McKinney ex rel. National Labor Relations Board v. Southern Bakeries, LLC
Docket: Civil No. 4:14-cv-4037
Court: District Court, W.D. Arkansas; August 14, 2014; Federal District Court
A Petition for 10(j) Injunctive Relief has been filed by M. Kathleen McKinney, Regional Director of Region 15 of the National Labor Relations Board (NLRB), against Southern Bakeries, LLC, which has responded and filed additional replies. Southern Bakeries, a commercial bakery in Hope, Arkansas, acquired its facility from Myer’s Bakeries, Inc. in 2005 and recognized the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union, Local 111, as the collective bargaining agent for its employees. The most recent collective bargaining agreement lasted from February 8, 2010, to February 8, 2012, and allowed Union representatives access to the facility with prior notice.
Following a decertification petition filed by an employee on December 7, 2011, the Union alleged unfair labor practices against Southern Bakeries and attempted to block the decertification election. In response, the Union increased its visits to the bakery. The collective bargaining agreement stipulated that Union representatives must provide preferably twelve hours' notice before visiting and be accompanied by a company representative, with access limited to designated break areas unless otherwise preapproved.
Testimonies indicated that prior to the decertification petition, the Union had unrestricted access to meet employees, but conditions changed thereafter. On March 20, 2012, Union representative Cesar Calderon testified about new restrictions, including being directed to a cubicle in the break room and needing to inform management of which employees he wished to meet, indicating a shift in the relationship dynamics between the Union and Southern Bakeries.
Calderon resisted a new procedure imposed by Banks, seeking unrestricted access to meet with employees, which Banks denied, threatening police involvement. Following a brief meeting, Calderon left the facility and later faced an allegation of inappropriate behavior, which he denied. On March 23, 2012, Ledbetter issued a letter banning Calderon from the facility due to another employee complaint, pending an investigation. Calderon's access was reinstated after an informal Board settlement. On May 23, 2012, a second decertification petition was filed, leading to a scheduled election on February 7, 2013.
On January 8, 2013, Calderon met with Ledbetter and other management to discuss surveillance cameras installed in the break area without prior notice or negotiation with the Union, justified by theft complaints. Ledbetter proposed covering the cameras during Union visits. Subsequently, Ledbetter informed the Union that its visits might be violating the Collective Bargaining Agreement, establishing a requirement for prior notice of the visit's purpose and intended employees.
Southern Bakeries frequently denied Union access requests due to non-compliance with this policy. On January 17, 2013, the company circulated a memorandum warning employees about possible Union strikes, referencing a recent situation at Hostess that resulted in significant job losses. Ledbetter also addressed employees in several meetings throughout January and February 2013, discussing Union activities, strikes, and job security, warning that the Union's approach could mirror the Hostess situation, which led to the closure of numerous bakeries and loss of many jobs.
Meyer’s Bakeries serves as a cautionary example of the risks associated with union contracts leading to bankruptcy. Employees are urged to report any harassment or threats during the election campaign, regardless of their stance on the Union, as the company is committed to addressing such issues and protecting employee rights. Job security is emphasized as the primary concern in the upcoming vote, with a warning that the Union's continued representation could jeopardize jobs through potential boycotts. The company argues that unions may promise benefits but often result in lower wages and fewer resources for employees due to the costs associated with union negotiations and grievances.
In May and June 2013, employee John Hankins circulated a withdrawal petition, which gathered 132 signatures, representing a majority of the 199 employees in the bargaining unit, requesting the employer to withdraw recognition from the Union. After verifying the signatures, Ledbetter notified the Union on July 3, 2013, but subsequently denied the Union access to the facility and stopped dues check-offs. The Union rejected the withdrawal petition and sought access, which was also denied.
The National Labor Relations Board (NLRB) conducted an investigation and found reasonable cause to believe Southern Bakeries violated the National Labor Relations Act. Following a complaint filed by McKinney on August 20, 2013, a hearing took place in February 2014 regarding unfair labor practices. The administrative law judge (ALJ) later determined that Southern Bakeries had interfered with employees' rights, and their unfair labor practices affected the validity of the withdrawal petition.
Section 10(j) empowers the Board to seek temporary injunctive relief from a district court while an underlying case is resolved. In evaluating such requests, the Eighth Circuit mandates consideration of the Dataphase factors: 1) the likelihood of the movant's success on the merits; 2) the risk of irreparable harm to the movant; 3) the balance of harms between the movant and other parties; and 4) the public interest. The probability of success does not require a greater than fifty-percent likelihood; a less stringent standard applies in cases involving the Act. Courts typically defer to the Board’s enforcement decisions and the determinations of Administrative Law Judges (ALJs), viewing them favorably due to their expertise.
In this instance, McKinney claims she can demonstrate that Southern Bakeries engaged in unfair labor practices under Sections 8(a)(1) and 8(a)(5) of the Act. Section 8(a)(1) prohibits employers from interfering with employees' rights to organize and bargain collectively. McKinney alleges violations, including: i) interrogating employees and threatening reprisals; ii) threats of job loss and plant closures; iii) portraying unionization as futile; iv) promising benefits for opposing the Union; v) disparaging the Union; and vi) creating an impression of surveillance. The court will evaluate these allegations individually.
McKinney alleges that Southern Bakeries engaged in unlawful interrogation of employees and threatened unspecified reprisals related to union activities. Ledbetter’s statement during a formal speech indicated a desire to address harassment, but the ALJ determined it constituted an interrogation about union activities and suggested potential reprisals for reporting such activities. The Board's precedent requires evaluating the totality of circumstances, including the nature of questioning and potential coercion. Persistent union solicitation is protected under the Act, and thus Southern Bakeries’ efforts to solicit reports of harassment related to lawful union activity violated Section 8(a)(1). The Court agrees that Ledbetter’s remarks could be viewed as both an interrogation and a threat, particularly given his position and the context of the statement, reinforcing McKinney's likelihood of success on this claim.
Additionally, McKinney claims Southern Bakeries made threats regarding job loss and plant closure, while Southern Bakeries contends it merely expressed opinions about union strike plans. The Board assesses threats based on whether remarks could reasonably restrain or coerce employees, rather than on subjective reactions.
An employer may lawfully predict a plant closure due to unionization if it demonstrates that such closure is a probable outcome beyond its control, provided the statements are based on objective facts. Unsupported predictions of plant shutdowns following a union victory are deemed unlawfully coercive. An Administrative Law Judge (ALJ) found that Ledbetter's comments in January and February 2013 threatened employees with job loss and plant closure, particularly through comparisons between Southern Bakeries and Hostess. The Court agrees that Southern Bakeries’ repeated assertions that union representation could lead to job losses and plant closures, along with references to Hostess strike statistics, could reasonably restrain employees' rights.
McKinney claims Ledbetter's speeches depicted collective bargaining and unionization as futile. While Southern Bakeries argues that Ledbetter simply expressed general views, the ALJ concluded his statements implied that the union lacked power and that benefits were contingent on the employer's goodwill, which could be interpreted as threats of losing existing benefits. The Court finds that these remarks could lead employees to believe union representation would be ineffective.
Additionally, McKinney contends that Southern Bakeries violated Section 8(a)(1) by suggesting employees would receive raises if they voted against the union. Southern Bakeries maintains it informed employees of the pay differences between nonunion and unionized employees. However, making express or implied promises of benefits to induce a vote against the union constitutes a violation of Section 8(a)(1).
Conduct by Southern Bakeries is deemed coercive as it misleads employees into believing they can secure union-promised benefits independently. Statements made by Ledbetter during speeches suggested that ousting the Union would lead to raises, implying that an employer victory in the decertification election would enhance wages for employees. The Court determined that McKinney demonstrated a likelihood of success on the merits regarding this unfair labor practice.
Additionally, McKinney alleged that Southern Bakeries disparaged the Union through Ledbetter’s speeches and a posted memorandum, which the company denied, claiming lawful expression of opinion. The ALJ found that Southern Bakeries did disparage the Union, labeling their campaign statements as fraudulent while threatening plant closure. While mere disparagement is insufficient for a violation of Section 8(a)(1), repeated disparagement coupled with coercive threats constitutes a violation. The Court supported the ALJ's conclusion that Southern Bakeries' actions met this threshold, establishing another likelihood of success on the merits for McKinney.
Furthermore, McKinney argued that the installation of cameras in the break room created an unlawful impression of surveillance. Southern Bakeries claimed the cameras were for theft deterrence and covered during union meetings. However, the ALJ concluded that the cameras' placement during a decertification campaign in a central union meeting area could reasonably lead employees to believe their union activities were being monitored. This impression infringes on employees' rights to engage in union activities free from fear of retaliation, violating Section 8(a)(1). The Court found sufficient evidence to support a likelihood of success on the merits for this claim as well.
Section 8(a)(5) prohibits employers from refusing to bargain collectively with employee representatives, as outlined in 29 U.S.C. 158. McKinney claims that Southern Bakeries violated this provision in three ways:
1. **Surveillance Cameras**: Southern Bakeries installed cameras in the break room without bargaining with the Union. The Administrative Law Judge (ALJ) concurred with McKinney, noting that the Board has previously ruled that such installations, without Union negotiation, constitute a violation of Section 8(a)(5). The evidence shows that cameras were installed without prior discussion, indicating a likelihood of success for McKinney's claim.
2. **Union Access**: McKinney argues that Southern Bakeries unlawfully altered the Union's access to the facility during a decertification campaign. Historically, the Union enjoyed unrestricted access, but Southern Bakeries imposed new rules requiring the Union to disclose the purpose of visits and limited access to a small cubicle, rather than the break room. The ALJ concluded that changing this access without bargaining violated Section 8(a)(5), as past practices regarding Union access are considered terms of employment that cannot be modified unilaterally.
3. **Withdrawal of Recognition**: McKinney contends that Southern Bakeries improperly withdrew recognition of the Union due to violations of Section 8(a)(1) and Section 8(a)(5) that compromised the integrity of the withdrawal petition. Southern Bakeries counters that the relevant factors do not demonstrate a causal link. However, the law states that an employer cannot withdraw recognition from a union if it has engaged in unfair labor practices that could undermine union support.
Overall, McKinney has demonstrated a likelihood of success on the merits for each of the claims related to unfair labor practices under Section 8(a)(5).
To establish an unlawful withdrawal of union recognition due to unfair labor practices that do not involve a general refusal to bargain, a causal relationship between the practices and employee disaffection must be demonstrated. The Board evaluates this connection using factors such as the timing of the unfair practices in relation to the recognition withdrawal, the nature of the actions taken by the employer, their potential impact on employee sentiment towards the union, and the overall effect on employee morale and union membership.
In this case, McKinney has shown a likelihood of success regarding several unfair labor practices committed by Southern Bakeries, including threats of job losses and plant closures from March 2012 to February 2013, leading to a withdrawal petition by employees in June 2013. The ALJ found a causal link between these practices and the petition, noting extensive violations close in time to the decertification effort that fostered significant disaffection among employees.
Additionally, the Board must demonstrate that any delay in the adjudicatory process would hinder its ability to remedy these unfair practices, emphasizing harm to collective bargaining rather than to individual employees. McKinney argues that irreparable harm exists due to Southern Bakeries' illegal withdrawal of union recognition, which, without an interim bargaining order, would obstruct collective bargaining efforts. The Court agrees, citing that prolonged refusal to recognize the Union could diminish its ability to regain support if the Board ultimately rules against Southern Bakeries. Southern Bakeries challenges the claim of irreparable harm, citing a delay in the filing of the petition; however, McKinney maintains that this time was utilized for the Board's investigation and deliberation prior to filing.
A court has discretion regarding the timeliness of a petition, as established in Hubbel v. Patrish LLC, but is not mandated to consider it. Delays by the Director in initiating a Section 10(j) action typically do not affect the availability of injunctive relief, as noted in Paulsen v. Renaissance Equity Holdings, where a 14-month delay was deemed standard. In the current case, the Board took a little over eight months to file the petition, which the court determined did not undermine McKinney's assertion of irreparable harm, thereby favoring an injunction.
The court then evaluated the balance of harms, finding that Southern Bakeries' claim that the injunction would harm its employees by infringing on their choice to withdraw support from the Union was unsubstantiated. The court attributed any loss of support to potential unfair labor practices by Southern Bakeries rather than employee choice. The interim bargaining order would not compel Southern Bakeries to accept any terms from the Union but would require good faith bargaining.
Lastly, regarding public interest, the court concluded that Southern Bakeries' argument focused on protecting employees' will to withdraw support from the Union was not persuasive, especially in light of the unfair labor practices likely committed by the company. The court emphasized the strong public interest in collective bargaining as articulated by Congress, thus favoring the issuance of temporary relief.
In conclusion, after weighing the relevant factors, the court granted McKinney's Petition for an Injunction under Section 10(j), ordering Southern Bakeries to cease and desist various actions pending the resolution of multiple labor-related cases before the NLRB.
Southern Bakeries, LLC is accused of multiple unfair labor practices, including failing to recognize and bargain in good faith with the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union, Local 111 as the exclusive bargaining representative for unit employees. Additional allegations involve unilaterally changing employee wages and conditions, denying Union representatives access to company facilities consistent with past practices, interrogating employees about union activities, and threatening employees regarding their union involvement. Other claims include disparaging comments about the Union, creating the impression of surveillance over union activities, and various forms of interference with employees' Section 7 rights.
Pending final adjudication by the Board, the court has ordered Southern Bakeries, LLC to recognize and bargain with the Union, allow Union access to facilities, remove surveillance cameras from break rooms, and post the District Court’s Order in both English and Spanish at relevant locations. The company must also hold meetings to read the Order to employees, notify the Union in advance, and file a sworn affidavit detailing compliance within twenty days. The case remains under the court's jurisdiction, and upon Southern Bakeries' compliance and resolution of related matters, the petitioner is to seek dismissal of the proceedings within thirty days of the Board's decision. Additionally, McKinney has filed a motion regarding the Section 10(j) injunction petition, to which Southern Bakeries has not responded.
The Court has granted McKinney's Motion to Supplement the Record regarding her 10(j) petition and denied Southern Bakeries' Motion to Supplement with its Exceptions to the ALJ’s Decision. Southern Bakeries did not present testimony from the employee who made the accusation, and while it does not object to including the ALJ's decision, it seeks to inform the Court of perceived legal deficiencies in that decision. However, the Board’s Rules do not permit filing exceptions with the Court.
In her complaint, McKinney alleged violations of Section 8(a)(3) by Southern Bakeries, specifically involving the investigation of three union employees and the termination of Christopher Contreras. McKinney has since abandoned her claims regarding the three employees and does not seek injunctive relief for Contreras following the ALJ's determination of lawful discharge.
The Court will not consider various unfair labor practice allegations, including employee interrogation, threats, and disparagement of the Union, as McKinney did not provide briefing on these issues. Additionally, her claims of employee surveillance during meetings and unlawful refusal to deduct union dues were similarly dismissed due to lack of evidence and briefing. The ALJ had previously ruled on the validity of Southern Bakeries' cessation of dues deductions and noted credibility differences between testimonies regarding Union access. The Court also did not address the issue of altered Union property access or the withdrawal of recognition from the Union, as McKinney failed to provide necessary arguments.
