voted in. According to Burris and Adgerson, Harris's threats were made in direct response to conversations with several of Sam's front-end employees about the benefits of Union membership. The General Counsel, after presenting the SPURS' testimony, moved for an amendment to the complaint to incorporate unfair labor practice charges stemming from Harris's unlawful threats of store closing. The ALJ allowed the amendment over Sam's objection and allowed Sam's additional time to defend against the new allegation.

After the hearing, the ALJ issued an opinion in which it determined that Sam's had violated §§ 8(a)(1) and (a)(3) of the Act 5 when: (1) Belthad threatened Porter that if the Union were victorious in the election the store would close; (2) a manager had discriminatorily disciplined Perez; and (3) Harris had threatened several employees that if the Union were successful in its election bid, Sam's would shut down. 6 As a result of these findings, the ALJ ordered Sam's to cease and desist from its illegal acts, remove from its personnel files any reference to Perez's unlawful discipline, and post a notice in the Landover Sam's. Sam's appealed the ALJ's decision to the Board. With only minor modifications, the Board affirmed the ALJ's opinion in all respects and adopted the ALJ's proposed order. Thereafter, Sam's filed the instant petition for review. The Board cross-petitions for enforcement of its order. 7

Sam's petitions for review on several grounds. First, Sam's argues that the unfair labor practice findings relating to the actions of Belt and Perez are not supported by substantial evidence and should be overturned. Next, Sam's contends that the amendment of the complaint to incorporate a charge that Harris threatened employees violated § 10(b) of the Act. 29 U.S.C.A. § 160(b) (West 1973). Also, Sam's asserts that this amendment violated its right to fundamental fairness and due process. Further, Sam's asserts that if the amendment of the complaint was proper, the unfair labor practice finding stemming from the actions of Harris was not supported by the evidence presented at the hearing.

We reverse the Board's finding that Belt unlawfully threatened Porter because that conclusion is not supported by substantial evidence. Because the Board used faulty analysis in determining that Perez was the victim of anti-Union animus, and as a result the unfair labor practice finding is not supported by substantial evidence, we also reverse that unfair labor practice finding. Finally, because we agree with Sam's that the amendment of the complaint to include the charge that Harris threatened employees was improper, we reverse that unfair labor practice determination as well.


The Board's legal interpretations of the NLRA are entitled to deference. See Holly Farms Corp. v. NLRB, 517 U.S. 392, 116 S.Ct. 1396, 1406, 134 L.Ed.2d 593 (1996). If the Board's interpretations are "rational and consistent with the Act," they will be upheld by reviewing courts. Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 42, 107 S.Ct. 2225, 96 L.Ed.2d 22 (1987). When we review mixed questions, the Board's application of legitimate legal interpretations to the facts of a particular case should be upheld if they are...

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