Paulsen v. Remington Lodging & Hospitality, LLC
Filing
29
MEMORANDUM AND OPINION: For the reasons set forth herein, and the reasons set forth on the record on May 26, 2013, the Court grants in part and denies in part petitioner's motion for a preliminary injunction. Specifically, the Court denies the r equest for an immediate order of reinstatement. However, the Court grants the request for a prospective order restraining respondent from engaging in certain enumerated unfair labor practices. The Court will issue a separate injunction that sets fort h the terms of the injunction (which are not in dispute). The Court denies petitioner's motion for an injunction pending appeal. Respondent must continue to submit a letter to the Court regarding the status of the rehiring of employees on the 15th day of every month until reinstatement is complete. SO ORDERED. Ordered by Judge Joseph F. Bianco on 8/14/2013. (Pilmar, Philip)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
_____________________
No 13-cv-2539 (JFB) (WDW)
_____________________
JAMES G. PAULSEN, REGIONAL DIRECTOR OF REGION 29 OF THE NATIONAL LABOR
RELATIONS BOARD, FOR AND ON BEHALF OF THE NATIONAL LABOR RELATIONS
BOARD,
Petitioner,
VERSUS
REMINGTON LODGING & HOSPITALITY, LLC,
Respondent.
___________________
MEMORANDUM AND ORDER
August 14, 2013
___________________
JOSEPH F. BIANCO, District Judge:
Petitioner James G. Paulsen, Regional
Director of Region 29 of the National Labor
Relations Board, for and on behalf of the
National
Labor
Relations
Board
(“petitioner” or “the Board”) brings this
action against Remington Lodging &
Hospitality,
LLC
(“respondent”
or
“Remington”) pursuant to Section 10(j) of
the National Labor Relations Act (“the
Act”), 29 U.S.C. § 160(j). Petitioner alleges
that respondent engaged in unfair labor
practices within the meaning of the Act
when it terminated its entire housekeeping
department after the employees began
organizing on behalf of a union and engaged
in other activities with the intention of
discouraging unionization.
On April 26, 2013, petitioner filed this
action seeking a temporary injunction, in
which petitioner requests an order barring
respondent from engaging in further unfair
labor practices and immediately reinstating
all employees whom respondent terminated
pending the final disposition of the matter
currently before the Board. After
submissions were filed by both parties, the
Court held an order to show cause hearing
on May 6, 2013. Following the hearing, the
Court invited further briefing by the parties.
On May 15, 2013, Administrative Law
Judge (“ALJ”) Raymond Green issued his
decision finding several violations of the Act
by respondent as alleged by petitioner,
which is on appeal before the Board. The
matter was fully submitted before this Court
on May 17, 2013. On May 22, 2013, the
Court orally denied on the record
petitioner’s
injunction.1
motion
for
a
preliminary
reinstatement, and of those, only 16 were
waiting for a position to become available
because 8 employees had not responded to
the employer’s letter and 13 offers had been
made; (2) at the time of this Memorandum
and Order, only 8 employees are waiting for
a position to open (and 4 of those 8 have
turned down PM shift positions and are
waiting for future AM shift openings); and
(3) it is extremely likely that these
remaining 8 employees will receive
positions over the next 60 days based upon
the historical rate at which Remington has
made offers. Third, if the Court were to
order immediate reinstatement, the current
workers would be displaced. The
fundamental question facing this Court is the
following: should the Court, given the
substantial delay that has already occurred,
allow an orderly and voluntary reinstatement
of the terminated employees to the status
quo ante over a relatively short period of
time, which would also include back pay for
the reinstated employees if petitioner
ultimately prevailed in the administrative
process, or should the Court order
immediate reinstatement and displace the
current workers (with no back pay should it
ultimately
be
determined
in
the
administrative process that the charges are
without merit)? The Court believes the latter
option is not the just and proper result in this
particular case. The Court is not punishing
the employees for the Board’s delay; rather,
it simply concludes in its discretion, given
the delay and the rapid reinstatement
schedule by the employer, that the
reinstatement injunction is unnecessary at
this juncture to prevent any irreparable harm
or to preserve the status quo that existed
before the onset of the alleged unfair labor
practices. Because of the employer’s
voluntary reinstatement program, that status
quo (to the extent it can be achieved given
the Board’s delay) is rapidly approaching
without the need for any such injunction.
As set forth more fully below, the Court
concluded in its discretion that an order of
immediate reinstatement pending final
disposition by the Board was unwarranted in
this particular case. This Court recognizes
the important role that Section 10(j) of the
Act plays in ensuring that the Board’s
remedial authority is not frustrated or
nullified by the passage of time that is
inherent in the Board’s administrative
litigation. However, in determining whether
injunctive relief under Section 10(j) is “just
and proper,” the Court also has an obligation
to
consider
the
specific
factual
circumstances before it and the equitable
considerations surrounding the exercise of
its discretion. Here, the circumstances are
rather unusual.
First, petitioner delayed seeking this
injunctive relief for approximately 6 months,
including a 3-month delay after the unfair
labor practice charges were filed in January
2013. Second, the employer has already
agreed (without any injunction) to reinstate
all of the employees who were terminated
and has been rapidly re-hiring all employees
interested in reinstatement. Specifically, (1)
at the time petitioner’s motion was fully
submitted, 37 employees eligible were for
1
Respondent also argued that there was no evidence
in the record that petitioner was granted authority to
bring this action by the Board, and that even if he
was granted the authority, that such authorization was
invalid because the Board lacks a quorum. (See
Resp’t’s Mot. to Dismiss Pet. For Preliminary
Injunction, May 2, 2013.) Because the Court held that
petitioner had not demonstrated that an injunction
was just and proper in this case, the Court declined to
reach this issue during the oral ruling. However,
because the Court, based upon a subsequent separate
motion, is now granting the injunction in part –
namely, prospectively enjoining respondent from
engaging in unfair labor practices – the Court
addresses this issue infra.
2
those cases are distinguishable because none
of them involved a situation, as we have
here, where the employer has agreed to
reinstate the workers in a very short period
of time while the administrative process is
being completed and also agreed to a
prospective injunction restraining them for
committing future unfair labor practices.
The principal reasons cited by petitioner
for
immediate
reinstatement
are
unpersuasive in this particular situation.
First, petitioner argues that the employees
will scatter (i.e., find new jobs and not want
to return to their previous employment)
unless there is immediate reinstatement. As
a threshold matter, the Court believes that
most, if not all, of the scattering already took
place during the 6-month delay by petitioner
in seeking the 10(j) injunction. For example,
by the time the motion was fully submitted
to this Court, over one-third of the
employees had declined or not responded to
an offer for reinstatement. Thus, it is
abundantly clear that the risk of additional
scattering is minimal at this juncture.
Second,
petitioner
contends
that,
notwithstanding the voluntary reinstatement
of the employees by respondent, the Court
also should still order reinstatement as a
form of judicial encouragement to the
employees. That assertion overlooks the
constitutional doctrine of mootness. Such an
argument suggests that, even if the employer
had already reinstated all the workers, the
Court should still order reinstatement, even
though the requested relief already had been
achieved. Such a contention has no support
in the law. However, to the extent petitioner
has legitimately raised a concern about the
chilling impact that the terminations may
have had on the union’s organizational
efforts, the Court (as a result of a separate
motion made for a cease and desist
injunction) will enjoin the employer from
taking any retaliatory action toward the
reinstated employees. The employees will be
aware that any such retaliation would be a
violation of the injunction and place the
employer in contempt of court. Finally,
petitioner points to other cases where courts
have ordered immediate reinstatement
notwithstanding greater periods of delay by
the Board than in this case. However, all of
Although petitioner would like the Court
to robotically issue the injunction with a
blind indifference to the facts as they exist
now, that is not the legal standard. The status
quo (including reinstatement) has been
largely restored already for most of the
terminated employees and will be fully
restored over the next 2 months. Under such
circumstances, the reinstatement injunction
is unnecessary at this juncture to prevent any
future irreparable harm and, thus, would not
be just and proper. As noted above, the
purpose of the reinstatement injunction is to
prevent employees from being out of their
jobs for the long time it will potentially take
for the administrative process to conclude,
including months or years of appeals. That
purpose will be fully satisfied without the
reinstatement injunction because of the
voluntary reinstatement of workers that has
already taken place and the complete
restoration that will very likely be over in 2
months (if not sooner). These employees
will be working for respondent during the
remainder of the administrative process and,
thus, a Section 10(j) reinstatement order is
wholly unnecessary.
***
On July 22, 2013, petitioner filed a
motion for a preliminary injunction pending
appeal. On July 23, 2013, the Court held a
phone conference with the parties. Although
petitioner initially did seek an order barring
respondent from engaging in further unfair
labor practices separate from the motion for
3
an order of immediate reinstatement,
petitioner made clear that it wished to
pursue the “cease and desist” injunction
separate from the order of reinstatement.
The Court allowed respondent to address
that specific request for injunctive relief. In
its response letter, dated July 26, 2013,
although respondent argued that the
proposed injunction prohibiting future
violations was unnecessary because there
were no ongoing violations, it consented to
the Court imposing such an order. (See
Resp’t’s July 26, 2013 Letter, at 3
(“Respondent would not object to this Court
entering an order directing it to not violate
the seven listed ULPs in ‘part A’ of the
Board’s proposed order”).) Accordingly, for
the reasons set forth below, the Court grants
petitioner’s motion for an injunction
restraining respondent, until the matter
currently before the Board is resolved, from
engaging in certain enumerated unfair labor
practices.2
approximately 60 days (if not sooner) as the
few
remaining
yet-to-be-reinstated
employees are rehired. It is difficult for
petitioner to argue that these 2 remaining
months will result in any irreparable harm
when the Board waited 6 months to make
the motion (and 2 months to file the notice
of appeal). In short, there is clearly no need
for an order of reinstatement pending appeal
under the particular circumstances of this
case.
I. BACKGROUND
A. Factual Background
The following facts are derived from the
ALJ’s decision in this matter, as well as the
parties’ motion papers, declarations, and
representations at oral argument.
Remington is a hotel management
company operating 70 hotels. (ALJ
Decision, May 15, 2013, ECF No. 13-1, at
3.) In December 2011, Remington replaced
Hyatt Corporation as the managing company
of the Hyatt Hotel in Hauppauge, New York
(the “Hotel”). (Id. at 2-3.) Prior to
Remington’s involvement with the property,
the housekeeping staff consisted of
individuals employed by Hospitality
Staffing Solutions (“HSS”), a staffing
agency. (Id.) However, after Remington
began managing the property, it hired those
employees directly and ceased its
relationship with HSS. (Id. at 3.)
Finally, for the reasons set forth herein,
the motion for an injunction pending appeal
is denied. As noted above, the cease and
desist injunction is already in place pending
final disposition of the matter currently
before the Board. The reinstatement issue,
which is the only issue on appeal, will
almost
certainly
be
moot
within
2
Although the denial of the motion for the order of
reinstatement is on appeal, this Court is still
permitted to issue injunctive relief pursuant to Rule
62(c) of the Federal Rules of Civil Procedure. Here,
this injunction (1) is without objection, (2) is
necessary to preserve the status quo (namely, to
prevent any future unfair labor practices), and (3)
does not impact the pending appeal of this Court’s
denial of a reinstatement order. Thus, although this
rule has been narrowly interpreted by the Second
Circuit, this Court has the authority to enter this
injunction under these circumstances. See New York
v. Nuclear Regulatory Comm’n, 550 F.2d 745, 75859 (2d Cir. 1977); Ideal Toy Corp. v. Sayco Doll
Corp., 302 F.2d 623, 625 (2d Cir. 1962).
In April 2012, a representative of Local
947, United Service Workers Union,
International Union of Journeymen and
Allied Trades (the “Union”) began
communicating with some of the
housekeeping staff regarding unionization.
(Id. at 4.) The ALJ determined that by June
10, 2012, Remington was aware that the
Union was soliciting employees inside the
hotel. (Id.) Representatives of Remington
4
a unit of approximately 40 housekeepers,
housemen, maintenance workers, and
drivers. (Id. at 7.) The petition listed both
Remington and HSS as employers. The
petition was amended numerous times, and
the final amendment on October 16, 2012
lists only Remington as the employer and
sought to have an election in a wall to wall
unit consisting of 120 employees. (Id. at 9.)
had conversations with the housekeeping
staff regarding the Union, and the ALJ
determined that these conversations
“constituted illegal interrogations” under the
Act. (Id. at 5.)
Sometime after the Union began
communicating with employees, but no later
than June 28, 2012, Remington began
discussing the possibility of subcontracting
the housekeeping work to HSS, i.e., entering
into the same relationship it terminated upon
its takeover of the Hyatt property. (Id.) In an
e-mail to top executives of Remington, a
division manager stated that the decision to
end the previous outsourcing relationship
was “to improve guest satisfaction and
operations scores,” but that “[t]his approach
has not delivered the expected results as our
scores are still a major problem for this
hotel.” (Id.) “In order to improve the hotel’s
financial position and flow through, as well
as to improve operational efficiencies,” the
division manager recommended reentering
into a relationship with HSS. (Id.) On
August 16, 2012, Remington and HSS
agreed that the housekeeping work would be
subcontracted to HSS and that this
relationship would begin on August 21. (Id.
at 7.) On August 20, 2012, Remington
notified the housekeeping staff that HSS was
taking over the housekeeping functions and
that if they wished to be hired by HSS, they
should fill out applications. (Id.) Most
employees filled out applications and most
of those employees were hired; only those
employees
whose
information
was
questioned by HSS’s e-verify system were
not hired. (Id.) The employees received
“substantial wage increases.” (Id.) Although
the employees were on the payroll of HSS,
“they continued to be supervised by
Remington.” (Id. at 9.)
Meanwhile, in September 2012, just one
month after renewing the relationship,
Remington and HSS began discussions
regarding the termination of their contract.
HSS agreed to terminate the contract and not
enforce a penalty clause against Remington
contained therein. (Id. at 9-10.) In addition,
Remington recruited a new housekeeping
staff and trained them at another hotel;
however, HSS was unaware of this action by
Remington. (Id. at 10.) On October 19,
2012, all 40 members of the housekeeping
staff were fired and were told that they
would not be rehired by Remington. (Id.)
Based on all of the evidence in the
record, the ALJ concluded that Remington
violated the Act by: (1) contracting out the
housekeeping department to HSS in August
2012 (id. at 8), and (2) choosing “not to hire
the housekeeping employees [in October
2012] because of their continued union
activities and to avoid a possible adverse
consequence resulting from the pending
election petition” (id. at 10).
The ALJ also concluded that other
actions by Remington constituted violations
of the Act. The ALJ determined that, in
August and September 2012, two of
respondent’s supervisors engaged in
unlawful interrogations of employees
regarding union activity and issued threats
of reprisals against employees if they voted
to unionize. (Id. at 11.) In addition,
Remington issued three leaflets to
employees in January 2013. (Id. at 12-13.)
On August 20, 2012, the Union filed its
first representative petition. On September
11, 2012, the Union filed a new petition for
5
Relations Act (“Pet’r’s Mem.”) at 2.)3
Following an investigation, the Board issued
a Complaint and Notice of Hearing on
February 13, 2013. A trial before an
Administrative Law Judge began on March
5, 2013 and concluded on March 20, 2013.
(Id. at 2-3.)
Although the ALJ determined that two of
the three pieces of information distributed
by Remington were lawful and “fairly
typical in union election campaigns,” the
ALJ found that Remington’s threat in one
leaflet that it would more strictly enforce its
existing disciplinary rules if the employees
unionized was an unlawful statement. (Id. at
13.)
Shortly after the Union filed the initial
unfair labor practice charge, Remington
began the process of rehiring the discharged
employees. On December 6, 2012, the
General Manager of the Hotel sent a letter to
the housekeeping employees for whom he
had contact information. (Decl. of Jeff
Rostek, May 2, 2013 (“Rostek May 2
Decl.”) ¶ 2.) The letter enclosed an
application for employment, “encourage[d]”
individuals to apply, and stated that “as
positions become available, all current
applicants will be considered for
employment.” (Rostek May 2 Decl. Ex. 1.)
As a result of this letter, the Hotel received
four completed applications. (Rostek May 2
Decl. ¶ 3.) On March 18, 2013, the General
Manager sent all members of the
housekeeping staff listed on the NLRB
Complaint a more detailed letter along with
an employment application. The letter stated
that the Hotel had one position currently
available and that this letter constituted an
“unconditional offer of employment” to the
first person to contract the Hotel’s Human
Resources Director. (Rostek May 2 Decl.
Ex. 2.) The letter also stated that additional
positions would become available and
would also be filled on a “first-come firstserve” basis. (Id.)
The ALJ also found that respondent
discharged Margaret Loiacono (“Loiacono”)
for discriminatory reasons. Loiacono did not
join the Union or assist it any way and,
therefore, she was not engaged in protected
concerted activity. (Id. at 16.) However, in
December 2012, in anticipation of a union
election campaign, Remington distributed
pie charts to employees regarding their
compensation and how it was divided. When
respondent gave her this chart, Loiacono
mentioned that she had previously been a
member of a union. After noticing a mistake
on the chart regarding compensation,
Loiacono engaged in a conversation about
the chart with another employee. When that
employee reported the content of the
conversation to management, a supervisor at
Remington sent the Hotel’s manager an email on December 31, 2012 detailing
Loiacono’s strong reaction to the pie chart.
On January 2, 2013, Remington terminated
Loiacono. (Id. at 14-15.) The ALJ held: “In
these circumstances, it seems to me that the
Respondent’s view of Loiacono’s reported
extravagant reaction to the pie charts could
likely have led management to view her as a
potential thorn in the side when it came to
other campaign literature that it intended to
issue as an election drew nearer.” (Id. at 1516.)
3
Although the Union did not file the first unfair labor
practice charge until November 27, 2012, the Board
learned of Remington’s decision to discharge the
workers on October 19, 2012, the same day as the
employees learned of this action. (See Resp’t’s Opp’n
to Pet. for Prelim. Inj. (“Resp’t’s Opp’n”) Ex. B, Email from Brent Childerhose, Oct. 19, 2012, ECF No.
7-2.)
On November 27, 2012 and January 7,
2013, the Union filed unfair labor practice
charges with the Board. (See Pet’r’s Mem.
of P & A in Supp. of Pet. for Prelim. Inj.
under Section 10(j) of the Nat’l Labor
6
On March 21, 2013, a Union
representative appeared at the Hotel with 22
employees. (May 17, 2013 Decl. of Jeff
Rostek (“Rostek May 17 Decl.”) ¶ 5.) The
employees were asked to sign their names
and provide a phone number. (Id.) However,
four of the names on the list are not included
in the NLRB’s complaint. (Id.)
additional positions will become available
due to the high turnover for housekeeping
staff in the industry. (Id. ¶¶ 9-11.) Thus,
Remington expected that all of the
remaining discharged employees would
receive offers of employment within several
months.
The Board claims that respondent’s
actions have discouraged Union activity. For
example, a representative of the Union states
that one of the housekeeping employees
used to call him once a week asking about
this case and whether there would be union
meetings in the future. However, since she
was rehired by Remington, this employee no
longer contacts the Union representative.
(Aff. of Jose Vega, Apr. 24, 2013 ¶ 8.)
As of May 17, 2013, 29 eligible
housekeeping employees had indicated that
they were interested in returning to work. Of
these 29, the Hotel had hired 6 (including
one employee who was rehired in October
2012 shortly after discharge). (Id. ¶ 11.) The
Hotel had received 5 rejections of offers,
including one by an employee who returned
to work and then quit after one day. (Id.)
Eight employees had not responded to the
Hotel, and there were 2 offers outstanding as
of that date. (Id.) Thus, as of the Court’s oral
decision, there were only 16 additional
employees who needed to receive offers of
employment to complete the process of
attempting to rehire all discharged
employees. (Id.)4
II. APPLICABLE LAW
Section 10(j) of the Act grants the Board
the power to “petition any United States
district court, within any district wherein the
unfair labor practice in question is alleged to
have occurred or wherein such person
resides or transacts business, for appropriate
temporary relief or restraining order.” 29
U.S.C. § 160(j). “In this Circuit, in order to
issue a § 10(j) injunction, the district court
must apply a two-prong test. First, the court
must find reasonable cause to believe that
unfair labor practices have been committed.
Second, the court must find that the
requested relief is just and proper.” Hoffman
v. Inn Credible Caterers, Ltd., 247 F.3d 360,
364-65 (2d Cir. 2001).
Remington also states that it did not
employ as many staff members in May 2013
as it did in October 2012 because the hotel
experiences significantly lower occupancy
between November to April. (Rostek May 2
Decl. ¶¶ 12-13.) Remington stated that it had
begun hiring more housekeeping staff in
preparation for the busy summer season. (Id.
¶¶ 12-14.) In addition, Remington stated that
4
There is a minor disagreement between the parties
regarding the number of discharged employees and,
therefore, the number of employees eligible for
employment. Respondent states that two employees
listed on the Board’s complaint were not employed
by HSS on October 19, 2012, and that one employee
has never been employed by HSS and is, in fact, a
current member of the Hotel’s kitchen staff. (Rostek
May 2 Decl. ¶ 8.) In any event, none of these
employees have expressed interest in being hired by
Remington and this divergence has no effect on the
Court’s conclusion.
In determining whether there is
reasonable cause to believe an unfair labor
practice has been committed, “[t]he court
need not make a final determination that the
conduct in question is an unfair labor
practice. It need find only reasonable cause
to support such a conclusion. Appropriate
deference must be shown to the judgment of
the NLRB, and a district court should
7
Silverman v. 40-41 Realty Assocs., Inc., 668
F.2d 678, 681 (2d Cir. 1982).
decline to grant relief only if convinced that
the NLRB’s legal or factual theories are
fatally flawed.” Silverman v. Major League
Baseball Player Relations Comm., Inc., 67
F.3d 1054, 1059 (2d Cir. 1995) (internal
citations omitted); see also Paulsen v.
Renaissance Equity Holdings, LLC, 849 F.
Supp. 2d 335, 353 (E.D.N.Y. 2012) (“[T]he
threshold for finding ‘reasonable cause’ is
similar to the threshold for making out a
prima facie case; courts have held that the
petitioner need only come forward with
evidence sufficient to spell out a likelihood
of violation.” (citations and internal
quotation marks omitted)). As one court
explained, “[t]he NLRB’s ‘version of the
facts should be sustained if within the range
of rationality, [and] inferences from the facts
should be drawn in favor of the charging
party.’” Dunbar v. Landis Plastics, Inc., 977
F. Supp. 169, 175 (N.D.N.Y. 1997) (quoting
Kaynard v. Mego Corp., 633 F.2d 1026,
1031 (2d Cir. 1980)).
“[T]he appropriate status quo in need of
preservation is that which was in existence
before the unfair labor practice occurred.”
Inn Credible Caterers, 247 F.3d at 369; see
also Kreisberg v. HealthBridge Mgmt., LLC,
12-CV-1299, 2012 WL 6553103, at *6 (D.
Conn. Dec. 14, 2012) (“The status quo that
requires protection under § 10(j) is the status
quo as it existed before the onset of the
alleged unfair labor practices, not the status
quo that has come into being as a result of
the unfair labor practices being litigated.”).
In making a determination whether an
injunction will prevent irreparable harm, the
proper plaintiff is the Regional Director
rather than individual employees. Inn
Credible Caterers, 247 F.3d at 369; see also
HealthBridge, 2012 WL 655103, at *7.
III. DISCUSSION
Although the Circuits vary on the
standard for determining whether granting
Section 10(j) relief is “just and proper,” in
the Second Circuit, “injunctive relief under
§ 10(j) is just and proper when it is
necessary to prevent irreparable harm or to
preserve the status quo.” Inn Credible
Caterers, 247 F.3d at 368. “Although this
standard is meant to ‘preserve[ ] traditional
equitable principles governing injunctive
relief,’ a court should be mindful to apply
this standard in the context of the N.L.R.A.”
Renaissance Equity, 849 F. Supp. 2d at 359
(alterations in original) (quoting Inn
Credible Caterers, 247 F.3d at 368). In
addition, “some degree of deference [to the
Board] is warranted when the Regional
Director seeks an injunction under section[]
10(j) . . . [and] [s]uch deference is especially
appropriate in section 10(j) cases when the
prevailing legal standard is clear and the
only dispute concerns the application of that
standard to a particular set of facts.”
A. Board’s Authority to Pursue This Action
As a threshold matter, respondent argues
that petitioner (the Regional Director) does
not have authority to bring this action
because the Board lacks a quorum to Act as
required by statute. See New Process Steel,
L.P. v. N.L.R.B., 130 S. Ct. 2635, 2639
(2010) (citing 29 U.S.C. § 153(b)).
Petitioner argues that the Board delegated
authority regarding all court litigation,
including the ability to initiate Section 10(j)
proceedings, to the Acting General Counsel
on November 9, 2011, when the Board had a
quorum, and that the Acting General
Counsel authorized the Regional Director to
bring this current petition on April 22, 2013.
(See Pet’r’s Opp’n to Resp’t’s Mot. to
Dismiss Pet. for Preliminary Injunction,
May 16, 2013, at 2.)
8
The Court agrees with Judge Cogan’s
extremely thorough and well-researched
decision in Renaissance Equity Holdings,
849 F. Supp. 2d at 343-52, that the General
Counsel has authority to initiate this
proceeding and authorize petitioner to file a
Section 10(j) action. In that decision, Judge
Cogan determined that Congress intended
“to allow the Board to delegate its § 10(j)
powers to the General Counsel . . . .” Id. at
374. Therefore, because “the Board had a
duly-constituted quorum when it delegated
its § 10(j) powers to the General Counsel”
and because “Congress created the post of
General Counsel to ensure that certain
prosecutorial functions operate without
regard to the Board[,] [t]he General
Counsel’s validly-delegated power to initiate
§ 10(j) petitions therefore does not vanish
when the Board loses its quorum.” Id. at
350. Judge Cogan then declined to reach the
question of whether President Obama’s
recess appointments to the Board were valid
because, even if they were not, the General
Counsel would still have had the authority to
bring the action. Id. at 350-352. Every other
court to decide this issue has reached the
same conclusion. See, e.g., Frankl v. HTH
Corp., 650 F.3d 1334, 1347-54 (9th Cir.
2011); Overstreet v. SFTC, LLC, 13-CV165, 2013 WL 1909154, at *3-7 (D.N.M.
May 9, 2013); Calatrello v. JAG
Healthcare, Inc., 12-CV-726, 2012 WL
4919808, at *2-4 (N.D. Ohio Oct. 16, 2012);
Gottschalk v. Piggly Wiggly Midwest, LLC,
861 F. Supp. 2d 962, 964-65 (E.D. Wis.
2012).5
B. The 10(j) Petition
1. Reasonable Cause
At the oral ruling on May 22, 2013, the
Court assumed for purposes of this motion
that the Board has demonstrated reasonable
cause to believe that an unfair labor practice
has been committed. However, because the
Court now grants an injunction in part
(prospectively restraining respondent from
engaging in unfair labor practices), the
Court considers this issue and finds that the
Board has demonstrated reasonable cause.6
As discussed supra, the Board’s
threshold for demonstrating reasonable
cause is low; it is similar to making out a
prima facie case and this Court must give
“appropriate deference” to the Board’s
determination that violations of the Act have
occurred. Major League Baseball Player
Relations, 67 F.3d at 1059. In addition,
when an ALJ has made factual findings and
issued a decision, the Court must also give
appropriate deference to the ALJ’s decision.
Silverman v. J.R.L. Food Corp., 196 F.3d
334, 337 (2d Cir. 1999); see also Hoffman v.
Pennant Foods Co., 08-CV-008, 2008 WL
1777382, at *6 (D. Conn. Apr. 15, 2008)
(“[O]nce the ALJ issues a decision, that
decision can play a key role in the court’s
evaluation of the NLRB’s petition.”). The
Board has met the minimal threshold of
demonstrating reasonable cause to believe
that violations of the Act occurred.
6
Although respondent vigorously disputes the
alleged unfair labor practices, the Court does not
believe it is necessary to hold a full evidentiary
hearing because the “reasonable cause” standard is
met, under the deferential standard discussed herein,
based upon the evidence already before the Court.
See, e.g., Calatrello v. Carriage Inn of Cadiz, 06-CV697, 2006 WL 3230778, at *2 (S.D. Ohio Nov. 6,
2006) (finding no hearing necessary). However, the
Court emphasizes that it makes no conclusion
regarding the ultimate merits of these disputed
charges.
5
Respondent also argues that there is no evidence in
the record that the Board authorized this petition.
However, as stated supra, the Board delegated
authority to the General Counsel to bring this action
on November 9, 2011, and petitioner does not need to
introduce evidence of this because it is in the public
record. See Order Contingently Delegating Authority
to the General Counsel, 76 Fed. Reg. 69768-02 (Nov.
9, 2011).
9
as a matter of law.”); Majestic Molded
Prods., Inc. v. N.L.R.B., 330 F.2d 603, 606
(2d Cir. 1964) (“A power display in the
form of a mass lay-off, where it is
demonstrated that a significant motive and a
desired effect were to ‘discourage
membership in any labor organization,’
satisfies the requirements of § 8(a)(3) to the
letter . . . .”); Kreisberg v. Stamford Plaza
Hotel & Conference Ctr., L.P., 849 F. Supp.
2d 279, 282 (D. Conn. 2012) (finding Board
had demonstrated reasonable cause to
believe that subcontracting out employees to
frustrate union activity violated the Act); see
also FES, 331 NLRB 9, 12 (2000) (stating
that a violation of Section 8(a)(3) occurs if
an employer fails to hire someone because
of union activity or affiliation).
Under Section 8(a)(3) of the Act, an
employer may not discriminate in the
“hir[ing] or tenure of employment or any
term or condition of employment to
encourage or discourage membership in any
labor organization.” 29 U.S.C. § 158(a)(3).
To demonstrate an unfair labor practice
under Section 8(a)(3), “the General Counsel
must show that the discharged employees’
protected conduct was a motivating factor in
the employer’s decision.” Rood Trucking
Co., 342 NLRB 895, 897 (2004) (citation
and internal quotation marks omitted). Once
the
General
Counsel
demonstrates
“discriminatory motivation,” see Donaldson
Bros. Ready Mix, Inc., 341 NLRB 958, 961
(2004), “the burden shifts to the employer to
demonstrate that it would have reached the
same decision absent the protected conduct,”
Wright Line, 251 NLRB 1083, 1087 (1980).
If the General Counsel proves that the
employer’s justification is pretext, there is
no need for the employer to attempt to
demonstrate that it would have taken the
action absent the protected conduct because
those reasons were false or not actually
relied upon. See Rood Trucking, 342 NLRB
at 898.
Petitioner has also demonstrated
reasonable cause to believe Remington’s
termination of Loiacono violated the Act.
Although the evidence regarding this
discharge is not overwhelming, the Court
defers to the Board and the ALJ because,
based upon the evidence before the Court, it
is within “the range of rationality” that this
action violated the Act. Mego Corp., 633
F.2d at 1031.
The Court concludes that there is
sufficient
evidence
to
demonstrate
reasonable cause that, by contracting out of
the housekeeping work to a company that it
had recently terminated its relationship with
and by failing to rehire the employees in
October 2012, Remington violated Section
8(a)(3) of the Act. The timing of the union
activity, combined with the on-again, offagain relationship between Remington and
HSS, provides sufficient evidence to
demonstrate
reasonable
cause
that
Remington used this subcontracting
relationship to avoid unionization at the
Hotel. See Gaetano & Assocs. Inc. v.
N.L.R.B., 183 F. App’x 17, 20 (2d Cir. 2006)
(“[T]emporal proximity can be a sufficient
basis from which to infer anti-union animus
Under Section 8(a)(1), an employer may
not “interfere with, restrain, or coerce
employees in the exercise of the rights
guaranteed” by the Act. 29 U.S.C.
§ 158(a)(1). “In evaluating questions arising
from the interrogation of employees, the
issue is whether the activity is calculated to
frustrate the union’s organization campaign
by installing fear of reprisals in the
employees. Where . . . there is no explicit
threat, interrogation is lawful unless the
circumstances indicate that coercion is
implicit in the questioning.” N.L.R.B. v.
Milco, Inc., 388 F.2d 133, 137 (2d Cir.
1968) (citation and internal quotation marks
omitted). The Board has also demonstrated
reasonable cause to believe that the
10
2001) (alteration, citation, and internal
quotation marks omitted); see also Blyer v.
Jung Sun Laundry Grp. Corp., 10-CV-2975,
2010 WL 4722286, at *10 (E.D.N.Y. Nov.
15, 2010) (“[I]t is inappropriate to punish
employees for the Regional Director’s delay.
The Court will only consider delay where
delay leads to a change in circumstances
which affects the appropriateness of the
relief requested . . . .” (citations and internal
quotation marks omitted)).
questioning of employees regarding union
activity and membership was intended to
coerce the employees into rejecting
unionization.
In addition, there is evidence of a
statement by Remington that it would more
strictly enforce workplace rules if the
employees unionized, and such evidence is
sufficient to establish reasonable cause that
there has been an unlawful threat in
violation of Section 8(a)(1). See Allegheny
Ludlum Corp., 320 NLRB 484, 484 (1995)
(stating that threatening employees with the
loss of flexibility is unlawful).
The delay in this case was substantial
and weighs in favor of denying the
injunction. Over 6 months passed between
the discharge of the employees and the
Board’s filing of this action. Although some
of this delay may not factor into the Court’s
determination because the Board was
investigating the alleged unfair labor
practice,
petitioner
completed
its
investigation in January when the complaint
was brought before the ALJ and waited over
3 months before seeking relief in this Court.
Petitioner admitted at oral argument that it
“could have filed” for this injunction in
January, but that it wanted to “establish an
administrative record” due to the “logistical
difficulties of the case.” (Oral Arg. May 7,
2013, at 6.) To the extent petitioner
suggested that it was more efficient and/or
expeditious
to
proceed
with
the
administrative hearing before seeking relief
here, the Court notes that it took over 3
months to commence the hearing before the
ALJ where a hearing before this Court
would have taken place within a matter of
weeks. At a minimum, if the level of
irreparable harm from the lack of an
immediate reinstatement order is as high as
the Board now claims, the Board should
have filed the action in this Court in January
while the ALJ proceeding was taking place.
The Court could have then, if it deemed it
appropriate, delayed any hearing until the
administrative record had been developed in
2. Just and Proper
Due to the unique circumstances of this
case, the Court finds that the Board has not
demonstrated that an order of reinstatement
of the employees is just and proper. The
combination of the Board’s delay in seeking
an injunction and the employer’s
commitment to rehiring all discharged
employees over a several month period
counsels against an injunction in this
particular case.
“[E]xcessive delay can undermine the
propriety of § 10(j) relief [because,] [a]s
time elapses, it becomes less likely that
injunctive relief can undo harms that have
occurred in the interim.” Muffley v. Spartan
Mining Co., 570 F.3d 534, 544 (4th Cir.
2009). However, delay is common in these
cases because of the time required for the
Board to investigate allegations of unfair
labor practices. Therefore, “‘delay by itself
is not a determinative factor in whether the
grant of interim relief is just and proper.
Delay is only significant if the harm has
occurred and the parties cannot be returned
to the status quo or if the Board’s final order
is likely to be as effective as an order for
interim relief.’” Blyer v. P & W Elec., Inc.,
141 F. Supp. 2d 326, 332-33 (E.D.N.Y.
11
front of the Administrative Law Judge.7 See
McDermott v. Ampersand Pub., LLC, 593
F.3d 950, 965 (9th Cir. 2010) (upholding
denial of injunctive relief and stating that
“[m]ost of the delay in this case has resulted
from the time taken by the litigation process
itself, and the Regional Director cannot be
faulted for that. But at least some of the
delay was caused by the Regional Director’s
deferred petition for preliminary injunctive
relief.”).
terminated employees, the court noted that
the changed circumstances during the period
of delay counseled against such a remedy:
Somewhat different considerations
require refusal of a preliminary
injunction to recall dismissed
employees. Here the grounds are too
uncertain, too much time has passed,
and it is not certain that the relief has
any relation whatever to the human
needs of the men involved.
Specifically, there is evidence,
although as noted it is somewhat
unclear, that recall had been offered
to some or all of the men. There is no
evidence that they are unemployed.
The Board has the power to make
back pay awards.
Other courts also have found that a
substantial delay weighed in favor of
denying a Section 10(j) injunction. Although
none of the cases are directly analogous to
the facts in this action, the Court agrees with
the reasoning set forth in those opinions.
In Mack v. Air Express International,
471 F. Supp. 1119 (N.D. Ga. 1979), one
year passed between the unlawful labor
practice and the court’s consideration of the
injunction. The court held that an injunction
was not equitably necessary because, inter
alia, of the delay. See id. at 1125 (“The
lapse of one year since the take-over date
makes any recreation of the Status quo ante
most difficult.”). In Siegel v. Marina City
Co., 428 F. Supp. 1090 (C.D. Cal. 1977), the
court held that a “preliminary injunction
could not preserve the status quo because
the Board has waited three months since the
alleged unfair labor practices occurred
before filing its petition herein.” Id. at 1093.
Id. at *7; see also McLeod v. Art Steel Co.,
Nos. 71-Civil 2571, 2-CA-12327, 12331,
1971 WL 783, at *1 (S.D.N.Y. July 7, 1971)
(“I am not convinced that in the present case
the Board has met this strict standard. The
alleged violations are old, the latest having
occurred over three months ago. There is no
showing that they are about to occur again.
The unfair labor practice charge has been
pending for almost two months, and was
tried over a month ago. It is reasonable to
expect a decision soon. There has not been
a sufficient showing or irreparable harm to
justify a court interfering at this stage and in
effect doing the Board’s work for it.”).
Similarly, in Kaynard v. Lawrence
Rigging, Inc., No. 72 C 315, 1972 WL 803
(E.D.N.Y. Mar. 31, 1972), in denying the
Board’s request for reinstatement of the
The Board’s delay alone, while weighing
against a just and proper finding, would not
by itself warrant denial of the injunction.
See, e.g., Paulsen v. 833 Cent. Owners
Corp., 12-CV-5502, 2012 WL 6021507, at
*4 (E.D.N.Y. Dec. 4, 2012) (eleven month
delay between the union’s initial charge and
Regional
Director’s
petition
not
unreasonable);
Renaissance
Equity
Holdings, 849 F. Supp. 2d at 361 (injunctive
relief granted despite fourteen month delay).
7
In fact, the Board has sought, and a court has
considered, a Section 10(j) motion without an
administrative record. See Landis Plastics, 977 F.
Supp. at 176 (holding that “reasonable cause” prong
could be decided without a formal evidentiary
hearing even without the benefit of an administrative
record).
12
this period of delay. See Crain v. Fabsteel
Co. of La., 427 F. Supp. 316, 318 (W.D. La.
1977).
However, the delay is significant in this case
because the circumstances have materially
changed since January. As stated supra,
Remington has undertaken a good faith
effort to rehire all discharged employees. On
March 18, 2013, over one month prior to the
filing of this Section 10(j), Remington sent
notices of unconditional offers of
employment to all of the HSS employees
listed in the NLRB’s complaint who were
eligible for reinstatement. The letter stated
that the Hotel had a position available for
acceptance on an unconditional basis, and
additional positions would be filled as they
became available on a “first come-first
serve” basis. As of May 17, 2013, 6
employees had accepted offers, 5 had
declined offers, 2 offers were outstanding,
and 8 had not responded at all. Therefore, as
of the Court’s ruling in May, there were
only 16 employees remaining who were
eligible for employment and who have
expressed interest in returning to the Hotel.
Remington has also promised to only hire
housekeeping staff from the remaining
employees who have expressed interest until
all eligible employees have received offers.
(Rostek May 17 Decl. ¶ 12.)
Because Remington’s intention to
aggressively
rehire
the
discharged
employees over the next several months is
crucial to the Court’s decision, the Court
ordered Remington to submit a status report
to the Court on the 15th day of every month
regarding the current pace of hiring. The
Court also noted at the time of the oral
ruling that if Remington failed to follow the
representations it had made in its affidavits
and at oral argument, or in any way took any
action that would result in all discharged
employees not receiving offers in the next
several months, the Court would allow
petitioner to renew the motion and the Court
would order the immediate reinstatement of
all discharged employees.8
The Board has emphasized the
irreparable harm the discharged employees
in the absence of injunctive relief. The
Board argued that this injunction was
necessary to: (1) return unemployed workers
to active employment, and (2) prevent
employees from scattering. (See Pet’r’s
Mem. at 21-22.) Although the Court has
carefully considered these arguments, they
are not persuasive in this particular case due
to the Board’s delay in seeking relief.
Employees have already scattered because
of the Board’s delay; a significant number of
the discharged workers have either failed to
express interest in returning to Remington or
Furthermore, the Hotel’s General
Manager stated in his declaration that the
housekeeping staff not only has high
turnover, but that the Hotel intended to
increase its rate of hiring during the summer
as occupancy at the Hotel increased. Based
on this representation, respondent’s counsel
stated at oral argument that he believed the
Hotel would be able to make offers to all of
the remaining employees within the next
several months. Because respondent is
essentially granting the relief that petitioner
seeks from this Court, albeit on a slightly
delayed basis, the Court believes it is not
just and proper to force respondent to
discharge the replacement employees who
have committed no misconduct, and may
have foregone other job opportunities during
8
The Court notes that Remington has submitted three
status reports regarding the rehiring of these
employees. As of August 2, 2013, there are only 8
employees who have expressed interest in returning
to the Hotel who have not received offers. (See ECF
Nos. 20, 22, 27.) In addition, 4 of those 8 employees
were AM shift housekeepers who have received
offers for the PM shift, but have declined those offers
and are awaiting offers for the AM shift. (Decl. of
Jeff Rostek, Aug. 2, 2013 ¶ 8.)
13
have declined offers of employment. For
example, by the time this motion was fully
submitted to this Court on May 17, 2013, of
the 37 employees eligible for reinstatement,
5 offers of reinstatement had already been
declined and 8 employees had failed to
respond to the employer’s letter offering
reinstatement. Thus, over one-third of the
employees had scattered due to the Board’s
delay. The scattering of the employees only
further highlights why the Board should
have filed this action in January. Thus, by
the time this action was filed, any ability to
return the situation to the pre-discharge
status quo had been substantially
undermined by the delay.
violations will prevent any further
deterioration of the Union’s position during
the pendency of the matter before the Board
and address any “chilling effect” the
terminations had on the employees’ desire to
unionize. See Blyer v. Domsey Trading
Corp., 91-CV-1304, 1991 WL 148513, at *3
(E.D.N.Y. July 30, 1991); see also Mattina
v. Chinatown Carting Corp., 290 F. Supp.
2d 386, 394 (S.D.N.Y. 2003) (enjoining
future violations of the Act and stating that
“[s]ince all of these actions [which the
Board requests be enjoined] are clear
violations of the Act, such an order for
injunctive relief is not only reasonable, but
necessary”). In other words, this injunction
will prevent irreparable harm to the policy
of the Act itself, see Seeler v. Trading Port,
Inc., 517 F.2d 33, 39 (2d Cir. 1975), by
signaling to the current and returning
employees that their statutory right to
unionize will be protected, see Stamford
Plaza Hotel, 849 F. Supp. 2d at 283
(although “the day-to-day life of [the]
employees is not dramatically different than
it was before” – because the employees have
The Board argues that this Court is
giving current employees impermissible
priority over discharged employees. See
Hoffman v. Parksite Grp., 596 F. Supp. 2d
416, 425 (D. Conn. 2009). This would only
be the case if Remington was not currently
hiring back all discharged employees that
have expressed interest in returning to the
Hotel. The discharged employees will all
receive an offer of employment, the same
relief this Court could afford, plus they will
receive backpay should the ALJ’s decision
be upheld. However, if the Court were to
prematurely order the reinstatement of these
employees, and thus the termination of the
innocent current employees, then current
employees would lose their jobs without any
remedy.
order. The language of the proposed injunction,
which the Court is granting, is as follows: “The Court
hereby enjoins and restrains the Respondent, its
officers, agents, representatives, servants, employees,
attorneys, successors and assigns, and all members
and persons acting in concert or participation with
them, from: (1) discharging, refusing to hire, and/or
refusing to consider for hire employees for engaging
in union activity protected by the Act; (2) discharging
employees based on its belief that employees are
union supporters; (3) threatening employees with
more onerous working conditions, decreased benefits,
and futility in selecting the Union as their collectivebargaining representative; (4) threatening employees
with discharge or immigration-related reprisals
because of their support for and activities on behalf
of a union; (5) informing employees that adverse
employment actions resulted because of their support
of a union; (6) interrogating employees regarding
their union activities, and telling them to cease
supporting a union; and (7) in any like or related
manner interfering with, restraining, or coercing
employees in the exercise of the rights guaranteed
them by Section 7 of the Act.”
Although the Court does not find that it
is just and proper to reinstate the employees,
the Court finds that it is just and proper to
issue an injunction to prevent future
violations of the Act until the final
disposition of the matter currently before the
Board.9 An injunction barring future
9
As noted supra, at a conference on July 22, 2013,
petitioner clarified that it was seeking this injunction
independent of the request for the reinstatement
14
merely been shifted to a subcontractor –
finding an injunction necessary to
reinvigorate the “spark to unionize” (citation
and internal quotation marks omitted)).10
although less than a likelihood, of success
on appeal, and (4) the public interests that
may be affected.” LaRouche v. Kezer, 20
F.3d 68, 72 (2d Cir. 1994) (citation and
internal quotation marks omitted).
In sum, the Court concludes that an
injunction reinstating the employees is not
just and proper. The Court emphasizes that
this decision is based upon the critical
combination of factors in this case – namely,
the delay by the Board in bringing this
action and the employer voluntarily rehiring
the employees at a rapid rate. However, the
Court, with the consent of the respondent,
will enjoin respondent from committing
future violations of the Act.
Petitioner has not submitted any new
evidence or arguments demonstrating how
the Board would suffer irreparable injury in
the absence of this reinstatement injunction
pending appeal. As a threshold matter, as
noted supra, if the Court were to grant this
injunction pending appeal, the replacement
employees would be discharged without
remedy even though the former employees
are currently being offered employment at a
rapid pace, and it is likely that all employees
will have received positions within the next
60 days (if not sooner), which will render
the appeal moot. There is simply no
evidence that any irreparable harm to the
few employees awaiting reinstatement will
take place over the next 2 months. In fact,
the Board’s delay of 2 months in filing its
notice of appeal further supports the lack of
any irreparable harm during this additional
60-day period. In short, for all of the reasons
the Court denied the reinstatement order, it
also denies the request for a reinstatement
order pending appeal.
C. Injunction Pending Appeal
On July 22, 2013, exactly two months
after the Court issued its original decision
denying the motion for a preliminary
injunction, petitioner filed a motion for an
injunction pending appeal. “While an appeal
is pending from an interlocutory order or
final judgment that grants, dissolves, or
denies an injunction, the court may suspend,
modify, restore, or grant an injunction . . . .”
Fed. R. Civ. P. 62(c). “The standard in this
circuit for a stay or injunction pending
appeal is: (1) whether the movant will suffer
irreparable injury absent a stay, (2) whether
a party will suffer substantial injury if a stay
is issued, (3) whether the movant has
demonstrated a substantial possibility,
IV. CONCLUSION
For the foregoing reasons, and the
reasons set forth on the record on May 26,
2013, the Court grants in part and denies in
part petitioner’s motion for a preliminary
injunction. Specifically, the Court denies the
request for an immediate order of
reinstatement. However, the Court grants the
request for a prospective order restraining
respondent from engaging in certain
enumerated unfair labor practices. The Court
will issue a separate injunction that sets
forth the terms of the injunction (which are
not in dispute). The Court denies petitioner’s
motion for an injunction pending appeal.
10
As noted supra, although respondent does not
believe the prospective injunction restraining it from
committing unfair labor practices is necessary, it does
not object to such an order. However, respondent
does suggest that it should not be required to read the
order aloud to groups of employees, and suggests that
a copy be posted. The Court concludes, under the
circumstances, that reading the order aloud is
unnecessary, but that the order should be posted in
the workplace (in English and Spanish) and a copy of
the order (in English and Spanish) should be
provided to all reinstated employees, as well as the 8
employees still awaiting reinstatement.
15
Respondent must continue to submit a letter
to the Court regarding the status of the
rehiring of employees on the 15th day of
every month until reinstatement is complete.
SO ORDERED.
______________________
JOSEPH F. BIANCO
United States District Judge
Dated: August 14, 2013
Central Islip, NY
***
Petitioner is represented by Ashok C.
Bokde, Brent Childerhose, and Lara
Haddad, National Labor Relations Board,
Two Metrotech Center, Brooklyn, NY
11201. Respondent is represented by Paul E.
Wagner, Stokes Roberts & Wagner, 903
Hanshaw Road, Ithaca, NY 14850 and Karl
M. Terrell, Stokes Roberts & Wagner, 3593
Hemphill Street, Atlanta, GA 30337.
16
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