In Bellagio, LLC, a freelance engineer who occasionally worked for the employer threatened voters in an election during a union organizing campaign. The National Labor Relations Board (NLRB) held that the freelance engineer's conduct was attributable to the union under the doctrine of apparent authority, and that his threats to one of the employees in the petitioned-for unit constituted objectionable conduct warranting the setting aside of the election and directing a second election.
Key Litigated Issues
In Bellagio, LLC, the key litigated issue was whether a third party supporter of a union's threat to an employee voting in an NLRB representation election:
Was attributable to the union.
Constituted objectionable conduct requiring the NLRB to:
set aside the election won by the union;
direct a new election.
Background
In September 2012, the union filed a petition to represent the audio-visual technicians and stage hands in the Bellagio's Production Services Department. Torres was a freelance audio engineer who had occasionally worked for the Bellagio. However, he did not work for the Bellagio at any time during the organizing campaign. Before the union petition was filed, Torres visited the union's hall and met with its business agent to offer his help with the effort to organize. The business agent declined Torres' offer. Nevertheless, Torres contacted employee Douglas Spicka and arranged to meet him. Torres told Spicka that the business agent had:
Approached him because Torres had worked at the Bellagio on several occasions.
Asked him to speak with Spicka because the business agent believed that Spicka was a swing vote.
Torres then spoke about the benefits of union representation. In October 2012, Spicka and other employees in the petitioned-for bargaining unit attended an organizing meeting with union representatives. Torres also attended the meeting. The union business agent led the meeting, distributed literature and answered questions about union benefits. During the meeting, the business agent noticed that Torres was present, but did not ask him to leave. The next day, the Bellagio held an employee meeting regarding the upcoming election. After the Bellagio opened up a discussion, several employees engaged in a heated exchange about the merits of union representation. During this exchange, Spicka:
Identified two employees as leaders of the organizing effort.
Stated that he was personally opposed to that effort.
Less than two days before the election, Torres sent Spicka a text message that accused Spicka of being "a rat." Spicka assumed this text message related to the statements he made at the organizing meeting. He immediately called Torres. Torres told Spicka that:
What Spicka did at the meeting was "not cool."
"[I]f this vote goes through, you're toast."
"[Y]ou better not vote."
Prior to the election, Spicka shared the details of Torres' comments with two other employees in the petitioned-for bargaining unit.
The October 10, 2012 election resulted in a ten-to-nine vote in the union's favor, with one void ballot and no challenged ballots.
Bellagio filed objections to the election primarily about Torres' threat to Spicka with the NLRB. An NLRB hearing officer conducted a hearing to receive and rule on evidence supporting the employer's objections. During the hearing, the hearing officer declined to draw an adverse inference from the union's failure to call Torres as a witness, finding that he was not favorably disposed to the union.
The hearing officer issued a report in which he:
Recommended overruling the objections relating to Torres' October 8 comments to Spicka.
Found that:
the credited testimony failed to establish that Torres had actual or apparent authority to act on behalf of the union; and
Torres' conduct was not objectionable third-party conduct.
The Bellagio filed exceptions to the hearing officer's rulings, and report and recommendations to the panel (Board) heading the NLRB's election processes.
Outcome
In a unanimous decision dated May 31, 2013, a three-member panel of the Board issued an opinion:
Applying common law agency principles and considering the totality of the circumstances, found that:
a third-party can become an agent of a union if he has apparent authority to speak or act for the union;
the union business agent knew that Torres attended the organizing meeting for the petitioned-for bargaining unit and did not ask him to leave or explain Torres' presence to the petitioned-for bargaining unit employees; and
the employees in the petitioned-for bargaining unit reasonably would have believed that Torres was an agent of the union who was working on the union's behalf in the organizing effort because the union business agent permitted him to attend the meeting without explaining why he was there.
Held that:
the union gave Torres apparent authority to act or speak on its behalf, allowing Torres' threat to Spicka be attributed to the union;
Torres' statement to Spicka (before the petition was filed), that the business agent had asked that he contact Spicka, although false, was conduct consistent with the impression that Torres was an agent of the union working on its behalf;
whether or not Torres spoke at the organizing meeting was not dispositive (clear evidence that he had would have supported an apparent authority finding);
evidence that the union business agent declined Torres' offer to assist the union's organizing effort and speak on behalf of the union was irrelevant to determining whether the voting employees perceived him to have authority to speak or act for the union;
Torres' threat of an unspecified reprisal, attributed to the union, was objectionable conduct that would reasonably tend to interfere with the employees' free choice in the election; and
a new election was necessary because the threat, occurring two days before the election and shared with at least two other voting employees, could have intimidated a sufficient number of voters and affected the election results.
The Board also found that the hearing officer erred by not drawing an adverse inference from the union choosing not to call Torres as a witness. The Board found that:
Torres was clearly favorably disposed to the union based on record evidence that he:
offered to help the union organize the Bellagio employees;
spoke favorably about the union with Spicka; and
attended the union's organizing meeting.
The hearing officer should have inferred that Torres' testimony about any fact within his knowledge would have supported an apparent authority finding.
Practical Implications
Bellagio is a rare case in which the NLRB sustained an employer's objections to an election. The Board's analysis in this case may be useful for an employer that raises post-election objections about pro-union third party intimidation against voting employees. In particular, it identifies what the Board considers when determining:
Who is a union agent.
Whether alleged threats to potential voters in NLRB elections justifies directing a new election.
Whether an NLRB administrative law judge or hearing officer should grant an employer's request that the NLRB draw adverse inferences from a union's failure to call a third-party supporter to testify about the nature and extent of his dealings with employees in support of the union.
The Board's analysis also suggests that both unions and employers should be careful about whom they knowingly permit to attend meetings with employees. The Board gave substantial weight to Torres' unexplained (assumed to be silent) attendance at the organizing meeting when assessing his apparent agency.