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National Labor Relations Board v. Staub Cleaners Inc.

decided: November 4, 1969.


Lumbard, Chief Judge, and Friendly and Kaufman, Circuit Judges. Lumbard, C.j. dissenting.

Author: Kaufman


Most issues on this review turn on whether the NLRB's determination that an election rumor was "neutralized" before the election took place, is supported by substantial evidence. If the rumor was not neutralized, then the Board's finding of unfair labor practices and its subsequent bargaining order must fail.

In 1963, Staub Cleaners, Inc., and Ben Barnet Cleaners, Inc. (the Company) refused to bargain with Local 39, Laundry and Dry Cleaners International Union, AFL-CIO, after the Union won the second of two representation elections. The NLRB subsequently held that the Company had committed unfair labor practices, among them a refusal to bargain (even after the Regional Director had issued a complaint), and a unilateral wage increase. The Board ordered the Company to bargain with the Union.This court, in 1966, reviewed that decision and upheld several unfair labor practice findings against the Company, but remanded to the NLRB for a hearing on whether or not a rumor that the Company would discharge all Negro employees if the Union lost, had invalidated the election. If the election were found invalid, the refusal to bargain charge, and its accompanying bargaining order would be without support. NLRB v. Staub Cleaners, Inc., 357 F.2d 1 (2d Cir. 1966).

As the facts were developed before the Trial Examiner, one Chester Thorpe, a Negro wool presser employed by the Company, told several people that he overheard some Royal Cleaners employees state that there was a rumor that Mr. Barnet, the Company's president, was going to "fire all the colored people" if the Union lost the election. Other employees repeated the rumor, and the Trial Examiner found that it had wide circulation before the election, and had so influenced employees that the election was invalid.

The Board, however, overruled the Trial Examiner, and held that acts and statements after the origination of the rumor effectively neutralized it, and rendered the election valid. Staub Cleaners, Inc., 171 N.L.R.B. 332, 171 NLRB No. 40 (1968). The events relied upon to support the neutralization theory included at least two direct denials of the truth of the rumor by management personnel in face to face discussions, and a letter from Barnet to all employees on July 22, two days before the election, condemning the "poisonous rumors" among other things. The Union also disassociated itself from the rumor; at a meeting during the election campaign, Frank Iervolino, International Union vice-president, urged the employees to "drop" the matter since there was no proof that Barnet had actually made the statement. At a second meeting, two days before the election, Iervolino again told the employees not to spread the rumor and indicated "we couldn't really prove where it came from or how it originated and I wanted no part of it."

There is no indication that the rumor originated with the Union, and both the Union's subsequent behavior and the facts developed before the Trial Examiner negate any such inference. The Board has been reluctant in the past to give the same weight to anonymous or third party attempts to influence the outcome of certification elections that it gives to improper efforts by the parties themselves. See Benton's Cloak & Suit Co., 97 NLRB 1327 (1952) (anonymous caller). Cf. Manning, Maxwell & Moore, Inc. v. NLRB, 324 F.2d 857 (5th Cir. 1963). But see NLRB v. Tampa Crown Distributors, Inc., 272 F.2d 470 (5th Cir. 1959) (enforcement of bargaining order denied where no denial by Union of responsibility for anonymous call). Even where the conduct condemned is the product of rank-and-file Union members, the Board has been hesitant to set aside an election in the absence of a showing that they acted at the command or urging of Union officials. See Orleans Mfg. Co., 120 NLRB 630 (1958):

"While the Board will consider conduct not attributable to any of the parties in determining whether an election should be set aside, the Board accords less weight to such conduct than to conduct of the parties."

See also E. I. Dupont de Nemours & Co., Inc., 105 NLRB 710 (1953). The rationale for such a distinction is soundly based. Generally, prejudicial remarks coming from anonymous or non-authoritative sources are apt to be more lightly regarded by employees than those backed up by the employer or the union. Allegations by one who controls the conditions of employment, or who seeks to participate in that control are more likely to carry weight. Moreover, where one of the parties is directly at fault, the most effective deterrent to future misconduct is to deny that party what it sought to gain improperly. But, when unknown third parties are responsible for the improper comments, they have little concern with the expense and annoyance incurred by repeating the election, and the NLRB order in such a case carries with it no deterrent effect.

Since it is not uncommon for elections to be characterized by unfounded rumors, the Board is justified in requiring at the very least that there be a "substantial likelihood" that the outcome was affected by the rumor. See Bok, Regulating NLRA Election Tactics, 78 Harv. L. Rev. 38, 87 (1964). To do otherwise would be to invite endless repetition of certification elections, without any assurance that those which follow would be any fairer than their predecessors.*fn1

We must, however, still resolve the conflict between the Board and the Trial Examiner on the neutralization issue. We are instructed to treat Examiner's findings as in effect a part of the record before the Board, and to give them "[no] more weight than in reason and the light of judicial experience they deserve." Universal Camera Corp. v. NLRB, 340 U.S. 474, 95 L. Ed. 456, 71 S. Ct. 456 (1951). It should be noted that in Universal Camera, difficult credibility questions were involved, but there is little disagreement here over the facts. What we are essentially concerned with is the policy question of the degree to which an election may deviate from ideal "laboratory conditions." It would be difficult to achieve a uniform standard if we treated the Trial Examiner's findings as entitled to more weight than the Board's. This is particularly true where the Board is the agency entrusted with first-line authority to define and apply Congressional policy, and in addition possesses broad experience in conducting and reviewing certification proceedings. It is appropriate in such instances that we give considerable weight to its determinations. See NLRB v. Gissel Packing Co., 395 U.S. 575, 612 n.32, 23 L. Ed. 2d 547, 89 S. Ct. 1918 (1969) (the NLRB, not the courts, should evaluate deviation from proper election practices).

In the instant case, the combination of Union disavowals, specific management-employee conversations, and the July 22 Barnet letter, represented substantial evidence to support the Board's finding of neutralization.*fn2 See National Labor Relations Act, § 10(e), 29 U.S.C. § 160(e) (1964); Universal Camera Corp. v. NLRB, 340 U.S. 474, 95 L. Ed. 456, 71 S. Ct. 456 (1951). Agreeing as we do that the Board's conclusion that the rumor was neutralized is supported by substantial evidence and the election valid, we are of the view that the Company's unilateral change in wage rates was a violation of its duty to bargain with the Union. NLRB v. Katz, 369 U.S. 736, 8 L. Ed. 2d 230, 82 S. Ct. 1107 (1962).

Staub and the dissent argue that even if an 8(a)(5) refusal to bargain is established, we should refuse to enforce the bargaining order because the NLRB delayed for some 21 months before reversing the Trial Examiner's findings and issuing an order, and waited another year before applying for enforcement. This is not the first time that this contention has been made, and it is not a wholly unattractive one, since it might indeed spur the NLRB to swifter action. However, the Supreme Court in NLRB v. Katz, 369 U.S. 736, 748 n.16, 8 L. Ed. 2d 230, 82 S. Ct. 1107 (1962), seems clearly to have foreclosed that alternative.*fn3 If the stark words of Katz were not enough the Court in NLRB v. Gissel Packing Co., Inc., 395 U.S. 575, 23 L. Ed. 2d 547, 89 S. Ct. 1918 (1969), displayed a strong willingness to accept bargaining orders from the Board in circumstances that we would have found inappropriate in the past. See also our decision in NLRB v. Pembeck Oil Corp., 404 F.2d 105 (2 Cir. 1968) vacated, 395 U.S. 828, 23 L. Ed. 2d 737, 89 S. Ct. 2125 (1969), on the authority of Gissel. In answering the contention that the order would be "harsh" where the union might no longer have a majority, the Court in Gissel indicated that it was for the Board, and not the courts, to decide when the order would be appropriate. 395 U.S. at 612 n. 32. The Court also suggested that if there is any prejudice to the employees in enforcing a bargaining order, that can be avoided by filing a decertification petition. 395 U.S. at 613.

While we share the dissent's distaste for enforcing stale mandates, we feel duty bound to follow what we believe to be the law so ...

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