Despite an Appellate Remand, the NLRB Allows an Ad Hominem Attack on an Employer

by BakerHostetler

In its recent 2-1 decision in Plaza Auto Center, Inc., 360 NLRB No.117 (May 28, 2014), the National Labor Relations Board again demonstrated its pro-employee bias and its willingness to twist a circuit court mandate and facts to achieve a partisan result. The majority in Plaza Auto Center gave its imprimatur to an employee cursing, denigrating, and defying his managers in a menacing manner. Like in playground basketball, the majority apparently operated on the belief “no blood, no foul.” Additionally, contrary to law, the majority ignored the specific remand instructions the Ninth Circuit Court of Appeals gave the Board.

The Relevant Facts

The case has a lengthy and somewhat convoluted history that has lasted for more than five years. Plaza Auto Centers, owned by Tony Plaza (“Plaza”), sells used cars in Yuma, Arizona. Nick Aguirre (“Aguirre”) was hired as a used-car salesman at the end of August 2008. Very quickly Aguirre became an unhappy employee, believing he was being mistreated and improperly paid.  Matters came to a head in a meeting held on October 28, 2008.

At this meeting, Plaza told Aguirre that he was “talking a lot negative stuff,” needed to follow policy and procedure, and should not be complaining about pay. Plaza twice told Aguirre that if he did not trust the company, he did not need to work there. At that point, Aguirre lost his temper and in a raised voice berated Plaza. He called him a “f****** mother f******” (sic), “f****** crook,” and “asshole.” He also told Plaza he was stupid, nobody liked him, and everybody talked behind his back. During the outburst, Aguirre stood up, pushed his chair aside, and told Plaza that if he fired him, he would regret it. Plaza then fired Aguirre.

The Board’s Initial Decision

An unfair labor practice hearing followed in 2009 before Lana Parke, a respected Administrative Law Judge, who found that the invitations to quit employment at the October meeting, and earlier, constituted unfair labor practices. The question remained for Judge Parke to decide whether the conduct of Aguirre in the October meeting was so egregious or abusive to lose the protection of the Act. In assessing employee behavior asserted to be egregious, the Board considers the Atlantic Steel factors: 1) the place of the discussion; 2) the subject matter of the discussion; 3) the nature of the employee’s outburst; and 4) whether the outburst was in any way provoked by the employer’s unfair labor practice. Atlantic Steel, 245 NLRB 814, 816 (1979).

Judge Parke determined that factors 1, 2, and 4 favored protection while factor 3, the nature of the outburst, weighed against protection. She found that without extreme provocation “Aguirre repeatedly reviled Mr. Plaza in obscene and denigrating terms accompanied by menacing conduct and language.” She discredited Aguirre’s testimony where it contradicted that of Plaza.  She found Aguirre’s conduct belligerent and found based on credibility that he rose from his chair and said if he was fired, Plaza would regret it. Considering and balancing all the factors, Judge Parke concluded that the termination of Aguirre did not violate the law. See Plaza Auto Center Inc., 355 NLRB 493, 498–506 (2010).

This should have been the end of the matter. Judge Parke’s decision was largely based on credibility findings. But Chairman Liebman and Member Pierce, with Member Schaumber dissenting, see the workplace differently. The Board majority (Chairman Liebman and Member Schaumber are no longer on the Board), while giving lip service to accepting the credibility findings of the Judge, characterized Aguirre’s behavior as a single brief outburst provoked by Plaza “unaccompanied by insubordination, physical contact, threatening gestures or threat of physical harm.” Looking through their rose-colored glasses, these Board members did not see the profane tirade as insubordination. The Board majority concluded that Aguirre’s conduct was not outside the realm of acceptable conduct and found the discharge to be an unfair labor practice. Plaza Auto Center Inc., 355 NLRB 493 (2010).

The Remand

Plaza appealed to the Ninth Circuit Court of Appeals. In a unanimous decision, the Court refused to enforce the determination and remanded it to the Board to properly balance the Atlantic factors, given the Court’s conclusion that the Board erred in its initial assessment that the nature of Aguirre’s outburst favored protection. Additionally, the Court instructed the Board to give full effect to the ALJ’s factual and credibility findings, including that Aguirre’s behavior was menacing or at least physically aggressive, unless the clear preponderance of all relevant evidence showed that Judge Parke was wrong in that regard. Plaza Auto Center, Inc. v. NLRB, 664 F.3d 286, 296 (9th Cir. 2011).

In its supplemental decision, the NLRB affirmed again, 2 to 1, that the discharge was unlawful, with Chairman Pearce and Member Hirozawa in the majority and member Johnson writing a dissent.  Only Pearce was on both panels.  Plaza Auto Center, Inc., 360 NLRB No. 117 (May 28, 2014). In doing so, the majority distorted the appellate court’s mandate in an effort to undo the finding of Judge Parke that Aguirre’s behavior was belligerent and menacing, stating that “regret” was ambiguous and could have referred to legal action. While absolutely true, one wonders whether the majority would have afforded employer representatives the same benefit of the doubt.

What is even more troubling about the majority decision is how Aguirre’s outburst was treated. The majority re-weighed the Atlantic factors such that the nature of the outburst in the absence of physicality does not matter. The majority found that this format “strikes a proper balance between an employee’s right to engage in Section 7 activity and an employer’s right to maintain order and discipline in its establishment in the particular circumstances of this case.” But as Member Johnson wrote in his most eloquent dissent, implicit in the majority decision is the troubling notion that while engaged in protected activity an employee may not be disciplined for verbal misconduct unaccompanied by physical threats.

As Member Johnson pointed out, the use of vulgarities and obscenities is not the reality of industrial life. Employees do not typically curse at each other and their superiors like characters in a Scorsese film.  It is perfectly reasonable to expect in the modern workplace that people treat each other with civility. And, there is a difference between swearing in the workplace and the ad hominem profanity unleashed by Aguirre against Plaza which certainly constituted insubordination. Member Johnson also noted that in the modern regulated workplace, it is essential for a company to proscribe profane behavior that could create a harassing or bullying atmosphere. The Board is not, he wrote, an “‘uberagency’ authorized to ignore [other] laws in an effort to protect the legitimate exercise of Section 7 rights.”

The attitudes that underlay this decision are dangerous. In the context of exercising section 7 rights an employee is largely given carte blanche. This philosophy will ultimately destroy the notion of promoting industrial peace. Why should management meet with its employees to discuss working conditions? We can only hope that the case will be appealed to the Ninth Circuit which will once more overturn the Board.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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