26 Introduction to Labor Law I 26 Introduction to Labor Law I

Labor law is a complex topic that occupies more than enough ground for an entire course, but our consideration of the topic will be brief. We will begin by looking at some of the main issues that emerge in labor law: how can a workplace vote to unionize, and what rules govern union elections? When a union has the right to bargain on behalf of a workplace, how do we determine which bargaining unit that union should properly represent? How do unions represent workers--do these functions at times resemble those of an attorney? How and when can employers punish unionized workers for abusive conduct?

26.1 National Labor Relations Board v. Gissel Packing Co. 26.1 National Labor Relations Board v. Gissel Packing Co.

NATIONAL LABOR RELATIONS BOARD v. GISSEL PACKING CO., INC., et al.

No. 573.

Argued March 26, 1969.

Decided June 16, 1969*

*578 Dominick L. Manoli argued the cause for petitioner in No. 573. With him on the brief were Solicitor General Griswold, Peter L. Strauss, Arnold Ordman, and Norton J. Come. Albert Gore argued the cause for petitioner in No. 691. With him on the brief was Joseph M. Jacobs. Edward J. Simerka argued the cause for petitioner in No. 585. With him on the brief was Eugene B. Schwartz.

John E. Jenkins, Jr., argued the cause and filed briefs for Gissel Packing Co., Inc., respondent in Nos. 573 and 691. Lewis P. Hamlin, Jr., argued the cause and filed a brief for General Steel Products, Inc., et al., respondents in No. 573. Fred F. Holroyd argued the cause for Heck’s, Inc., respondent in No. 573. With him on the brief was Charles E. Hurt. Lawrence G. Wallace argued the cause for respondent in No. 585. On the brief were Solicitor General Griswold, Dominick L. Manoli, and Messrs. Strauss, Ordman, and Come.

Briefs of amici curiae in Nos. 573 and 691 were filed by J. Albert Woll, Laurence Gold, and Thomas E. Harris for the American Federation of Labor & Congress of Industrial Organizations, and by the Associated Builders & Contractors, Inc. Briefs of amici curiae in No. 585 were filed by Lambert H. Miller for the National Association of Manufacturers; by Harry L. Browne for the American Retail Federation; and by Stanley E. Tobin for the Mechanical Specialties Co., Inc.

*579Mr. Chief Justice Warren

delivered the opinion of the Court.

These cases involve the extent of an employer’s duty under the National Labor Relations Act to recognize a union that bases its claim to representative status solely on the possession of union authorization cards, and the steps an employer may take, particularly with regard to the scope and content of statements he may make, in legitimately resisting such card-based recognition. The specific questions facing us here are whether the duty to bargain can arise without a Board election under the Act; whether union authorization cards, if obtained from a majority of employees without misrepresentation or coercion, are reliable enough generally to provide a valid, alternate route to majority status; whether a bargaining order is an appropriate and authorized remedy where an employer rejects a card majority while at the same time committing unfair labor practices that tend to undermine the union’s majority and make a fair election an unlikely possibility; and whether certain specific statements made by an employer to his employees constituted such an election-voiding unfair labor practice and thus fell outside the protection of the First Amendment and § 8 (c) of the Act, 49 Stat. 452, as amended, 29 U. S. C. § 158 (c). For reasons given below, we answer each of these questions in the affirmative.

I.

Of the four eases before us, three — Gissel Packing Co., Heck’s Inc., and General Steel Products, Inc. — were consolidated following separate decisions in the Court of Appeals for the Fourth Circuit and brought here by the National Labor Relations Board in No. 573. Food Store Employees Union, Local No. 347, the petitioning Union in Gissel, brought that case here in a separate petition in No. 691. All three cases present the same legal issues *580in similar, uncomplicated factual settings that can be briefly described together. The fourth case, No. 585 (Sinclair Company), brought here from the Court of Appeals for the First Circuit and argued separately, presents many of the same questions and will thus be disposed of in this opinion; but because the validity of some of the Board’s factual findings are under attack on First Amendment grounds, detailed attention must be paid to the factual setting of that case.

Nos. 573 and 691.

In each of the cases from the Fourth Circuit, the course of action followed by the Union and the employer and the Board’s response were similar. In each case, the Union waged an organizational campaign, obtained authorization cards from a majority of employees in the appropriate bargaining unit, and then, on the basis of the cards, demanded recognition by the employer. All three employers refused to bargain on the ground that authorization cards were inherently unreliable indicators of employee desires; and they either embarked on, or continued, vigorous antiunion campaigns that gave rise to numerous unfair labor practice charges. In Gissel, where the employer’s campaign began almost at the outset of the Union’s organizational drive, the Union (petitioner in No. 691), did not seek an election, but instead filed three unfair labor practice charges against the employer, for refusing to bargain in violation of §8 (a) (5), for coercion and intimidation of employees in violation of §8 (a)(1), and for discharge of Union adherents in violation of § 8 (a) (3).1 In Heck’s an elec*?tion sought by the Union was never held because of nearly identical unfair labor practice charges later filed by the Union as a result of the employer’s antiunion campaign, initiated after the Union’s recognition demand.2 *582And in General Steel, an election petitioned for by the Union and won by the employer was set aside by the Board because of the unfair labor practices committed by the employer in the pre-election period.3

In each case, the Board’s primary response was an order to bargain directed at the employers, despite the absence of an election in Gissel and Heck’s and the employer’s victory in General Steel. More specifically, the Board found in each case (1) that the Union had obtained *583valid authorization cards4 from a majority of the employees in the bargaining unit and was thus entitled to represent the employees for collective bargaining purposes; and (2) that the employer’s refusal to bargain with the Union in violation of § 8 (a) (5) was motivated, not by a “good faith” doubt of the Union’s majority status, but by a desire to gain time to dissipate that status. The Board based its conclusion as to the lack of good faith doubt on the fact that the employers had committed substantial unfair labor practices during their antiunion campaign efforts to resist recognition. Thus, the Board found that all three employers had engaged in restraint and coercion of employees in violation of § 8 (a)(1) — in Gissel, for coercively interrogating employees about Union activities, threatening them with discharge, and promising them benefits; in Heck’s, for coercively interrogating employees, threatening reprisals, creating the appearance of surveillance, and offering benefits for opposing the Union; and in General Steel, for coercive interrogation and threats of reprisals, including discharge. In addition, the Board found that the employers in Gissel and Heck’s had wrongfully discharged employees for engaging in Union activities in violation of § 8 (a) (3). And, because the employers had rejected *584the card-based bargaining demand in bad faith, the Board found that all three had refused to recognize the Unions in violation of § 8 (a) (5).

Only in General Steel was there any objection by an employer to the validity of the cards and the manner in which they had been solicited, and the doubt raised by the evidence was resolved in the following manner. The customary approach of the Board in dealing with allegations of misrepresentation by the Union and misunderstanding by the employees of the purpose for which the cards were being solicited has been set out in Cumberland Shoe Corp., 144 N. L. R. B. 1268 (1963) and reaffirmed in Levi Strauss & Co., 172 N. L. R. B. No. 57, 68 L. R. R. M. 1338 (1968). Under the Cumberland Shoe doctrine, if the card itself is unambiguous (i. e., states on its face that the signer authorizes the Union to represent the employee for collective bargaining purposes and not to seek an election), it will be counted unless it is proved that the employee was told that the card was to be used solely for the purpose of obtaining an election. In General Steel, the trial examiner considered the allegations of misrepresentation at length and, applying the Board’s customary analysis, rejected the claims with findings that were adopted by the Board and are reprinted in the margin.5

*585Consequently, the Board ordered the companies to cease and desist from their unfair labor practices, to offer reinstatement and back pay to the employees who had been discriminatorily discharged, to bargain with the Unions on request, and to post the appropriate notices.

On appeal, the Court of Appeals for the Fourth Circuit, in per curiam opinions in each of the three cases (398 F. 2d 336, 337, 339), sustained the Board’s findings as to the §§8(a)(l) and (3) violations, but rejected the Board’s findings that the employers’ refusal to bargain violated § 8 (a) (5) and declined to enforce those portions of the Board’s orders directing the respondent companies to bargain in good faith. The court based its § 8 (a) (5) rulings on its 1967 decisions raising the same fundamental issues, Crawford Mfg. Co. v. NLRB, 386 F. 2d 367, cert. denied, 390 U. S. 1028 (1968) ; NLRB v. Logan Packing Co., 386 F. 2d 562; NLRB v. Sehon Stevenson & Co., Inc., 386 F. 2d 551. The court in those cases held that the 1947 Taft-Hartley amendments to the Act, which permitted the Board to resolve representation disputes by certification under § 9 (c) only by secret ballot election, withdrew from the Board the authority to order an employer to bargain under § 8 (a) (5) on the basis of cards, in the absence of NLRB certification, unless the employer knows independently of the cards that there is in fact no representation dispute. The court held that the cards themselves were so inherently unreliable that their use gave an employer virtually an automatic, good faith claim *586that such a dispute existed, for which a secret election was necessary. Thus, these rulings established that a company could not be ordered to bargain unless (1) there was no question about a Union’s majority status (either because the employer agreed the cards were valid or had conducted his own poll so indicating), or (2) the employer’s §§ 8 (a)(1) and (3) unfair labor practices committed during the representation campaign were so extensive and pervasive that a bargaining order was the only available Board remedy irrespective of a card majority.

Thus based on the earlier decisions, the court’s reasoning in these cases was brief, as indicated by the representative holding in Heck’s:

“We have recently discussed the unreliability of the cards, in the usual case, in determining whether or not a union has attained a majority status and have concluded that an employer is justified in entertaining a good faith doubt of the union’s claims when confronted with a demand for recognition based solely upon union authorization cards. We have also noted that the National Labor Relations Act after the Taft-Hartley amendments provides for an election as the sole basis of a certification and restricts the Board to the use of secret ballots for the resolution of representation questions. This is not one of those extraordinary cases in which a bargaining order might be an appropriate remedy for pervasive violations of § 8 (a) (1). It is controlled by our recent decisions and their reasoning. . . . There was not substantial evidence to support the findings of the Board that Heck’s, Inc. had no good faith doubt of the unions’ claims of majorities.” 398 F. 2d, at 338-339.

*587 No. 585.

In No. 585, the factual pattern was quite similar. The petitioner, a producer of mill rolls, wire, and related products at two plants in Holyoke, Massachusetts, was shut down for some three months in 1952 as the result of a strike over contract negotiations with the American Wire Weavers Protective Association, the representative of petitioner’s journeymen and apprentice wire weavers from 1933 to 1952. The Company subsequently reopened without a union contract, and its employees remained unrepresented through 1964, when the Company was acquired by an Ohio corporation, with the Company’s former president continuing as head of the Holyoke, Massachusetts, division. In July 1965, the International Brotherhood of Teamsters, Local Union No. 404, began an organizing campaign among petitioner’s Holyoke employees and by the end of the summer had obtained authorization cards from 11 of the Company’s 14 journeymen wire weavers choosing the Union as their bargaining agent. On September 20, the Union notified petitioner that it represented a majority of its wire weavers, requested that the Company bargain with it, and offered to submit the signed cards to a neutral third party for authentication. After petitioner’s president declined the Union’s request a week later, claiming, inter alia, that he had a good faith doubt of majority status because of the cards’ inherent unreliability, the Union petitioned, on November 8, for an election that was ultimately set for December 9.

When petitioner’s president first learned of the Union’s drive in July, he talked with all of his employees in an effort to dissuade them from joining a union. He particularly emphasized the results of the long 1952 strike, which he claimed “almost put our company out of busi*588ness,” and expressed worry that the employees were forgetting the “lessons of the past.” He emphasized, secondly, that the Company was still on “thin ice” financially, that the Union’s “only weapon is to strike,” and that a strike “could lead to the closing of the plant,” since the parent company had ample manufacturing facilities elsewhere. He noted, thirdly, that because of their age and the limited usefulness of their skills outside their craft, the employees might not be able to find re-employment if they lost their jobs as a result of a strike. Finally, he warned those who did not believe that the plant could go out of business to “look around Holyoke and see a lot of them out of business.” The president sent letters to the same effect to the employees in early November, emphasizing that the parent company had no reason to stay in Massachusetts if profits went down.

During the two or three weeks immediately prior to the election on December 9, the president sent the employees a pamphlet captioned: “Do you want another 13-week strike?” stating, inter alia, that: “We have no doubt that the Teamsters Union can again close the Wire Weaving Department and the entire plant by a strike. We have no hopes that the Teamsters Union Bosses will not call a strike. . . . The Teamsters Union is a strike happy outfit.” Similar communications followed in late November, including one stressing the Teamsters’ “hoodlum control.” Two days before the election, the Company sent out another pamphlet that was entitled: “Let’s Look at the Record,” and that purported to be an obituary of companies in the Holyoke-Springfield, Massachusetts, area that had allegedly gone out of business because of union demands, eliminating some 3,500 jobs; the first page carried a large cartoon showing the preparation of a grave for the Sinclair Company and other headstones containing the names of other plants allegedly victimized by the unions. Finally, on the day before *589the election, the president made another personal appeal to his employees to reject the Union. He repeated that the Company’s financial condition was precarious; that a possible strike would jeopardize the continued operation of the plant; and that age and lack of education would make re-employment difficult. The Union lost the election 7-6, and then filed both objections to the election and unfair labor practice charges which were consolidated for hearing before the trial examiner.

The Board agreed with the trial examiner that the president’s communications with his employees, when considered as a whole, “reasonably tended to convey to the employees the belief or impression that selection of the Union in the forthcoming election could lead [the Company] to close its plant, or to the transfer of the weaving production, with the resultant loss of jobs to the wire weavers.” Thus, the Board found that under the “totality of the circumstances” petitioner’s activities constituted a violation of §8 (a)(1) of the Act. The Board further agreed with the trial examiner that petitioner’s activities, because they “also interfered with the exercise of a free and untrammeled choice in the election,” and “tended to foreclose the possibility” of holding a fair election, required that the election be set aside. The Board also found that the Union had a valid card majority (the unambiguous cards, see n. 4, supra, went unchallenged) when it demanded recognition initially and that the Company declined recognition, not because of a good faith doubt as to the majority status, but, as the §8 (a)(1) violations indicated, in order to gain time to dissipate that status — in violation of § 8 (a)(5). Consequently, the Board set the election aside, entered a cease-and-desist order, and ordered the Company to bargain on request.

On appeal, the Court of Appeals for the First Circuit sustained the Board’s findings and conclusions and en*590forced its order in full. 397 F. 2d 157. The court rejected the Company’s proposition that the inherent unreliability of authorization cards entitled an employer automatically to insist on an election, noting that the representative status of a union may be shown by means other than an election; the court thus reaffirmed its stance among those circuits disavowing the Fourth Circuit’s approach to authorization cards.6 Because of the conflict among the circuits on the card issues and because of the alleged conflict between First Amendment freedoms and the restrictions placed on employer speech by § 8 (a)(1) in Sinclair, No. 585, we granted certiorari to consider both questions. 393 U. S. 997 (1968). For reasons given below, we reverse the decisions of the Court of Appeals for the Fourth Circuit and affirm the ruling of the Court of Appeals for the First Circuit.

II.

In urging us to reverse the Fourth Circuit and to affirm the First Circuit, the National Labor Relations *591Board contends that we should approve its interpretation and administration of the duties and obligations imposed by the Act in authorization card cases. The Board argues (1) that unions have never been limited under § 9 (c) of either the Wagner Act or the 1947 amendments to certified elections as the sole route to attaining representative status. Unions may, the Board contends, impose a duty to bargain on the employer under § 8 (a) (5) by reliance on other evidence of majority employee support, such as authorization cards. Contrary to the Fourth Circuit’s holding, the Board asserts, the 1947 amendments did not eliminate the alternative routes to majority status. The Board contends (2) that the cards themselves, when solicited in accordance with Board standards which adequately insure against union misrepresentation, are sufficiently reliable indicators of employee desires to support a bargaining order against an employer who refuses to recognize a card majority in violation of §8 (a) (5). The Board argues (3) that a bargaining order is the appropriate remedy for the § 8 (a) (5) violation, where the employer commits other unfair labor practices that tend to undermine union support and render a fair election improbable.

Relying on these three assertions, the Board asks us to approve its current practice, which is briefly as follows. When confronted by a recognition demand based on possession of cards allegedly signed by a majority of his employees, an employer need not grant recognition immediately, but may, unless he has knowledge independently of the cards that the union has a majority, decline the union’s request and insist on an election, either by requesting the union to file an election petition or by filing such a petition himself under §9 (c)(1)(B). If, however, the employer commits independent and substantial unfair labor practices disruptive of election conditions, the Board may withhold the election or set it aside, and issue instead a bargaining order as a remedy *592for the various violations. A bargaining order will not issue, of course, if the union obtained the cards through misrepresentation or coercion or if the employer’s unfair labor practices are unrelated generally to the representation campaign. Conversely, the employers in these cases urge us to adopt the views of the Fourth Circuit.

There is more at issue in these cases than the dispute outlined above between the Board and the four employers, however, for the Union, petitioner in No. 691, argues that we should accord a far greater role to cards in the bargaining area than the Board itself seeks in this litigation. In order to understand the differences between the Union and the Board, it is necessary to trace the evolution of the Board’s approach to authorization cards from its early practice to the position it takes on oral argument before this Court. Such an analysis requires viewing the Board’s treatment of authorization cards in three separate phases: (1) under the Joy Silk doctrine, (2) under the rules of the Aaron Brothers case, and (3) under the approach announced at oral argument before this Court.

The traditional approach utilized by the Board for many years has been known as the Joy Silk doctrine. Joy Silk Mills, Inc., 85 N. L. R. B. 1263 (1949), enforced, 87 U. S. App. D. C. 360, 185 F. 2d 732 (1950). Under that rule, an employer could lawfully refuse to bargain with a union claiming representative status through possession of authorization cards if he had a “good faith doubt” as to the union’s majority status; instead of bargaining, he could insist that the union seek an election in order to test out his doubts. The Board, then, could find a lack of good faith doubt and enter a bargaining order in one of two ways. It could find (1) that the employer’s independent unfair labor practices were evidence of bad faith, showing that the employer was seeking time to dissipate the union’s *593majority. Or the Board could find (2) that the employer had come forward with no reasons for entertaining any doubt and therefore that he must have rejected the bargaining demand in bad faith. An example of the second category was Snow & Sons, 134 N. L. R. B. 709 (1961), enforced, 308 F. 2d 687 (C. A. 9th Cir. 1962), where the employer reneged on his agreement to bargain after a third party checked the validity of the card signatures and insisted on an election because he doubted that the employees truly desired representation. The Board entered a bargaining order with very broad language to the effect that an employer could not refuse a bargaining demand and seek an election instead “without a valid ground therefor,” 134 N. L. R. B., at 710-711. See also Dixon Ford Shoe Co., Inc., 150 N. L. R. B. 861 (1965); Kellogg Mills, 147 N. L. R. B. 342, 346 (1964), enforced, 347 F. 2d 219 (C. A. 9th Cir. 1965).

The leading case codifying modifications to the Joy Silk doctrine was Aaron Brothers, 158 N. L. R. B. 1077 (1966). There the Board made it clear that it had shifted the burden to the General Counsel to show bad faith and that an employer “will not be held to have violated his bargaining obligation . . . simply because he refuses to rely upon cards, rather than an election, as the method for determining the union’s majority.” 158 N. L. R. B., at 1078. Two significant consequences were emphasized. The Board noted (1) that not every unfair labor practice would automatically result in a finding of bad faith and therefore a bargaining order; the Board implied that it would find bad faith only if the unfair labor practice was serious enough to have the tendency to dissipate the union’s majority. The Board noted (2) that an employer no longer needed to come forward with reasons for rejecting a bargaining demand. The Board pointed out, however, that a bargaining order would issue if it could prove that an employer’s “course of conduct” *594gave indications as to the employer’s bad faith. As examples of such a “course of conduct,” the Board cited Snow & Sons, supra; Dixon Ford Shoe Co., Inc., supra, and Kellogg Mills, supra, thereby reaffirming John P. Serpa, Inc., 155 N. L. R. B. 99 (1965), where the Board had limited Snow & Sons to its facts.

Although the Board’s brief before this Court generally followed the approach as set out in Aaron Brothers, supra, the Board announced at oral argument that it had virtually abandoned the Joy Silk doctrine altogether. Under the Board’s current practice, an employer’s good faith doubt is largely irrelevant, and the key to the issuance of a bargaining order is the commission of serious unfair labor practices that interfere with the election processes and tend to preclude the holding of a fair election. Thus, an employer can insist that a union go to an election, regardless of his subjective motivation, so long as he is not guilty of misconduct; he need give no affirmative reasons for rejecting a recognition request, and he can demand an election with a simple “no comment” to the union. The Board pointed out, however, (1) that an employer could not refuse to bargain if he knew, through a personal poll for instance, that a majority of his employees supported the union, and (2) that an employer could not refuse recognition initially because of questions as to the appropriateness of the unit and then later claim, as an afterthought, that he doubted the union’s strength.

The Union argues here that an employer’s right to insist on an election in the absence of unfair labor practices should be more circumscribed, and a union’s right to rely on cards correspondingly more expanded, than the Board would have us rule. The Union’s contention is that an employer, when confronted with a card-based bargaining demand, can insist on an election only by filing the election petition himself immediately under *595i 9 (c)(1)(B) and not by insisting that the Union file the election petition, whereby the election can be subjected to considerable delay. If the employer does not himself petition for an election, the Union argues, he must recognize the Union regardless of his good or bad faith and regardless of his other unfair labor practices, and should be ordered to bargain if the cards were in fact validly obtained. And if this Court should continue to utilize the good faith doubt rule, the Union contends that at the least we should put the burden on the employer to make an affirmative showing of his reasons for entertaining such doubt.

Because the employers’ refusal to bargain in each of these cases was accompanied by independent unfair labor practices which tend to preclude the holding of a fair election, we need not decide whether a bargaining order is ever appropriate in cases where there is no interference with the election processes.

With the Union’s arguments aside, the points of difference between the employers and the Board will be considered in the following manner. The validity of the cards under the Act, their intrinsic reliability, and the appropriateness of a bargaining order as a response to violations of § 8 (a)(5) as well as §§ 8 (a)(1) and (3) will be discussed in the next section. The nature of an employer’s reaction to an organizational campaign, and particularly the Board’s conclusion that the employer’s statements in No. 585 contained threats of reprisal and thus constituted restraint and coercion in violation of § 8 (a)(1) and not protected speech, will be covered in the final section.

III.

A.

The first issue facing us is whether a union can establish a bargaining obligation by means other than a Board election and whether the validity of alternate routes to *596majority status, such as cards, was affected by the 1947 Taft-Hartley amendments. The most commonly traveled7 route for a union to obtain recognition as the exclusive bargaining representative of an unorganized group of employees is through the Board’s election and certification procedures under § 9 (c) of the Act (29 ü. S. C. § 159(c)); it is also, from the Board’s point of view, the preferred route.8 A union is not limited to a Board election, however, for, in addition to § 9, the present Act provides in § 8 (a) (5) (29 U. S. C. § 158 (a)(5)), as did the Wagner Act in § 8 (5), that “[i]t shall be an unfair labor practice for an employer ... to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 9 (a).” Since § 9 (a), in both the Wagner Act and the present Act, refers to the representative as the one “designated or selected” by a majority of the employees without specifying precisely how that representative is to be chosen, it was early recognized that an employer had a duty to bargain whenever the union representative presented “convincing evidence of majority support.”9 Almost from the inception of the Act, *597then, it was recognized that a union did not have to be certified as the winner of a Board election to invoke a bargaining obligation; it could establish majority status by other means under the unfair labor practice provision of §8 (a) (5) — by showing convincing support, for instance, by a union-called strike or strike vote,10 or, as here, by possession of cards signed by a majority of the employees authorizing the union to represent them for collective bargaining purposes.11

We have consistently accepted this interpretation of the Wagner Act and the present Act, particularly as to the use of authorization cards. See, e. g., NLRB v. Bradford Dyeing Assn., 310 U. S. 318, 339-340 (1940); Franks Bros. Co. v. NLRB, 321 U. S. 702 (1944); United Mine Workers v. Arkansas Flooring Co., 351 U. S. 62 (1956). Thus, in United Mine Workers, supra, we noted that a “Board election is not the only method by which an employer may satisfy itself as to the union’s majority status,” 351 U. S., at 72, n. 8, since § 9 (a), “which deals expressly with employee representation, says nothing as to how the employees’ representative shall be chosen,” 351 U. S., at 71. We therefore pointed out in that case, where the union had obtained signed authorization cards from a majority of the employees, that “[i]n the absence of any bona fide dispute12 as to the existence of the required majority of eligible employees, the employer’s denial of recognition of the union would have violated *598§8 (a) (5) of the Act.” 351 U. S., at 69. We see no reason to reject this approach to bargaining obligations now, and we find unpersuasive the Fourth Circuit’s view that the 1947 Taft-Hartley amendments, enacted some nine years before our decision in United Mine Workers, supra, require us to disregard that case. Indeed, the 1947 amendments weaken rather than strengthen the position taken by the employers here and the Fourth Circuit below. An early version of the bill in the House would have amended § 8 (5) of the Wagner Act to permit the Board to find a refusal-to-bargain violation only where an employer had failed to bargain with a union “currently recognized by the employer or certified as such [through an election] under section 9.” Section 8 (a)(5) of H. R. 3020, 80th Cong., 1st Sess. (1947). The proposed change, which would have eliminated the use of cards, was rejected in Conference (H. R. Conf. Rep. No. 510, 80th Cong., 1st Sess., 41 (1947)), however, and we cannot make a similar change in the Act simply because, as the employers assert, Congress did not expressly approve the use of cards in rejecting the House amendment. Nor can we accept the Fourth Circuit’s conclusion that the change was wrought when Congress amended § 9 (c) to make election the sole basis for certification by eliminating the phrase “any other suitable method to ascertain such representatives,”13 under which the Board had occasionally used cards as a certification basis. A certified union has the benefit of numerous special privileges *599which are not accorded unions recognized voluntarily or under a bargaining order14 and which, Congress could determine, should not be dispensed unless a union has survived the crucible of a secret ballot election.

The employers rely finally on the addition to § 9 (c) of subparagraph (B), which allows an employer to petition for an election whenever “one or more individuals or labor organizations have presented to him a claim15 to be recognized as the representative defined in section 9 (a).” That provision was not added, as the employers assert, to give them an absolute right to an election at any time; rather, it was intended, as the legislative history indicates, to allow them, after being asked to bargain, to test out their doubts as to a union’s majority in a secret election which they would then presumably not cause to be set aside by illegal antiunion activity.16 We *600agree with the Board's assertion here that there is no suggestion that Congress intended §9 (c)(1)(B) to relieve any employer of his § 8 (a) (5) bargaining obligation where, without good faith, he engaged in unfair labor practices disruptive of the Board's election machinery. And we agree that the policies reflected in § 9 (c) (1) (B) fully support the Board's present administration of the Act (see supra, at 591-592); for an employer can insist on a secret ballot election, unless, in the words of the Board, he engages “in contemporaneous unfair labor practices likely to destroy the union’s majority and seriously impede the election.” Brief for Petitioner, the Board, in No. 573, p. 36.

In short, we hold that the 1947 amendments did not restrict an employer’s duty to bargain under § 8 (a)(5) solely to those unions whose representative status is certified after a Board election.17

*601B.

We next consider the question whether authorization cards are such inherently unreliable indicators of employee desires that, whatever the validity of other alternate routes to representative status, the cards themselves may never be used to determine a union’s majority and to support an order to bargain. In this context, the employers urge us to take the step the 1947 amendments and their legislative history indicate Congress did not take, namely, to rule out completely the use of cards in the bargaining arena. Even if we do not unhesitatingly accept the Fourth Circuit’s view in the matter, the employers argue, at the very least we should overrule the Cumberland Shoe doctrine (see supra, at 584) and establish stricter controls over the solicitation of the cards by union representatives.18

*602The objections to the use of cards voiced by the employers and the Fourth Circuit boil down to two contentions:19 (1) that, as contrasted with the election procedure,20 the cards cannot accurately reflect an employee’s wishes, either because an employer has not had a chance to present his views and thus a chance to insure that the employee choice was an informed one, or because the choice was the result of group pressures and not individual decision made in the privacy of a voting booth; and (2) that quite apart from the election comparison, the cards are too often obtained through misrepresentation and coercion which compound the cards’ inherent inferiority to the election process. Neither contention is persuasive, and each proves too much. The Board itself has recognized, and continues to do so here, that secret elections are generally the most satisfactory — indeed the preferred — method of ascertaining whether a union has majority support.21 The acknowledged superiority of the election process, however, does not mean that cards are thereby rendered totally invalid, for where an employer engages in conduct disruptive of the election process, cards may be the most effective — perhaps the only — way of assuring employee choice. As for misrepresentation, in any specific case of *603alleged irregularity in the solicitation of the cards, the proper course is to apply the Board’s customary standards (to be discussed more fully below) and rule that there was no majority if the standards were not satisfied. It does not follow that because there are some instances of irregularity, the cards can never be used; otherwise, an employer could put off his bargaining obligation indefinitely through continuing interference with elections.

That the cards, though admittedly inferior to the election process, can adequately reflect employee sentiment when that process has been impeded, needs no extended discussion, for the employers’ contentions cannot withstand close examination. The employers argue that their employees cannot make an informed choice because the card drive will be over before the employer has had a chance to present his side of the unionization issues. Normally, however, the union will inform the employer of its organization drive early in order to subject the employer to the unfair labor practice provisions of the Act; the union must be able to show the employer’s awareness of the drive in order to prove that his contemporaneous conduct constituted unfair labor practices on which a bargaining order can be based if the drive is ultimately successful. See, e. g., Hunt Oil Co., 157 N. L. R. B. 282 (1966); Don Swart Trucking Co., 154 N. L. R. B. 1345 (1965). Thus, in all of the cases here but the Charleston campaign in Heck’s the employer, whether informed by the union or not, was aware of the union’s organizing drive almost at the outset and began its antiunion campaign at that time; and even in the Heck’s Charleston case, where the recognition demand came about a week after the solicitation began, the employer was able to deliver a speech before the union obtained a majority. Further, the employers argue that without a secret ballot an employee may, in *604a card drive, succumb to group pressures or sign simply to get the union “off his back” and then be unable to change his mind as he would be free to do once inside a voting booth. But the same pressures are likely to be equally present in an election, for election cases arise most often with small bargaining units22 where virtually every voter’s sentiments can be carefully and individually canvassed. And no voter, of course, can change his mind after casting a ballot in an election even though he may think better of his choice shortly thereafter.

The employers’ second complaint, that the cards are too often obtained through misrepresentation and coercion, must be rejected also in view of the Board’s present rules for controlling card solicitation, which we view as adequate to the task where the cards involved state their purpose clearly and unambiguously on their face. We would be closing our eyes to obvious difficulties, of course, if we did not recognize that there have been abuses, primarily arising out of misrepresentations by union organizers as to whether the effect of signing a card was to designate the union to represent the employee for collective bargaining purposes or merely to authorize it to seek an election to determine that issue. And we would be equally blind if we did not recognize that various courts of appeals and commentators23 have differed significantly as to the effectiveness of the Board’s Cumberland Shoe doctrine (see supra, at 584) to cure such abuses.

Thus, even where the cards are unambiguous on their face, both the Second Circuit (NLRB v. S. E. Nichols Co., 380 F. 2d 438 (1967)) and the Fifth Circuit (Engineers & Fabricators, Inc. v. NLRB, 376 F. 2d 482 (1967)) have joined the Fourth Circuit below *605in rejecting the Board’s rule that the cards will be counted unless the solicitor’s statements amounted under the circumstances to an assurance that the cards would be used only for an election, or for no other purpose than an election. And even those circuits which have adopted the Board’s approach have criticized the Board for tending too often to apply the Cumberland rule too mechanically, declining occasionally to uphold the Board’s application of its own rule in a given case. See, e. g., NLRB v. Southbridge Sheet Metal Works, Inc., 380 F. 2d 851 (C. A. 1st Cir. 1967); NLRB v. Sandy’s Stores, Inc., 398 F. 2d 268 (C. A. 1st Cir. 1968); NLRB v. Swan Super Cleaners, Inc., 384 F. 2d 609 (C. A. 6th Cir. 1967); NLRB v. Dan Howard Mfg. Co., 390 F. 2d 304 (C. A. 7th Cir. 1968); Furr’s, Inc. v. NLRB, 381 F. 2d 562 (C. A. 10th Cir. 1967); UAW v. NLRB, 129 U. S. App. D. C. 196, 392 F. 2d 801 (1967). Among those which reject the Cumberland rule, the Fifth Circuit agrees with the Second Circuit (see S. E. Nichols Co., supra), that a card will be vitiated if an employee was left with the impression that he would be able to resolve any lingering doubts and make a final decision in an election, and further requires that the Board probe the subjective intent of each signer, an inquiry expressly avoided by Cumberland. See NLRB v. Southland Paint Co., 394 F. 2d 717, 728, 730 (C. A. 5th Cir. 1968); Engineers & Fabricators, Inc. v. NLRB, supra. Where the cards are ambiguous on their face, the Fifth Circuit, joined by the Eighth Circuit (see, e. g., NLRB v. Peterson Bros., 342 F. 2d 221 (C. A. 5th Cir. 1965), and Bauer Welding & Metal Fabricators, Inc. v. NLRB, 358 F. 2d 766 (C. A. 8th Cir. 1966)), departs still further from the Board rule. And there is a conflict among those courts which otherwise follow the Board as to single-purpose cards (compare NLRB v. Lenz Co., 396 F. 2d 905, 908 (C. A. 6th Cir. 1968), with NLRB v. C. J. Glasgow Co., 356 F. 2d 476, 478 (C. A. 7th Cir. 1966)).

*606We need make no decision as to the conflicting approaches used with regard to dual-purpose cards, for in each of the five organization campaigns in the four cases before us the cards used were single-purpose cards, stating clearly and unambiguously on their face that the signer designated the union as his representative. And even the view forcefully voiced by the Fourth Circuit below that unambiguous cards as well present too many opportunities for misrepresentation comes before us somewhat weakened in view of the fact that there were no allegations of irregularities in four of those five campaigns (Gissel, the two Heck’s campaigns,24 and Sinclair). Only in General Steel did the employer challenge the cards on the basis of misrepresentations. There, the trial examiner, after hearing testimony from over 100 employees and applying the traditional Board approach (see n. 5, supra), concluded that “all of these employees not only intended, but were fully aware, that they were thereby designating the Union as their representative.” Thus, the sole question before us, raised in only one of the four cases here, is whether the Cumberland Shoe doctrine is an adequate rule under the Act for assuring employee free choice.

In resolving the conflict among the circuits in favor of approving the Board’s Cumberland rule, we think it sufficient to point out that employees should be bound by the clear language of what they sign unless that language is deliberately and clearly canceled by a union adherent with words calculated to direct the signer to disregard and forget the language above his signature. There is nothing inconsistent in handing an employee *607a card that says the signer authorizes the union to represent him and then telling him that the card will probably be used first to get an election. Elections have been, after all, and will continue to be, held in the vast majority of cases; the union will still have to have the signatures of 30% 25 of the employees when an employer rejects a bargaining demand and insists that the union seek an election. We cannot agree with the employers/ here that employees as a rule are too unsophisticated to be bound by what they sign unless expressly told that their act of signing represents something else. In addition to approving the use of cards, of course, Congress has expressly authorized reliance on employee signatures alone in other areas of labor relations, even where criminal sanctions hang in the balance,26 and we should not act hastily in disregarding congressional judgments that employees can be counted on to take responsibility for their acts.

We agree, however, with the Board’s own warnings in Levi Strauss & Co., 172 N. L. R. B. No. 57, 68 L. R. R. M. 1338, 1341, and n. 7 (1968), that in hearing testimony concerning a card challenge, trial examiners should not neglect their obligation to ensure employee free choice by *608a too easy mechanical application of the Cumberland rule.27 We also accept the observation that employees are more likely than not, many months after a card drive and in response to questions by company counsel, to give testimony damaging to the union, particularly where company officials have previously threatened reprisals for union activity in violation of § 8 (a) (1).28 We therefore reject any rule that requires a probe of an employee’s subjective motivations as involving an endless and unreliable inquiry. We nevertheless feel that the trial examiner’s findings in General Steel (see n. 5, supra) represent the limits of the Cumberland rule’s application. We emphasize that the Board should be careful to guard *609against an approach any more rigid than that in General Steel. And we reiterate that nothing we say here indicates our approval of the Cumberland Shoe rule when applied to ambiguous, dual-purpose cards.

The employers argue as a final reason for rejecting the use of the cards that they are faced with a Hobson’s choice29 under current Board rules and will almost inevitably come out the loser. They contend that if they do not make an immediate, personal investigation into possible solicitation irregularities to determine whether in fact the union represents an uncoerced majority, they will have unlawfully refused to bargain for failure to have a good faith doubt of the union’s majority; and if they do make such an investigation, their efforts at polling and interrogation will constitute an unfair labor practice in violation of §8 (a)(1) and they will again be ordered to bargain. As we have pointed out, however, an employer is not obligated to accept a card check as proof of majority status, under the Board’s current practice, and he is not required to justify his insistence on an election by making his own investigation of employee sentiment and showing affirmative reasons for doubting the majority status. See Aaron Brothers, 158 N. L. R. B. 1077, 1078. If he does make an investigation, the Board’s recent cases indicate that reasonable polling in this regard will not always be termed violative of § 8 (a)(1) if conducted in accordance with the requirements set out in Struksnes Construction Co., 165 N. L. R. B. No. 102, 65 L. R. R. M. 1385 (1967). And even if an employer’s limited interrogation is found violative of the Act, it might not be serious enough to call for a bargaining order. See Aaron Brothers, supra; Hammond & Irving, Inc., 154 N. L. R. B. 1071 *610(1965). As noted above, the Board has emphasized that not “any employer conduct found violative of Section 8 (a)(1) of the Act, regardless of its nature or gravity, will necessarily support a refusal-to-bargain finding,” Aaron Brothers, supra, at 1079.

C.

Remaining before us is the propriety of a bargaining order as a remedy for a §8 (a)(5) refusal to bargain where an employer has committed independent unfair labor practices which have made the holding of a fair election unlikely or which have in fact undermined a union’s majority and caused an election to be set aside. We have long held that the Board is not limited to a cease-and-desist order in such cases, but has the authority to issue a bargaining order without first requiring the union to show that it has been able to maintain its majority status. See NLRB v. Katz, 369 U. S. 736, 748, n. 16 (1962); NLRB v. P. Lorillard Co., 314 U. S. 512 (1942). And we have held that the Board has the same authority even where it is clear that the union, which once had possession of cards from a majority of the employees, represents only a minority when the bargaining order is entered. Franks Bros. Co. v. NLRB, 321 U. S. 702 (1944). We see no reason now to withdraw this authority from the Board. If the Board could enter only a cease-and-desist order and direct an election or a rerun, it would in effect be rewarding the employer and allowing him “to profit from [his] own wrongful refusal to bargain,” Franks Bros., supra, at 704, while at the same time severely curtailing the employees’ right freely to determine whether they desire a representative. The employer could continue to delay or disrupt the election processes and put off indefinitely his obligation *611to bargain;30 and any election held under these circumstances would not be likely to demonstrate the employees’ true, undistorted desires.31

The employers argue that the Board has ample remedies, over and above the cease-and-desist order, to control employer misconduct. The Board can, they assert, direct the companies to mail notices to employees, to read *612notices to employees during plant time and to give the union access to employees during working time at the plant, or it can seek a court injunctive order under § 10 (j) (29 U. S. C. § 160 (j)) as a last resort. In view of the Board’s power, they conclude, the bargaining order is an unnecessarily harsh remedy that needlessly prejudices employees’ § 7 rights solely for the purpose of punishing or restraining an employer. Such an argument ignores that a bargaining order is designed as much to remedy past election damage32 as it is to deter future misconduct. If an employer has succeeded in undermining a union’s strength and destroying the laboratory conditions necessary for a fair election, he may see no need to violate a cease-and-desist order by further unlawful activity. The damage will have been done, and perhaps the only fair way to effectuate employee rights is to re-establish the conditions as they existed before the employer’s unlawful campaign.33 *613There is, after all, nothing permanent in a bargaining order, and if, after the effects of the employer’s acts have worn off, the employees clearly desire to disavow the union, they can do so by filing a representation petition. For, as we pointed out long ago, in finding that a bargaining order involved no “injustice to employees who may wish to substitute for the particular union some other . . . arrangement,” a bargaining relationship “once rightfully established must be permitted to exist and function for a reasonable period in which it can be given a fair chance to succeed,” after which the “Board may, . . . upon a proper showing, take steps in recognition of changed situations which might make appropriate changed bargaining relationships.” Frank Bros., supra, at 705-706.

Before considering whether the bargaining orders were appropriately entered in these cases, we should summarize the factors that go into such a determination. Despite our reversal of the Fourth Circuit below in Nos. 573 and 691 on all major issues, the actual area of disagreement between our position here and that of the Fourth Circuit is not large as a practical matter. While refusing to validate the general use of a bargaining order in reliance on cards, the Fourth Circuit nevertheless left open the possibility of imposing a bargaining order, without need of inquiry into majority status on the basis of cards or otherwise, in “exceptional” cases marked by “outrageous” and “pervasive” unfair labor practices. *614Such an order would be an appropriate remedy for those practices, the court noted, if they are of “such a nature that their coercive effects cannot be eliminated by the application of traditional remedies, with the result that a fair and reliable election cannot be had.” NLRB v. Logan Packing Co., 386 F. 2d 562, 570 (C. A. 4th Cir. 1967); see also NLRB v. Heck’s, Inc., 398 F. 2d 337, 338. The Board itself, we should add, has long had a similar policy of issuing a bargaining order, in the absence of a§8(a)(5) violation or even a bargaining demand, when that was the only available, effective remedy for substantial unfair labor practices. See, e. g., United Steelworkers of America v. NLRB, 126 U. S. App. D. C. 215, 376 F. 2d 770 (1967); J. C. Penney Co., Inc. v. NLRB, 384 F. 2d 479, 485-486 (C. A. 10th Cir. 1967).

The only effect of our holding here is to approve the Board’s use of the bargaining order in less extraordinary cases marked by less pervasive practices which nonetheless still have the tendency to undermine majority strength and impede the election processes. The Board’s authority to issue such an order on a lesser showing of employer misconduct is appropriate, we should reemphasize, where there is also a showing that at one point the union had a majority; in such a case, of course, effectuating ascertainable employee free choice becomes as important a goal as deterring employer misbehavior. In fashioning a remedy in the exercise of its discretion, then, the Board can properly take into consideration the extensiveness of an employer’s unfair practices in terms of their past effect on election conditions and the likelihood of their recurrence in the future. If the Board finds that the possibility of erasing the effects of past practices and of ensuring a fair election (or a fair rerun) by the use of traditional remedies, though present, is slight and that employee sentiment once expressed through cards would, on balance, be better protected *615by a bargaining order, then such an order should issue (see n. 32, supra).

We emphasize that under the Board’s remedial power there is still a third category of minor or less extensive unfair labor practices, which, because of their minimal impact on the election machinery, will not sustain a bargaining order. There is, the Board says, no per se rule that the commission of any unfair practice will automatically result in a § 8 (a) (5) violation and the issuance of an order to bargain. See Aaron Brothers, supra.

With these considerations in mind, we turn to an examination of the orders in these cases. In Sinclair, No. 585, the Board made a finding, left undisturbed by the First Circuit, that the employer’s threats of reprisal were so coercive that, even in the absence of a §8 (a)(5) violation, a bargaining order would have been necessary to repair the unlawful effect of those threats.34 The Board therefore did not have to make the determination called for in the intermediate situation above that the risks that a fair rerun election might not be possible were too great to disregard the desires of the employees already expressed through the cards. The employer argues, however, that its communications to its employees were protected by the First Amendment and § 8 (c) of the Act (29 U. S. C. § 158 (c)), whatever the effect of those communications on the union’s majority or the Board’s ability to ensure a fair election; it is to that contention that .we shall direct our final attention in the next section.

In the three cases in Nos. 573 and 691 from the Fourth Circuit, on the other hand, the Board did not make a *616similar finding that a bargaining order would have been necessary in the absence of an unlawful refusal to bargain. Nor did it make a finding that, even though traditional remedies might be able to ensure a fair election, there was insufficient indication that an election (or a rerun in General Steel) would definitely be a more reliable test of the employees’ desires than the card count taken before the unfair labor practices occurred. The employees argue that such findings would not be warranted, and the court below ruled in General Steel that available remedies short of a bargaining order could guarantee a fair election. 398 F. 2d 339, 340, n. 3. We think it possible that the requisite findings were implicit in the Board’s decisions below to issue bargaining orders (and to set aside the election in General Steel); and we think it clearly inappropriate for the court below to make any contrary finding on its own (see n. 32, supra). Because the Board’s current practice at the time required it to phrase its findings in terms of an employer’s good or bad faith doubts (see Part II, supra), however, the precise analysis the Board now puts forth was not employed below, and we therefore remand these cases for proper findings.

IV.

We consider finally petitioner Sinclair’s First Amendment challenge to the holding of the Board and the Court of Appeals for the First Circuit. At the outset we note that the question raised here most often arises in the context of a nascent union organizational drive, where employers must be careful in waging their anti-union campaign. As to conduct generally, the above-noted gradations of unfair labor practices, with their varying consequences, create certain hazards for employers when they seek to estimate or resist unionization efforts. But so long as the differences involve conduct easily avoided, such as discharge, surveillance, and coer*617cive interrogation, we do not think that employers can complain that the distinctions are unreasonably difficult to follow. Where an employer’s antiunion efforts consist of speech alone, however, the difficulties raised are not so easily resolved. The Board has eliminated some of the problem areas by no longer requiring an employer to show affirmative reasons for insisting on an election and by permitting him to make reasonable inquiries. We do not decide, of course, whether these allowances are mandatory. But we do note that an employer’s free speech right to communicate his views to his employees is firmly established and cannot be infringed by a union or the Board. Thus, § 8 (c) (29 U. S. C. § 158 (c)) merely implements the First Amendment by requiring that the expression of “any views, argument, or opinion” shall not be “evidence of an unfair labor practice,” so long as such expression contains “no threat of reprisal or force or promise of benefit” in violation of §8 (a)(1). Section 8(a)(1), in turn, prohibits interference, restraint or coercion of employees in the exercise of their right to self-organization.

Any assessment of the precise scope of employer expression, of course, must be made in the context of its labor relations setting. Thus, an employer’s rights cannot outweigh the equal rights of the employees to associate freely, as those rights are embodied in § 7 and protected by §8 (a)(1) and the proviso to § 8 (c). And any balancing of those rights must take into account the economic dependence of the employees on their employers, and the necessary tendency of the former, because of that relationship, to pick up intended implications of the latter that might be more readily dismissed by a more disinterested ear. Stating these obvious principles is but another way of recognizing that what is basically at stake is the establishment of a nonpermanent, limited relationship between the employer, his economically dependent employee and his union agent, not the *?election of legislators or the enactment of legislation whereby that relationship is ultimately defined and where the independent voter may be freer to listen more objectively and employers as a class freer to talk. Cf. New York Times Co. v. Sullivan, 376 U. S. 254 (1964).

Within this framework, we must reject the Company’s challenge to the decision below and the findings of the Board on which it was based. The standards used below for evaluating the impact of an employer’s statements are not seriously questioned by petitioner and we see no need to tamper with them here. Thus, an employer is free to communicate to his employees any of his general views about unionism or any of his specific views about a particular union, so long as the communications do not contain a “threat of reprisal or force or promise of benefit.” He may even make a prediction as to the precise effects he believes unionization will have on his company. In such a case, however, the prediction must be carefully phrased on the basis of objective fact to convey an employer’s belief as to demonstrably probable consequences beyond his control or to convey a management decision already arrived at to close the plant in case of unionization. See Textile Workers v. Darlington Mfg. Co., 380 U. S. 263, 274, n. 20 (1965). If there is any implication that an employer may or may not take action solely on his own initiative for reasons unrelated to economic necessities and known only to him, the statement is no longer a reasonable prediction based on available facts but a threat of retaliation based on misrepresentation and coercion, and as such without the protection of the First Amendment. We therefore agree with the court below that “[conveyance of the employer’s belief, even though sincere, that unionization will or may result in the closing of the plant is not a statement of fact unless, which is most improbable, the eventuality *619of closing is capable of proof.” 397 F. 2d 157, 160. As stated elsewhere, an employer is free only to tell “what he reasonably believes will be the likely economic consequences of unionization that are outside his control,” and not “threats of economic reprisal to be taken solely on his own volition.” NLRB v. River Togs, Inc., 382 F. 2d 198, 202 (C. A. 2d Cir. 1967).

Equally valid was the finding by the court and the Board that petitioner’s statements and communications were not cast as a prediction of “demonstrable ‘economic consequences,’ ” 397 F. 2d, at 160, but rather as a threat of retaliatory action. The Board found that petitioner’s speeches, pamphlets, leaflets, and letters conveyed the following message: that the company was in a precarious financial condition; that the “strike-happy” union would in all likelihood have to obtain its potentially unreasonable demands by striking, the probable result of which would be a plant shutdown, as the past history of labor relations in the area indicated; and that the employees in such a case would have great difficulty finding employment elsewhere. In carrying out its duty to focus on the question: “[W]hat did the speaker intend and the listener understand?” (A. Cox, Law and the National Labor Policy 44 (I960)), the Board could reasonably conclude that the intended and understood import of that message was not to predict that unionization would inevitably cause the plant to close but to threaten to throw employees out of work regardless of the economic realities. In this connection, we need go no further than to point out (1) that petitioner had no support for its basic assumption that the union, which had not yet even presented any demands, would have to strike to be heard, and that it admitted at the hearing that it had no basis for attributing other plant closings in the area to unionism; and (2) that the Board has often found that employees, who are particularly sensitive to rumors *620of plant closings,35 take such hints as coercive threats rather than honest forecasts.36

Petitioner argues that the line between so-called permitted predictions and proscribed threats is too vague to stand up under traditional First Amendment analysis and that the Board’s discretion to curtail free speech rights is correspondingly too uncontrolled. It is true that a reviewing court must recognize the Board’s competence in the first instance to judge the impact of utterances made in the context of the employer-employee relationship, see NLRB v. Virginia Electric & Power Co., 314 U. S. 469, 479 (1941). But an employer, who has control over that relationship and therefore knows it best, cannot be heard to complain that he is without an adequate guide for his behavior. He can easily make his views known without engaging in “ ‘brinkmanship’ ” when it becomes all too easy to “overstep and tumble [over] the brink,” Wausau Steel Corp. v. NLRB, 377 F. 2d 369, 372 (C. A. 7th Cir. 1967). At the least he can avoid coercive speech simply by avoiding conscious overstatements he has reason to believe will mislead his employees.

For the foregoing reasons, we affirm the judgment of the Court of Appeals for the First Circuit in No. 585, and we reverse the judgments of the Court of Appeals for the Fourth Circuit in Nos. 573 and 691 insofar as they decline enforcement of the Board’s orders to bargain and remand those cases to that court with directions to remand to the Board for further proceedings in conformity with this opinion. r. . , , J

r. J It is so ordered.

26.2 Macy's, Inc. v. National Labor Relations Board 26.2 Macy's, Inc. v. National Labor Relations Board

MACY’S, INCORPORATED, Petitioner Cross-Respondent v. NATIONAL LABOR RELATIONS BOARD, Respondent Cross-Petitioner.

No. 15-60022

United States Court of Appeals, Fifth Circuit.

Filed June 2, 2016

*560Shay Dvoretzky, Jones Day, Washington, DC, Willis J. Goldsmith, Jones Day, New York, NY, for Petitioner Cross-Respondent.

Linda Dreeben, Esq., Deputy Associate General Counsel, Julie Brock Broido, Supervisory Attorney, Gregory Paul Lauro, Trial Attorney, National Labor Relations Board, Appellate & Supreme Court Litigation Branch, Washington, DC, Jonathan Kreisberg, National Labor Relations Board, Regional Office, Boston, MA, for Respondent Cross-Petitioner.

Alfred Sebastian Gordon, O’Connell, Pyle, Rome, Ehrenberg, P.C., Boston, MA, Matthew James Ginsburg, AFL-CIO, Washington, DC, for Intervenor.

Todd Clifford Duffield, Ogletree Dea-kins, P.C., Atlanta, GA, for Amicus Curiae Coalition for a Democratic Workplace, Chamber of Commerce of the United States of America, International Foodser-vice Distributors Association, National Association of Manufacturers, National Association of Wholesaler-Distributors, National Federation of Independent Business, Society for Human Resource Management, National Restaurant Association.

Howard Shapiro, Esq., Proskauer, New Orleans, LA, for Amicus Curiae HR Policy Association.

Jason C. Schwartz, Esq., Gibson, Dunn & Crutcher, L.L.P., Washington, DC, for Amicus Curiae Retail Litigation Center, National Retail Federation.

Before BENAVIDES, DENNIS, and COSTA, Circuit Judges.

JAMES L. DENNIS, Circuit Judge:

The National Labor Relations Board (NLRB or the Board) certified a collective-bargaining unit consisting of all cosmetics and fragrances employees at the Saugus, Massachusetts, Macy’s department store. After Macy’s refused to bargain with Local 1445, United Food and Commercial Workers Union (the Union), which was certified as the unit’s bargaining representative, the Board filed an unfair labor practices order. Macy’s filed a petition for review with this court, contending that (1) the Board applied a legal standard that violated the National Labor Relations Act (NLRA or the Act) and otherwise committed an abuse of discretion; and (2) under the proper legal standard as well as the incorrect legal standard upon which the Boai'd *561relied, all selling employees must be included in the petitioned-for unit.1 The Board filed a cross-application for enforcement of its order. Because the Board did not violate the NLRA or abuse its discretion in certifying the unit of cosmetics and fragrances employees, we DENY the petition for review and GRANT the Board’s cross-petition for enforcement of its order.

I.

A.

Macy’s operates a national chain of department stores, including one in Saugus, Massachusetts. The Saugus store is divided into eleven primary sales departments: juniors, ready-to-wear, women’s shoes, handbags, furniture (also known as big ticket), home (also referred to as housewares), men’s clothing, bridal, fíne jewelry, fashion jewelry, and cosmetics and*, fragrances. The petitioned-for unit includes all full-time, part-time, and on-call employees employed in the Saugus store’s cosmetics and fragrances department, including counter managers, beauty advisors, and all selling employees in cosmetics, women’s fragrances, and men’s fragrances.

The, cosmetics and fragrances department is located in two areas within the Saugus store, on the first and second floors; the two areas are connected by a bank of elevators. Each of the two selling areas is spatially distinct from the other primary sales departments. Cosmetics beauty advisors are specifically assigned to one of eight counters in the first floor cosmetics area, each of which is dedicated to selling products from one of eight primary cosmetics vendors. Cosmetics beauty advisors typically sell only one vendor’s products, which they also use to give customers makeovers. Fragrances beauty ad-visors are assigned to either the men’s or the women’s fragrances counter, and they sell all available men’s or women’s products, regardless of the vendor. Cosmetics and fragrances beauty advisors keep lists of their regular customers, which they use to invite customers to product launches or to book appointments to give customers makeovers. Although cosmetics and fragrances employees occasionally assist other departments with inventory, the record is clear that cosmetics and fragrances employees are never asked to sell in other departments, nor are other selling employees asked to sell in the cosmetics and fragrances department.

Six of the eight cosmetics counters, the women’s fragrances counter, and the men’s fragrances counter each have a counter manager who, in addition to selling products, helps organize promotional events, monitors the counter’s stock, coaches beauty advisors on customer service and selling technique, ensures that the counter is properly covered by beauty advisors, and schedules visits by vendor employees, such as sprayers and makeup artists. Finally, the department has seven on-call employees who, unlike the beauty advisors, may work at any of the ten counters. There is no indication that any other primary sales department has the equivalent of counter managers, and the record is unclear as to whether the other primary sales departments have the equivalent of on-call employees.

.Outside of the cosmetics and fragrances department the Saugus store has approxi*562mately thirty non-selling employees (a receiving team, a merchandising team, and staffing employees) and eighty selling employees organized within the other ten primary sales departments. Most, but not all, of the other departments have their own sales manager, and at least some of them are divided into sub-departments. Certain other primary sales departments have specialist sales employees who, like the cosmetics beauty advisors, specialize in selling a particular vendor’s products; in those departments, vendor representatives monitor stock and train selling employees on selling technique and product knowledge.

Cosmetics and fragrances employees and other selling employees have some incidental contact: cosmetics and fragrances employees occasionally assist in storewide inventory, and all employees whose shifts correspond with the store’s opening attend brief daily “rallies” at which management reviews the previous day’s sales figures and any in-store events that are taking place that day. In addition, all selling employees work shifts during the same time periods, use the same entrance, have the same clocking system, and use the same break room. However, the record contains little evidence of temporary interchange between cosmetics and fragrances employees and other selling employees.

Although compensation differs, all selling employees enjoy the same benefits, are subject to the same employee handbook, and have access to the same in-store dispute resolution program. All selling employees are evaluated based on the same criteria. Finally, all selling employees are coached through the same program designed to improve selling techniques and product knowledge.

B.

In October 2012, the Union filed a petition with the Board seeking a representation election among all cosmetics and fragrances employees at the Saugus store. In November 2012, the Board’s Acting Regional Director (ARD) issued a Decision and Direction of Election in which he found that a petitioned-for bargaining unit of cosmetics and fragrances employees, including counter managers, employed by Macy’s at its Saugus store was appropriate. Thereafter, Macy’s filed a timely request for review. Macy’s contended that the smallest appropriate unit must include all employees at the Saugus store or, in the alternative, all selling employees at the store. The Union filed an opposition. In December 2012, the Board granted the Employer’s request for review.

In making a determination as to the appropriateness of the bargaining unit, the Board applied the “overwhelming community pf interest” test set forth in Specialty Healthcare and Rehabilitation Center of Mobile, 357 NLRB No. 83, 2011 WL 3916077 (2011), enforced sub nom. Kindred Nursing Centers East, LLC v. NLRB, 727 F.3d 552 (6th Cir. 2013). The Board determined that the cosmetics and fragrances employees share a community of interest, finding that all of the petitioned-for employees: work in the same department and in the same two connected, distinct work areas; have common, separate supervision; work with a shared distinct purpose and functional integration; have little contact with other selling employees; and are paid on the same basis, receive the same benefits, and are subject to the same employer policies.

The Board then addressed Macy’s contention that the smallest appropriate unit must include a wall-to-wall unit of all Sau-gus store employees, or, alternatively, all selling employees at the store. The Board explained that Specialty Healthcare requires an employer to demonstrate that *563the excluded employees share an “overwhelming community of interest” with the employees in the petitioned-for unit, such that their community of interest factors “overlap almost completely.” While acknowledging that the petitioned-for unit shared some factors with certain other selling employees, the Board concluded that a storewide unit was not required.

Finally, the Board addressed Macy’s contention that Specialty Healthcare deviated from a line of precedent holding that a storewide unit is “presumptively appropriate” within the retail industry. After considering the relevant precedent, the Board concluded that it has, “over time, developed and applied a standard that allows a less-than-storewide unit so long as that unit is identifiable, the unit employees share a community of interest, and those employees are sufficiently distinct from other store employees.” It therefore found that the petitioned-for unit was appropriate under Board precedent even without reference to Specialty Healthcare.

After Macy’s refused to bargain with the Union, the Board filed an unfair labor practices order. Macy’s petitioned for review, arguing that the unit sanctioned by the Board was clearly not appropriate, that the Board applied a test that cannot be squared with the NLRA or prior Board precedent governing initial unit determinations, and that, even under Specialty Healthcare, the Board approved an inappropriate unit. The Board cross-applied for enforcement of its order.

II.

Under Section 10(e) of the NLRA, which governs petitions for enforcement of Board orders, the Board’s factual findings are conclusive if they are “supported by substantial evidence on the record considered as a whole.” 29 U.S.C. § 160(e). Section 10(f), which governs petitions for review of Board orders, contains the same standard of review for factual findings. 29 U.S.C. § 160(f). As for questions of law, the Supreme Court has repeatedly held that “the NLRB has the primary responsibility for developing and applying national labor policy” and that the Board’s rules should therefore be accorded “considerable deference.” NLRB v. Curtin Matheson Scien., Inc., 494 U.S. 775, 786, 110 S.Ct. 1542, 108 L.Ed.2d 801 (1990).

“This court’s review of the Board’s determination of an appropriate bargaining unit is exceedingly narrow.” Elec. Data Sys. Corp. v. NLRB, 938 F.2d 570, 572 (5th Cir. 1991) (quoting NLRB v. S. Metal Serv., 606 F.2d 512, 514 (5th Cir. 1979) (internal quotation marks omitted)). This court therefore reviews unit determinations only to determine “whether the decision is arbitrary, capricious, an abuse of discretion, or lacking in evidentiary support.” Id. at 573. An employer who challenges the Board’s determination has the burden of establishing “that the designated unit is clearly not appropriate.” Id. at 574 (quoting NLRB v. Purnell’s Pride, Inc., 609 F.2d 1153, 1155-56 (5th Cir. 1980)).

III.

Section 9(a) of the NLRA provides that a union will be the exclusive bargaining representative if chosen “by the majority of the employees in a unit appropriate for” collective bargaining. 29 U.S.C. § 159(a). Section 9(b) authorizes the Board to “decide in each case whether, in order to assure to employees the fullest freedom in exercising the rights guaranteed by [the Act], the unit appropriate for the purposes of collective bargaining shall be the employer unit, craft unit, plant unit, or subdivision thereof.” 29 U.S.C. § 159(b). The Act does not, however, tell the Board how *564to determine whether a bargaining unit is appropriate.

In making its determination, the Board has traditionally looks at the “community of interest” of the employees involved. Elec. Data Sys., 938 F.2d at 573. As this court has explained:

Whether employees have a community of interests is determined by looking at such factors as: similarity in the scale and manner of determining earnings; similarity in employment benefits, hours of work and other terms and conditions of employment; similarity in the kind of work performed; similarity in the qualifications, skills and training of employees; frequency of contact or interchange among employees; geographic proximity; continuity or integration of production processes; common supervision and determination of labor-relations policy; relationship to the administrative organization of the employer; history of collective bargaining; desires of the affected employees; and extent of union organization.

NLRB v. Catalytic Indus. Maint. Co. (CIMCO), 964 F.2d 513, 518 (5th Cir. 1992). This court has made clear that “[t]hese factors have no independent significance.” Purnell’s Pride, 609 F.2d at 1156. Rather, in assessing the employees’ community of interests “[t]he Board must consider the entire factual situation, and its discretion is not limited by a requirement that its judgment be supported by all, or even most, of the potentially relevant factors.” Elec. Data Sys. Corp., 938 F.2d at 573 (quoting NLRB v. DMR Corp., 795 F.2d 472, 475 (5th Cir. 1986)). In addition, the Supreme Court has stated that “employees may seek to organize ‘a unit’ that is ‘appropriate’ — not necessarily the single most appropriate unit.” Am. Hosp. Ass’n v. NLRB, 499 U.S. 606, 610, 111 S.Ct. 1539, 113 L.Ed.2d 675 (1991). Applying this standard, this court has held that where there is evidence that an alternative unit “might also [be] an appropriate bargaining unit,” the unit approved by the NLRB will nevertheless be enforced unless it was “clearly not appropriate.” Elec. Data Sys. Corp., 938 F.2d at 574 (quoting Purnell’s Pride, 609 F.2d at 1156).

In Specialty Healthcare, the Board clarified the principles that apply in cases, such as this one, where a party contends that the smallest appropriate bargaining unit must include additional employees beyond those in the petitioned-for unit. If the Board determines that the smaller unit is readily identifiable as a group — based on job classifications, departments, functions, work locations, skills, or similar factors — and the employees in the smaller unit share a community of interest according to the traditional criteria,

the Board will find the petitioned-for unit to be an appropriate unit, despite a contention that employees in the unit could be placed in a larger unit which would also be appropriate or even more appropriate, unless the party so contending demonstrates that employees in the larger unit share an overwhelming community of interest with those in the petitioned-for unit.

Specialty Healthcare, 357 NLRB No. 83, at *17. Even before the Board decided Specialty Healthcare, the D.C. Circuit had approved an “overwhelming community of interest” standard, holding that “[i]f the employees in the proposed unit share a community of interest, then the unit is prima facie appropriate,” and the employer bears the burden of showing that it is “truly inappropriate.” Blue Man Vegas, LLC v. NLRB, 529 F.3d 417, 421 (D.C. Cir. 2008). As the court explained, this burden is satisfied where there “is no legitimate basis upon which to exclude cer*565tain employees from [the proposed unit].” Id.; accord Specialty Healthcare, 357 NLRB No. 83, at *16.

A.

Macy’s begins by arguing that the unit approved by the Board was clearly not appropriate because all sales employees at the Saugus store represent “a homogenous work force.” Citing to Amalgamated Clothing Workers, 491 F.2d 595 (5th Cir. 1974), Macy’s argues that a unit limited to cosmetics and fragrances employees is inappropriate because “there are no material distinctions among the sales employees in the Saugus store.” In Amalgamated Clothing Workers, the Board had approved a unit of cutters, markers, and spreaders solely on the grounds that they were “highly skilled.” Id. at 598. This court rejected the Board’s unit determination because of “the complete lack of separate interests in any conditions of employment” that distinguished the petitioned-for unit from the rest of the employees. Id. at 598.

The Board’s findings in this case, which are supported by substantial evidence, do not demonstrate a “complete lack of separate interests.” In making its argument, Macy’s simply ignores or contradicts the Board’s explicit findings that illustrate the distinct interests of the cosmetics and fragrances employees. Contrary to Maey’s claim that all employees “collaborate in the same integrated workplace,” the Board found “little evidence of temporary interchange between the petitioned-for employees and other selling employees.” Macy’s & Local 1445, 361 NLRB No. 4, *6 (July 22, 2014). Specifically, the Board found “no examples of (1) other selling employees actually assisting the cosmetics and fragrances department, (2) cosmetics and fragrances employees actually assisting other departments, or (3) a selling employee from one department picking up shifts in another department.” Id. And while Macy’s asserts that “[ejxten-sive training and coaching opportunities are available to all sales employees,” the Board in fact found that much of the training was department-specific. Id. at *4 (“[S]ales departments hold various seminars during the year that train employees in their departments in selling technique, product knowledge, and related topics.”). Even Macy’s assertion that all selling employees “perform the same basic job function of selling merchandise to customers” ignores the Board’s finding that cosmetics and fragrances employees perform a unique function, that of “selling cosmetics and fragrances.” Id. at *10.

Macy’s concedes that there are distinctions between the cosmetics and fragrances sales employees and the rest of the selling staff. It acknowledges that the department is organized as a separate department, supervised by a separate sales manager, and operated primarily in distinct areas of the store. But it asserts that the Board failed to explain why these distinctions outweigh the similarities between the petitioned-for employees and the other selling employees, and it argues that, under Purnell’s Pride, this “lack of explanation is fatal to the Board’s decision.” In Purnell’s Pride, the Regional Director had simply listed the factors that guided his unit determination. 609 F.2d at 1159-60. Finding that the Board, in upholding the Regional Director’s ruling, had failed to adequately explain its weighing of the community interest factors, see id. at 1160, this court remanded the case to allow the Board to disclose the basis of its order, id. at 1162. Here, the Board satisfied Pur-nell’s Pride’s requirements: the decision identified some factors that could weigh against the petitioned-for unit and explained — with citation to Board precedent — why these factors did not render the *566petitioned-for unit inappropriate. Macy’s & Local 1U5, 361 NLRB No. 4, *11.

Finally, Macy’s advances two policy-based arguments. First, it contends' that the petitioned-for unit is inappropriate because its approval by the Board will “wreak havoc in the retail industry” by disrupting employer operations and frustrating customer experience. Next, it contends that the certification of departmental units will undermine workers’ rights. These arguments are unsuccessful. Macy’s does not cite to any controlling authority for the proposition that the effect on an employer’s business is a factor to be considered in unit determinations. And the Board’s history of approving multiple units in the retail and other industries suggests that neither workers nor businesses will suffer grave consequences as a result of the Board’s order. See, e.g., Teledyne Economic Dev. v. NLRB, 108 F.3d 56, 57 (4th Cir. 1997) (enforcing Board’s decision certifying two units at one employer, a Job Corps Center); Banknote Corp. of Am., Inc. v. NLRB, 84 F.3d 637, 647 (2d Cir. 1996) (enforcing Board order requiring employer to bargain with three different units at a printing facility); Stern’s Paramus, 150 NLRB 799, 802-03, 806 (1965) (approving separate units of selling, non-selling, and restaurant employees at a department store; and observing that while the Board has regarded a storewide unit as the “basically appropriate” or “optimum” unit in retail establishments, it has approved “a variety” of less-than-store-wide units representing various “occupational groupings” in department stores); I. Magnin & Co., 119 NLRB at 643 (1957).

As we noted above, the Board may certify “ ‘a unit’ that is ‘appropriate’ — not necessarily the single most appropriate unit.” Am. Hosp. Ass’n, 499 U.S. at 610, 111 S.Ct. 1539. Although the unit composition argued for by Macy’s may have also been “an appropriate bargaining unit,” we cannot say that the one approved by the NLRB was “clearly not appropriate” based on the employees’ “community of interests.” Elec. Data Sys. Corp. 938 F.2d at 574 (quoting Purnell’s Pride, 609 F.2d at 1156).

B.

Next, Macy’s contends that the Board’s “overwhelming community of interest” test cannot be squared with the NLRA or prior Board precedent governing initial unit determinations. We disagree.

As the Supreme Court has recognized, the Board has the authority to develop rules, whether through adjudication or by the exercise of its rulemaking authority, to guide its resolution of unit determinations. Am. Hosp. Ass’n, 499 U.S. at 611-12, 111 S.Ct. 1539. As interpretations of the Act, such rules are subject to the principles of Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. 467 U.S. 837, 843, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). See NLRB v. UFCW, Local 23, 484 U.S. 112, 123-24, 108 S.Ct. 413, 98 L.Ed.2d 429 (1987). Under Chevron, where “the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.” Id., at 843, 104 S.Ct. 2778. The courts must “respect the judgment of the agency empowered to apply the law ‘to varying fact patterns,’ even if the issue “with nearly equal reason [might] be resolved one way rather than another.’ ” Holly Farms Corp. v. NLRB, 517 U.S. 392, 398-99, 116 S.Ct. 1396, 134 L.Ed.2d 593 (1996) (citation omitted). This court will not disturb the Board’s reading of the Act if it is “reasonably defensible.” Ford Motor Co. v. NLRB, 441 U.S. 488, 497, 99 S.Ct. 1842, 60 L.Ed.2d 420 (1979).

*567Further, the Board has authority to depart from precedent and change its rules and standards as long as it “set[s] forth clearly the reasons for its new approach.” NLRB v. Sunnyland Packing Co., 557 F.2d 1157, 1160 (5th Cir. 1977). However, where the Board .has not departed from a “uniform rule,” the Board need not give a detailed rationale for its chosen approach. See NLRB v. H. M. Patterson & Son, Inc., 636 F.2d 1014, 1017 (5th Cir. 1981).

We agree with our sister circuits that in Specialty Healthcare the Board “clarified — rather than overhauled — its unit-determination analysis.” Nestle Dreyer’s Ice Cream Co. v. NLRB, No. 14-2222, 2016 WL 1638039 (4th Cir. Apr. 26, 2016); accord FedEx Freight, Inc. v. NLRB, 816 F.3d 515, 525 (8th Cir. 2016) (“We conclude that the overwhelming community of interest -standard articulated in Specialty Healthcare is not a material departure from past precedent.”); Kindred, 727 F.3d at 561 (“The Board has used the overwhelming-community-of-interest standard before, so its adoption in Specialty Healthcare ... is not new.”); Blue Man Vegas, 529 F.3d at 421 (the Board’s “consistent analytic framework” includes the question whether “the excluded employees share an overwhelming community of interest with the included employees”).

In Specialty Healthcare, the Board laid out the “traditional standard” applicable when an employer contends that the smallest appropriate unit contains employees not in the petitioned-for unit. 357 NLRB No. 83, at *15. Citing its own precedent and decisions of the D.C. Circuit and the Seventh Circuit, the Board explained: “Given that the statute requires only an appropriate unit, once the Board has determined that employees in the proposed unit share a community of interest, it cannot be that the mere fact that they also share a community of interest with additional employees renders the smaller unit inappropriate.” Id. (citing Montgomery Ward & Co., 150 NLRB 598, 601 (1964); Blue Man Vegas, 529 F.3d at 421; Dunbar Armored, Inc. v. NLRB, 186 F.3d 844, 847 (7th Cir. 1999)). In such a situation, the Board determined that its precedent requires the proponent of the larger unit to demonstrate that all employees “share ‘an overwhelming community of interest’ such that there ‘is no legitimate basis upon which to exclude certain employees from it.’ ” Id. at *16 (quoting Blue Man Vegas, 529 F.3d at 421). The Board acknowledged that it “has sometimes used different words to describe this standard and has sometimes decided cases such as this without articulating any clear standard,” id. at 17, but an evaluation of the cited cases reveals that the newly-formulated standard was not a departure from Board precedent.

Macy’s urges us to overrule Specialty Healthcare for several reasons. First, it asserts that the overwhelming community of interest test improperly affords controlling weight to the extent of union organization, in violation of Section 9(c)(5) of the NLRA. Second, it argues that the test departs from established Board precedent. Third, it contends that the test was improperly taken from the “accretion” context. Fourth, it claims that the Board violated the Administrative Procedure Act (APA) by promulgating the overwhelming community of interest test through adjudication .rather than rulemaking. Finally, Macy’s asserts that the test’s application is particularly inappropriate in the retail context, where it “discardfs] decades of precedent favoring storewide bargaining units.” Contending that the Board was able to find the unit of cosmetics and fragrances employees appropriate only by following Specialty Healthcare, Macy’s argues that this court’s invalidation of the overwhelm*568ing community of interest test — or its determination that the test is inapplicable in the retail context — would preclude enforcement of the Board’s order. Each of these arguments is unavailing.

1. The Overwhelming Community of Interest Test and Section 9(c)(5)

Section 9(c)(5) of the Act provides that the Board, in making unit determinations, shall ensure that “the extent of organization shall not be controlling.” 29 U.S.C. § 159(c)(5). The Supreme Court has construed this language to mean that “Congress intended to overrule Board decisions where the unit determined could only be supported on the basis of extent of organization,” but that Congress did not preclude the Board from considering organization “as one factor” in making unit determinations. NLRB v. Metro. Life Ins. Co., 380 U.S. 438, 441-42, 85 S.Ct. 1061, 13 L.Ed.2d 951 (1965).

Citing NLRB v. Lundy Packing Co., 68 F.3d 1577 (4th Cir. 1995), Macy’s argues that the Board’s overwhelming community of interest test contravenes Section 9(c) by “accord[ing] controlling weight to the extent of union organization” by making union-proposed units presumptively appropriate. However, the Fourth Circuit has expressly rejected this characterization of its holding in Lundy. See Dreyer’s, 2016 WL 1638039. In Lundy, the Fourth Circuit rejected the Board’s use of a standard under which “any union-proposed unit is presumed appropriate unless an ‘overwhelming community of interest’ exists between the excluded employees and the union-proposed unit.” 68 F.3d at 1581 (emphasis added). In Dreyer’s, the court explained:

Lundy does not establish that the overwhelming-community-of-interest test as later applied in Specialty Healthcare fails to comport with the NLRA. Instead, Lundy prohibits the overwhelming-community-of-interest test where the Board first conducts a deficient community-of-interest analysis — that is, where the first step of the Specialty Healthcare test fails to guard against arbitrary exclusions.

2016 WL 1638039, at *7. Where the Board “rigorously weights] the traditional community-of-interest factors to ensure that the proposed unit was proper under the NLRA,” the Court concluded, the “overwhelming community of interest” does not conflict with the Act. Id. at *8. That is precisely what the Board did in the instant case. As a result, the test and its application do not violate Section 9(c).

2. The Board’s Unit Determination Precedent

Macy’s next argues that the Specialty Healthcare standard departs from established Board precedent. Macy’s asserts that, contrary to Board precedent, the Specialty Healthcare analysis looks, “solely and in isolation,” at “whether the employees in the unit sought have interests in common with one another.” This argument is unconvincing. The community of interest test articulated in Specialty Healthcare and applied in this case was taken from the Board’s 2002 decision in United Operations and was based on Board precedent going back to 1964. That test does not look only at the commonalities within the petitioned-for unit. Rather, it asks:

whether the employees are organized into a separate department-, have distinct skills and training; have distinct job functions and perform distinct work, including inquiry into the amount and type of job overlap between classifications; are functionally integrated with the Employer’s other employees; have frequent contact with other employees; *569interchange with other employees', have distinct terms and conditions of employment; and are separately supervised.

Specialty Healthcare, 357 NLRB No. 83, at *14 (emphasis added). The Board’s initial unit determination in Specialty Healthcare and in this case thus conformed to established precedent. See, e.g., In re United Operations, Inc., 338 NLRB 123; Bartlett Collins Co., 334 NLRB 484 (2001); The Dahl Oil Co., 221 NLRB 1311 (1964). The Board did not abuse its discretion by applying the traditional community of interest test in its initial unit determination.

8. “Overwhelming Community of Interest” in the Accretion Context

An “accretion” is the addition of a small group of employees to an established bargaining unit without first holding an election. Michael J. Frank, Accretion Elections: Making Employee Choice Paramount, 5 U. Pa. J. Lab. & Emp. L. 101, 102 (2002). Because of accretion’s “interference with the employees’ freedom to choose their own bargaining agents,” the Board does not apply the traditional community of interest test to determine whether the enlarged unit would be appropriate; rather, the Board generally finds that “[a] group of employees is properly accreted to an existing bargaining unit when they have such a close community of interests with the existing unit that they have no true identity distinct from it.” DMR Corp., 795 F.2d at 476 (citation omitted) (emphasis in original). While the structure and the underlying policy motivations of this standard resemble those of the Specialty Healthcare overwhelming community of interest test, Macy’s contention that the latter was “improperly imported” from the accretion context fails to persuade us. As an initial matter, as the Fourth Circuit observed in Dreyer’s, “[it is not] unreasonable ... for the Board to use the same overwhelming-community-of-interest test in this context that it has historically used in the context of accretions.” 2016 WL 1638039, at *9. Furthermore, the Board has applied the overwhelming community of interest test in the initial determination context since at least 1967, when, in Jewish Hospital Association of Cincinnati, it held that a unit limited to service employees was inappropriate because of their “overwhelming community of interest” with maintenance employees. 223 NLRB at 617. Macy’s premise that the overwhelming community of interest test is inappropriate when applied in an initial unit determination thus falls, and its related contention that the test is therefore inappropriate necessarily fails.

k. The NLRB’s Adjudicative Rulemak-ing Authority

In NLRB v. Bell Aerospace Co. Div. of Textron, Inc., 416 U.S. 267, 294, 94 S.Ct. 1757, 40 L.Ed.2d 134 (1974), the Supreme Court announced that “the Board is not precluded from announcing new principles in an adjudicative proceeding and that the choice between rulemaking and adjudication lies in the first instance within the Board’s discretion.” Yet Macy’s contends that, because Specialty Healthcare announced “ ‘policy-type rules or standards’ to be applied in all future unit determination cases,” the Board was required by the APA to resort to rulemaking and the decision should be set aside.

The Supreme Court has previously rejected a claim identical to that advanced by Macy’s. In SEC v. Chenery Corp., 332 U.S. 194, 67 S.Ct. 1760, 91 L.Ed. 1995 (1947), the respondent corporation argued that the Commission was required to resort to its rulemaking procedures if it desired to promulgate a new standard that would govern future conduct, rather than applying a general standard that it had formulated for the first *570time in that proceeding. The Court rejected this contention, noting that the Commission had a statutory duty to decide the issue at hand in light of the proper standards and that this duty remained “regardless of whether those standards previously had been spelled out in a general rule or regulation.” Id. at 201, 67 S.Ct. 1760. The Court concluded that “the choice made between proceeding by general rule or by individual, ad hoc litigation is one that lies primarily in the informed discretion of the administrative agency.” Id., at 203, 67 S.Ct. 1760. Even accepting the premise that Specialty Healthcare announced a new standard, the contention that the Board violated the APA is therefore unavailing.

5. Presumptively Appropriate Units

In early cases dealing with the retail industry, the Board stated that a storewide unit was “basically appropriate,” I. Magnin, 119 NLRB at 643, or was “the optimum unit,” May Department Stores, 97 NLRB 1007, 1008 (1952). But even in the cases announcing that “presumption,” the Board recognized that smaller units can be appropriate. See Allied Store of New York, Inc., 150 NLRB 799, 803 (1965). This is consistent with the policies underlying the Board’s general approach to unit determination: recognition that a unit is presumptively appropriate does not lead to a requirement that only that unit can be appropriate. As the Board explained in Specialty Healthcare:

the suggestion that there is only one set of appropriate units in an industry runs counter to the statutory language and the main corpus of our unit jurisprudence, which holds that the Board need find only that the proposed unit is an appropriate unit, rather than the most appropriate unit, and that there may be multiple sets of appropriate units in any workplace.

357 NLRB No. 83, at *10. Thus, even if a store-wide unit were presumptively appropriate in the retail industry — a contention to which the Board strenuously objects, Macy’s & Local 1445, 371 NLRB No. 4, *17-22 — the application of Specialty Healthcare to the retail context would not mark a deviation from Board precedent.

The standard articulated by the Board in Specialty Healthcare does not violate the NLRA. The Board did not depart from a uniform rule by applying it, and its basis and application were cogently explained. The standard was not improperly imported from another context, and it was not adopted in violation of the APA. Finally, the application of the standard in the retail context is not inconsistent with prior Board decisions. We therefore decline to reject the Specialty Healthcare standard and hold that the Board did not abuse its discretion by articulating and applying this standard in the instant case.

C.

Finally, Macy’s argues that, even under Specialty Healthcare, the Board approved an inappropriate unit because it carried its burden of showing that all selling employees within the store share an overwhelming community of interest. However, as explained in Part III.A, supra, the Board’s factual findings illustrate numerous distinctions between the cosmetics and fragrances employees and the other selling employees, such that it cannot be said that there is “no legitimate basis upon which to exclude [those] employees” from the unit. Specialty Healthcare, 357 NLRB No. 83, at *15. We therefore hold that the Board did not abuse its discretion when it determined that the other selling employees do *571not share an overwhelming a community of interest with the petitioned-for employees.

IV.

The Board reasonably concluded the unit of cosmetics and fragrances employees at the Saugus store was appropriate. Macy’s has failed to establish that the unit is clearly not appropriate and has failed to demonstrate-that the Board abused its discretion by articulating and applying the overwhelming community of interest test. The Board’s cross-application for enforcement is therefore GRANTED and Macy’s petition for review is DENIED.

26.3 New Jersey Bell Telephone v. NLRB, 720 F.2d 789 (3d Cir. 1983) 26.3 New Jersey Bell Telephone v. NLRB, 720 F.2d 789 (3d Cir. 1983)

720 F.2d 789 (1983)

NEW JERSEY BELL TELEPHONE COMPANY, Petitioner,
v.
NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 83-3069.

United States Court of Appeals, Third Circuit.

Argued September 27, 1983.
Decided November 7, 1983.

James F. Brady (argued), Newark, N.J., for petitioner.

Helen Morgan, Daniel R. Pollitt (argued), Attys., William A. Lubbers, Gen. Counsel, John E. Higgins, Jr., Deputy Gen. Counsel, Robert E. Allen, Associate Gen. Counsel, Elliott Moore, Deputy Associate Gen. Counsel, N.L.R.B., Washington, D.C., for respondent.

Before ALDISERT and BECKER, Circuit Judges, and POLLAK, District Judge.[*]

 

OPINION OF THE COURT

 

ALDISERT, Circuit Judge.

In this petition to review and cross-application for enforcement of a decision and order of the National Labor Relations Board, we are asked to decide whether the New Jersey Bell Telephone Company may properly condition release of personal information contained in employee attendance records to a labor organization on employee consent. The Board found that the Company violated § 8(a)(5) and (1) of the National Labor Relations Act, 29 U.S.C. § 158(a)(5), and (1) (1976), by refusing to release information necessary in processing a grievance when its employees declined to authorize disclosure. Because we conclude that the absence and tardiness records are confidential 790*790 under the terms of the Company's Employee Privacy Protection Plan, the petition to review is granted and the cross-application for enforcement denied.

 

I.

 

In early 1980, New Jersey Bell Telephone Company instituted its Employee Privacy Protection Plan, which provides that the Company will not release personal information about its employees to persons outside the Company without employee authorization.[1] This dispute arose when three employees reported to work late on December 3, 1980 and were marked tardy. In the process of determining whether to file a grievance, the Communication Workers of America, Local 1023, AFL-CIO, requested the Company to furnish it with the absence and tardiness records of the three employees. Relying on its Privacy Plan, the Company advised the Union that it could have the information only if the employees authorized its release. When the Company sought authorization, however, the employees, at the Union's behest, withheld their consent, and consequently the information was not disclosed.

Although the grievance was eventually settled, the Union filed an unfair labor practice charge with the Board, contending that it was unconditionally entitled to the records. A hearing before an Administrative Law Judge followed, during which the intimate and highly personal nature of the information contained in the employees' absence and tardiness records was revealed. The records disclosed that reasons given for employee absences included colitis, insertion of urethral tubes, vaginal infections, scalded rectal areas and heart problems.

The ALJ dismissed the complaint in its entirety, concluding that the records contained confidential information under the teachings of both Supreme Court and Board precedent and therefore the Company could properly require employee consent prior to disclosure to the Union. The Board reversed, agreeing with the ALJ that disclosure of confidential information may be conditioned upon employee consent, but disagreeing as to the confidentiality of the absence and tardiness records. As this issue of confidentiality requires us to interpret and apply a legal precept, our review is plenary. Allied Chemical and Alkali Workers of America v. Pittsburgh Plate Glass Co., 404 U.S. 157, 182, 92 S.Ct. 383, 399, 30 L.Ed.2d 341 (1971); Universal Minerals, Inc. v. C.A. Hughes & Co., 669 F.2d 98, 102 (3d Cir.1981).

 

II.

 

As a general rule, an employer must provide a bargaining representative with relevant information necessary for the proper performance of its duties. NLRB v. Acme Industrial Co., 385 U.S. 432, 435-36, 87 S.Ct. 565, 567-68, 17 L.Ed.2d 495 (1967). 791*791 The failure to provide such information constitutes a violation of § 8(a)(5) and (1) of the Act, 29 U.S.C. § 158(a)(5), (1).[2]

This rule, however, is not absolute. The Supreme Court has recognized a limited exception for information that is confidential in nature. Detroit Edison Co. v. NLRB, 440 U.S. 301, 99 S.Ct. 1123, 59 L.Ed.2d 333 (1979). In Detroit Edison, the Court held that an employer did not violate the statutory duty to bargain in good faith by resisting an unconsented-to disclosure of individual employee aptitude test results to a union that was processing a grievance. The Court relied on three factors: (1) the sensitive nature of the information sought; (2) the minimal burden that a requirement of employee consent would impose on the union; and (3) the lack of evidence that the employer had fabricated concern for employee confidentiality only to frustrate the union in the discharge of its responsibilities. Id. at 319-20, 99 S.Ct. at 1133-34. The Court found that any possible impairment of the union's function in processing grievances is more than justified by the interests served in conditioning disclosure on the consent of the very employees whose grievances are being processed. Id. at 319, 99 S.Ct. at 1133. Those interests included the employees' privacy interests. Id. at 318, 99 S.Ct. at 1132.

To determine whether release of the records here may be conditioned on employee consent, we proceed by addressing each of the Detroit Edison factors. First, regarding confidentiality, it can scarcely be argued that the information contained in the records is not sensitive or confidential in nature. As we have indicated, many of the reasons given in the absence and tardiness records are of a highly personal nature. The records show, for example, that one Company employee suffered from diarrhea for two days, and was absent for an additional five days because in "treating for hemroids [sic] [, the employee] used too hot of water and too much epsom salts, [and] burnt the skin." Supp. app. to brief for the Board at 8a. It is difficult to imagine more intimate or personal employee data.

Second, the Company's requirement that releases be obtained from the employees is the same burden that was imposed on the union in Detroit Edison and held to be acceptable. We conclude, therefore, that this requirement permissibly places only a minimal burden on the Union. In addition, we note that it was not the Company's consent requirement but rather the Union's direction that consent be withheld that prevented the Union from obtaining the information it sought.

Finally, there is no evidence that the Privacy Plan was instituted to frustrate the Union in its role as employee representative. Importantly, the Plan applies to anyone seeking information about Company employees. Further, the Plan embodies, on its face, the laudable policy of protecting the employees' privacy rights. Under Detroit Edison, therefore, we conclude that the absence and tardiness records are confidential and the Company need not release them to the Union without employee consent.

We reach the same conclusion after considering the Board's own precedent. In 792*792 Johns-Manville Sales Corp., 252 N.L.R.B. 368 (1980), the Board held that an employer committed no unfair labor practice by refusing to disclose to a union the identities of those employees suffering from a certain medical disorder without first securing employee consent. The Board found a "legitimate aura of confidentiality" in the identities of the affected employees. Id. We perceive no difference between the Johns-Manville employees and the employees here. In each case, the information requested contains, in part, material which reflects upon the medical condition of certain employees. Furthermore, the Board in Johns-Manville noted that the employer's refusal was made in good faith as it attempted to accommodate the union by allowing disclosure on consent. Id. New Jersey Bell has made the same good faith attempt at accommodation.

The Board argues that Detroit Edison and Johns-Manville may be distinguished because each involved professionally-developed information. Such a purported distinction borders on the whimsical. Nothing in either opinion, or in the realm of sound reason, indicates that the classification of information as confidential turns on whether it was professionally developed. To the contrary, Detroit Edison indicates that the proper inquiry is into the nature of the information sought and not its source. See 440 U.S. at 318, 99 S.Ct. at 1132.

We do not think the issue here is even close. Supreme Court precedent, Board precedent, and common sense all militate against the Board's decision in this case. The Board would have been well-advised to have accepted the perceptive analysis of the ALJ:

[By directing the involved employees not to sign releases, the Union] intentionally placed itself in the way of attaining its own legitimate objective for there is no evidence in the record that the employees had any real objections to the Union representative gaining access to the material in question and it would have been a simple matter for the Union to obtain releases, to gain access to the materials it needed and to pursue the grievance procedure to a proper conclusion. Instead, it preferred to play games, to challenge the employer's Employee Privacy Protection Plan, a policy which, on its face, appears to be legitimately concerned with employees' rights to privacy and not in any way discriminatorily motivated.

App. at 153a.

 

III.

 

The Company's petition for review of the Board's order will be granted and the Board's cross-application for enforcement will be denied.[3]

[*] Honorable Louis H. Pollak, United States District Judge for the Eastern District of Pennsylvania, sitting by designation.

[1] The Plan provides in relevant part:

Release of personal information about any employee to those within or outside the Bell System is carefully controlled.

. . .

Non-sensitive information that the Company will verify includes only your name, employment status (active or inactive), employment dates, classification (e.g., regular or part-time), job title and Department. Such "Directory" information, as well as your work location, home address, telephone number and dates of attendance at work, may be released to a law enforcement agency upon lawful demand when such information is required for bona fide law enforcement purposes.

In general, the Company will not verify and it will not release other personal information about you to those outside the Bell System, unless you authorize the Company in writing to do so, or unless the Company is required by legal process to do so; or to comply with a lawful investigation by a government agency, or in connection with any proceeding or action affecting the Company's interests including its defense to any employment-related matter.

App. at 98a-1.

 

[2] Section 8(a)(5) of the National Labor Relations Act provides that "[i]t shall be an unfair labor practice for an employer to refuse to bargain collectively with the representatives of his employees...." 29 U.S.C. § 158(a)(5). Section 8(a)(1) makes it an unfair labor practice for an employer to interfere with, restrain or coerce employees in the exercise of the right to self-organization, to form, join or assist labor organizations, to bargain collectively and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. 29 U.S.C. § 158(a)(1). Accordingly, a violation of section 8(a)(5) is also a violation of section 8(a)(1). See United Steelworkers of America, AFL-CIO-CLC v. NLRB, 530 F.2d 266, 270 n. 6 (3d Cir.), cert. denied, 429 U.S. 834, 97 S.Ct. 100, 50 L.Ed.2d 100 (1976).

[3] In the view we take, it is unnecessary to reach the Company's other contentions.

26.4 Circus Circus Casinos, Inc. v. NLRB, 961 F.3d 469 (D.C. Cir. 2020) 26.4 Circus Circus Casinos, Inc. v. NLRB, 961 F.3d 469 (D.C. Cir. 2020)

961 F.3d 469 (2020)

CIRCUS CIRCUS CASINOS, INC., d/b/a Circus Circus Las Vegas, Petitioner,
v.
NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 18-1201 Consolidated with 18-1211.

United States Court of Appeals, District of Columbia Circuit.

Argued October 28, 2019.
Decided June 12, 2020.

On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board.

Paul T. Trimmer argued the cause for petitioner. With him on the briefs was Daniel I. Aquino, Las Vegas, NV.

Kellie Isbell, Senior Attorney, National Labor Relations Board, argued the cause for respondent. With her on the brief were Peter B. Robb, General Counsel, David S. Habenstreit, Assistant General Counsel, and Julie Brock Broido, Supervisory Attorney.

Before: SRINIVASAN, Chief Judge, RAO, Circuit Judge, and RANDOLPH, Senior Circuit Judge.

Opinion concurring in part and dissenting in part filed by Chief Judge SRINIVASAN.

472*472 RAO, Circuit Judge.

This case arises out of an employment dispute between Circus Circus Casinos, 473*473 Inc. ("Circus") and temporary employee Michael Schramm. The National Labor Relations Board ("NLRB") determined that Circus committed three unfair labor practices: threatening Schramm for exercising statutory rights under the National Labor Relations Act ("NLRA"), interfering with his right to union representation during an investigatory meeting, and suspending and terminating him because of protected union activity. Circus petitions for review, arguing the Board's decision misapplied governing law and lacked substantial evidence. For the reasons that follow, we grant Circus's petition for review in full and deny the Board's cross-application for enforcement.

 

I.

 

Circus Circus is a hotel and casino in Las Vegas, Nevada. In September 2013, the company hired journeyman carpenter Michael Schramm into its engineering department on a temporary basis to upgrade doorjamb security in the hotel's guest rooms. As a carpenter, Schramm was represented by the United Brotherhood of Carpenters and Joiners of America, Southwest Regional Council of Carpenters Local #1780 ("the Union").

In November or early December 2013, Schramm and about twelve other employees attended one of the engineering department's mandatory weekly safety meetings along with department head Rafe Cordell and several other managers. During the meeting, an engineer named Fred Tenney brought up the concern that secondhand exposure to marijuana smoke in guest rooms could cause employees to test positive for illegal drugs. Schramm echoed this concern, and a discussion ensued between Cordell, Schramm, and Tenney. According to Schramm and Tenney, they repeatedly pressed Cordell for additional commitments by the company and refused to accept his assurances that employees' exposure was insufficient to produce a positive test result. On their account, Cordell eventually became angry, turned red, and told Schramm "you know what, maybe we just won't need you anymore" before abruptly leaving the meeting. Testimony from Cordell and other managers and employees also in attendance reported the weekly safety meeting proceeded just like any other and concluded without incident. Although some remember a discussion about marijuana policy, none remember Cordell making a threatening statement.

Several weeks later, Circus initiated an investigation into whether Schramm violated company policy with respect to a medical exam mandated by the Occupational Safety and Health Administration ("OSHA"). Pursuant to OSHA regulations, Circus provides custom-fit respirators to employees likely to encounter airborne hazards during their work, including virtually all members of the engineering department. See 29 C.F.R. § 1910.134(a)-(d). Because respirators can aggravate certain underlying health conditions, OSHA requires employers to contract with a medical service provider to review an employee's medical history and perform a medical examination prior to the custom-fitting process. See id. § 1910.134(e)-(f). To assure compliance with OSHA regulations, Circus maintains written policies that make submitting to the testing process a mandatory condition of employment. The company's General Rules of Conduct specify that "serious violations," including "insubordination" and "[f]ailure or refusal to submit to a physical examination ... ordered by Circus," "will result in disciplinary action up to and including immediate termination."

Schramm arrived at an onsite clinic for his scheduled testing appointment on December 10. He refused, however, to complete 474*474 preliminary paperwork without first speaking with the contract doctor. Although clinic technicians explained he could not see the doctor without first completing a preliminary intake process, Schramm left the appointment and returned to work. Clinic staff relayed the incident to Cordell, who quickly suspended Schramm pending investigation into his refusal to take the medical exam. Over the next three days, Circus personnel interviewed Cordell and several other managers about the incident and scheduled Schramm for an investigatory interview. When a Circus human resources representative contacted Schramm to set up the interview, she provided a phone number for the Union in the event Schramm desired to have a Union representative present at the meeting. The record indicates Schramm attempted to contact the Union twice by phone, but to no avail.

Schramm returned to the Circus facility on December 13 for the interview. Cordell and two human resources representatives attended on behalf of Circus. According to Schramm, he looked around the hallway for a Union representative before entering the meeting and began by stating: "I called the Union three times [and] nobody showed up, I'm here without representation." Circus's witnesses deny Schramm made this statement at the beginning of the meeting but acknowledge continuing the interview without offering Schramm union representation.

In late December, Cordell and human resources met once again with Schramm to terminate his employment; this time he was accompanied by a Union steward. Circus represented during the administrative proceedings that it fired Schramm for violating the company's rules against insubordination and refusing to submit to mandatory testing.

Schramm subsequently filed unfair labor practice charges on his own behalf with the NLRB. After overriding the regional director's decision not to pursue the charges, the Board's general counsel issued a complaint alleging Circus violated three standards established under Section 8(a)(1) of the Act. See 29 U.S.C. § 158(a)(1). The complaint first alleged Cordell's comment to Schramm during the weekly safety meeting interfered with NLRA rights by discouraging employees from voicing shared concerns about the terms and conditions of employment. Second, the complaint alleged Schramm's statement at the beginning of the investigatory meeting was a request for union representation under NLRB v. J. Weingarten, Inc., 420 U.S. 251, 95 S.Ct. 959, 43 L.Ed.2d 171 (1975), and that Circus violated the Act by ignoring the request. Finally, the complaint alleged that under the test for mixed-motive termination in Wright Line, 251 NLRB 1083 (1980), Circus unlawfully suspended and terminated Schramm because of activity protected under the Act and not because of his alleged workplace misconduct. After a hearing, an administrative law judge ("ALJ") issued a recommended decision finding that Circus committed the unfair labor practices brought by the general counsel.[1]

The Board, sitting as a delegated three-member panel, see 29 U.S.C. § 153(b), adopted the ALJ's decision in all material respects and rejected a request by Circus to reopen the record for additional evidence 475*475 tending to impeach Tenney, Schramm's key corroborating witness. See Circus Circus Casinos, Inc., 366 NLRB No. 110 (June 15, 2018). The Board noted Chairman Ring dissented as to the Weingarten violation on the ground that the majority was wrong to find a request for representation "subsumed" in Schramm's statement, which described prior requests to the Union rather than a request to the company. Id. at *1 n.2. To remedy these unfair labor practices, the Board ordered Circus to reinstate Schramm with backpay, cease and desist from similar violations, and post a workplace notice describing the agency's findings. Id. at *2.

Circus petitioned for review of the Board's unfair labor practice findings and refusal to reopen the record, arguing the order is inconsistent with the NLRA and the Administrative Procedure Act ("APA"). The Board cross-petitioned for enforcement of the order.

 

II.

 

Judicial review of the Board's decisions and orders must evaluate both the Board's statements of law and application of law to the facts. Congress combined within the NLRB the authority to make rules, enforce rules, and adjudicate whether rules were violated in individual cases. See 29 U.S.C. § 160(a)-(c). The Supreme Court upheld the constitutionality of the NLRB against due process challenges notwithstanding this combination of functions in part because appellate review would afford "adequate opportunity to secure judicial protection against arbitrary action." NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 47, 57 S.Ct. 615, 81 L.Ed. 893 (1937). Orders of the Board cannot be enforced without Article III approval, see 29 U.S.C. § 160(e)-(f), and reviewing courts "are not to abdicate the conventional judicial function" because "Congress has imposed on them responsibility for assuring that the Board keeps within reasonable grounds," Universal Camera Corp. v. NLRB, 340 U.S. 474, 490, 71 S.Ct. 456, 95 L.Ed. 456 (1951). Judicial review ensures that the Board stays within statutory and constitutional limits.

The Board rarely promulgates regulations through notice and comment but instead sets standards through adjudication. The Board, "uniquely among major federal administrative agencies, has chosen to promulgate virtually all the legal rules in its field through adjudication rather than rulemaking." Allentown Mack Sales & Serv., Inc. v. NLRB, 522 U.S. 359, 374, 118 S.Ct. 818, 139 L.Ed.2d 797 (1998) (citing NLRB v. Bell Aerospace Co., 416 U.S. 267, 294-95, 94 S.Ct. 1757, 40 L.Ed.2d 134 (1974)). Thus, an order of the Board might simply apply an existing standard, or alternatively, it might set forth a new standard while deciding a particular case. Nonetheless, as with other administrative agencies, the Board is subject to the APA's requirement of "reasoned decisionmaking." Id. (quoting Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 52, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983)). Legal standards promulgated by the Board under the NLRA must be "rational and consistent with the Act," id. at 364, 118 S.Ct. 818 (citation omitted), and applications of those standards in individual cases must be "reasonable and reasonably explained," Carlson v. PRC, 938 F.3d 337, 343-44 (D.C. Cir. 2019) (citation omitted).

Because Board adjudications may establish new rules or apply existing rules, "[o]ur standards for arbitrary and capricious review distinguish between an agency's burden of explanation when announcing new rules and when applying existing rules in individual cases." Baltimore Gas & Elec. Co. v. FERC, 954 F.3d 476*476 279, 286 (D.C. Cir. 2020). New rules set through adjudication must meet the same standard of reasonableness as notice and comment rulemaking. See Allentown Mack, 522 U.S. at 374, 118 S.Ct. 818 (citing State Farm, 463 U.S. at 52, 103 S.Ct. 2856). When the Board seeks to change applicable standards through an adjudication, the Board must "display awareness that it is changing position," demonstrate the rule is "permissible under the statute," and show "there are good reasons for the new policy." FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515, 129 S.Ct. 1800, 173 L.Ed.2d 738 (2009). By contrast, Board orders applying existing policy must be consistent with precedent and cannot be enforced when the agency "erred in applying established law to the facts of the case." Fred Meyer Stores, Inc. v. NLRB, 865 F.3d 630, 638 (D.C. Cir. 2017) (citation omitted); see also Rapoport v. SEC, 682 F.3d 98, 104 (D.C. Cir. 2012) ("[A]gencies must apply their rules consistently. They may not depart from their precedent without explaining why. If they do, we have no choice but to remand for a reasoned explanation." (citation and internal quotation marks omitted)).

Orders of the Board are arbitrary and capricious when they "simply disregard rules that are still on the books." Fox Television, 556 U.S. at 515, 129 S.Ct. 1800. Rule of law principles require that parties have fair notice and an opportunity to conform their behavior to legal rules.[2] As the Supreme Court has explained, "the Board must be required to apply in fact the clearly understood legal standards that it enunciates in principle," and "courts are entitled to take those standards to mean what they say." Allentown Mack, 522 U.S. at 376-77, 118 S.Ct. 818. Reviewing courts cannot simply take the Board's orders in isolation. Instead, we must identify the standard at issue, examine its application in prior adjudications, and then determine whether the instant case is a faithful application of existing law or instead a sub silentio revision. See, e.g., ABM Onsite Servs.-West, Inc. v. NLRB, 849 F.3d 1137, 1146 (D.C. Cir. 2017) ("[W]hen the Board fails to explain—or even acknowledge—its deviation from established precedent, its decision will be vacated as arbitrary and capricious." (citation and internal quotation marks omitted)).

Two provisions of the NLRA govern this case. Section 8(a)(1) makes it unlawful for employers to "interfere with, restrain, or coerce employees" in the exercise of protected rights. 29 U.S.C. § 158(a)(1). Section 7 protects the right of employees to organize, bargain collectively, and "refrain from" or "engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection." Id. § 157. In this case, the Board purported to apply three well established standards to determine Circus committed unfair labor practices by unlawfully threatening, investigating, suspending, and terminating Schramm. Circus contests both the fact-finding and legal analysis supporting the Board's findings. We take each alleged violation in turn.

 

A.

 

We begin with the Board's conclusion that Circus violated the Weingarten 477*477 rule by denying Schramm's request for union representation at the investigatory meeting. In NLRB v. J. Weingarten, Inc., the Supreme Court approved the Board's construction of Section 7 of the Act as guaranteeing an employee the right "to refuse to submit without union representation to an interview which he reasonably fears may result in his discipline." 420 U.S. at 256, 95 S.Ct. 959. The Weingarten right "arises only in situations where the employee requests representation," id. at 257, 95 S.Ct. 959, and leaves employers free to investigate and discipline pursuant to "legitimate employer prerogatives" short of compelling unrepresented attendance, id. at 258, 95 S.Ct. 959. To prove a Weingarten allegation, the general counsel must show (1) the employee made a valid request for a union representative to be present during an investigatory interview; (2) the employee reasonably believed the interview might result in disciplinary action; and (3) the employer compelled the employee to attend the interview without union representation. 420 U.S. at 256-58, 95 S.Ct. 959 (citing Mobil Oil Corp., 196 NLRB 1052, 1052 (1972), and Quality Mfg. Co., 195 NLRB 197, 198-99 (1972)); see also Costco Wholesale Corp., 366 NLRB No. 9, at *1 (Feb. 2, 2018).

The Board maintains Schramm triggered Weingarten by stating at the beginning of the meeting: "I called the Union three times [and] nobody showed up, I'm here without representation." As the Board explained, "[s]ubsumed in the statement is a reasonably understood request to have someone present at the meeting." Circus Circus, 366 NLRB No. 110, at *1. Further, the Board concluded Circus unlawfully compelled Schramm when the company failed to offer him the choice between continuing unassisted or foregoing the interview altogether. Id. at *2 n.10; see also Bellagio, LLC v. NLRB, 854 F.3d 703, 708 (D.C. Cir. 2017) ("[O]nce an employee validly requests a union representative, an employer has three paths open to it: it may grant the request, end the interview, or offer the employee the choice between having an interview without a representative or having no interview at all."). Noting his dissent, Chairman Ring would have concluded Schramm's statement fell short of a valid request for representation under any formulation previously recognized by the Board. Circus Circus, 366 NLRB No. 110, at *1 n.2. Circus argues the Board's conclusion that Schramm made a valid request is a serious departure from the Weingarten rule. We agree, and conclude the Board acted in an arbitrary and capricious manner by significantly altering the test for valid Weingarten requests to cover the facts of this case.

The Weingarten allegation should have been dismissed because Schramm did not make an affirmative request for union representation. To invoke the Weingarten right, an employee's utterance must be "reasonably calculated" to put the employer "on notice of the employee's desire for union representation." Houston Coca Cola Bottling Co., 265 NLRB 1488, 1497 (1982); Consol. Edison Co. of N.Y., 323 NLRB 910, 916 (1997). Under the reasonably calculated notice standard, the Board has long required an employee to affirmatively request representation in order to invoke the protections of the Act. Valid requests may take the form of straightforward demands, see, e.g., Consol. Edison, 323 NLRB at 914 ("I need a Union Steward."); questions about the need for assistance, see, e.g., NLRB v. N.J. Bell Tel. Co., 936 F.2d 144, 145 (3d Cir. 1991) ("[S]hould [I] have a union representative present[?]"); or requests for delay or an alternative representative, see, e.g., Montgomery Ward & Co., 273 NLRB 1226, 1227 (1984). In this case, Schramm 478*478 merely recited facts about his past communication with the Union and the circumstances of his attendance at the meeting: "I called the Union three times [and] nobody showed up, I'm here without representation." Any affirmative request by Schramm was made to the Union rather than to a Circus representative—there was no valid request here to trigger Weingarten's requirements.

None of the Board's prior decisions construe Weingarten's reasonably calculated notice standard broadly enough to cover mere statements of fact, and we were unable to find a precedent accepting similar remarks as an affirmative request. Nor was our dissenting colleague. See Dissenting Op. 488. Instead, affirmative requests have always taken the form of demands for representation, questions, or related requests. See, e.g., Gen. Die Casters, Inc., 358 NLRB 742, 742 (2012) (finding request where employee asked twice if he should "get somebody in here"); Bodolay Packaging Mach., Inc., 263 NLRB 320, 325 (1982) (finding request where employee asked if he "needed a witness"). In the absence of an affirmative request, the Board must dismiss Weingarten charges because there is no protected concerted activity by the employee and the NLRA does not apply. See, e.g., Costco Wholesale, 366 NLRB No. 9, at *1 (dismissing unfair labor practice charge for lack of employee request); USPS, 360 NLRB 659, 660 (2014) (same); Kohl's Food Co., 249 NLRB 75, 78 (1980) (same).

The text and structure of the NLRA demonstrate why an affirmative request is an indispensable element of a Weingarten violation. As the Supreme Court explained in Weingarten, the affirmative request requirement "inheres in [Section] 7's guarantee of the right of employees to act in concert for mutual aid and protection." 420 U.S. at 256, 95 S.Ct. 959. Employee requests for union representation trigger an employer's duty to respond under Section 8(a)(1) when they amount to protected "other concerted activities" under Section 7. The phrase "other concerted activities" must be read in context and is preceded by a series of affirmative rights: "Employees shall have the right to self-organization, to form, join, or assist labor organizations, 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." 29 U.S.C. § 157. Under the ejusdem generis canon, an enumerated list of specific, affirmative actions preceding the general term "other concerted activities" creates an inference that the catch-all phrase is similarly limited to affirmative acts. See Wash. Dep't of Soc. & Health Servs. v. Guardianship Estate of Keffeler, 537 U.S. 371, 384, 123 S.Ct. 1017, 154 L.Ed.2d 972 (2003) ("[W]here general words follow specific words in a statutory enumeration, the general words are construed to embrace only objects similar in nature to those objects enumerated by the preceding specific words." (quoting Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 114-15, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001))). As there was no affirmative request on these facts, Circus was not required to offer Schramm representation or to take any other action under the Weingarten rule.

By deviating from established practice in this case, the Board expanded the reach of Weingarten without accounting for employee choice, a central policy of the NLRA. Cf. Colo. Fire Sprinkler, Inc. v. NLRB, 891 F.3d 1031, 1040-41 (D.C. Cir. 2018) (emphasizing the importance of employee choice in the selection of a union representative under Section 9(a)). Weingarten's emphasis on affirmative employee requests serves not only to notify the employer that the employee is invoking statutory 479*479 rights, but also to protect the employee's choice not to invoke the right when he believes doing so would be against his interests. Union representatives serve the union's interest rather than those of any single member, and representatives may be called upon to testify on behalf of the employer as well as the employee. See Appalachian Power Co., 253 NLRB 931, 933 (1980) (emphasizing an employee's "choice of deciding whether the presence of the representative was more or less advantageous to his interests" is "one of the fundamental purposes of the rule as articulated in Weingarten"); USPS, 241 NLRB 141, 152-53 (1979) (contrasting role of union representative to that of a criminal attorney). Thus, one consequence of the Board's finding that Schramm's request was "subsumed" in a simple statement of fact would be to limit employee choice.[3]

If "requests" were interpreted as broadly as the Board elected to do here, the Weingarten right would transform from one that must be invoked by an employee to one that cautious employers must assume automatically applies to all covered investigatory meetings. Yet nothing in Weingarten or the Board's subsequent application of the rule obligates employers prophylactically to inform employees of their right to representation. See El Paso Healthcare Sys., 358 NLRB 460, 467 (2012) ("The employee's right to the assistance of a union representative arises only upon the request of the employee; the employer has no duty to inform the employee of the right."); USPS, 241 NLRB at 152 ("[T]he Weingarten class of cases implicitly hold that the employer is under no obligation affirmatively to advise the employee of his Weingarten rights.").

Consistent with the Board's precedents, we hold Weingarten requires an employee to affirmatively request union representation in a manner reasonably calculated to put the employer on notice. See USPS, 360 NLRB at 660 ("Even assuming [an employee] had an objectively reasonable basis to fear discipline, the right to Weingarten representation is triggered when the employee requests it." (citing 420 U.S. at 257, 95 S.Ct. 959)); Consol. Edison, 323 NLRB at 916 (requests "need only be sufficient to put the employer on notice"); Houston Coca Cola Bottling, 265 NLRB at 1497 (language must be "reasonably calculated to apprise the [e]mployer"). Under the reasonably calculated notice standard, valid requests may take the form of demands, questions, or related requests for delay or for a specific representative. On this record, Schramm's statement of fact standing alone was insufficient to trigger the protections of the Act. Because the Board erred by concluding otherwise, we set aside this unfair labor practice finding and vacate the corresponding part of the Board's order. See Midwest Div.-MMC, LLC v. NLRB, 867 F.3d 1288, 1297 (D.C. Cir. 2017) (granting review for misapplication of Weingarten); Bellagio, 854 F.3d at 709 (same).[4]

 

480*480 B.

 

Next, we review the Board's conclusion under Wright Line that Circus violated Section 8(a)(1) of the Act by suspending and terminating Schramm because of protected activity. Employers violate Section 8(a)(1) when they terminate or otherwise discipline an employee because of conduct protected by the Act. See Inova Health Sys. v. NLRB, 795 F.3d 68, 80 (D.C. Cir. 2015).[5] At the same time, "employers retain the right to discharge workers for any number of other reasons unrelated to the employee's union activities." NLRB v. Transp. Mgmt. Corp., 462 U.S. 393, 394, 103 S.Ct. 2469, 76 L.Ed.2d 667 (1983); see also Jones & Laughlin, 301 U.S. at 45-46, 57 S.Ct. 615 ("The [A]ct does not interfere with the normal exercise of the right of the employer to select its employees or to discharge them.... [T]he Board is not entitled to make its authority a pretext for interference with the right of discharge."). When an employer asserts a legitimate basis for its disciplinary decision, the line between employer prerogative and unlawful infringement of employees' rights is a question of motive.

In Wright Line, the Board adopted the Supreme Court's burden-shifting framework from Mt. Healthy City School District Board of Education v. Doyle, 429 U.S. 274, 286-87, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977), to accommodate "the legitimate competing interests inherent in dual motivation cases." 251 NLRB at 1088. Under the Wright Line standard, the general counsel must first establish a prima facie case that animus against protected activity was "a motivating factor" in the employer's decision. Inova, 795 F.3d at 80; Wright Line, 251 NLRB at 1090. Second, the burden of persuasion shifts to the employer to show it "would have taken" the same action even in the absence of protected conduct. Inova, 795 F.3d at 80 (citation omitted); Wright Line, 251 NLRB at 1091; see also Transp. Mgmt., 462 U.S. at 403-04, 103 S.Ct. 2469 (approving Wright Line as a valid interpretation of the Act).

Purporting to apply Wright Line to the facts of this case, the Board concluded Circus acted with animus against Schramm's exercise of NLRA rights and rejected the company's explanation that it would have fired Schramm regardless because he refused to comply with the medical examination requirement. The Board reasoned that if Circus's "true concern" was that Schramm undergo testing, "he would have been allowed to speak to the doctor prior to testing or, at a minimum, sent back for testing" before discipline. See Circus Circus, 366 NLRB No. 110, at *4. Circus disputes the Board's legal analysis under both prongs of Wright Line, arguing 481*481 the Board accepted the general counsel's prima facie case despite an absence of evidence and, further, that the Board short changed the company's rebuttal case. Pointing to our decision in Sutter East Bay Hospitals v. NLRB, 687 F.3d 424 (D.C. Cir. 2012), Circus argues the Board failed to assess whether the company reasonably believed Schramm committed misconduct that the company consistently disciplines with similar severity. We assume without deciding that the general counsel satisfied his burden in the first prong and instead focus on Wright Line's second prong. We agree with Circus that the Board misapplied Wright Line by failing to consider the company's rebuttal case in line with our decision in Sutter East Bay.

As we have explained, Wright Line's second prong requires the Board to examine first, whether the employer "reasonably believed" the employee committed the acts supporting discipline, and second, whether the decision was consistent with the company's "policies and practice." Sutter East Bay, 687 F.3d at 435. In Wright Line, the Board analyzed whether the employer had "reason to believe" the terminated employee violated company policy, and also whether the employee's asserted misconduct was "commonplace and generally resulted in no discipline whatsoever." 251 NLRB at 1091. The Board has repeatedly recognized that reasonable belief and consistency in enforcement are important aspects of the analysis. See, e.g., DTR Indus., Inc., 350 NLRB 1132, 1135-36 (2007) (dismissing unfair labor practice charge where employer reasonably believed employee produced defective products on purpose); GHR Energy Corp., 294 NLRB 1011, 1014 (1989) (dismissing unfair labor practice charge where employer reasonably believed employees violated a policy the company strictly enforced). We have similarly examined these factors when assessing the Board's application of Wright Line on arbitrary and capricious review. See, e.g., Windsor Redding Care Ctr., LLC v. NLRB, 944 F.3d 294, 300 (D.C. Cir. 2019) (refusing enforcement where Board ignored "zero-tolerance" policy for abuse toward elderly patients and disregarded evidence of strict enforcement in prior cases); Hawaiian Dredging Constr. Co. v. NLRB, 857 F.3d 877, 885 (D.C. Cir. 2017) (refusing enforcement where Board failed to recognize employer's good faith belief that misconduct occurred); Fort Dearborn Co. v. NLRB, 827 F.3d 1067, 1075 (D.C. Cir. 2016) (concluding employer acted inconsistently with policy and past practice when discharging employee).

Contrary to this longstanding precedent, the Board rejected Circus's rebuttal case without addressing evidence relevant to Wright Line's second prong. First, the Board failed to assess whether Circus reasonably believed Schramm committed the misconduct in question. The company decided to suspend and discharge Schramm based on reports by medical personnel that Schramm failed to take a required medical exam. Circus's subsequent investigation did not reveal any contrary facts. Rather than assess whether it was reasonable for Circus to believe Schramm committed the misconduct in question, the Board adopted factual findings about what happened at the clinic. What actually happened is immaterial, however, because Circus had no reason to doubt the reports of medical personnel and was therefore entitled to rely on them. See Sutter East Bay, 687 F.3d at 436 ("Whether the ALJ believes the reports are accurate or whether [the employee] actually engaged in the tirade is largely immaterial to whether [the employer] reasonably believed she did."). Further, the Board devoted significant attention to the finding that Schramm offered to retake the medical exam at the 482*482 time of his suspension and again at the investigatory meeting with Cordell and human resources. Yet an employee's offer to correct misconduct does not disturb Circus's reasonable belief that a terminable offense had been committed.

Second, the Board failed to assess whether Circus's decision to terminate Schramm was consistent with company policy and practice. The company's written policies make "insubordination" and "refusal to submit to a physical examination" terminable offenses. Without addressing whether these rules covered Schramm's conduct, the ALJ instead analyzed OSHA regulations and Circus's testing policy to conclude Schramm had a right to discuss the content of the OSHA medical questionnaire with the doctor before submitting the form. We fail to see the relevance of this observation, however, given Schramm's testimony that he sought to obtain an exemption from wearing a respirator, not an exemption from the basic medical intake information clinic personnel requested (and Schramm refused to provide) before allowing him to speak with the doctor. Circus also presented testimony that no employee had ever refused to submit to an OSHA medical exam and identified three prior instances in which the company terminated employees for refusing to submit to a mandatory drug test. We need not decide whether this evidence would suffice to meet Circus's rebuttal burden under Wright Line's second prong. It is enough to conclude the Board failed to engage with this record evidence and thereby acted arbitrarily and without substantial evidence on the record as a whole. See id. at 437 ("The ALJ's conclusions leave that crucial second step of the Wright Line test unexamined and unanswered.").

Finally, we reject the alternative reasoning supplied by the Board that Circus "should have" been satisfied by Schramm's offers to retake the medical exam if his refusal was the company's "true concern." Circus is entitled to a policy of strict enforcement of its rules related to insubordination and compliance with testing policies. The Board cannot second guess an employer's legitimate and consistently enforced policies for safety and discipline in the workplace. To do so exceeds the Board's expertise and authority under the Act. See Cellco P'ship v. NLRB, 892 F.3d 1256, 1262 (D.C. Cir. 2018) ("It is clear that [the employer] has made a legitimate business judgment—a not unusual one— that an employee lying during an investigation is a serious threat to management of the enterprise. The Board has no warrant to challenge that decision."). "It is well recognized that an employer is free to lawfully run its business as it pleases. This means that an employer may discharge an employee for a good reason, a bad reason, or no reason, so long as it is not for an unlawful reason." Epilepsy Found. of Ne. Ohio v. NLRB, 268 F.3d 1095, 1105 (D.C. Cir. 2001) (citing Transp. Mgmt., 462 U.S. at 394, 103 S.Ct. 2469).

The Board suggests it was not required to analyze the employer's rebuttal under Wright Line and Sutter East Bay because its finding of "pretext" rendered reasonable belief and consistency in practice irrelevant. We reject this argument as a fundamental misstatement of Wright Line. Determining an employer's explanation to be pretext is a legal conclusion that follows from the Wright Line analysis, not an upfront finding that short circuits consideration of the whole record. The Board adopted Wright Line to obviate distinctions between pretext and dual-motive cases by creating a uniform standard for "all cases alleging violation[s] of Section 8(a)(3) or violations of Section 8(a)(1) turning on employer motivation." 251 NLRB at 1089 & n.13; see NLRB GC Memorandum 80-58, 1980 WL 19306, at *1 (1980) ("The 483*483 Wright Line test will be applied to both pretext and mixed motive cases."). This framework governs regardless of whether an employer's defense is meritorious or unmeritorious. Before determining the out-come of a case, the Board must examine whether the employer had a reasonable belief misconduct occurred and a prior consistent practice of enforcing rules against such misconduct. See Frank Black Mech. Servs. Inc., 271 NLRB 1302, 1302 n.2 (1984) ("Wright Line analysis applies to all 8(a)(3) and (1) discharge cases regardless of the Board's ultimate conclusion as to motive." (citing Transp. Mgmt., 462 U.S. at 393, 103 S.Ct. 2469)). Nor will we simply accept the Board's application of Wright Line in this case as an authoritative interpretation. Courts do not defer to an agency's arbitrary and capricious interpretation of its own standard. See Kisor v. Wilkie, ___ U.S. ___, 139 S. Ct. 2400, 2418, 204 L.Ed.2d 841 (2019); Encino Motorcars, LLC v. Navarro, ___ U.S. ___, 136 S. Ct. 2117, 2126, 195 L.Ed.2d 382 (2016) ("An arbitrary and capricious regulation of this sort is itself unlawful and receives no Chevron deference.").

To defend its reasoning, the Board cites our decision in Ozburn-Hessey Logistics, LLC v. NLRB, 833 F.3d 210 (D.C. Cir. 2016), for the proposition that compelling evidence of pretext precludes the need to consider Circus's reasonable belief. But we have never excused the Board from its duty to consider whether an employer's reasonable belief justifies a termination decision. In Ozburn-Hessey, our court considered whether the Board misapplied Wright Line by accepting pretext as a substitute for analyzing an employer's rebuttal case. We did not endorse this analytical approach, but instead concluded the Board had "rejected each of the reasons the [c]ompany claimed to have relied on in taking those disciplinary actions" and, "after considering them in light of the record, concluded that they were `mere pretext[s].'" 833 F.3d at 219. We explained that previous Board decisions also analyzed facts under both prongs of Wright Line, despite some dicta that might suggest an employer's rebuttal need not be considered on the whole record. See id. (quoting Rood Trucking Co., 342 NLRB 895, 898 (2004)). The approach in Ozburn-Hessey reflects our court's commitment to "uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned." Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 419 U.S. 281, 286, 95 S.Ct. 438, 42 L.Ed.2d 447 (1974). That path is unavailable to us here, however, because the Board's reasoning "entirely fail[ed] to consider an important aspect of the problem." Fred Meyer Stores, 865 F.3d at 638 (quoting State Farm, 463 U.S. at 43, 103 S.Ct. 2856).

As we held in Sutter East Bay, the Board must analyze an employer's reasonable belief that an employee engaged in misconduct and consider whether the disciplinary decision is consistent with the employer's policy and practice. Without this analysis we cannot ensure the Board correctly applied established law to the facts of the case, treated like cases alike, and, consistent with the Act, preserved both employee rights and employer prerogatives. Here, the Board misapplied Wright Line by failing to consider the employer's rebuttal case. This error is fatal to the Board's Section 8(a)(1) termination finding, and we therefore vacate that part of the Board's order. On remand the Board may reconsider whether the record supports an unlawful termination finding under the correct standard. See Hawaiian Dredging, 857 F.3d at 885 (refusing enforcement for failure to consider appropriate evidence under Wright Line's second prong); Sutter East Bay, 687 F.3d at 436 (same).

 

484*484 C.

 

Finally, we turn to the Board's finding that Circus violated Section 8(a)(1) by unlawfully threatening Schramm. Employer statements "interfere with, restrain, or coerce" employees in violation of Section 8(a)(1) when they "reasonably tend[ ] to interfere" with the exercise of protected rights. Adv. Life Sys., Inc. v. NLRB, 898 F.3d 38, 44 (D.C. Cir. 2018). Proof of employer intent or coercive effect on employees is not required to establish a violation. See Avecor, Inc. v. NLRB, 931 F.2d 924, 931-32 (D.C. Cir. 1991); Am. Freightways Co., 124 NLRB 146, 147 (1959). As with the other two unfair labor practice findings in this case, Circus contests the Board's factfinding and legal conclusion. Assuming without deciding that Cordell's statement could constitute an actionable threat if made as alleged, we focus on Circus's challenge to the Board's underlying factual finding that Cordell told Schramm "you know what, maybe we just won't need you anymore" during a weekly safety meeting. Although the Board enjoys wide deference with respect to factfinding, such deference is not unlimited. We conclude this unlawful threat finding presents the rare case in which an ALJ's witness credibility determinations must be set aside.

Whether Circus committed the relevant conduct is a question of fact reviewed for "substantial evidence on the record considered as a whole." 29 U.S.C. § 160(e)-(f); see David Saxe Prods., LLC v. NLRB, 888 F.3d 1305, 1311 (D.C. Cir. 2018). Evidence is substantial when "a reasonable mind might accept [it] as adequate to support a conclusion." Universal Camera, 340 U.S. at 477, 71 S.Ct. 456 (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). An ALJ's credibility findings contribute to substantial evidence unless "hopelessly incredible, self-contradictory, or patently insupportable." PruittHealth-Virginia Park, LLC v. NLRB, 888 F.3d 1285, 1294 (D.C. Cir. 2018) (citation and internal quotation marks omitted).

Although our standard sets a high bar, ALJ witness credibility determinations are not immune from judicial scrutiny and must be reasonable and reasonably explained. See Stanford Hosp. & Clinics v. NLRB, 325 F.3d 334, 337 (D.C. Cir. 2003) ("Decisions regarding witness credibility and demeanor are entitled to great deference, as long as relevant factors are considered and the resolutions are explained." (citation and internal quotation marks omitted)). Our review is not a rubber stamp, and case law reflects at least three grounds that may render an ALJ's credibility decisions unreasonable. This court will not condone arbitrary resolutions that reflect a "lack of evenhandedness." Sutter East Bay, 687 F.3d at 437. Nor will we uphold credibility decisions resting "explicitly on a mistaken notion." Sasol N. Am. Inc. v. NLRB, 275 F.3d 1106, 1112 (D.C. Cir. 2002). When drawing inferences for and against witness testimony, an ALJ "is not free to prescribe what inferences from the evidence it will accept and reject, but must draw all those inferences that the evidence fairly demands." King Elec., Inc. v. NLRB, 440 F.3d 471, 475 (D.C. Cir. 2006) (quoting Allentown Mack, 522 U.S. at 378, 118 S.Ct. 818) (alterations omitted).

We hold that the ALJ witness credibility determinations supporting the conclusion that Cordell threatened Schramm are patently insupportable. See PruittHealth, 888 F.3d at 1294. Circus presented six witnesses who regularly attended the weekly safety meeting to rebut testimony from Schramm and Tenney alleging the threat occurred. The ALJ purported to evaluate each witness using criteria drawn from the record and common 485*485 sense, reasoning that the ability to remember certain details made testimony more reliable overall. But the ALJ applied these criteria unevenly, drew unsupported inferences, and failed to draw inferences warranted by the record that tended to favor the company's account.

First, the ALJ credited witness testimony with a "lack of evenhandedness." Sutter East Bay, 687 F.3d at 437. For instance, the ALJ reasonably inferred that the ability to remember the meeting's date made a witness more credible. Schramm testified the threat occurred during a meeting "getting near" Thanksgiving, either November 21 or November 27, while his corroborating witness, Tenney, testified the meeting occurred "before Thanksgiving," and "possibly the 21st." As to testimony favoring Circus, Cordell remembers a conversation with Schramm and Tenney that occurred on December 6, while other witnesses recalled a conversation between these parties at a safety meeting but did not specify a date. Based on this testimony, the ALJ concluded that Schramm, Tenney, Cordell, and a fourth witness were discussing the same meeting, even though they disagreed as to the date and the contents of the meeting. By contrast, she discredited four other witnesses who supported Circus's account because their testimony did not include a meeting date.[6] The ALJ also emphasized a witness's ability to recall specific comments Schramm reported making during the meeting, including noting that Cordell was not a medical professional and describing prior experience with marijuana smoke exposure while employed at another hotel. Yet the ALJ credited Schramm and Tenney for recalling these details but discredited three company witnesses who remembered the same details but also testified Cordell never made a threat. Legitimate adjudication requires evenhanded assessment of testimony offered on behalf of the employer and the employee.

Second, the ALJ found Schramm's version of events "more inherently probable" because "[f]or the witnesses called by [Circus], this was just another weekly safety meeting. For Teeney [sic] and Schramm, it was a memorable occasion." Circus Circus, 366 NLRB No. 110, at *4. This inference by the ALJ rests "explicitly on a mistaken notion" that none of the other employees in the safety meeting would remember their manager turning red and threatening to terminate an employee for voicing a workplace complaint. Sasol N. Am., 275 F.3d at 1112 (overturning inference from written notes that failed to stand for the proposition for which the Board cited them); see also United States ex rel. Exarchou v. Murff, 265 F.2d 504, 507 (2d Cir. 1959) ("We do not think this finding of impossibility accords with the facts of human life."); NLRB v. Universal Camera Corp., 190 F.2d 429, 430 (2d Cir. 1951) 486*486 ("[A]s to matters of common knowledge we are to use a somewhat stiffer standard."). Glaringly absent from this analysis are contrary inferences of equal or greater probative value that "the evidence fairly demands," including the possibility that six witnesses failed to remember the threat because none occurred. King Elec., 440 F.3d at 475 (quoting Allentown Mack, 522 U.S. at 378, 118 S.Ct. 818) (alterations omitted). The ALJ's reasoning again demonstrated "a lack of evenhandedness": she determined that the inherent memorability of a threat favored Tenney's testimony even though he was not threatened, and favored one of the company's witnesses to the extent he remembered a heated exchange, but not to the extent that he also testified the exchange ended without a threat by Cordell. Sutter East Bay, 687 F.3d at 437.

Third, of particular concern is the ALJ's failure to draw an adverse inference against Tenney, Schramm's only corroborating witness, based on a fair consideration of record evidence that materially impeached part of his testimony. At the hearing, Tenney testified that he created a contemporaneous record of Cordell's threat on his mobile device by entering the note "[Cordell] threatened carpenter" into the company's electronic work order system known as "HotSOS." Schramm testified that Tenney told him the exact log number of the HotSOS entry created after the threat. Circus immediately produced complete HotSOS records for the date on which Tenney said the meeting occurred. The records showed Tenney made several entries on that day but none that referenced Cordell's conduct toward Schramm or any other threatening conduct. Nevertheless, the ALJ concluded Tenney merely misremembered the date or the substance of the entry and, in any event, that "his testimony was inherently credible and entitled to greater weight than that of witnesses presented by [Circus]." Circus Circus, 366 NLRB No. 110, at *4. In reaching this conclusion, the ALJ failed to consider evidence that was certainly a "relevant factor[ ]" bearing on the credibility determinations at issue. Stanford Hosp., 325 F.3d at 337.

Although the ALJ did not purport to rely on the HotSOS record to credit Tenney, the inconsistency in his testimony "fairly demand[ed]" an adverse inference against the remainder of his account. King Elec., 440 F.3d at 475 (quoting Allentown Mack, 522 U.S. at 378, 118 S.Ct. 818). The ALJ's explanations for not discounting the remainder of Tenney's testimony are inadequate. To conjecture that Tenney misremembered a date smacks of the "speculation without a jot of evidentiary support in the record" we have criticized in the past. Jackson Hosp. Corp. v. NLRB, 647 F.3d 1137, 1142 (D.C. Cir. 2011). An ALJ's introduction of new reasons to credit testimony is particularly troubling where, as here, agency procedures tightly limited Circus's ability to respond by reopening the record. See 29 C.F.R. § 102.48(c)(1) (limiting reopening of the record to "newly discovered evidence" that "would require a different result").[7] Further, describing testimony 487*487 favoring one party as "inherently credible" notwithstanding a material gap in the witness's account fails to provide a rationale on which to sustain the ALJ's reasoning.

The Board argues that even if the ALJ's analysis is flawed, we should still uphold the Board's finding based on the ALJ's favorable assessment of Schramm's testimonial demeanor during the hearing. Witness demeanor can be valid evidence favoring a given outcome. Here, however, testimonial demeanor is too thin a reed to sustain the ALJ's conclusion. Schramm's testimony is materially contradicted by six witnesses, union members and non-members alike, who remember only an ordinary discussion that concluded without any threats. Schramm's testimonial demeanor alone cannot overcome this strong record evidence. Contrary to the Board's assertions, deference to agency factfinding does not stretch so far. Cf. Shamrock Foods Co. v. NLRB, 346 F.3d 1130, 1135 (D.C. Cir. 2003) (finding substantial evidence where the ALJ disbelieved company witnesses and testimony of aggrieved employee was corroborated by a coworker); Parsippany Hotel Mgmt. Co. v. NLRB, 99 F.3d 413, 425-26 (D.C. Cir. 1996) (finding substantial evidence where documentary evidence corroborated employee's testimony and employer witness discredited herself through contradictory statements).

While we do not lightly overrule factual determinations, under these circumstances we conclude there was insubstantial evidence to support the finding that Cordell threatened Schramm at a workplace safety meeting. Accepting the ALJ's determinations here would be inconsistent with the role set out for us by Congress and the Court. See Universal Camera, 340 U.S. at 490, 71 S.Ct. 456; Jones & Laughlin, 301 U.S. at 47, 57 S.Ct. 615. Accordingly, we vacate this unfair labor practice and need not reach the Board's refusal to reopen the record for additional evidence tending to impeach Tenney's corroborating account.

 

* * *

 

As with other agencies, the Board must apply existing regulatory standards unless and until it provides a reasoned explanation for a new standard. Here, the Board engaged in unreasoned decisionmaking by finding unfair labor practices without substantial evidence on the record as a whole and by departing from announced standards in an arbitrary and capricious manner. For the foregoing reasons, we grant the petition for review in full and vacate the Board's order. With respect only to the unlawful termination finding, we remand for further proceedings consistent with this opinion.

So ordered.

Srinivasan, Chief Judge, concurring in part and dissenting in part:

I join my colleagues' decision in Part II.B of the court's opinion to remand for the Board to reassess whether Circus terminated Schramm because of his protected activity or instead for valid reasons. I respectfully disagree, though, with my colleagues' decision to set aside the Board's distinct determinations that: (1) Circus violated Schramm's right to union representation during the investigatory meeting with him; and (2) Schramm's supervisor unlawfully threatened him in response to his exercise of statutory rights. Because I would sustain the Board's decision in those respects, I do not join Parts II.A and II.C of the court's opinion.

1. Under the Board's Weingarten rule, an employee is entitled "to refuse to submit without union representation to an interview 488*488 which he reasonably fears may result in his discipline." NLRB v. J. Weingarten, Inc., 420 U.S. 251, 256, 95 S.Ct. 959, 43 L.Ed.2d 171 (1975). That right "arises only in situations where the employee requests representation." Id. at 257, 95 S.Ct. 959. Under the Board's precedents, an employee will be treated as having requested union representation so as to invoke Weingarten "if the language used by the employee is reasonably calculated to apprise the Employer that the employee is seeking such assistance." Houston Coca Cola Bottling Co., 265 NLRB 1488, 1497 (1982). "No magic or special words are required to satisfy this element of the Weingarten rationale." Id.

My colleagues agree with that understanding of the triggering condition for the Weingarten rule. See Maj. Op. 477-78. The sole issue here is whether Schramm's statements at the outset of his investigatory meeting satisfied that condition—i.e., whether his statements qualify as reasonably calculated to apprise Circus that he desired union assistance in the meeting. According to my colleagues, the Board arbitrarily departed from its precedents in concluding that Schramm's statements met that standard. In my view, however, the Board permissibly determined, consistent with its precedents, that Schramm adequately conveyed his desire for union representation.

Before the meeting, Schramm had been advised by Airth Colin, a human resources representative for Circus, to bring a union steward if he desired representation in the meeting. Circus Circus Casinos Inc., 366 NLRB No. 110, at *1 (June 15, 2018). When Schramm arrived at the meeting, he explained to those present: "I called the union three times [and] nobody showed up, I'm here without representation." Id. at *4. Schramm thereby conveyed to Circus's representatives at the meeting (including Colin) that he had attempted to do precisely what he had been advised to do if he desired union representation. In that context, the Board reasonably held Schramm's statements adequate to apprise Circus of his interest in representation. Id. at *1.

It is true, as my colleagues observe, that the statements at issue here related facts about past efforts to enlist union assistance. Maj. Op. 477-78. But an employee's statements can both describe recent efforts to secure union representation and simultaneously convey a continuing interest in that representation. The Board reasonably held that to be the case here. After all, why would Schramm relate to Circus's representatives at the outset of the meeting that he had unsuccessfully tried to secure union representation if not because he still desired that assistance, especially given that Circus had advised Schramm to make those very efforts if he desired representation? The Board's precedents hold that an employee's questions such as "Do I need to get somebody in here?" and "Do I need a witness?" qualify as statements reasonably calculated to apprise an employer of a desire for union representation, even absent any reference to a union as such. See General Die Casters, Inc., 358 NLRB 742, 742 (2012); Bodolay Packaging Mach., Inc., 263 NLRB 320, 325 (1982). Schramm's statements here, which specifically referenced union representation, evince a desire for such representation no less clearly. At the least, the Board did not arbitrarily depart from its decisions in so concluding.

My colleagues express a concern that, if Schramm's statements are treated as sufficient to invoke Weingarten, he would effectively be denied the choice to proceed without union representation. Maj. Op. 478-79. I do not understand why that would be the case. When an employee's statements trigger Weingarten, the employer 489*489 can: (i) grant union representation; (ii) deny representation and discontinue the interview; or (iii) deny representation and give the employee the option to continue unrepresented or forgo the interview. Weingarten, 420 U.S. at 258-59, 95 S.Ct. 959. The last option specifically recognizes and preserves an employee's ability to choose to go forward without union assistance.

For these reasons, I would sustain the Board's determination that Schramm's statements at the outset of the meeting reasonably apprised Circus of his interest in union assistance so as to trigger the Weingarten rule.

2. The Board separately held that Schramm's supervisor, Rafe Cordell, unlawfully threatened Schramm for exercising his statutory rights when Cordell said to Schramm, "maybe we just won't need you anymore," after Schramm raised certain concerns about workplace conditions. Circus Circus, 366 NLRB No. 110, at *4. My colleagues overturn the Board's factual finding (specifically, the Board's adoption of the ALJ's finding) that Cordell made that statement. Maj. Op. 484. While my colleagues acknowledge that we review the Board's factual findings under a highly deferential standard, they conclude that this is the rare case in which a finding should be set aside. Respectfully, I disagree.

Schramm testified that Cordell made the contested statement following a discussion about secondhand marijuana smoke during a safety meeting sometime in late November. Those safety meetings were held every Thursday at four different times. Cordell, meanwhile, testified that the relevant discussion occurred at a shift change meeting in early December. Circus produced six witnesses who testified about a meeting touching on the issue of secondhand marijuana smoke. But that was a recurring topic of discussion among employees. Schramm and another Circus employee, Tenney, had raised it during at least two meetings. Consequently, the ALJ first had to determine which Circus witnesses were talking about the relevant meeting before assessing whether Cordell in fact threatened Schramm during it.

In making that determination, the ALJ focused on one detail about which Schramm, Tenney, Cordell, and one other Circus witness all testified: that when Cordell dismissed Schramm's concern about potentially failing a drug test due to secondhand exposure to marijuana smoke, Schramm responded that Cordell was not a medical professional qualified to make that judgment. Because none of the other four witnesses recalled that detail, the ALJ could not definitively conclude that they were discussing the pertinent meeting. In addition, none of Circus's witnesses, aside from Cordell, had been asked about Cordell's statement that Circus may no longer need Schramm's services.

The upshot is that the ALJ faced four Circus witnesses whom she could not definitively conclude were discussing the relevant meeting, and in any event, none of those witnesses had specifically testified about whether Cordell threatened Schramm. The ALJ then concluded that Schramm's and Tenney's testimony about Cordell's threat outweighed the only directly contradictory testimony: that of Cordell himself. In my view, the ALJ's credibility determinations in that regard, adopted by the Board, were not "hopelessly incredible, self-contradictory, or patently insupportable." PruittHealth-Virginia Park, LLC v. NLRB, 888 F.3d 1285, 1294 (D.C. Cir. 2018) (internal quotation marks omitted).

[1] Circus does not contest the finding that Schramm engaged in protected activity under Section 7 of the Act by seconding Tenney's marijuana smoke concern during the safety meeting. See 29 U.S.C. § 157. The Board must identify protected activity to invoke NLRA jurisdiction in the first instance. In the absence of an objection by Circus, however, we will not consider this jurisdictional issue and express no opinion on the Board's finding.

[2] Administrative law's reasonable explanation requirement balances the need for definite standards with respect for agency discretion. Insisting on definite standards recognizes "the basic human claim that the law should provide like treatment under like circumstances," and "a clear statement of the standards the agency is applying is necessary if administrative adjudication is to be consistent with the democratic process." Henry J. Friendly, The Federal Administrative Agencies: The Need for Better Definition of Standards, 75 HARV. L. REV. 863, 878, 880 (1962).

[3] Our dissenting colleague believes the Board's decision here would not disturb Weingarten's treatment of employee choice. See Dissenting Op. 488-89. It is true that after a valid request, the employer may offer the employee a choice between formally waiving representation or forgoing the interview. See Weingarten, 420 U.S. at 258-59, 95 S.Ct. 959; Bellagio, 854 F.3d at 708. Yet a rule that requires such a choice after any type of open-ended statement would in practice change the Weingarten right from one invoked by the employee to a choice framed by the employer and requiring an affirmative waiver by employees. Such a standard is wholly different from the Weingarten framework and would impose a distinct set of burdens on employees and employers not contemplated by longstanding precedent.

[4] Even if Schramm's statement could be construed as an affirmative request, the general counsel must also show Circus compelled his attendance at the interview. "[T]he mere fact that an employee's request for union representation is not met does not, without more, mean that the employer has committed an unfair labor practice." Bellagio, 854 F.3d at 708-09. The Weingarten right gives an employee the choice to "forgo his guaranteed right and ... participate in an interview unaccompanied by his union representative." 420 U.S. at 256-57, 95 S.Ct. 959. Because Circus rested its petition for review on other grounds, however, we express no opinion on whether the record suggests that Schramm elected not to participate in the interview but was compelled to do so by his employer.

[5] Employer discipline violates Section 8(a)(1) and (3) when the protected activity at issue is union participation. Section 8(a)(3) bars employers from discriminating in order "to encourage or discourage membership in any labor organization." 29 U.S.C. § 158(a)(3).

[6] Our dissenting colleague argues that because Schramm and Tenney raised their marijuana smoke concern at multiple meetings, the ALJ reasonably concluded four of Circus's witnesses described a different meeting from the one in question. See Dissenting Op. 489. Yet the ALJ found that Schramm and Tenney raised the marijuana smoke concern at two meetings: one in early November, and another in late November or early December. No one testified Cordell attended the first of the two meetings, and Schramm and Tenney testified to a single relevant conversation with Cordell at the second. See Circus Circus, 366 NLRB No. 110, at *4. At least three of the four Circus witnesses disregarded by the ALJ specifically recalled a conversation between Schramm, Tenney, and Cordell about marijuana smoke at a safety meeting, and the record includes evidence of only one meeting at which all three had such a discussion. See id. Thus, the ALJ lacked a basis in the record to conclude Circus's witnesses described a phantom third meeting at which Schramm, Tenney, and Cordell discussed marijuana smoke without resorting to threats.

[7] As counsel noted at oral argument, the NLRB's limited discovery procedures meant Circus learned of Tenney's alleged HotSOS entry for the first time during the hearing before the ALJ. See Oral Arg. at 3:42-4:20. In response, Circus produced Tenney's HotSOS entries for November 21, the date on which he repeatedly claimed to have recorded Cordell's threat against Schramm. See id. at 4:41-5:15. It was only after the ALJ issued a recommended decision crediting Tenney that thousands of other November HotSOS entries became relevant as a potential means of rebutting the ALJ's rationale. See id. at 5:24-6:00. Circus could not have foreseen this development, and the Board's refusal to reopen the record left the ALJ's error unremarked and unremedied.