United States Court of Appeals, District of Columbia Circuit
March 12, 2018
Petitions for Review and Cross-Application for Enforcement of
an Order of the National Labor Relations Board
E. Lofland argued the cause and filed the briefs for
A. Seid, Attorney, National Labor Relations Board, argued the
cause for respondent. With him on the brief were Richard F.
Griffin, General Counsel at the time the brief was filed,
Jennifer Abruzzo, Deputy General Counsel at the time the
brief was filed, John H. Ferguson, Associate General Counsel,
Linda Dreeben, Deputy Associate General Counsel, and Jill A.
Griffin, Supervisory Attorney.
Before: Kavanaugh [*] and Millett, Circuit Judges, and
Sentelle, Senior Circuit Judge.
MILLETT, CIRCUIT JUDGE
if you do; unfair if you don't. As a practical matter,
that is the position in which the National Labor Relations
Board's decision in this case left the employer. Advanced
Life Systems, a family owned-and-operated small business,
found itself whipsawed between Board precedent that, on the
one hand, forbids employers to make pay increases
and holiday gifts without first negotiating with the union,
and, on the other, generally forbids employers to stop
making increases and holiday gifts after a union's
election. We hold that two statements by the company's
owner constitute unfair labor practices, but the Board's
ruling that the employer's suspension of personal gifts
and discretionary pay raises was unlawful is not supported by
National Labor Relations Act, 29 U.S.C. § 151 et
seq., protects the right of employees to "bargain
collectively through representatives of their own
choosing." Id. § 157. The Act enforces
that right by proscribing certain "unfair labor
practice[s]," id. § 158(a), including any
employer action that "interfere[s] with, restrain[s], or
coerce[s] employees in the exercise" of that right to
collective bargaining, id. § 158(a)(1). The Act
also shields employees from discriminatory employer actions
designed to punish or deter union participation and
membership. See id. § 158(a)(3).
employees exercise their Section 7 rights and elect a union
to represent them, the Act makes it an unfair labor practice
for employers "to refuse to bargain collectively with
th[ose] representatives" on issues regarding
"wages, hours, and other terms and conditions of
employment." 29 U.S.C. § 158(a)(5), (d). In other
words, the Act imposes on covered employers an affirmative
duty to bargain over the terms and conditions of employment.
See Local Union No. 189, Amalgamated Meat Cutters, and
Butcher Workmen of N. America, AFL-CIO v. Jewel Tea Co.,
381 U.S. 676, 685-686 (1965). Correspondingly, the Act
forbids employers to make unilateral changes to those
employment matters for which bargaining is mandatory. See
NLRB v. United States Postal Serv., 8 F.3d 832, 836
(D.C. Cir. 1993).
Life Systems, Inc. provides ambulance services in Yakima,
Washington. See Advanced Life Sys., Inc., 364 NLRB
No. 117 at 13 (2016). William Woodcock is Advanced Life's
majority owner and operator. Woodcock's immediate family
members co-own the business, but only Woodcock controlled the
company and its operations. Advanced Life began operations in
1996 and has grown over the intervening years to operate six
ambulance stations and employ around fifty-five personnel,
comprising a mix of Emergency Medical Technicians
("EMTs"), paramedics, dispatchers, and
administrative and management staff.
its size, Advanced Life never adopted a formalized wage
schedule or written policy. Advanced Life Sys., 364
NLRB at 13. New hires were reportedly told that they could
expect periodic pay raises on, for example, the anniversary
of their hire date. But those informal predictions rarely, if
ever, materialized. Id.; see id. at 3 n.8.
In practice, pay increases occurred at highly irregular
intervals, varying between 2 weeks and 22.5 months.
Id. at 7-9 (Member Miscimarra, dissenting). The
amount of any pay raise, even for the same employee, was
equally unpredictable, with per hour increases ranging
between 25 cents and $2.50. Id. at 14. The record
reveals no discernible nexus between, on one hand, the timing
or amount of any pay raises and, on the other hand, any
consistent or predictable metric like seniority or advanced
training. Rather, Woodcock exercised unbridled discretion
over the timing and amount of each individual's pay
increase (if any). Id. at 13 n.8.
Advanced Life lacked any formal bonus policy or standardized
gift practice. Advanced Life Sys., 364 NLRB at 14.
In 1996, the company's first year of operations, the
Woodcock family hosted a Christmas potluck for all Advanced
Life employees at one of the ambulance stations and
distributed personal gifts to each employee. Id. at
14; ALJ Hr'g Tr. 83:7, In re: Advanced Life Systems,
Inc., and International Ass'n of EMTs and
Paramedics, No. 19-CA-096464 (NRLB ALJ Feb. 25, 2014).
company grew, the potluck grew into an annual Christmas party
at which Woodcock and his wife distributed assorted gifts and
prizes to their employees, including everything from raffle
tickets and gift cards to cash, appliances, and trips.
Advanced Life Sys., 364 NLRB at 14. Those gifts were
all paid for by the Woodcocks out of their personal funds.
Id. at 14 n.21, 15; see also id. at 16.
Advanced Life continued this holiday practice until 2011,
with one exception. In 2010, in lieu of gifts, the Woodcocks
donated approximately $10, 000 to an employee whose home was
destroyed in a mudslide.
the Woodcocks nor Advanced Life kept any records of the gifts
given to employees. Advanced Life Sys., 364 NLRB at
14 n.21, 15. Since the Woodcocks paid for the gifts entirely
from their personal funds, they never claimed a tax deduction
nor sought other favorable treatment for those expenditures.
The employees, for their part, never claimed the gifts as
wages nor reported them on their income taxes.
2012, the now-defunct National Emergency Medical Services
Association ("Union") began an organizing campaign
among Advanced Life's paramedics, EMTs, and dispatchers.
During the organization campaign, one of the unit employees,
Matthew Schauer, talked with Woodcock about the "pros
and cons" of unionization. ALJ Hr'g Tr. 74:20. In
testimony that the Board credited, Schauer reported Woodcock
as saying that Advanced Life "would not be able to give
us raises if we brought a union in." Id. at
after that, the Union won the representation election, and
the Board certified it as the unit's exclusive
collective-bargaining representative. Following the
Union's election, Advanced Life discontinued pay raises
and the Christmas party and gifts pending negotiation of
those matters with the Union.
months later, in December 2012, Lenny Ugaitafa, a bargaining
unit employee, inquired about a pay raise. Woodcock explained
that his attorney had advised him to temporarily freeze all
changes in the employees' terms and conditions of
employment, including pay raises, "because of the whole
Union deal." ALJ Hr'g Tr. 65:15.
next month, another unit employee, Cole Gravel, asked
Woodcock why Advanced Life had not made any pay raises in the
five months since the employees had unionized. Woodcock
replied that, because pay raises had been discretionary prior
to the election, Advanced Life was now legally obligated to
negotiate any change in pay with the Union. Advanced Life
Sys., 364 NLRB at 2.
International Association of EMTs and Paramedics, a labor
organization affiliated with the Union, filed two unfair
labor practice charges against Advanced Life in January 2013.
Then-Acting General Counsel Lafe Solomon issued an order
consolidating the cases and complaints. General Counsel
Richard Griffin subsequently ratified the consolidated
complaint and, after independently reviewing the merits,
authorized continued prosecution of the matter.
General Counsel's complaint alleged that Advanced Life
violated Section 8 of the Act, 29 U.S.C. § 158, by (i)
"withholding regularly scheduled biannual wage
increases;" (ii) "failing to provide employees with
Christmas bonuses;" (iii) "telling employees that
wage increases were withheld because of their union
activity[;]" and (iv) "discriminating in regard to
the hiring, tenure or terms and conditions of employment of
its employees" to discourage union and concerted
activities. Advanced Life Sys., 364 NLRB at 13.
hearing, a Board administrative law judge concluded that
Woodcock's three statements made to employees about
halting wage increases after unionization violated Section
8(a)(1) of the Act, 29 U.S.C. § 158(a)(1), because they
were designed to discourage the exercise of the
employees' Section 7 collective action rights, 29 U.S.C.
§ 157. The administrative law judge also found that
Advanced Life "had a longstanding practice of granting
hourly wage increases mainly between 25 to 50 cents once
every 6 months or sooner, depending on tenure and
performance[, ]" and that its unilateral cessation of
pay raises and Christmas bonuses violated Section 8(a)(5) of
the Act, which prohibits changing the terms and conditions of
employment without bargaining, 29 U.S.C. § 158(a)(5).
Advanced Life Sys., 364 NLRB at 15. Lastly, the
administrative law judge ruled that Advanced Life's
decision to halt wage increases and Christmas gifts pending
negotiations with the Union constituted anti-union
retaliation in violation of Section 8(a)(3), 29 U.S.C. §
158(a)(3), as evidenced by Woodcock's contemporaneous
statements. Advanced Life Sys., 364 NLRB at 18.
Board affirmed most of the administrative law judge's
findings and rulings, concluding that Advanced Life was
liable for two violations of Section 8(a)(1) based on
Woodcock's statements immediately before and four months
after the election that tied the temporary halt in wage
increases to the need to negotiate with the Union.
Advanced Life Sys., 364 NLRB at 2. The Board also
found two violations of Section 8(a)(3) for discriminatorily
ceasing pay raises and Christmas bonuses following the