Labor & Employment Law Daily NLRB didn’t deprive employer of due process by ruling on violation not specifically charged
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Thursday, September 26, 2019

NLRB didn’t deprive employer of due process by ruling on violation not specifically charged

By Kathleen Kapusta, J.D.

Noting the “long and acrimonious history” between the parties, the court found that while OHL complained it was “not the lawbreaker that the Board paints it to be,” it had multiple opportunities to prevent its current predicament.

The NLRB’s finding that Ozburn-Hessey Logistics (OHL) violated the NLRA when it unilaterally changed its attendance policy two separate times without giving the union notice and opportunity to bargain, and then discharged an employee pursuant to the policy, did not deprive OHL of due process, the Sixth Circuit ruled. While the second violation was not specifically alleged in the charge or complaint, the record was replete with evidence the Board provided ample notice to OHL and the parties thoroughly litigated the issue at the hearing, the appeals court stated, denying OHL’s petition and granting the Board’s cross-petition for enforcement (Ozburn-Hessey Logistics, LLC dba Geodis Logistics, LLC, September 24, 2019, Griffin, R.).

New attendance policy. Two years after the union began a campaign to organize OHL’s employees at its Memphis, Tennessee, warehouse, it won a hard-fought representation election by a one-vote margin. After the election, but before OHL’s challenges to its validity had been resolved, the company unilaterally changed its attendance policy without notifying the union or attempting to bargain with it. It issued the new policy in October 2013, changing, among other things, the number of points assigned to each attendance infraction. The progressive discipline thresholds remained the same, however, including termination after accruing 13 points.

Two-hour rule. At some subsequent point, the company changed its policy again to provide that: “If the employee works for at least 2 hours, then the employee will receive 1 point for leaving early. If the employee leaves before working a full 2 hours, then the employee will receive 2 points.” This “two-hour rule” was not incorporated into the written policy and the company did not contemporaneously notify employees of the change.

Terminated. When the employee began working at OHL full-time in April 2013, he received a copy of the original attendance policy. During his tenure, he received several infractions under the policy, including two violations of the two-hour rule. While he objected to these, pointing out that the policy clearly stated one point for leaving early without permission, he was fired in 2014 after accumulating 13 combined points.

ALJ’s decision. The union subsequently filed a charge with the NLRB, alleging that in May or June of 2014, OHL “unilaterally changed its attendance policy without providing the Union with notice and an opportunity to bargain,” and that in July of 2015, OHL “discharged [the employee] as a result of its unilaterally changed attendance policy.” After a hearing, the ALJ found OHL violated the NLRA by announcing and changing its attendance policy in mid-October 2013 by changing the points assessed for leaving early without providing notice or opportunity to bargain. The ALJ also found, however, that employee’s discharge was not caused by the changes to the attendance policy.

Board decision. Affirming in part, the Board found that OHL violated the Act “by unilaterally changing its attendance policy in October 2013 without affording the Union notice or the opportunity to bargain,” and “violated Section 8(a)(5) and (1) by unilaterally announcing and implementing the 2-hour rule, and by discharging [the employee] in reliance on that unlawful rule.” Although the Board noted that the implementation of the two-hour rule was not specifically alleged as an unfair labor practice in the complaint, it found the issue was sufficiently connected to the October 2013 policy change—which was alleged to be an unfair labor practice in the complaint—and was fully and fairly litigated at the hearing before the ALJ. Thus, it found that ruling on the issue would not violate OHL’s due process rights. It also ordered OHL to reinstate the employee.

Pergament. On appeal, OHL argued that the Board improperly reached the two-hour rule, and infringed on its due process rights, by misapplying its previous decision in Pergament United Sales, which held that “In the context of the [NLRA], due process is satisfied when a complaint gives a respondent fair notice of the acts alleged to constitute the unfair labor practice and when the conduct implicated in the alleged violation has been fully and fairly litigated.” While OHL argued that the Board’s finding was based on an unpleaded allegation of fact—that the two-hour rule was implemented independently at some unspecified time after the unilateral change alleged in the complaint—Pergament, observed the court, applies to unpled unfair labor practices, not unpled allegations of fact.

Notice. Turning to Pergament’s notice requirement, the court observed that OHL’s notice that the two-hour rule was at issue began with the employee, who emphatically and repeatedly objected to the two-hour rule’s application to his disciplinary infractions for twice leaving early. “In light of these numerous objections, it should have come as no surprise to OHL that a claim for wrongful termination of [the employee] would involve the two-hour rule,” said the court. But more importantly, the court stated, months before the hearing, the General Counsel’s office, in an email exchange with OHL’s counsel, gave OHL explicit notice that it would litigate the two-hour rule issue. “By itself,” said the court, “this email vitiates OHL’s claim that it did not have sufficient notice.”

Further, pointing to the complaint’s allegation that on or about October 1, 2013, OHL changed the number of attendance points charged and changed the circumstances under which attendance points are charged, the court found this to be an accurate characterization of both changes to the policy except for the date. Finally, while OHL emphasized that the old attendance policy was less favorable to employees than the new policy as it provided that employees would receive three points for leaving early, that was true even after the two-hour rule modified the new policy, said the court, pointing out that it would make no sense for the General Counsel to file a complaint alleging that the employee was terminated solely because of a change to the attendance policy that benefitted him (the October 1, 2013 change). “The complaint’s allegations as they relate to [the employee’s] termination only make sense if they incorporate the two-hour rule.”

Fully and fairly litigated. As for the fully and fairly litigated requirement, not only did OHL have the opportunity to cross-examine the General Counsel’s witnesses about the rule, when the General Counsel called an OHL employee as a witness, OHL’s counsel did in fact question him about the rule. Further, OHL did not claim lack of notice at the hearing or ask for a continuance. Moreover, OHL’s witnesses discussed the rule in detail, the court observed, noting that the parties fully and fairly litigated the issue. As to OHL’s assertion that “[w]itnesses were not questioned regarding whether the 2-point rule was part of a ‘second independent change’ at an unspecified date in an unspecified manner,” this “hyper-technical argument” lacked merit, said the court, finding that OHL had every opportunity to robustly litigate the two-hour rule issue, and it took advantage of those opportunities. Due process demands nothing more.”

Two harms. Finally, OHL argued that the change to the attendance policy did not cause the employee’s firing. Because the October 2013 policy was more favorable to the employee than the old one, even after the implementation of the two-hour rule, the ALJ found that the employee benefitted in that he accrued 13 points at a later time and the change delayed rather than hastened his discharge. But this view, said the court, oversimplified the facts. “If OHL had changed its attendance policy only once, reducing the number of points for leaving early from three to two, then OHL’s causation argument would have merit.” Instead, the court explained, OHL made two independent changes to the policy, causing new harm to the union each time by refusing to notify or bargain with it.

With the first change, the Board found that OHL had “in effect created a new status quo, upon which [the employee] understandably relied.” Further, OHL implemented the two-hour rule without informing its employees of the change, said the court, and the employee only learned of it after he received extra points for two attendance violations. Thus, the court reasoned, but for the implementation of the rule, the employee would not have been terminated.

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