Atc Vancom of California , L.p. v. National Labor Relations Board

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-3476
ATC V ANCOM OF C ALIFORNIA , L.P.,
Petitioner,
v.
N ATIONAL L ABOR R ELATIONS B OARD ,
Respondent.
____________
Petition for Review of an Order of
the National Labor Relations Board.
Nos. 31-RD-1434, 31-CA-25022, 31-CA-24875.
____________
A RGUED A PRIL 13, 2004—D ECIDED J UNE 3, 2004
____________
Before F LAUM , Chief Judge, and P OSNER and W ILLIAMS ,
Circuit Judges.
F LAUM , Chief Judge. This case arose after officials of
ATC Vancom of California, L.P. (“ATC”) removed postings
from a union bulletin board in the weeks leading up to a
representation election. Based on a charge filed by the
Chauffeurs, Sales Drivers, Warehousemen and Helpers,
Local 572, International Brotherhood of Teamsters, AFL-
CIO (“the Union” or “the Teamsters”), the General Counsel
of the National Labor Relations Board (“the Board”) issued
a complaint against ATC, alleging that it violated Section
8(a)(5) and (1) of the National Labor Relations Act (“the

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2 No. 03-3476
Act”) (29 U.S.C. § 158(a)(5) and (1)) by unilaterally chang-
ing the bulletin-board policy that was established in its
collective bargaining agreement with the Union. Following
a hearing, the Administrative Law Judge (“ALJ”) rejected
ATC’s state law defense and found ATC to have violated
Section 8(a)(5) and (1) of the Act. The Board issued a
decision affirming the ALJ’s findings and adopting his
recommended order. For the reasons stated in this opinion,
we affirm the Board’s order.
I. Background
ATC operates the city bus system in Santa Clarita,
California. ATC’s bus drivers were represented by the
Teamsters which had a collective bargaining agreement
with ATC that was in effect from November 1996 to August
2001. Pursuant to a provision contained in the collective
bargaining agreement, ATC provided space for a bulletin
board for the Union to use. The bulletin board’s purpose
was to operate as a space for the Union to communicate
with the drivers regarding “formal notices of meetings,
elections, names of representatives and officers of the
Union, and recreational or social events of the Union.” The
bulletin board was contained in a glass case and located
in the driver’s room—a break room at the bus yard’s admin-
istration building. The right side of the bulletin board was
considered to belong to the Union, while the left side was
used for operational information. During the first eleven
months of 2000, George Rodriguez, one of the union stew-
ards among the drivers, posted between ten and fifteen
Teamsters notices on the bulletin board.
Sometime in the middle of 2000, the United
Transportation Union (“the UTU”) approached Rodriguez
and asked him to solicit authorization cards on its behalf,
and requested that he file a petition with the Board to de-
certify the Teamsters as the employees’ collective bargain-

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No. 03-3476 3
ing representatives. Rodriguez agreed, and after he filed
a decertification petition on November 30, the Board
scheduled an election between the Teamsters and the UTU
for January 3, 2001. Rodriguez, apparently serving both
unions, continued to post Teamsters materials on the bul-
letin board, while posting UTU notices elsewhere in the
facility.
On December 7 or 8, Rodriguez posted a notice on the
bulletin board announcing a special meeting for all driv-
ers/operators to be held at a local hotel. After seeing the
notice, ATC Operations Manager, Sheri Camuso, removed
it from the bulletin board. The following week, on December
14 or 15, Rodriguez posted a similar notice. Again, Camuso
removed the notice within hours. This action prompted a
meeting between ATC officials and Teamsters representa-
tives. During the meeting Camuso was advised that she was
breaching both the collective bargaining agreement and the
law by removing Union notices from the bulletin board. She
responded that ATC’s corporate headquarters had told her
that the company must remain neutral in the upcoming
election and ATC would no longer allow the Teamsters to
post notices concerning the election. On December 26, ATC
distributed a memorandum concerning the posting of union
materials. It stated in part that to preserve “ ‘employer
neutrality’ . . . there shall be no literature posted of any
kind by either the UTU or the Teamsters on the bulletin
boards.”
The election was held as scheduled on January 3, 2001
and the UTU defeated the Teamsters. Following the elec-
tion, the Teamsters filed objections to the election as well as
an unfair labor practices claim. The Regional Director for
Region 31 of the Board issued a consolidated complaint
alleging that ATC had “failed and refused to bargain with
the Union” by “unilaterally changing the employee’s work-
ing conditions by eliminating the Union’s bulletin board
posting privileges.” A hearing on the consolidated complaint

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4 No. 03-3476
was held before the ALJ. On December 14, 2001, the ALJ
issued his decision holding that ATC had violated Sections
8(a)(5) and (1) of the Act and that the violations affected the
outcome of the election. The ALJ rejected ATC’s defense
that its actions were motivated by the California Neutrality
Statute, Cal Gov’t Code § 16645 (West 2004), holding that
because the statute was not in effect in December 2000, “the
statute simply had no application.” The ALJ recommended
that the Board set aside the election, direct a second
election, order ATC to cease and desist from “depriving the
Union of access to its bulletin board,” and post a notice
informing its employees that it had violated their rights
guaranteed by the Act. The Board affirmed the ALJ’s
rulings, findings, and conclusions and adopted the ALJ’s
recommended order. ATC, an Illinois corporation whose
principal place of busines is in the state of Illinois, filed a
petition for review of the Board’s order with this Court.
II. Discussion
In this case we are asked to review the Board’s order
finding that ATC violated Section 8 of the Act when ATC
revoked the privileges to use the bulletin board granted by
the collective bargaining agreement. We review factual
findings of the Board to determine if they are “supported by
substantial evidence on the record as a whole.” Bob Evans
Farms, Inc. v. NLRB, 163 F.3d 1012, 1017 (7th Cir. 1998).
The substantial evidence test “requires not the degree of
evidence which satisfies the court that the requisite fact
exists, but merely the degree that could satisfy the reason-
able fact finder. Allentown Mack Sales & Serv., Inc. v.
NLRB, 522 U.S. 359, 377 (1998) (emphasis in original). We
review the Board’s legal conclusions to “determine whether
they have a reasonable basis in the law.” Bob Evans Farms,
163 F.3d at 1017. The legal conclusions of the Board must
be upheld “unless they are irrational or inconsistent with

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No. 03-3476 5
the [Act].” NLRB v. Augusta Bakery, 957 F.2d 1467, 1471
(7th Cir. 1992) (citations and quotations omitted).
The Board concluded that ATC’s unilateral action in bar-
ring the Union from its own bulletin board was a violation
of Section 8(a)(5) and (1). Section 8(a)(1) of the Act makes
it an unfair labor practice to “interfere with, restrain, or
coerce employees in the exercise of the rights guaranteed”
in Section 7 of the Act (29 U.S.C. § 157), which in turn
provides employees the “right to self-organization, to form,
join, or assist labor organizations . . . and to engage in other
concerted activities for the purpose of collective bargaining
or other mutual aid or protection . . . .” Therefore, an
employer violates the Act when it interferes with its employ-
ees’ right to communicate with their statutory representa-
tive. See St. Francis Medical Center, 340 NLRB No. 168,
2003 WL 23119210, at *20 (December 31, 2003) (finding
that confiscation of union literature tends to restrain and
coerce employees). Section 8(a)(5) of the Act makes it an
unfair labor practice to refuse to bargain with representa-
tives of its employees. The Act defines the bargaining
obligation to prohibit an employer from “unilaterally
terminating or modifying a collective bargaining agreement
during its effective term.” NLRB v. Manley Truck Line, Inc.,
779 F.2d 1327, 1329-30 (7th Cir. 1985). Accordingly, an
employer violates Section 8(a)(5) and (1) when it makes
“mid-term changes in any provision of a collective bargain-
ing agreement relating to a mandatory subject of bargain-
ing, such as wages, hours, or other terms of employment .
. . .” NLRB v. Southwestern Elec. Coop., Inc., 794 F.2d 276,
278 (7th Cir. 1986).
ATC does not dispute that it restricted access to the union
bulletin board that was mandated under the collective
bargaining agreement. ATC contends, however, that the
Board erred in rejecting ATC’s argument that it was
compelled by the California Neutrality Statute, Cal Gov’t
Code § 16645 (West 2004), to revoke the Teamsters’ bulle-

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6 No. 03-3476
tin-board privileges. ATC argues that the basis for the
Board’s decision—that the California statute did not go
in effect until after the violations of the Act—is clearly
erroneous. Moreover, ATC claims that the Board’s failure to
rule on the issue of whether the Act preempted the Califor-
nia law is inconsistent with its position in other cases and
that it violates the Board’s statutory obligation of the
“centralized administration of national labor policy.” ATC
also submits that we should order a rehearing because ATC
was not permitted to present evidence in support of its
state-law defense.
ATC’s defenses based on the California Neutrality Statute
are wholly without merit. The California Neutrality Statute
places limits on the expenditures of state funds and the
conduct of state contractors—preventing them from assist-
ing, promoting, or deterring union organizing. The purpose
of the Neutrality Statute is to “prohibit an employer from
using state funds and facilities for the purpose of influenc-
ing employees to support or oppose unionization . . . .” Cal
Gov’t Code § 16645 (West 2004). The California Neutrality
Statute explicitly provides that it “does not apply to an
expenditure made prior to June 1, 2001, or to a grant or
contract awarded prior to January 1, 2001 . . . .” Cal. Gov’t
Code § 16648 (West 2004). Thus, in light of the Board’s
undisputed finding that ATC removed Union notices and
implemented a new bulletin-board policy in December 2000,
the Board reasonably rejected ATC’s defense on the ground
that ATC’s “unlawful activity occurred before the [Califor-
nia] statute . . . went into effect.”
On petition for review, ATC challenges the Board’s timing
rationale. ATC claims that the Board ignored evidence that
ATC also removed a Union notice on January 2, 2001, after
the state law went into effect. However, ATC waived this
argument by not raising it before the Board. See NLRB v.
Somerville Constr. Co., 206 F.3d 752, 755 (7th Cir. 2000).

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No. 03-3476 7
Moreover, there is no evidence in the record indicating that
ATC was responsible for the removal of the notice on
January 2.
ATC’s additional timing argument—that it took action in
December of 2000 to avoid a “ ‘spillover effect’ which would
enable the California Attorney General to argue that the
employer had not adequately complied with the new stat-
ute”—is equally unavailing. Again, this argument is not
properly before the Court as ATC did not raise it before the
Board. Moreover, ATC has not presented us with a sound
legal basis for presuming that the statute would be retro-
actively applied. In fact, ATC’s position is belied by the
plain language of the statute that states that activity
occurring prior to January 1, 2001 is not covered by the
statute.
Relying on the Board’s decision in Stein Printing
Company, 204 NLRB 17 (1973), ATC asserts that it had a
good-faith reason to abide by the California Neutrality
Statute in December 2000, because no court had yet found
the statute to be preempted by federal law. However, in
Stein, the Board failed to adopt the ALJ’s good-faith ra-
tionale and confined its decision to the circumstance where
an employer’s compliance with a contractual provision
would “clearly” violate “the governing state law.” Id. at 17
n.2. Even if Stein does allow for a good-faith defense, a lack
of guidance on the federal preemption issue is insufficient
to support a good-faith belief that a law might cover conduct
that took place before its effective date. Individuals and
entities are not entitled to binding advisory opinions from
public agencies or courts that announce the proper opera-
tion of laws before they go into effect. It was ATC’s respon-
sibility to investigate for itself whether the state law
applied to conduct in December 2000, whether the state law
would apply to postings on the bulletin board, and whether,
if applicable, the state law would be preempted by the Act.
ATC apparently failed to engage in this type of inquiry, and

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8 No. 03-3476
1 The Ninth Circuit recently addressed this issue and concluded
that the NLRA preempts the California Neutrality Statute. See
Chamber of Commerce of the United States v. Lockyer, 364 F.3d
1154, 1165 (9th Cir. 2004).
as a result, erroneously attempted to comply with a state
law that was not in effect. This sort of undiscerning compli-
ance does not amount to good faith.
We turn now to ATC’s argument that the Board was
obligated to address the question of whether the California
Neutrality Statute was preempted by federal law. 1 As ex-
plained above, the preemption issue is not implicated in
this case as the state law had yet to go into effect at the
time of the violations. To the extent that ATC is concerned
that it might face prosecution in the future for complying
with its collective bargaining agreement pursuant to the
Board’s order, ATC has not shown that such a concern is
anything more than speculative. ATC does not allege that
it has ever been threatened with prosecution. Given the
speculative nature of ATC’s concern, the Board acted rea-
sonably in deferring consideration of the preemption issue
and leaving open the possibility of its reconsideration, “[i]f,
in the future, [ATC] is sued under the neutrality statute
based on its actions in compliance with this Order.”
Lastly, we reject ATC’s argument that the Board was
obligated to reverse the ALJ’s exclusion of evidence sup-
porting its state-law defense. Specifically, ATC sought to
introduce evidence of pre-election tension at the facility.
However, this evidence is irrelevant to the questions pre-
sented by this case, namely whether the state law was in
effect in December 2000. As ATC does not contend that the
proffered evidence proves that the bulletin board had be-
come a “battleground,” see Nugent Service, 207 NLRB 158
(1973), which could possibly privilege ATC’s conduct, there
is no basis for ordering a rehearing.

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No. 03-3476 9
III. Conclusion
The Board’s order is A FFIRMED .
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—6-3-04

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