USCA1 Opinion
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 94-1294
NATIONAL LABOR RELATIONS BOARD,
Petitioner,
v.
HORIZONS HOTEL CORPORATION
D/B/A CARIB INN OF SAN JUAN,
Respondent.
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No. 94-1303
HORIZONS HOTEL CORPORATION
D/B/A CARIB INN OF SAN JUAN,
Petitioner,
v.
NATIONAL LABOR RELATIONS BOARD,
Respondent.
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ON APPLICATION FOR ENFORCEMENT AND PETITION
FOR REVIEW OF AN ORDER OF
THE NATIONAL LABOR RELATIONS BOARD
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Before
Torruella, Chief Judge,
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Campbell, Senior Circuit Judge,
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and Boyle,* Senior District Judge.
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* Of the District of Rhode Island, sitting by designation.
Luis F. Padilla for Horizons Hotel Corporation.
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David Habenstreit, Attorney, National Labor Relations Board,
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with whom Frederick L. Feinstein, General Counsel, Linda Sher,
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Acting Associate General Counsel, Aileen A. Armstrong, Deputy
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Associate General Counsel, and Linda Dreeben, Supervisory
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Attorney, were on brief for National Labor Relations Board.
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March 3, 1995
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BOYLE, Senior District Judge. This case presents
BOYLE, Senior District Judge
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issues concerning a final order of the National Labor Relations
Board (the Board) which concluded that Horizons Hotel Corporation
d/b/a Carib Inn of San Juan (Horizons) engaged in unfair labor
practices in violation of 8(a)(1), (3), and (5) of the
National Labor Relations Act (the Act), 29 U.S.C. 158(a)(1),
(3), (5). The claims of unfair labor practices arose in part
from the conduct of a bankruptcy trustee who was in possession of
the hotel at the time Horizons purchased it. The Board petitions
us under 10(e) of the Act, 29 U.S.C. 160(e), to enforce its
order, which adopted with modification the opinion and
recommended order of the administrative law judge (ALJ). 312
N.L.R.B. No. 200 (Nov. 22, 1993). Horizons petitions us under
10(f) of the Act, 29 U.S.C. 160(f), to review and vacate the
Board's order, asserting the following: the Board lacked
jurisdiction to act in this case; the conclusions of the ALJ and
the Board are contrary to law; and the factual determinations of
the ALJ, adopted by the Board, are not supported by substantial
evidence. We conclude that the Board's order adopting the ALJ's
opinion and proposed order is without error and is to be enforced
as it stands. See 29 U.S.C. 160(e), (f).
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I. STANDARD OF REVIEW
I. STANDARD OF REVIEW
The appropriate standard of review is provided in
10(e) of the Act, 29 U.S.C. 160(e): "The findings of the Board
with respect to questions of fact if supported by substantial
evidence on the record considered as a whole shall be
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conclusive." Thus, a finding of the Board that the Act has been
violated is upheld "as long as the finding is supported by
substantial evidence . . . even if we would have reached a
different conclusion." 3-E Co., Inc. v. NLRB, 26 F.3d 1, 3 (1st
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Cir. 1994)(citing 29 U.S.C. 160(e)). In reviewing a Board
decision, great weight is afforded the credibility determinations
of the ALJ, as he or she had the opportunity to observe the
witnesses testify, see id.; Holyoke Visiting Nurses Ass'n v.
___ __ ______________________________
NLRB, 11 F.3d 302, 308 (1st Cir. 1993); therefore, credibility
____
determinations are disturbed only where it is apparent that the
ALJ "overstepped the bounds of reason." 3-E Co., Inc., 26 F.3d
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at 3; Holyoke Visiting Nurses Ass'n, 11 F.3d at 308 (citing NLRB
_____________________________ ____
v. American Spring Bed Mfg. Co., 670 F.2d 1236, 1242 (1st Cir.
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1982)).
II. BACKGROUND
II. BACKGROUND
The record supports the ALJ's finding of the following
facts, adopted by the Board. See 3-E Co., Inc., 26 F.3d at 2
___ _____________
(citing Cumberland Farms, Inc. v. NLRB, 984 F.2d 556, 558 (1st
______________________ ____
Cir. 1993)).
A. Hotel in Bankruptcy: November 1981 - May 14, 1986
A. Hotel in Bankruptcy: November 1981 - May 14, 1986
In 1981, the Carib Inn hotel and casino in San Juan,
Puerto Rico, was owned by the Carib Inn of San Juan Corporation
(Carib Inn Corporation). In November 1981, Carib Inn Corporation
filed a petition for bankruptcy in the U.S. Bankruptcy Court for
the District of Puerto Rico under chapter 11 of Title 11, 11
U.S.C. 1101, et seq. The chapter 11 proceeding was converted
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to a chapter 7, 11 U.S.C. 701 et seq., proceeding in November
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1985. On November 21, 1985, the Bankruptcy Court appointed
H ctor Rodr guez-Estrada (Rodr guez) trustee under 29 U.S.C.
1104. As trustee, Rodr guez was ordered to liquidate the assets
of the bankruptcy estate.
At all relevant times, employees of the hotel's service
and casino units1 were represented by Uni n de Trabajadores de
la Industria Gastron mica de Puerto Rico, Local 610, Hotel
Employees and Restaurant Employees International Union, AFL-CIO
(the Union). The service- and casino-unit employees were
employed under the terms of a collective bargaining agreement.2
In November or December 1985, Horizons considered the
prospect of purchasing the Carib Inn. Horizons submitted a bid
for the bankruptcy estate in February 1986. Prior to the bid,
Horizons's president, Benito Fern ndez, spent time at the hotel,
investigating its operation and its physical grounds. At some
point, Fern ndez began to occupy an office at the hotel. The
office was located next to that of Rodr guez. Fern ndez and
Rodr guez shared a secretary.
On April 3, Rodr guez met with Ileana Qui ones, general
manager of Professional Employment Center (PEC), a local
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1 For a list of the employment positions within the service and
casino units, see ALJ's Decision and Proposed Order, appended to
In re: Horizons Hotel Corp., et al, 312 N.L.R.B. No. 200 (Nov.
___________________________________
22, 1993).
2 On March 20, 1986, Rodr guez terminated the collective
bargaining agreement pursuant to 11 U.S.C. 365. The propriety
of this action is not in question.
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employment agency. At the meeting, Rodr guez told Qui ones that
PEC's services were needed because the hotel was operating under
new management which sought to hire new employees. He asked her
if there was a possibility that employees hired through PEC would
be union workers. She responded that they would not. Rodr guez
told Qui ones that he would consider retaining PEC if she could
guarantee him that there would be no risk of a union at the
hotel. He requested that Qui ones indicate in writing that there
was no possibility of a union presence.
The following day, April 4, 1986, Qui ones sent a
letter to Rodr guez. The letter was addressed as follows: "Sr.
H ctor M. Rodr guez-Estrada[,] Horizons Hotel" -- Qui ones was of
the belief that Rodr guez was employed as a manager of Horizons.
A summary of the items discussed at the previous day's meeting
was included with the letter. The first item listed was as
follows: "1. There is no possibility for a Union."
On May 12 or 13, 1986, Frankie Rosado-Garc a (Rosado),
a waiter in one of the hotel's restaurants, and a union steward,
while on duty, served the Union's president, who was seated at a
table. After Rosado waited on him, Rodr guez, who was present in
the restaurant, approached Rosado, and said: "[A-ha] . . . you
betrayed me." Rosado later went to Rodr guez' office to question
him about the comment. Rodr guez asked Rosado if the Union's
president had come "to stop the hotel." He then told Rosado that
if the Union continued to bother him, he would fire all union
employees. On another occasion in May, Rodr guez told Rosado
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that the Union was not backing the hotel employees. He said that
the Union had failed to collect from the Federal court money owed
to the employees. He further stated that there was no union in
Puerto Rico that would defend the employees.
B. Sale of the Hotel: May 14, 1986 - May 31, 1986
B. Sale of the Hotel: May 14, 1986 - May 31, 1986
On May 14, 1986, a deed was executed whereby Horizons
purchased the Carib Inn from Rodr guez. The deed provided that
possession of the hotel property would be turned over to Horizons
on May 31, 1986.
On May 19, 1986, Rodr guez hired Juan Rafael G mez
(G mez) as resident manager. That day, Rodr guez circulated a
memorandum (May 19 memorandum) announcing the same. Fern ndez
had signed the memorandum, expressly indicating his approval of
G mez' hiring.
On May 21, 1986, Rodr guez circulated a memorandum
(May 21 memorandum) to all employees of the Carib Inn, notifying
them that Horizons would assume control of the hotel on June 1,
1986, and that all employees would be terminated on May 31, 1986.
The memorandum advised the employees that they could apply for
positions with Horizons by submitting applications at a
recruiting office set up by Horizons in a nearby condominium.
The recruiting office would accept applications for two days
only.
Later that day, May 21, F lix Ram rez, the Union's
general steward, and Valent n Hern ndez, the Union's secretary
and treasurer, went to Rodr guez' office to discuss with him the
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memorandum. Rodr guez threatened not to meet with them. He told
them that he didn't have to talk with them because they no longer
represented the hotel's employees. He stated: "[T]he Union is
out," and "Horizons has nothing to do with the Union." Rodr guez
finally agreed to meet with them, however, after Hern ndez
threatened to report his conduct to the Secretary of Labor for
the Commonwealth of Puerto Rico. During the meeting, however,
Rodr guez told Ram rez and Hern ndez that they should discuss
with G mez any concerns they may have concerning hotel
administration.
Prior to the May 21 memorandum, PEC had begun
soliciting applications for positions at the hotel. Qui ones
understood that PEC was to be responsible for hiring Horizons's
new employees. It advertised in a local newspaper and collected
applications and relevant information on potential employees. It
conducted interviews and informed Rodr guez of appealing
candidates. Rodr guez, however, advised Qui ones that PEC would
do no independent hiring, but rather would hire only those
individuals whom it was instructed to hire.
Horizons's recruiting program, announced in the May 21
memorandum, was carried out. A representative of PEC was present
throughout. Several days after the program, Rodr guez provided
G mez a list of individuals to interview. Interviews were
thereafter conducted at the hotel. A representative of PEC was
present during the interviews. Not one employee of the Carib Inn
was interviewed. At one point, Rodr guez told a Carib Inn
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employee that he had been authorized to hire new employees for
Horizons.
C. Transfer of Control: June 1, 1986
C. Transfer of Control: June 1, 1986
On June 1, 1986, Horizons assumed possession of the
hotel property. Since that date, Horizons has continued the
business operations previously conducted by Rodr guez as trustee,
and by the Carib Inn Corporation, using substantially the same
facilities and equipment, and providing the same services, with
the exception of the casino, which ceased operation on June 23,
1986.
After the transfer of possession, no service-unit
employees previously employed at the hotel were employed by
Horizons, with the exception of several former unit employees
hired in a supervisory or managerial capacity. See 312 N.L.R.B.
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No. 200 n.2. Fourteen of Horizons's twenty-four casino unit
employees, however, were previously employed at the hotel. At no
time did Horizons negotiate or enter into a bargaining agreement
with the Union.
On June 1, 1986, Horizons hired Rodr guez as a
consultant. He later became Horizons's general manager.
The Bankruptcy Court confirmed the sale of the Carib
Inn to Horizons by order dated June 6, 1986.
D. The Present Action
D. The Present Action
The Union pursued claims against Horizons in August
1986. The Board issued a complaint and notice of hearing on
September 30, 1987; an amended complaint and notice of hearing
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was issued on December 21, 1987. The amended complaint includes
the following allegations: that Horizons interfered with,
restrained, and coerced employees in the exercise of their rights
in violation of 8(a)(1) of the Act, 29 U.S.C. 158(a)(1), by
creating the impression of surveillance of employees' union
activities, threatening employees with discharge because of their
union activities, and attempting to denigrate the Union in the
eyes of employees; that Horizons refused to hire former service
unit employees in violation of 8(a)(3) of the Act, 29 U.S.C.
8(a)(3); and that Horizons refused to bargain collectively with
representatives of the Union in violation of 8(a)(5) of the
Act, 29 U.S.C. 158(a)(5). The amended complaint alleges that
much of the improper conduct was carried out by Rodr guez, acting
as an agent of Horizons.
An ALJ conducted hearings on various dates from March
1989 through March 1991. The decision and proposed order issued
on January 15, 1993. The ALJ concluded that Horizons violated
8(a)(1), (3), and (5) of the Act, 29 U.S.C. 158(a)(1), (3),
(5). The Board, with modification, adopted the ALJ's rulings,
findings, and conclusions. In re: Horizons Hotel Corp., et al,
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312 N.L.R.B. No. 200 (Nov. 22, 1993). It amended the ALJ's
proposed remedy and order, and ordered the following: that
Horizons cease and desist from engaging in unfair labor
practices; that it offer positions of employment to the 65
former hotel employees who were not hired by Horizons in
violation of the Act; that it bargain collectively with the
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Union on request; that, on request, it cancel any changes in
employment conditions which may have been instituted since it
purchased the Carib Inn; that, in the event the casino resumes
operation, it bargain with the Union concerning casino employees,
and it offer positions to those identified former casino
employees who were not hired; and that it preserve records and
publish notice of the order.
Both the Board and Horizons petition this Court to act.
The Board petitions us to enter an order enforcing its order.
Horizons petitions us to review and vacate the Board's opinion
and order. As grounds, Horizons asserts that exclusive
jurisdiction over this matter lies with the bankruptcy court,
because much of the allegedly improper conduct was committed by a
bankruptcy trustee. Horizons further asserts that as a matter
of law it cannot be held accountable for any improper conduct of
Rodr guez, the bankruptcy trustee. Finally, Horizons argues that
there is insufficient evidence to support the findings that
Rodr guez was an agent of Horizons, and that Horizons violated
8(a)(1), (3), and (5) of the Act, 29 U.S.C. 158(a)(1), (3),
(5).
We examine the issues.
III. JURISDICTION
III. JURISDICTION
Horizons asserts that, because this action concerns
conduct of a bankruptcy trustee, it is within the exclusive
jurisdiction of the bankruptcy court. In so arguing, it
characterizes the present action as a "suit[] against the
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trustee." Horizons's argument is without merit. The issue was
determined in In re: Carib-Inn of San Juan Corp., 905 F.2d 561
____________________________________
(1st Cir. 1990), a related action commenced by Horizons in the
bankruptcy court to enjoin the Board from pursuing the present
case. In Carib-Inn, we concluded that the Board had exclusive
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jurisdiction to determine the merits of the present case, as
"[t]he [Board's] complaint . . . is directed solely at Horizons
and seeks no remedy against the bankruptcy estate." Id. at 562.
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The cases cited by Horizons are inapposite. See Baron v.
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Barbour, 104 U.S. 126, 128, 131 (1881)(court of the District of
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Columbia has no jurisdiction to entertain suit against receiver
appointed by a court of the State of Virginia without leave of
the appointing court); Leonard v. Vrooman, 383 F.2d 556, 560
_______ _______
(9th Cir. 1967), cert. denied, 390 U.S. 925 (1968)(bankruptcy
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court has no jurisdiction to enjoin state action against trustee
in bankruptcy for illegally seizing and possessing plaintiff's
real property); Vass v. Conron Bros. Co., 59 F.2d 969, 970 (2d
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Cir. 1932)(bankruptcy court may enjoin action in state court
against receiver in bankruptcy where not commenced with leave of
the appointing court); In re: Campbell, 13 B.R. 974, 976
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(D.Idaho 1981)(permission of the bankruptcy court is a
prerequisite for state-court action against trustee in bankruptcy
for acts done within his authority as trustee). Each concerns an
action against a trustee or receiver in bankruptcy; the present
case is not an action against the trustee in bankruptcy,
Rodr guez, but rather against the purchaser of a bankruptcy
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estate, Horizons.
The Board acted within its jurisdiction under 10 of
the Act, 29 U.S.C. 160, in pursuing the present claims, and
under 10(e) and (f), 29 U.S.C. 160(e), (f), this Court has
jurisdiction "of the proceeding and the question determined
therein," and has the power "to make and enter a decree
enforcing, modifying, and enforcing as so modified, or setting
aside in whole or in part the order of the Board."
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IV. ANALYSIS
IV. ANALYSIS
A. Rodr guez As Agent of Horizons
A. Rodr guez As Agent of Horizons
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Horizons presents two objections to the ALJ's
determination, adopted by the Board, that Rodr guez, the trustee
in bankruptcy, acted as agent for Horizons prior to June 1, 1986,
the date on which possession of the Carib Inn was transferred to
Horizons. First, Horizons argues that as a matter of law, as
purchaser of a bankruptcy estate it cannot be held accountable
for the conduct of the bankruptcy trustee, Rodr guez, which
occurred prior to the transfer of the estate. Second, it argues
that the finding that Rodr guez was acting as agent for Horizons
is not supported by substantial evidence.
The Act guarantees employees the right "to self-
organize, to form, join, or assist labor organizations, to
bargain collectively . . . and to engage in other concerted
activities for the purpose of collective bargaining or other
mutual aid or protection." 29 U.S.C. 157. The Act precludes
employers from conducting unfair labor practices, as that term is
defined in 8 of the Act, 29 U.S.C. 158. Employers may be
liable for the unfair labor practices of their agents. See
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International Ass'n of Machinists v. NLRB, 311 U.S. 72, 80
___________________________________ ____
(1940); 3- Co., Inc., 26 F.3d at 3-4; NLRB v. Uni n Nacional de
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Trabajadores, 540 F.2d 1, 8-9 (1st Cir. 1976), cert. denied, 429
____________ ____________
U.S. 1039 (1977). Agents for whose unlawful conduct employers
are responsible need not be employees. See Cagle's, Inc. v.
______________
NLRB, 588 F.2d 943, 947-49 (5th Cir. 1979); Uni n Nacional, 540
____ ______________
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F.2d at 8-9.
An employer need not have actually authorized or
subsequently ratified the conduct of its agent for it to be
liable. 29 U.S.C. 152(13). Rather, an employer is liable for
the unlawful conduct of its agent when, under all the
circumstances, employees could reasonably believe that the agent
was acting for and on behalf of management. See American Press,
___ _______________
Inc. v. NLRB, 833 F.2d 621, 625 (6th Cir. 1987)(citation
____ ____
omitted); Uni n Nacional, 540 F.2d at 8-9.
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Horizons contends that as a matter of law, a trustee in
bankruptcy cannot be deemed an agent of the purchaser of the
estate for whose unlawful conduct the purchase is liable.
Horizons argues that the trustee's duties to the bankruptcy
estate, and the transfer of the property "free and clear" of
encumbrances, preclude the possibility. Horizons points to no
authority whatever to support its contention. We find its
argument unpersuasive. That Rodr guez may have been duty bound
to act for the benefit of the bankruptcy estate is irrelevant and
has no bearing on whether he acted on behalf of Horizons. Cf.
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Cagle's, Inc., 588 F.2d at 947 (private employer liable for the
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conduct of city chamber of commerce director). The fact that
Horizons purchased the hotel "free and clear" of liens and
encumbrances and that it did not expressly assume liability for
the conduct of any prior owner of the estate is also irrelevant.
See In Re: Carib Inn, 905 F.2d at 563-64. Horizons is not here
___ ________________
being held responsible simply for the conduct or liability of a
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prior owner; it is being held responsible for its own unlawful
acts, which were carried out through its agent, Rodr guez, who
happened to control the property prior to the transfer of its
possession to Horizons.
Horizons next argues that the finding that Rodr guez
acted as its agent is not supported by substantial evidence. On
the record before us, we are satisfied that the ALJ's
determination, adopted by the Board, that Rodr guez acted as
agent for Horizons is supported by substantial evidence.
Rodr guez occupied an office in the hotel next to that of
Fern ndez, Horizons's president, and the two shared a secretary;
Rodr guez solicited the services of PEC, an employment agency, to
recruit employees for Horizons; the May 19 memorandum indicated
that Rodr guez acted with the approval of Fern ndez when he hired
G mez as resident manager; Rodr guez announced to union
representatives that Horizons "has nothing to do with the Union";
he told an employee that he was responsible for determining whom
Horizons would hire; and he provided to G mez a list of
applicants to interview for positions with Horizons. On the
basis of these facts, it is clear that employees of the Carib Inn
could reasonably have believed that Rodr guez was acting for and
on behalf of Horizons. Furthermore, Horizons never disavowed
Rodr guez' conduct; On the contrary, Horizons hired Rodr guez
after possession of the hotel was transferred on June 1.
Substantial evidence on the record as a whole supports
the ALJ's finding, adopted by the Board, that Rodr guez was
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acting as an agent of Horizons prior to the transfer of the Carib
Inn on June 1. See 3-E Co., Inc., 26 F.3d at 3.
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B. Violations of the Act
B. Violations of the Act
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1. Section 8(a)(1), 29 U.S.C. 158(a)(1)
1. Section 8(a)(1), 29 U.S.C. 158(a)(1)
The Board determined that certain statements of
Rodr guez, attributable to Horizons, violated 8(a)(1) of the
Act, 29 U.S.C. 158(a)(1). Horizons asserts that the finding is
not supported by substantial evidence.
Section 8(a)(1) of the Act, 29 U.S.C. 158(a),
provides that it is an unfair labor practice for an employer to
"interfere with, restrain, or coerce" employees in the exercise
of their rights guaranteed by the Act. "An employer violates
8(a)(1) by coercively interrogating employees about their union
activities or sentiments, or about the activities or sentiments
of others, and by either directly or indirectly threatening
employees." 3-E Co., Inc., 26 F.3d at 3 (citing Cumberland
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Farms, Inc., 984 F.2d at 559; NLRB v. Otis Hospital, 545 F.2d
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252, 256 (1st Cir. 1976)). When examining assertedly violative
conduct, courts must be mindful that "[i]t is the coercive
tendency of employer statements, not their actual effect, that
constitutes a violation of the Act." NLRB v. Marine Optical,
____ ________________
Inc., 671 F.2d 11, 18 (1st Cir. 1982)(citations omitted). The
____
Board's inference of coercive tendency will not be disturbed if
reasonable, even if susceptible of an alternative interpretation.
Id. (citations omitted).
__
The Board's determination that Horizons violated
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8(a)(1) of the Act, 29 U.S.C. 158(a)(1), is supported by
substantial evidence and stands without error. Rodr guez told a
hotel employee, Rosado, that he (Rosado) had betrayed him by
talking to the Union's president; he then questioned Rosado
about his conversation. Thereafter, he told Rosado that all
hotel employees would be fired if the Union continued to bother
him. These statements are reasonably interpreted as coercive
interrogation and direct threats. Considered in context, the
statements could reasonably have interfered with or coerced hotel
employees in the exercise of their organizational rights. See 3-
___ __
E Co., Inc., 26 F.3d at 3; Cumberland Farms, Inc., 984 F.2d at
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559.
2. Sections 8(a)(3) and (1), 29 U.S.C. 158(a)(1),
2. Sections 8(a)(3) and (1), 29 U.S.C. 158(a)(1),
(3)
(3)
The Board, in adopting the findings of the ALJ, found
that Horizons's refusal to hire all but several of the hotel's
former service-unit employees violated 8(a)(3) and (1) of the
Act, 29 U.S.C. 158(a)(1), (3). Horizons argues that this
determination is not supported by substantial evidence, and is
therefore erroneous.
Section 8(a)(3) of the Act, 29 U.S.C. 158(a)(3),
declares that it is an unfair labor practice for an employer "by
discrimination in regard to hire or tenure of employment . . . to
encourage or discourage membership in any labor organization."
Where an employer violates 8(a)(3) of the Act, 29 U.S.C.
8(a)(3), by discriminating in its hiring practices to
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discourage a union presence, it necessarily violates 8(a)(1) of
the Act, 29 U.S.C. 8(a)(1), which disallows employers to
"interfere with, restrain, or coerce" employees in the exercise
of their organizational rights. See, e.g., American Press, Inc.,
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833 F.2d at 624; NLRB v. Horizon Air Services, Inc., 761 F.2d 22,
____ __________________________
26-28 (1st Cir. 1985); Kallman v. NLRB, 640 F.2d 1094, 1100 (9th
_______ ____
Cir. 1981).
Generally, a successor employer has the right to
operate its business as it wishes. See Elastic Nut Shop Div. of
___ ________________________
Harvard Ind. v. NLRB, 921 F.2d 1275, 1279 (D.C. Cir. 1990)(citing
____________ ____
NLRB v. Burns International Security Services, Inc., 406 U.S.
____ _____________________________________________
272, 287-88 (1972)). Within this prerogative is the successor's
freedom to hire its own work force: "'nothing in the federal
labor laws "requires that an employer . . . who purchases the
assets of a business be obligated to hire all of the employees of
the predecessor . . . ."'" Id. (quoting Howard Johnson Co. v.
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Detroit Local Executive Board, 417 U.S. 249, 261 (1974)(citation
_____________________________
omitted)). The successor employer may not, however, discriminate
against union employees in its hiring. See Fall River Dyeing &
___ ____________________
Finishing Corp. v. NLRB, 482 U.S. 27, 40 (1987)(citations
________________ ____
omitted).
Thus, where a successor employer refuses to hire its
predecessor's employees because of their union affiliation, it
may violate 8(a)(3), 29 U.S.C. 158(a)(3). The test is as
follows: If it is proved that the former employees' protected
conduct was a substantial or motivating factor for the
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successor's refusal to hire, the refusal to hire violates
8(a)(3), 29 U.S.C. 158(a)(3), unless the successor proves by a
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preponderance of the evidence that it "would have taken the same
action for wholly permissible reasons." NLRB v. Transportation
____ ______________
Management Corp., 462 U.S. 393, 399 (1983). See also Elastic
________________ ________ _______
Stop Nut Div. of Harvard Ind., 921 F.2d at 1280; Horizon Air
_______________________________ ___________
Services, Inc., 761 F.2d at 27. "[I]f the employer [refuses to
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hire] an employee for having engaged in union activities and has
no other basis for the discharge, or if the reasons that [it]
proffers are pretextual, the employer commits an unfair labor
practice." Transportation Management Corp., 462 U.S. at 398.
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In the present case, the Board determined that the
General Counsel sustained its burden of proving that the hotel's
former service-unit employees' union affiliation was the
substantial or motivating factor in Horizons's refusal to hire
them. This determination is supported by substantial evidence:
Rodr guez, Horizons's agent, indicated to Qui ones that Horizons
would utilize PEC's services only on the condition that there be
no risk of a union at the hotel; Qui ones responded with a
letter confirming that "[t]here is no possibility for a Union";
Rodr guez told a Carib Inn union employee that all union
employees would be fired if the Union continued to bother him;
Rodr guez told union leaders that "Horizons has nothing to do
with the Union"; not one union-affiliated former employee who
submitted an application with Horizons was interviewed; with the
exception of several individuals who were offered supervisory or
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managerial positions, no former service-unit employees were hired
by Horizons.
The Board disqualified as a pretext Horizons's
proffered lawful reason for refusing to hire the former
employees. This determination also is supported by substantial
evidence. Horizons asserted at the administrative proceedings
that the former employees were not hired because many of them
were not needed, and because they were not competent employees.
Fern ndez testified that the former employee's unfitness was
determined after he personally observed them, and that their
incompetence is evidenced by the fact that the hotel had gone
into bankruptcy. The Board, adopting the ALJ's findings,
discredited Fern ndez' testimony and rejected Horizons's
proffered justification, noting that Horizons submitted no
evidence tending to prove that Fern ndez personally observed each
former employee, and that it failed to prove its contention that
the service employees caused the hotel's bankruptcy. The Board
concluded that Horizons's retention of PEC for recruiting
services, and its solicitation of applications from former
service-unit employees, was conduct intended as a smoke screen to
conceal its scheme to keep the Union out of the Carib Inn.
Again, this conclusion is well supported by substantial evidence.
The Board, in adopting the ALJ's findings, concluded
that Horizons violated 8(a)(3) and (1) of the Act, 29 U.S.C.
8(a)(1), (3). This determination is supported by substantial
evidence and stands without error.
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3. Sections 8(a)(5) and (1), 29 U.S.C. 158(a)(1),
3. Sections 8(a)(5) and (1), 29 U.S.C. 158(a)(1),
(5)
(5)
The Board determined, in adopting the findings of the
ALJ, that Horizons violated 8(a)(5) and (1) of the Act, 29
U.S.C. 8(a)(1), (5), by refusing to bargain collectively with
the Union, which represented employees of the service and casino
units. Horizons asserts that this finding is in error,
unsupported by substantial evidence.
Section 8(a)(5) of the Act, 29 U.S.C. 158(a)(5),
provides that it is an unfair labor practice for an employer "to
refuse to bargain collectively with the representatives of his
employees." Where an employer violates 8(a)(5) of the Act, 29
U.S.C. 8(a)(5), by refusing to bargain collectively, it
necessarily violates 8(a)(1) of the Act, 29 U.S.C. 8(a)(1),
which disallows employers to "interfere with, restrain, or
coerce" employees in the exercise of their organizational rights.
See, e.g., Fall River Dyeing & Finishing Corp., 482 U.S. at 34 &
___ ____ ___________________________________
n.2. Under 8(a)(5), 29 U.S.C. 158(a)(5), "an employer is
obligated to bargain with the union representing its
predecessor's employees if: (1) the new employer is a
'successor' to the old . . . and (2) a majority of the
successor's employees previously were employed by the
predecessor." Asseo v. Centro M dico Del Turabo, 900 F.2d 445,
_____ ________________________
450-51 (1st Cir. 1990)(citing Fall River Dying & Finishing Corp.,
__________________________________
482 U.S. at 43-52). If these two criteria are satisfied, "a
rebuttable presumption of majority status arises, leading to a
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consequent duty to bargain in good faith." Id. at 451.
__
Where a successor employer's unlawful hiring practices
preclude the possibility of a majority status in its work force,
however, the successor violates the Act by refusing to bargain
collectively with the union that had represented the
predecessor's employees. Elastic Stop Nut Div. of Harvard Ind.,
_____________________________________
921 F.2d at 1282. Thus, with regard to the former union
employees of the hotel's service unit, our affirmance of the
Board's determination that Horizons violated 8(a)(3) of the
Act, 29 U.S.C. 158(a)(3), by refusing to hire them because of
their union affiliation compels affirmance of the determination
that Horizons violated 8(a)(5), 29 U.S.C. 158(a)(5), as a
duty to bargain with the employees' union representatives arose
from the violation of 8(a)(3). See Elastic Stop Nut Div. of
___ _________________________
Harvard Ind., 921 F.2d at 1282.
____________
With regard to the hotel's casino-unit employees, the
Board's finding of a violation of 8(a)(5), 29 U.S.C.
158(a)(5), is supported by substantial evidence. The Board, in
adopting the ALJ's findings, found that the casino continued
operations after transfer of possession of the hotel to Horizons
on June 1, and that Horizons operated the casino through June 23,
1986. The Board determined that, with respect to casino
operations, Horizons was a successor employer. Fourteen of
Horizons's twenty-four casino-unit employees were former union
employees of the hotel's casino unit.
The fact that greater than one-half of the employees in
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Horizons's casino unit had been union employees of Horizons's
predecessor raises a rebuttable presumption that there existed in
the casino unit a "majority status." See Asseo, 900 F.2d at 450-
___ _____
51. Horizons does not assert that it was able to overcome this
presumption. Horizons therefore had a duty to bargain with
representatives of the former casino-unit employees. Its failure
to do so violated 8(a)(5) and (1) of the Act, 29 U.S.C.
158(a)(1), (5).
C. The Board's Order
C. The Board's Order
_________________
Horizons argues that the portion of the Board's order
requiring it to "cancel, on request by the Union, any changes in
wages and benefits that [Horizons] made when it began operations"
is "inappropriate." After a review of the record, we conclude
that the Board's order was a reasonable remedy fashioned to
address Horizons's violations of 8(a)(1), (3) and (5) of the
Act, 29 U.S.C. 158(a)(1), (3), (5). See Horizon Air Services,
___ _____________________
Inc., 761 F.2d at 32-33 (citations omitted)("We respect the
____
Board's special competence and expertise in fashioning remedies.
And, where the Board's design is planned out with due regard to
supportable findings, sensible reasoning, and an accurate view of
the governing law, there is no room for judicial intervention.").
V. CONCLUSION
V. CONCLUSION
The ALJ's findings, adopted by the Board, are supported
by substantial evidence on the record as a whole and stand
without error. Horizons's request for review is denied, and the
______
Board's request for enforcement of its order is granted.
_______
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