Guardsmark, LLC v. National Labor Relations Board

475 F.3d 369, 374 U.S. App. D.C. 360, 2007 U.S. App. LEXIS 2263, 2007 WL 283455
CourtCourt of Appeals for the D.C. Circuit
DecidedFebruary 2, 2007
Docket05-1216, 05-1236, 05-1272
StatusPublished
Cited by23 cases

This text of 475 F.3d 369 (Guardsmark, LLC v. National Labor Relations Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Guardsmark, LLC v. National Labor Relations Board, 475 F.3d 369, 374 U.S. App. D.C. 360, 2007 U.S. App. LEXIS 2263, 2007 WL 283455 (D.C. Cir. 2007).

Opinion

Opinion for the Court filed by Circuit Judge TATEL.

TATEL, Circuit Judge.

Under National Labor Relations Board case law, where an employer promulgates work rules “likely to have a chilling effect on Section 7 rights, the Board may conclude that their maintenance is an unfair labor practice, even absent evidence of enforcement.” Lafayette Park Hotel, 326 N.L.R.B. 824, 825 (1998), enforced mem., No. 98-1625, 1999 WL 1215578, at *1 (D.C.Cir. Nov.26, 1999). Applying this principle, the Board found that two of petitioner’s work rules — one requiring that employees register their complaints only through the chain of command and the other barring solicitation — violated the National Labor Relations Act. The Board found that a third rule — barring “fraternization” — was lawful because the Board thought employees would not reasonably interpret it to interfere with protected activities, a ruling the union now challenges. Concluding that the Board faithfully applied its case law to the chain-of-command and solicitation rules, we deny the employer’s petition for review. But because the Board’s decision with respect to the fraternization rule was unreasonable, we grant the Union’s petition.

I.

Petitioner Guardsmark, LLC, a nationwide company providing security guard services, distributes a handbook to all uniformed employees. Three of the handbook’s rules are at issue here: a chain-of-command rule telling employees “not [to] register complaints with any representative of the client”; a solicitation rule prohibiting solicitation and distribution of literature “at all times while on duty or in uniform”; and a fraternization rule prohibiting employees from “fraterniz[ing] on duty or off duty” with other employees. Guardsmark, LLC, 344 N.L.R.B. No. 97, at *1, 2005 WL 1378568 (June 7, 2005).

Focusing on events that occurred in Guardsmark’s San Francisco office, the Service Employees International Union Local 24/7 filed unfair labor practice charges with the National Labor Relations Board, and the Board’s General Counsel then issued a complaint, alleging that all three rules violate section 8(a)(1) of the National Labor Relations Act, 29 U.S.C. §§ 151-169, which makes it an unfair labor practice for employers “to interfere with, restrain, or coerce employees in the exercise [of their section 7 rights].” Id. § 158(a)(1). Section 7, in turn, provides that employees:

shall have the right to self-organization, to form, join, or assist labor organiza *373 tions, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities

Id. § 157. The General Counsel charged that Guardsmark’s rules discourage protected labor activity, such as enlisting the support of customers for work grievances, soliciting and distributing literature while off duty, and meeting with other employees to discuss terms and conditions of employment. Guardsmark, 344 N.L.R.B. No. 97, at *14-15, 2005 WL 1378568. Defending its three rules before the ALJ, Guards-mark argued that the chain-of-command rule applies only while employees are on duty; that the solicitation rule does not, as the company had informed some employees, apply to off-duty employees in uniform who cover up the company insignia; and that the fraternization rule targets only personal entanglements that “could cloud [a security guard’s] judgment,” thereby compromising the company’s goal of providing reliable security to its clients. Admin. Hr’g Tr. 189, April 29, 2004.

The ALJ agreed with the General Counsel with respect to the chain-of-command rule because, according to the ALJ, the rule prevents employees from seeking client assistance regarding any aspect of their employment. Guardsmark, 344 N.L.R.B. No. 97, at *14, 2005 WL 1378568. With respect to the other rules, the ALJ agreed with Guardsmark. The solicitation rule, the ALJ found, clearly communicates to employees that they may not engage in unofficial activity while in uniform, and thus, “it seems reasonable to presume that employees, without having to be specifically told, would understand that removing or covering their uniforms will constitute compliance with this provision.” Id. Finding that employees would read the fraternization rule “in the context of [their] duties ... to insure the protection of individuals and property,” the ALJ concluded that they would understand both that the rule “is designed to provide safeguards so that security will not be compromised by interpersonal relationships,” and that it does not preclude section 7 activity. Id. at *15. To remedy the chain-of-command violation, the ALJ recommended that Guardsmark be required to post a remedial notice in its San Francisco office. Id. at *16-17.

The Board adopted the ALJ’s conclusion that the chain-of-command rule explicitly prohibits protected labor activity because nothing in the rule limits its application to working time. Id. at *2. But the Board disagreed with the ALJ regarding the solicitation rule, concluding that employees would not reasonably construe the rule to include a “safe harbor” for “removing or covering their uniforms [while soliciting off duty in order to] conipl[y] with this provision.” Id. at *4. The Board explained that Guardsmark’s “clarification” of the rule to some employees in its San Francisco branch failed to cure the violation because the company never communicated the clarification to all employees. Id. at *5. The Board agreed with the ALJ that the fraternization rule prohibits only personal entanglements and that employees would reasonably understand it not to apply to protected activity. Id. at *3. Board Member Liebman dissented from the fraternization ruling, arguing that the limitation to personal entanglements, while perhaps the best reading of the rule, was not the only reasonable interpretation. Id. at *8. Finally, the Board modified the ALJ’s order to require nationwide posting of remedial notices. Id. at *6.

Guardsmark petitions for review as to the chain-of-command ■ and solicitation *374 rules. The Union petitions as to the fraternization rule, and Guardsmark intervenes in opposition. The Board seeks enforcement of its entire order.

II.

To determine whether a work rule violates NLRA section 8(a)(1), the Board considers “ ‘whether the rule[ ] would reasonably tend to chill employees in the exercise’ of their statutory rights.” Adtranz ABB Daimler-Benz Transp. v. NLRB, 253 F.3d 19, 25 (D.C.Cir.2001) (quoting Lafayette Park Hotel, 326 N.L.R.B. 824, 825 (1998)). In making this assessment, the Board engages in a two-step inquiry described in Martin Luther Memorial Home, 343 N.L.R.B. No. 75, at *1-2 (May 19, 2004). First, the Board éxamines whether the rule “explicitly

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Bluebook (online)
475 F.3d 369, 374 U.S. App. D.C. 360, 2007 U.S. App. LEXIS 2263, 2007 WL 283455, Counsel Stack Legal Research, https://law.counselstack.com/opinion/guardsmark-llc-v-national-labor-relations-board-cadc-2007.