NLRB v. Horizons Hotel Corp., 1st Cir. (1995)

7/26/2019 NLRB v. Horizons Hotel Corp., 1st Cir. (1995)

1/34

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.

____________________

No. 94-1303

HORIZONS HOTEL CORPORATION D/B/A CARIB INN OF SAN JUAN,

Petitioner,

v.

NATIONAL LABOR RELATIONS BOARD,

Respondent.

____________________

ON APPLICATION FOR ENFORCEMENT AND PETITION FOR REVIEW OF AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD

____________________


2/34

Before

Torruella, Chief Judge, ___________ Campbell, Senior Circuit Judge, ____________________ and Boyle,* Senior District Judge.

_____________________

_____________________

____________________

* Of the District of Rhode Island, sitting by designation.

Luis F. Padilla for Horizons Hotel Corporation. _______________ David Habenstreit, Attorney, National Labor Relations Bo _________________ with whom Frederick L. Feinstein, General Counsel, Linda S _______________________ ______ Acting Associate General Counsel, Aileen A. Armstrong, De ____________________

Associate General Counsel, and Linda Dreeben, Supervi _______________ Attorney, were on brief for National Labor Relations Board.

____________________

March 3, 1995 ____________________


3/34

-2-

BOYLE, Senior District Judge. This case pres BOYLE, Senior District Judge


4/34

_______________________

issues concerning a final order of the National Labor Relat

Board (the Board) which concluded that Horizons Hotel Corpora

d/b/a Carib Inn of San Juan (Horizons) engaged in unfair l

practices in violation of 8(a)(1), (3), and (5) of

National Labor Relations Act (the Act), 29 U.S.C. 158(a)

(3), (5). The claims of unfair labor practices arose in

from the conduct of a bankruptcy trustee who was in possessio

the hotel at the time Horizons purchased it. The Board petit

us under 10(e) of the Act, 29 U.S.C. 160(e), to enforce

order, which adopted with modification the opinion

recommended order of the administrative law judge (ALJ).

N.L.R.B. No. 200 (Nov. 22, 1993). Horizons petitions us un

10(f) of the Act, 29 U.S.C. 160(f), to review and vacate

Board's order, asserting the following: the Board la

jurisdiction to act in this case; the conclusions of the AL

the Board are contrary to law; and the factual determination

the ALJ, adopted by the Board, are not supported by substan

evidence. We conclude that the Board's order adopting the

opinion and proposed order is without error and is to be enfo

as it stands. See 29 U.S.C. 160(e), (f). ___

I. STANDARD OF REVIEW I. STANDARD OF REVIEW

The appropriate standard of review is provided

10(e) of the Act, 29 U.S.C. 160(e): "The findings of the B

with respect to questions of fact if supported by substan

evidence on the record considered as a whole shall


5/34

-3-

conclusive." Thus, a finding of the Board that the Act has

violated is upheld "as long as the finding is supporte

substantial evidence . . . even if we would have reache

different conclusion." 3-E Co., Inc. v. NLRB, 26 F.3d 1, 3_____________ ____

Cir. 1994)(citing 29 U.S.C. 160(e)). In reviewing a B

decision, great weight is afforded the credibility determinat

of the ALJ, as he or she had the opportunity to observe

witnesses testify, see id.; Holyoke Visiting Nurses Ass'n___ __ _____________________________

NLRB, 11 F.3d 302, 308 (1st Cir. 1993); therefore, credibi ____

determinations are disturbed only where it is apparent that

ALJ "overstepped the bounds of reason." 3-E Co., Inc., 26_____________

at 3; Holyoke Visiting Nurses Ass'n, 11 F.3d at 308 (citing_____________________________

v. American Spring Bed Mfg. Co., 670 F.2d 1236, 1242 (1st_____________________________

1982)).

II. BACKGROUND II. BACKGROUND


6/34

The record supports the ALJ's finding of the follo

facts, adopted by the Board. See 3-E Co., Inc., 26 F.3d a___ _____________

(citing Cumberland Farms, Inc. v. NLRB, 984 F.2d 556, 558______________________ ____

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

Puerto Rico, was owned by the Carib Inn of San Juan Corpora

(Carib Inn Corporation). In November 1981, Carib Inn Corpora

filed a petition for bankruptcy in the U.S. Bankruptcy Court

the District of Puerto Rico under chapter 11 of Title 11

U.S.C. 1101, et seq. The chapter 11 proceeding was conve ________

-4-

to a chapter 7, 11 U.S.C. 701 et seq., proceeding in Nove _______

1985. On November 21, 1985, the Bankruptcy Court appoi

H ctor Rodr guez-Estrada (Rodr guez) trustee under 29 U.S.C

1104. As trustee, Rodr guez was ordered to liquidate the as


7/34

of the bankruptcy estate.

At all relevant times, employees of the hotel's ser

and casino units1 were represented by Uni n de Trabajadores

la Industria Gastron mica de Puerto Rico, Local 610, H

Employees and Restaurant Employees International Union, AFL

(the Union). The service- and casino-unit employees

employed under the terms of a collective bargaining agreement

In November or December 1985, Horizons considere

prospect of purchasing the Carib Inn. Horizons submitted a

for the bankruptcy estate in February 1986. Prior to the

Horizons's president, Benito Fern ndez, spent time at the ho

investigating its operation and its physical grounds. At

point, Fern ndez began to occupy an office at the hotel.

office was located next to that of Rodr guez. Fern ndez

Rodr guez shared a secretary.

On April 3, Rodr guez met with Ileana Qui ones, gen

manager of Professional Employment Center (PEC), a l

____________________

1 For a list of the employment positions within the servicecasino units, see ALJ's Decision and Proposed Order, appende

In re: Horizons Hotel Corp., et al, 312 N.L.R.B. No. 200 ( ___________________________________ 22, 1993).

2 On March 20, 1986, Rodr guez terminated the collec bargaining agreement pursuant to 11 U.S.C. 365. The propr of this action is not in question.

-5-


8/34

employment agency. At the meeting, Rodr guez told Qui ones

PEC's services were needed because the hotel was operating u

new management which sought to hire new employees. He aske

if there was a possibility that employees hired through PEC

be union workers. She responded that they would not. Rodr

told Qui ones that he would consider retaining PEC if she c

guarantee him that there would be no risk of a union at

hotel. He requested that Qui ones indicate in writing that t

was no possibility of a union presence.

The following day, April 4, 1986, Qui ones sen

letter to Rodr guez. The letter was addressed as follows:

H ctor M. Rodr guez-Estrada[,] Horizons Hotel" -- Qui ones wa

the belief that Rodr guez was employed as a manager of Horiz

A summary of the items discussed at the previous day's mee

was included with the letter. The first item listed was

follows: "1. There is no possibility for a Union."

On May 12 or 13, 1986, Frankie Rosado-Garc a (Rosa

a waiter in one of the hotel's restaurants, and a union ste

while on duty, served the Union's president, who was seated

table. After Rosado waited on him, Rodr guez, who was presen

the restaurant, approached Rosado, and said: "[A-ha] . . .

betrayed me." Rosado later went to Rodr guez' office to ques


9/34

him about the comment. Rodr guez asked Rosado if the Uni

president had come "to stop the hotel." He then told Rosado

if the Union continued to bother him, he would fire all u

employees. On another occasion in May, Rodr guez told Ro

-6-

that the Union was not backing the hotel employees. He said

the Union had failed to collect from the Federal court money

to the employees. He further stated that there was no unio

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 Hori

purchased the Carib Inn from Rodr guez. The deed provided

possession of the hotel property would be turned over to Hori

on May 31, 1986.

On May 19, 1986, Rodr guez hired Juan Rafael

(G mez) as resident manager. That day, Rodr guez circulat

memorandum (May 19 memorandum) announcing the same. Fern

had signed the memorandum, expressly indicating his approva

G mez' hiring.


10/34

On May 21, 1986, Rodr guez circulated a memora

(May 21 memorandum) to all employees of the Carib Inn, notif

them that Horizons would assume control of the hotel on Jun

1986, and that all employees would be terminated on May 31, 1

The memorandum advised the employees that they could apply

positions with Horizons by submitting applications a

recruiting office set up by Horizons in a nearby condomin

The recruiting office would accept applications for two

only.

Later that day, May 21, F lix Ram rez, the Uni

general steward, and Valent n Hern ndez, the Union's secre

and treasurer, went to Rodr guez' office to discuss with hi

-7-

memorandum. Rodr guez threatened not to meet with them. He

them that he didn't have to talk with them because they no lo

represented the hotel's employees. He stated: "[T]he Unio

out," and "Horizons has nothing to do with the Union." Rodr

finally agreed to meet with them, however, after Hern

threatened to report his conduct to the Secretary of Labor


11/34

the Commonwealth of Puerto Rico. During the meeting, howe

Rodr guez told Ram rez and Hern ndez that they should dis

with G mez any concerns they may have concerning

administration.

Prior to the May 21 memorandum, PEC had b

soliciting applications for positions at the hotel. Qui

understood that PEC was to be responsible for hiring Horizo

new employees. It advertised in a local newspaper and colle

applications and relevant information on potential employees.

conducted interviews and informed Rodr guez of appea

candidates. Rodr guez, however, advised Qui ones that PEC

do no independent hiring, but rather would hire only t

individuals whom it was instructed to hire.

Horizons's recruiting program, announced in the Ma

memorandum, was carried out. A representative of PEC was pre

throughout. Several days after the program, Rodr guez pro

G mez a list of individuals to interview. Interviews

thereafter conducted at the hotel. A representative of PEC

present during the interviews. Not one employee of the Carib

was interviewed. At one point, Rodr guez told a Carib

-8-


12/34

employee that he had been authorized to hire new employees

Horizons.

C. Transfer of Control: June 1, 1986 C. Transfer of Control: June 1, 1986

On June 1, 1986, Horizons assumed possession of

hotel property. Since that date, Horizons has continued

business operations previously conducted by Rodr guez as trus

and by the Carib Inn Corporation, using substantially the

facilities and equipment, and providing the same services,

the exception of the casino, which ceased operation on June

1986.

After the transfer of possession, no service-

employees previously employed at the hotel were employe

Horizons, with the exception of several former unit emplo

hired in a supervisory or managerial capacity. See 312 N.L. ___

No. 200 n.2. Fourteen of Horizons's twenty-four casino

employees, however, were previously employed at the hotel.

time did Horizons negotiate or enter into a bargaining agree

with the Union.

On June 1, 1986, Horizons hired Rodr guez a

consultant. He later became Horizons's general manager.

The Bankruptcy Court confirmed the sale of the C

Inn to Horizons by order dated June 6, 1986.

D. The Present Action D. The Present Action


13/34

The Union pursued claims against Horizons in Au

1986. The Board issued a complaint and notice of hearin

September 30, 1987; an amended complaint and notice of hea

-9-

was issued on December 21, 1987. The amended complaint incl

the following allegations: that Horizons interfered

restrained, and coerced employees in the exercise of their ri

in violation of 8(a)(1) of the Act, 29 U.S.C. 158(a)(1)

creating the impression of surveillance of employees' u

activities, threatening employees with discharge because of t

union activities, and attempting to denigrate the Union in

eyes of employees; that Horizons refused to hire former ser

unit employees in violation of 8(a)(3) of the Act, 29 U.S.

8(a)(3); and that Horizons refused to bargain collectively

representatives of the Union in violation of 8(a)(5) of

Act, 29 U.S.C. 158(a)(5). The amended complaint alleges

much of the improper conduct was carried out by Rodr guez, ac

as an agent of Horizons.

An ALJ conducted hearings on various dates from


14/34

1989 through March 1991. The decision and proposed order is

on January 15, 1993. The ALJ concluded that Horizons viol

8(a)(1), (3), and (5) of the Act, 29 U.S.C. 158(a)(1),

(5). The Board, with modification, adopted the ALJ's ruli

findings, and conclusions. In re: Horizons Hotel Corp., et_______________________________

312 N.L.R.B. No. 200 (Nov. 22, 1993). It amended the

proposed remedy and order, and ordered the following:

Horizons cease and desist from engaging in unfair l

practices; that it offer positions of employment to t

former hotel employees who were not hired by Horizons

violation of the Act; that it bargain collectively wit

-10-

Union on request; that, on request, it cancel any change

employment conditions which may have been instituted sinc

purchased the Carib Inn; that, in the event the casino res

operation, it bargain with the Union concerning casino employ

and it offer positions to those identified former ca

employees who were not hired; and that it preserve records

publish notice of the order.


15/34

Both the Board and Horizons petition this Court to

The Board petitions us to enter an order enforcing its or

Horizons petitions us to review and vacate the Board's opi

and order. As grounds, Horizons asserts that exclu

jurisdiction over this matter lies with the bankruptcy co

because much of the allegedly improper conduct was committed

bankruptcy trustee. Horizons further asserts that as a ma

of law it cannot be held accountable for any improper conduc

Rodr guez, the bankruptcy trustee. Finally, Horizons argues

there is insufficient evidence to support the findings

Rodr guez was an agent of Horizons, and that Horizons violate

8(a)(1), (3), and (5) of the Act, 29 U.S.C. 158(a)(1),

(5).

We examine the issues.

III. JURISDICTION III. JURISDICTION

Horizons asserts that, because this action conc

conduct of a bankruptcy trustee, it is within the exclu

jurisdiction of the bankruptcy court. In so arguing,

characterizes the present action as a "suit[] against

-11-


16/34

trustee." Horizons's argument is without merit. The issue

determined in In re: Carib-Inn of San Juan Corp., 905 F.2d____________________________________

(1st Cir. 1990), a related action commenced by Horizons in

bankruptcy court to enjoin the Board from pursuing the pre

case. In Carib-Inn, we concluded that the Board had exclu _________

jurisdiction to determine the merits of the present case,

"[t]he [Board's] complaint . . . is directed solely at Hori

and seeks no remedy against the bankruptcy estate." Id. at__

The cases cited by Horizons are inapposite. See Baron___ ____

Barbour, 104 U.S. 126, 128, 131 (1881)(court of the Distric_______

Columbia has no jurisdiction to entertain suit against rece

appointed by a court of the State of Virginia without leave

the appointing court); Leonard v. Vrooman, 383 F.2d 556,_______ _______

(9th Cir. 1967), cert. denied, 390 U.S. 925 (1968)(bankru ____________

court has no jurisdiction to enjoin state action against tru

in bankruptcy for illegally seizing and possessing plainti

real property); Vass v. Conron Bros. Co., 59 F.2d 969, 970____ _________________

Cir. 1932)(bankruptcy court may enjoin action in state c

against receiver in bankruptcy where not commenced with leave

the appointing court); In re: Campbell, 13 B.R. 974,_________________

(D.Idaho 1981)(permission of the bankruptcy court i


17/34

prerequisite for state-court action against trustee in bankru

for acts done within his authority as trustee). Each concern

action against a trustee or receiver in bankruptcy; the pre

case is not an action against the trustee in bankrup

Rodr guez, but rather against the purchaser of a bankru

-12-

estate, Horizons.

The Board acted within its jurisdiction under 1

the Act, 29 U.S.C. 160, in pursuing the present claims,

under 10(e) and (f), 29 U.S.C. 160(e), (f), this Court

jurisdiction "of the proceeding and the question deter

therein," and has the power "to make and enter a de

enforcing, modifying, and enforcing as so modified, or set

aside in whole or in part the order of the Board."


18/34

-13-

IV. ANALYSIS IV. ANALYSIS

A. Rodr guez As Agent of Horizons

A. Rodr guez As Agent of Horizons ______________________________

Horizons presents two objections to the


19/34

determination, adopted by the Board, that Rodr guez, the tru

in bankruptcy, acted as agent for Horizons prior to June 1, 1

the date on which possession of the Carib Inn was transferre

Horizons. First, Horizons argues that as a matter of la

purchaser of a bankruptcy estate it cannot be held account

for the conduct of the bankruptcy trustee, Rodr guez,

occurred prior to the transfer of the estate. Second, it ar

that the finding that Rodr guez was acting as agent for Hori

is not supported by substantial evidence.

The Act guarantees employees the right "to s

organize, to form, join, or assist labor organizations,

bargain collectively . . . and to engage in other conce

activities for the purpose of collective bargaining or o

mutual aid or protection." 29 U.S.C. 157. The Act precl

employers from conducting unfair labor practices, as that ter

defined in 8 of the Act, 29 U.S.C. 158. Employers ma

liable for the unfair labor practices of their agents.

International Ass'n of Machinists v. NLRB, 311 U.S. 72,___________________________________ ____

(1940); 3- Co., Inc., 26 F.3d at 3-4; NLRB v. Uni n Naciona

____________ ____ ____________

Trabajadores, 540 F.2d 1, 8-9 (1st Cir. 1976), cert. denied,____________ ____________

U.S. 1039 (1977). Agents for whose unlawful conduct emplo

are responsible need not be employees. See Cagle's, Inc____________

NLRB, 588 F.2d 943, 947-49 (5th Cir. 1979); Uni n Nacional,____ ______________

-14-


20/34

F.2d at 8-9.

An employer need not have actually authorize

subsequently ratified the conduct of its agent for it t

liable. 29 U.S.C. 152(13). Rather, an employer is liable

the unlawful conduct of its agent when, under all

circumstances, employees could reasonably believe that the a

was acting for and on behalf of management. See American Pr ___ __________

Inc. v. NLRB, 833 F.2d 621, 625 (6th Cir. 1987)(cita ____ ____

omitted); Uni n Nacional, 540 F.2d at 8-9. ______________

Horizons contends that as a matter of law, a truste

bankruptcy cannot be deemed an agent of the purchaser of

estate for whose unlawful conduct the purchase is lia

Horizons argues that the trustee's duties to the bankru

estate, and the transfer of the property "free and clear

encumbrances, preclude the possibility. Horizons points t

authority whatever to support its contention. We find

argument unpersuasive. That Rodr guez may have been duty b

to act for the benefit of the bankruptcy estate is irrelevant


21/34

has no bearing on whether he acted on behalf of Horizons.

Cagle's, Inc., 588 F.2d at 947 (private employer liable for_____________

conduct of city chamber of commerce director). The fact

Horizons purchased the hotel "free and clear" of liens

encumbrances and that it did not expressly assume liability

the conduct of any prior owner of the estate is also irrele

See In Re: Carib Inn, 905 F.2d at 563-64. Horizons is not___ ________________

being held responsible simply for the conduct or liability

-15-

prior owner; it is being held responsible for its own unla

acts, which were carried out through its agent, Rodr guez,

happened to control the property prior to the transfer of

possession to Horizons.

Horizons next argues that the finding that Rodr

acted as its agent is not supported by substantial evidence.

the record before us, we are satisfied that the

determination, adopted by the Board, that Rodr guez acte


22/34

agent for Horizons is supported by substantial evide

Rodr guez occupied an office in the hotel next to that

Fern ndez, Horizons's president, and the two shared a secret

Rodr guez solicited the services of PEC, an employment agency

recruit employees for Horizons; the May 19 memorandum indic

that Rodr guez acted with the approval of Fern ndez when he

G mez as resident manager; Rodr guez announced to u

representatives that Horizons "has nothing to do with the Uni

he told an employee that he was responsible for determining

Horizons would hire; and he provided to G mez a list

applicants to interview for positions with Horizons. On

basis of these facts, it is clear that employees of the Carib

could reasonably have believed that Rodr guez was acting for

on behalf of Horizons. Furthermore, Horizons never disa

Rodr guez' conduct; On the contrary, Horizons hired Rodr

after possession of the hotel was transferred on June 1.

Substantial evidence on the record as a whole supp

the ALJ's finding, adopted by the Board, that Rodr guez

-16-


23/34

acting as an agent of Horizons prior to the transfer of the C

Inn on June 1. See 3-E Co., Inc., 26 F.3d at 3. ___ _____________

B. Violations of the Act B. Violations of the Act _____________________

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

Rodr guez, attributable to Horizons, violated 8(a)(1) of

Act, 29 U.S.C. 158(a)(1). Horizons asserts that the findin

not supported by substantial evidence.

Section 8(a)(1) of the Act, 29 U.S.C. 158

provides that it is an unfair labor practice for an employer

"interfere with, restrain, or coerce" employees in the exer

of their rights guaranteed by the Act. "An employer violat

8(a)(1) by coercively interrogating employees about their u

activities or sentiments, or about the activities or senti

of others, and by either directly or indirectly threate

employees." 3-E Co., Inc., 26 F.3d at 3 (citing Cumber ______________ _____

Farms, Inc., 984 F.2d at 559; NLRB v. Otis Hospital, 545___________ ____ _____________

252, 256 (1st Cir. 1976)). When examining assertedly viola

conduct, courts must be mindful that "[i]t is the coer

tendency of employer statements, not their actual effect,

constitutes a violation of the Act." NLRB v. Marine Opti ____ ___________

Inc., 671 F.2d 11, 18 (1st Cir. 1982)(citations omitted).____

Board's inference of coercive tendency will not be disturbe


24/34

reasonable, even if susceptible of an alternative interpretat

Id. (citations omitted). __

The Board's determination that Horizons viol

-17-

8(a)(1) of the Act, 29 U.S.C. 158(a)(1), is supporte

substantial evidence and stands without error. Rodr guez to

hotel employee, Rosado, that he (Rosado) had betrayed hi

talking to the Union's president; he then questioned Ro

about his conversation. Thereafter, he told Rosado that

hotel employees would be fired if the Union continued to bo

him. These statements are reasonably interpreted as coer

interrogation and direct threats. Considered in context,

statements could reasonably have interfered with or coerced

employees in the exercise of their organizational rights. Se_

E Co., Inc., 26 F.3d at 3; Cumberland Farms, Inc., 984 F.2___________ _______________________

559.

2. Sections 8(a)(3) and (1), 29 U.S.C. 158(a) 2. Sections 8(a)(3) and (1), 29 U.S.C. 158(a)


25/34

(3) (3)

The Board, in adopting the findings of the ALJ, f

that Horizons's refusal to hire all but several of the hot

former service-unit employees violated 8(a)(3) and (1) of

Act, 29 U.S.C. 158(a)(1), (3). Horizons argues that

determination is not supported by substantial evidence, an

therefore erroneous.

Section 8(a)(3) of the Act, 29 U.S.C. 158(a)

declares that it is an unfair labor practice for an employer

discrimination in regard to hire or tenure of employment . .

encourage or discourage membership in any labor organizati

Where an employer violates 8(a)(3) of the Act, 29 U.

8(a)(3), by discriminating in its hiring practices

-18-

discourage a union presence, it necessarily violates 8(a)(1

the Act, 29 U.S.C. 8(a)(1), which disallows employers

"interfere with, restrain, or coerce" employees in the exer

of their organizational rights. See, e.g., American Press, I ___ ____ ________________


26/34

833 F.2d at 624; NLRB v. Horizon Air Services, Inc., 761 F.2____ __________________________

26-28 (1st Cir. 1985); Kallman v. NLRB, 640 F.2d 1094, 1100_______ ____

Cir. 1981).

Generally, a successor employer has the right

operate its business as it wishes. See Elastic Nut Shop Di___ ___________________

Harvard Ind. v. NLRB, 921 F.2d 1275, 1279 (D.C. Cir. 1990)(ci ____________ ____

NLRB v. Burns International Security Services, Inc., 406____ _____________________________________________

272, 287-88 (1972)). Within this prerogative is the success

freedom to hire its own work force: "'nothing in the fe

labor laws "requires that an employer . . . who purchases

assets of a business be obligated to hire all of the employee

the predecessor . . . ."'" Id. (quoting Howard Johnson Co__ _________________

Detroit Local Executive Board, 417 U.S. 249, 261 (1974)(cita _____________________________

omitted)). The successor employer may not, however, discrimi

against union employees in its hiring. See Fall River Dyei___ _______________

Finishing Corp. v. NLRB, 482 U.S. 27, 40 (1987)(citat

________________ ____

omitted).

Thus, where a successor employer refuses to hire

predecessor's employees because of their union affiliation

may violate 8(a)(3), 29 U.S.C. 158(a)(3). The test i

follows: If it is proved that the former employees' prote

conduct was a substantial or motivating factor for


27/34

-19-

successor's refusal to hire, the refusal to hire violat

8(a)(3), 29 U.S.C. 158(a)(3), unless the successor proves______

preponderance of the evidence that it "would have taken the

action for wholly permissible reasons." NLRB v. Transporta ____ _________

Management Corp., 462 U.S. 393, 399 (1983). See also Ela ________________ ________ __

Stop Nut Div. of Harvard Ind., 921 F.2d at 1280; Horizon_______________________________ ______

Services, Inc., 761 F.2d at 27. "[I]f the employer [refuse______________

hire] an employee for having engaged in union activities an

no other basis for the discharge, or if the reasons that

proffers are pretextual, the employer commits an unfair l

practice." Transportation Management Corp., 462 U.S. at 398. _______________________________

In the present case, the Board determined that

General Counsel sustained its burden of proving that the hot

former service-unit employees' union affiliation was

substantial or motivating factor in Horizons's refusal to

them. This determination is supported by substantial evide


28/34

Rodr guez, Horizons's agent, indicated to Qui ones that Hori

would utilize PEC's services only on the condition that ther

no risk of a union at the hotel; Qui ones responded wi

letter confirming that "[t]here is no possibility for a Uni

Rodr guez told a Carib Inn union employee that all u

employees would be fired if the Union continued to bother

Rodr guez told union leaders that "Horizons has nothing t

with the Union"; not one union-affiliated former employee

submitted an application with Horizons was interviewed; wit

exception of several individuals who were offered supervisor

-20-

managerial positions, no former service-unit employees were

by Horizons.

The Board disqualified as a pretext Horizo

proffered lawful reason for refusing to hire the fo

employees. This determination also is supported by substan

evidence. Horizons asserted at the administrative procee

that the former employees were not hired because many of

were not needed, and because they were not competent employ


29/34

Fern ndez testified that the former employee's unfitness

determined after he personally observed them, and that t

incompetence is evidenced by the fact that the hotel had

into bankruptcy. The Board, adopting the ALJ's findi

discredited Fern ndez' testimony and rejected Horizo

proffered justification, noting that Horizons submitte

evidence tending to prove that Fern ndez personally observed

former employee, and that it failed to prove its contention

the service employees caused the hotel's bankruptcy. The B

concluded that Horizons's retention of PEC for recrui

services, and its solicitation of applications from fo

service-unit employees, was conduct intended as a smoke scree

conceal its scheme to keep the Union out of the Carib

Again, this conclusion is well supported by substantial evide

The Board, in adopting the ALJ's findings, concl

that Horizons violated 8(a)(3) and (1) of the Act, 29 U.

8(a)(1), (3). This determination is supported by substan

evidence and stands without error.

-21-


30/34

3. Sections 8(a)(5) and (1), 29 U.S.C. 158(a) 3. Sections 8(a)(5) and (1), 29 U.S.C. 158(a)

(5) (5)

The Board determined, in adopting the findings of

ALJ, that Horizons violated 8(a)(5) and (1) of the Act,

U.S.C. 8(a)(1), (5), by refusing to bargain collectively

the Union, which represented employees of the service and ca

units. Horizons asserts that this finding is in er

unsupported by substantial evidence.

Section 8(a)(5) of the Act, 29 U.S.C. 158(a)

provides that it is an unfair labor practice for an employer

refuse to bargain collectively with the representatives of

employees." Where an employer violates 8(a)(5) of the Act,

U.S.C. 8(a)(5), by refusing to bargain collectively,

necessarily violates 8(a)(1) of the Act, 29 U.S.C. 8(a)

which disallows employers to "interfere with, restrain,

coerce" employees in the exercise of their organizational ri

See, e.g., Fall River Dyeing & Finishing Corp., 482 U.S. at___ ____ ___________________________________

n.2. Under 8(a)(5), 29 U.S.C. 158(a)(5), "an employe

obligated to bargain with the union representing

predecessor's employees if: (1) the new employer i

'successor' to the old . . . and (2) a majority of

successor's employees previously were employed by

predecessor." Asseo v. Centro M dico Del Turabo, 900 F.2d

_____ ________________________

450-51 (1st Cir. 1990)(citing Fall River Dying & Finishing Co ______________________________


31/34

482 U.S. at 43-52). If these two criteria are satisfie

rebuttable presumption of majority status arises, leading

-22-

consequent duty to bargain in good faith." Id. at 451. __

Where a successor employer's unlawful hiring pract

preclude the possibility of a majority status in its work fo

however, the successor violates the Act by refusing to bar

collectively with the union that had represented

predecessor's employees. Elastic Stop Nut Div. of Harvard I _________________________________

921 F.2d at 1282. Thus, with regard to the former u

employees of the hotel's service unit, our affirmance of

Board's determination that Horizons violated 8(a)(3) of

Act, 29 U.S.C. 158(a)(3), by refusing to hire them because

their union affiliation compels affirmance of the determina

that Horizons violated 8(a)(5), 29 U.S.C. 158(a)(5), a

duty to bargain with the employees' union representatives a

from the violation of 8(a)(3). See Elastic Stop Nut Di___ ____________________

Harvard Ind., 921 F.2d at 1282.


32/34

____________

With regard to the hotel's casino-unit employees,

Board's finding of a violation of 8(a)(5), 29 U.S.C

158(a)(5), is supported by substantial evidence. The Boar

adopting the ALJ's findings, found that the casino conti

operations after transfer of possession of the hotel to Hori

on June 1, and that Horizons operated the casino through June

1986. The Board determined that, with respect to ca

operations, Horizons was a successor employer. Fourteen

Horizons's twenty-four casino-unit employees were former u

employees of the hotel's casino unit.

The fact that greater than one-half of the employee

-23-

Horizons's casino unit had been union employees of Horizo

predecessor raises a rebuttable presumption that there existe

the casino unit a "majority status." See Asseo, 900 F.2d at___ _____

51. Horizons does not assert that it was able to overcome

presumption. Horizons therefore had a duty to bargain

representatives of the former casino-unit employees. Its fai


33/34

to do so violated 8(a)(5) and (1) of the Act, 29 U.

158(a)(1), (5).

C. The Board's Order C. The Board's Order _________________

Horizons argues that the portion of the Board's o

requiring it to "cancel, on request by the Union, any change

wages and benefits that [Horizons] made when it began operati

is "inappropriate." After a review of the record, we conc

that the Board's order was a reasonable remedy fashione

address Horizons's violations of 8(a)(1), (3) and (5) of

Act, 29 U.S.C. 158(a)(1), (3), (5). See Horizon Air Servi ___ ________________

Inc., 761 F.2d at 32-33 (citations omitted)("We respect____

Board's special competence and expertise in fashioning reme

And, where the Board's design is planned out with due regar

supportable findings, sensible reasoning, and an accurate vie

the governing law, there is no room for judicial intervention

V. CONCLUSION V. CONCLUSION

The ALJ's findings, adopted by the Board, are suppo

by substantial evidence on the record as a whole and s

without error. Horizons's request for review is denied, an______

Board's request for enforcement of its order is granted. _______

-24-


34/34

Documents

NLRB v. Horizons Hotel Corp., 1st Cir. (1995)