Tnt Logistics of North America, Inc. v. N.L.R.B., 04-1131.

• Decision Date: 24 June 2005
• Docket Number: No. 04-1200.,No. 04-1131.,04-1131.,04-1200.
• Citation: 413 F.3d 402
• Parties: TNT LOGISTICS OF NORTH AMERICA, INCORPORATED, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. National Labor Relations Board, Petitioner, v. TNT Logistics of North America, Incorporated, Respondent.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 402

413 F.3d 402

TNT LOGISTICS OF NORTH AMERICA, INCORPORATED, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

National Labor Relations Board, Petitioner, v. TNT Logistics of North America, Incorporated, Respondent.

No. 04-1131.

No. 04-1200.

United States Court of Appeals, Fourth Circuit.

Argued February 4, 2005.

Decided June 24, 2005.

ARGUED: James Michael Walters, Atlanta, Georgia, for TNT Logistics of North America, Incorporated. Elizabeth Ann Heaney, National Labor Relations Board, Washington, D.C., for the Board. ON BRIEF: Rhonda R. Wilcox, Fisher & Phillips, Atlanta, Georgia, for TNT Logistics of North America, Incorporated. Arthur F. Rosenfeld, General, John E. Higgins, Jr., Deputy General, John H. Ferguson, Associate General, Aileen A. Armstrong, Deputy Associate General, Julie B. Broido, Supervisory Attorney, National Labor Relations Board, Washington, D.C., for the Board.

Before WILKINSON and WILLIAMS, Circuit Judges, and Henry F. FLOYD, United States District Judge for the District of South Carolina, sitting by designation.

Enforcement granted in part and denied in part; remanded by published opinion. Judge Wilkinson wrote the opinion, in which Judge Williams and Judge Floyd joined.

OPINION

WILKINSON, Circuit Judge.

TNT is a company with a contract to provide delivery services for Home Depot. It discharged one of its drivers after he was involved in three successive mishaps causing property damage. Around the time of the third incident, the employee sent a letter to his supervisors indicating his intent to form a union with his co-workers. The NLRB found that the company committed unfair labor practices by firing the driver and by telling him that the company's contract with Home Depot disallowed unions.

We agree that it was unlawful for TNT to imply that unions were not permitted at one of its locations, but we disagree that TNT violated the NLRA by firing its driver. Given this employee's recent track record of carelessness, we think TNT sufficiently established that it had a legitimate business interest in the driver's termination. Therefore, enforcement of the Board's order will be granted in part and denied in part. We remand so the remedy may be adjusted in accordance with this decision.

I.

TNT Logistics of North America, Inc. ("TNT") is a transportation company that transacts business throughout the East Coast. It has a contract with several Home Depot stores in Florida to deliver merchandise to the stores' customers.

James Morgan was employed by TNT as a driver. From 1999 to 2001, Morgan worked in TNT's facility in New Castle, Pennsylvania. Drivers at that facility are represented by a union, and Morgan served on the negotiating team of that union while he was there. Morgan also had prior union experience. Before working for TNT, he was employed as a paid union organizer for the Teamsters Union in Youngstown, Ohio.

In the spring of 2001, for personal reasons, Morgan asked TNT to transfer him to one of the company's facilities in Florida. TNT accommodated Morgan's request, and found a job for him in its Cape Coral, Florida, location. The drivers at this location — which has an office inside a Home Depot store — were not represented by a union.

Approximately one year after being transferred to Florida, Morgan was involved in a string of accidents, each requiring TNT to compensate Home Depot for the resulting property damage. These three incidents all occurred within thirty days of each other.

The first mishap occurred on May 17, 2002, when eleven pallets of paving stones fell from Morgan's truck as he was driving on the highway. The loss totaled $924.80. Morgan claims that he was not disciplined for this incident, but admits that he was called in by his supervisor, Patrick Callahan, to discuss what took place. Although Callahan does not recall issuing Morgan a formal warning, he does remember discussing the incident with Morgan "at length" because "the nature of this accident was potentially very harmful" and "actually a pretty ugly ordeal."

The second mishap occurred just five days later. On May 22, 2002, Morgan left several bags of concrete outside at a customer's construction site. A rainfall ruined the concrete, forcing TNT to pay approximately $258 to cover the loss. Morgan says the customer authorized him to leave the concrete at the site, but TNT's company policy provides that any customer authorization of this sort must be written and endorsed with the customer's signature. Although once again Morgan's file contains no warning about this incident, Morgan admits to being called and questioned about it by Callahan. During that conversation, Callahan recalls specifically admonishing Morgan that "he was wrong" to leave the mortar mix unattended, but he does not remember formally announcing "this is a warning. You've got one more shot."

Finally, the third mishap occurred on the morning of June 14, 2002, when Morgan dropped a birdbath as he tried to load it onto his truck. The birdbath was worth $32. Morgan was not specifically disciplined for this incident, but he was contacted by a supervisor on that day to discuss it.

Around the same time of this third accident, TNT received a letter written by Morgan indicating his "intentions along with other TNT employees to form a union." The letter was dated Wednesday, June 12, 2002, and Morgan says he read it to a co-worker over a two-way radio around that time. Morgan mailed the letter to TNT supervisors on June 13, and he faxed the letter to them on the morning of June 14. TNT manager Allan Tishman says he learned of the birdbath incident on the morning of June 14, but he did not receive Morgan's letter until later that afternoon.

The next Monday, June 17, Tishman e-mailed TNT's labor and employment director, Jack Webb, the following message:

One of our drivers, James Morgan ... has had the following cargo claims in the last month. He was issued a verbal warning on 5-27 after the second incident, he had the third on Friday 6-14. Would this be sufficient for termination?

The message then detailed the three incidents described above. Webb responded by asking whether other drivers had been fired for similar occurrences. Apparently satisfied with Tishman's response, Webb recommended firing Morgan.

On June 18, 2002, Patrick Callahan asked to speak to Morgan. Morgan initially responded that he had a right to a lawyer during a disciplinary hearing, but eventually permitted the meeting to proceed. Morgan then threatened to file NLRB charges, explaining "I think this is about union activity." According to Morgan, Callahan responded by stating, "You know you can't have a union here because TNT has a contract with Home Depot that says that unions are disallowed in the operation and they would lose their contract." When Morgan asked how Callahan knew this, Callahan explained "I didn't read it verbatim but I know that's the policy that they have."

Callahan then walked Morgan to another supervisor's office where Morgan was handed a termination letter. The letter explained that Morgan was being discharged for "unsatisfactory job performance" as determined "[b]ased on the frequency and number of claims" he had been involved in.

Morgan brought unfair labor charges before the NLRB. An ALJ heard the case on April 7, 2003, and issued a decision on May 13, 2003. The ALJ found TNT to be in violation of the National Labor Relations Act ("NLRA" or "the Act"), but he made this decision "[n]otwithstanding [a] concern that Morgan's testimony may have exaggerated his union activity."

On November 28, 2003, the ALJ's decision was largely adopted by the NLRB, which concluded that TNT violated the Act in two different ways. First, it found TNT to be in violation of section 8(a)(1) of the Act for telling Morgan that unions were not allowed due to the company's contract with Home Depot. Second, it determined that TNT violated section 8(a)(1) and (3) of the Act for discharging Morgan because of his protected activities in support of a union. See 29 U.S.C. § 158(a) (2000).

The Board's order required that TNT offer Morgan reinstatement and make him whole for any lost earnings. It further ordered the company to "cease and desist from ... [t]elling employees that it is futile for them to select a union as their collective-bargaining representative," and it required that TNT post a notice to its employees informing them of their right to "[f]orm, join, or assist a union." TNT now appeals.

We review the Board's factual findings to determine if they are "supported by substantial evidence on the record considered as a whole." 29 U.S.C. § 160(e) (2000); Universal Camera Corp. v. NLRB, 340 U.S. 474, 487-88, 71 S.Ct. 456, 95 L.Ed. 456 (1951). See also Beth Israel Hosp. v. NLRB, 437 U.S. 483, 501, 98 S.Ct. 2463, 57 L.Ed.2d 370 (1978) (same standard used to review the application of law to facts). "It is not, of course, our job to review de novo the factual determinations of the Board. Still, substantial evidence review is an objective assessment of the sufficiency of the evidence." Dorsey Trailers, Inc. v. NLRB, 233 F.3d 831, 839 (4th Cir.2000) (internal citation omitted). Upon making this inquiry, we enforce one of the Board's holdings, but deny enforcement of the other.

II.

The Board concluded that TNT violated section 8(a)(1) of the NLRA which makes it illegal for employers "to interfere with, restrain, or coerce employees in the exercise of" their protected rights under the Act. 29 U.S.C. § 158(a)(1). It based this decision on the ALJ's uncontested finding that Supervisor Callahan told Morgan, "You know you can't have a union here because TNT has a contract with Home Depot that says that unions are disallowed in the operation and they would lose their contract." The ALJ found that since Callahan, a manager, worked in an office inside Home Depot, it is reasonable to assume he knew about the terms of TNT's contract with the store.

Callahan's...