Nabors Alaska Drilling, Inc. v. National Labor Relations Board
Docket: Nos. 98-70548, 98-70550, 98-70821 and 99-70247
Court: Court of Appeals for the Ninth Circuit; September 7, 1999; Federal Appellate Court
Nabors Alaska Drilling, Inc. is seeking judicial review of two final orders from the National Labor Relations Board (NLRB), which has simultaneously filed for enforcement of these orders. The NLRB found that Nabors engaged in unfair labor practices by denying non-employee organizers access to jobsites during an election campaign, violating Section 8(a)(1) of the National Labor Relations Act. As a result, the Board ordered Nabors to allow union organizers access and to post a compliance notice. In a separate case, the Board determined that Nabors violated Sections 8(a)(1) and 8(a)(3) by wrongfully terminating two employees due to anti-union sentiment, ordering their reinstatement with back pay and a notice regarding the order. The court has jurisdiction under 29 U.S.C. 160(e) and (f) and agrees with the NLRB on most issues but disputes the remedy in the discharge case. Nabors operates various offshore and onshore drilling sites in Alaska, where the Alaska State District Council of Laborers sought to organize approximately 290 employees. Despite the union's efforts, including meetings at the Anchorage Airport and distributing literature, the union lost the representational election. The union gathered 143 signed authorization cards, representing about 49% of eligible voters, prior to filing a petition to represent the employees on September 1, 1995.
On October 2nd, Nabors provided the Union with a list of addresses and phone numbers for potential bargaining-unit members, which was later revised due to inaccuracies. The Union's outreach resulted in contact with 50 to 70 potential members, with one pro-union employee reaching out to about 75 at the jobsite. The Union ceased airport meetings because a policy change made it difficult to reserve meeting space. They opted not to use newspaper or television ads due to cost concerns and limited reach to Nabors' employees, who lacked telephones in their accommodations. On September 21, 1995, the Union sought access to Nabors' job sites for organizing, but Nabors denied this request on October 2nd. The Union filed an unfair labor practice charge on October 4th but chose to proceed with the election.
Following the Union's loss in the election, Nabors terminated employees Ronald Pearson, Frank Anderson, and Steve Couture. Nabors did not contest the Board's finding that Pearson was discharged due to union activity, violating 8(a)(1) and 8(a)(3). They argued that Anderson and Couture were terminated for smoking marijuana at work. On February 10, 1996, Brian Buzby, a high-level supervisor, terminated both employees after allegedly smelling marijuana smoke in Couture’s office. Buzby claimed he independently decided to terminate them, although his and the personnel manager's testimonies indicated prior discussions about the decision. Anderson, believing he was being terminated for socializing rather than for marijuana use, expressed confusion about the basis of his termination. Couture also sought clarification during his termination meeting, and the Administrative Law Judge credited Couture's account of the interaction.
Couture believed he was discharged for socializing with Anderson during work hours and was not surprised by the termination due to his previous involvement with the Union. Buzby called both employees to his office, accompanied by Martin, to inform them of their termination as instructed by Wilson. Martin testified that Buzby indicated they knew the reason for their dismissal but did not respond when asked. Buzby offered them the option to take a urinalysis test to potentially return to work, although he later claimed he did not say this. Both Couture and Anderson corroborated Martin's account. Couture tested positive for marijuana, while Anderson's test was inconclusive due to dilution. Nabors' expert confirmed both failed the tests, and before receiving these results, Anderson was told by Wilson that neither would be eligible for rehire. Following the terminations, Nabors tested all employees on Rig 27E, discovering two others had tested positive but were rehired due to not being caught using drugs on the job. Couture and Anderson were specifically noted as the only employees caught using drugs since Wilson became personnel manager in 1985. Both were active Union supporters, and the Union filed multiple unfair labor practice charges against Nabors. An ALJ found Nabors' refusal to grant access to Union representatives as an unfair labor practice, ordering Nabors to allow access and to post a notice of violations. In the discharge case, the ALJ determined Couture and Anderson were terminated due to their Union activities, affirming that this constituted an unfair labor practice under sections 8(a)(1) and 8(a)(3). The ALJ ordered their reinstatement with back pay and for Nabors to post a notice of the violations and intent to comply, which the Board affirmed.
Factual findings by the Board are reviewed under the substantial evidence standard, determining if a reasonable jury could reach the Board’s conclusion. Credibility findings are afforded special deference, and the NLRB’s reasonable interpretations of the National Labor Relations Act are also deferred to. Section 7 of the Act grants employees the right to self-organize and to be informed about the benefits of such organization, which can, in extreme cases, require employers to allow non-employee union organizers access to their property. This exception is applicable when employees are isolated from typical information flows, hindering communication through usual channels. The case of Alaska Barite Co. illustrates a scenario where union access was warranted due to the employees' isolation. Similarly, in Husky Oil N.P.R. Operations, the Board found an unfair labor practice when the employer denied union access despite employees having limited communication means. The current case is compared to Husky Oil, noting that while the union faced challenges in contacting employees at the airport, the evidence indicated more regular access to contact Nabors’ employees before their departure to the North Slope, although logistical difficulties remained in arranging meetings and identifying employees.
Nabors contends that the Supreme Court's decision in Lechmere invalidated the precedent set by Husky Oil. This assertion is refuted based on two key points: first, Husky Oil is grounded in the Alaska Barite case, which Lechmere expressly endorsed. Second, Nabors interprets the Lechmere ruling too narrowly, suggesting a union must prove it has no alternative means of communication with employees. Instead, the proper interpretation allows for access unless the union has "reasonably effective" means of communication. The Administrative Law Judge (ALJ) and the Board determined that the Union lacked such means, justifying the need for access to Nabors' job sites, a conclusion supported by substantial evidence.
Regarding discriminatory discharge, an employer violates labor laws if it terminates an employee due to union activity. The analysis follows the burden-shifting framework established in Wright Line, where the General Counsel must first demonstrate that anti-union discrimination influenced the termination. If successful, the burden shifts to the employer to present legitimate reasons for the discharge. An employer can still justify a termination based on facts discovered post-termination, but back-pay remedies are limited to the period before the employer identified the valid reason.
Nabors argues against the Board's finding of substantial evidence for anti-union animus, asserting that Buzby made the termination decisions without evidence of his anti-union stance. However, substantial evidence supports the Board's conclusion that Wilson, not Buzby, made the decision to terminate employees Anderson and Couture. Testimonies indicate Buzby offered reinstatement contingent on passing a drug test and consulted Wilson before the terminations. Wilson's involvement in an anti-union campaign and prior unfair labor practices reinforces the finding of anti-union animus related to the terminations.
Two employees, Anderson and Couture, were terminated for marijuana use but were not eligible for rehire, contrary to Nabors’ drug-testing policy, which differentiates between on-the-job drug use and positive test results. Substantial evidence supports the finding that their discharge violated sections 8(a)(1) and 8(a)(3) of the National Labor Relations Act. Although Nabors argued that the terminations were justified regardless of any pro-union activity, the Administrative Law Judge (ALJ) incorrectly deemed the drug test results irrelevant to the legality of the discharge. The results are pertinent for assessing whether Nabors had a legitimate reason for the terminations. The Board's remedy, which failed to consider these results, was deemed erroneous. On remand, the Board must reevaluate the remedy, allowing backpay for Anderson and Couture until Nabors identified a legitimate reason for their discharge based on the drug-testing policy, with rehire eligibility after 90 days from that identification. The court denied the petition for review in part and granted it in part, remanding the case for a re-determination of the remedy. The cross-petition for enforcement was granted in part and denied in part, also requiring remand.
Nabors is obligated to provide the Union with a complete list of names and addresses of all potential bargaining-unit members, as established by the Board in Excelsior Underwear. The relevance of Oakland Mall is questioned, as it pertains to an "attenuated Section 7 right" concerning communication with customers rather than direct bargaining issues. However, Nabors' interpretation of the Board’s ruling is deemed overstated. According to Nabors' policy, employees involved in an accident with suspected drug or alcohol use must undergo urinalysis screening as soon as practical. If drug or alcohol use is confirmed, the employee faces immediate suspension pending investigation. Additionally, any employee suspected of substance use based on observations may also be required to submit to urinalysis. A confirmed positive result leads to immediate suspension, removal from the jobsite, and termination after confirmation, with a 90-day rehire prohibition. The chain of custody for urine specimens must be maintained throughout the process.
