Five Star Transportation, Inc. v. National Labor Relations Board

United States Court of Appeals
For the First Circuit

No. 07-1316

FIVE STAR TRANSPORTATION, INC.,

Petitioner, Appellant,

v.

NATIONAL LABOR RELATIONS BOARD,

Respondent, Appellee,

UNITED FOOD AND COMMERCIAL WORKERS, LOCAL 1459,

Intervenor.

ON PETITION FOR REVIEW OF AN ORDER OF THE
NATIONAL LABOR RELATIONS BOARD

Before

Torruella, Circuit Judge,
Cyr, Senior Circuit Judge,
and Lynch, Circuit Judge.

Robert L. Dambrov, with whom Cooley, Shrair P.D. was on brief,
for petitioner.
Philip A. Hostak, Attorney, National Labor Relations Board,
with whom Robert J. Englehart, Supervisory Attorney, were on brief,
for respondent.
David B. Rome, Laurie R. Houle, and Pyle, Rome, Lichten,
Ehrenberg & Liss-Riordan, P.C. were on brief, for intervenor
Transportation Division, United Food & Commercial Workers, Local
1459, AFL-CIO.

March 31, 2008
 TORRUELLA, Circuit Judge. Petitioner Five Star

Transportation, Inc. ("Five Star") seeks judicial review of the

decision of the National Labor Relations Board ("NLRB") finding

that it engaged in an unfair labor practice in violation of

§ 8(a)(1) of the National Labor Relations Act ("Act") when it

refused to hire, or even consider for hire, six school bus drivers

who wrote critical letters and email messages to the Belchertown

School District ("District") in an effort to dissuade it from

granting Five Star a bus services contract for the 2003 through

2006 school terms. After a thorough review of the record, we

reject Five Star's claims and enforce the NLRB's decision.

I. Background

We recount the facts as found by the NLRB. The

Belchertown, Massachusetts, School District has a practice of

contracting with private bus companies to provide transportation

services for its students. Such contracts usually last for three

years and are secured through a competitive bidding process. The

2000-2003 bus services contract was awarded to a company now known

as First Student, Inc. ("First Student"). Upon assuming

operations, First Student recognized the United Food and Commercial

Workers Union, Local 1459 ("Union") as the bargaining

representative for its drivers, and First Student and the Union

entered into a series of collective-bargaining agreements governing

wages, work rules, and fringe benefits.

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 In early January of 2003, nearing the expiration of the

District's contract with First Student, the District began

organizing the bid process for awarding the 2003-2006 bus services

contract. As a part of the bid specifications distributed to

potential vendors, the District required that any new vendor give

current drivers "first consideration for employment." The Union

vice-president, Daniel Clifford, also wrote to all prospective

bidders notifying them of the Union's representation of the

Belchertown school bus drivers, and stating the Union's desire to

continue such representation regardless of which company won the

contract.

At the January 16, 2003 "bid opening" meeting, Five Star

submitted the lowest bid. Thereafter, on January 21, Clifford

wrote to the District expressing his concern that Five Star's bid

was so low -- nearly $300,000 lower than the then-current contract

-- that it was questionable whether it would be able to maintain

the drivers' wage and benefit levels, and the safe and effective

service, then provided by First Student. Clifford also requested

that all bidders be required to offer employment to the incumbent

vendor's drivers "at a level of wages and benefits no less than

provided by the predecessor," and submitted a draft resolution for

the School Board on the matter.

That same day, Clifford also faxed a letter to Teresa

Lecrenski, the president of Five Star, requesting her guarantee

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that Five Star would voluntarily recognize the Union as the

drivers' bargaining representative, would continue the drivers'

employment with full seniority, and would meet with the Union to

negotiate a successor collective-bargaining agreement. The letter

further stated:

If we do not hear back from you promptly on
these issues, we will infer that you do not
intend to cooperate in these reasonable
demands on behalf of our members and if you
are awarded the contract, we will exercise all
of our legal options as aggressively as a
labor union could be expected to protect the
hard-won benefits of its members.

Lecrenski did not respond to Clifford's letter.

On January 31, Clifford held a meeting with a group of

Belchertown school bus drivers to discuss the implications of Five

Star's bid on the drivers' wages, benefits, and work conditions.

At the meeting, two former Five Star employees spoke about their

negative experiences with Five Star, including job instability and

untimely responses to bus breakdowns and mechanical problems.

Clifford also distributed newspaper articles documenting several

safety incidents that had marred the company in 1996. Following

the presentation, Clifford urged the Belchertown drivers to write

to the District expressing their concerns, and provided them with

the names and addresses of District officials, and a sample letter

requesting that the District rebid the 2003-2006 contract with the

stipulation that all bidders commit to honoring the terms of the

then-current collective-bargaining agreement.

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 Between February 3 and February 8, the District received

fifteen letters from Belchertown school bus drivers. These letters

varied widely in content and tone, but most of them expressed the

drivers' concern that, in the event Five Star won the

transportation contract, they be allowed to continue in their jobs

at the then-current wage and benefit levels, and in a safe working

environment. The awarding of the contract was delayed while the

District considered the issues raised by the letters, but on

February 24, Five Star was officially awarded the school bus

service contract for the 2003 through 2006 terms.

Prior to securing the contract, Lecrenski had been

notified by the District of the existence of the letters and, at

her request, she was granted copies of them. After Five Star was

awarded the bus services contract, seventeen former First Student

drivers who were members of the Union bargaining unit applied for

a position at Five Star. Of these, only six were hired. Lecrenski

admits that the sole reason the other eleven applicants were not

hired or even considered was because they had written letters

critical of Five Star.

On August 14, the Union filed a charge against Five Star

with the NLRB alleging that "[b]y failing to hire former unionized

Belchertown bus drivers, the Company ha[d] discriminated against

them because of their protected and concerted activity." On

March 17, 2004, the NLRB General Counsel ("General Counsel") filed

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his Complaint and Notice of Hearing against Five Star, and an

evidentiary hearing lasting three days was held before an

Administrative Law Judge ("ALJ"). On June 23, 2004, the ALJ issued

his decision finding, inter alia, that Five Star had violated

§ 8(a)(1) of the Act with regard to nine of the eleven drivers who

were not hired or considered for hire based on their critical

letters to the District. The other two drivers were found to have

written letters that were not protected by the Act. Five Star

filed exceptions, and the General Counsel partial exceptions, to

the ALJ's decision, and the case was raised to the NLRB.

A three-member panel of the NLRB reviewed the ALJ's

findings and the parties' exceptions and supporting briefs. It

divided the eleven drivers into three categories: (1) those whose

letters had failed to raise common employment-related concerns;

(2) those whose letters primarily raised such concerns; and (3)

those whose letters primarily disparaged Five Star. The NLRB

concluded that Five Star had violated § 8(a)(1) only as to the six

drivers belonging to the second group, because only those drivers'

actions were protected by the Act. It ordered these drivers

reinstated and granted back pay with interest; the remaining

drivers were properly denied employment. See Five Star Transp.,

Inc., 349 N.L.R.B. No. 8, 2007 WL 185977 (Jan. 22, 2007). Five

Star promptly sought judicial review.

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 II. Discussion

A. Standard of Review

We review the NLRB's determination that an employer has

engaged in an unfair labor practice based on the entirety of the

record. Providence Hosp. v. NLRB, 93 F.3d 1012, 1016 (1st Cir.

1996). We accord the NLRB's legal findings plenary review, giving

due deference to the NLRB's interpretation of the statutes which

implicate its area of expertise so long as the interpretation flows

rationally from the text of the statute. Id.; see also NLRB v.

Insulfab Plastics, Inc., 789 F.2d 961, 968 (1st Cir. 1986). The

NRLB's factual findings, however, are reviewed under the

substantial evidence standard, which is satisfied if the findings

are based on "'such relevant evidence as a reasonable mind might

accept as adequate to support [the NLRB's] conclusion.'" NLRB v.

Hotel Employees & Rest. Employees Int'l Union Local 26, 446 F.3d

200, 206 (1st Cir. 2006) (quoting McGaw of P.R., Inc. v. NLRB, 135

F.3d 1, 7 (1st Cir. 1997)).

B. Violation of § 8(a)(1)1

1
Section 8(a)(1) of the National Labor Relations Act, 29 U.S.C.
§ 158(a)(1), establishes that "[i]t shall be an unfair labor
practice for an employer . . . to interfere with, restrain, or
coerce employees in the exercise of the rights guaranteed in § [7,
codified at §] 157 of this title."

Section 7, 29 U.S.C. § 157, in turn reads: "Employees shall have
the right to self-organization, to form, join, or assist labor
organizations, to bargain collectively through representatives of
their own choosing, and to engage in other concerted activities for
the purpose of collective bargaining or other mutual aid or

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 For over half a century it has been established that an

employer may violate § 8(a) of the National Labor Relations Act

through both its hiring and firing practices. See Phelps Dodge

Corp. v. NLRB, 313 U.S. 177, 188 (1941) ("To differentiate between

discrimination in denying employment and in terminating it, would

be a differentiation not only without substance but in defiance of

that against which the prohibition of discrimination [due to union

affiliation] is directed."); see also NLRB v. Horizons Hotel Corp.,

49 F.3d 795, 805 (1st Cir. 1995) (upholding the NLRB's

determination that the employer's refusal to hire predecessor's

employees because of their union affiliation violated § 8(a) of the

Act). Five Star argues, however, that its refusal to hire the six

letter writers identified by the NLRB ("discriminatees") does not

qualify as an unfair labor practice under the Act. It challenges

the NLRB's decision on three grounds: (1) that § 8(a)(1) does not

apply to the instant action because no employer-employee

relationship existed between Five Star and the six discriminatees;

(2) that the letters do not constitute concerted activity; and (3)

even if the letters do constitute concerted activity, the Act

leaves the discriminatees unprotected because their letters were

intended to "sabotage, impugn, and undermine Five Star's reputation

and prevent the awarding of the Bus Contract to Five Star."

protection . . . ."

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 1. Employer-Employee Relationship

Five Star's first argument is dismissed in short order.

Five Star argues that it could not have violated § 8(a)(1) because

this provision applies to conduct by an "employer" against

"employees" and, at the time the discriminatees wrote their

letters, they were not employed nor had they applied for employment

at Five Star. This contention, however, blatantly disregards the

statutory meaning assigned by the Act to the term "employee" which

"shall include any employee, and shall not be limited to the

employees of a particular employer." 29 U.S.C. § 152(3) (emphasis

added). It is undisputed that the discriminatees were First

Student employees when they wrote their letters to the District,

and Five Star is certainly an employer. Thus, the Act's

protections apply. See Fabric Servs., Inc., 190 N.L.R.B. 540, 541-

42 (1971) ("[The NLRB] find[s] no basis . . . for construing

section 8(a)(1) as safeguarding employees . . . only from

infringements at the hands of their own employer. To the contrary,

the specific language of the Act clearly manifests a legislative

purpose to extend the statutory protection of section 8(a)(1)

beyond the immediate employer-employee relationship.").

2. Concerted Activity

Five Star's second argument calls for a slightly more

involved analysis, but ultimately it too falls flat. According to

Five Star, the NLRB erred in finding the discriminatees to be

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protected by the Act because the letters they sent were not

"concerted activity" under § 7, as each one of them was written and

sent by an individual driver acting solely on his or her own

behalf. Five Star also appears to contend that, because it was

unaware that discriminatees' letters had resulted from the

January 31, 2003 meeting organized by the Union, the letters cannot

be considered concerted activity or a group action.

The "concerted activity" prong of § 7 scrutinizes the

manner in which employees raise their common employment-related

concerns. Five Star is correct that, generally, an activity is

carried out in a "concerted" manner for purposes of § 7 if it is

"engaged in with or on the authority of other employees, and not

solely by and on behalf of the employee himself." Meyers Indus.,

Inc. (Meyers I), 268 N.L.R.B. 493, 497 (1984). Nonetheless, some

activities carried out by individual employees may be considered to

be concerted. Meyers Indus., Inc. (Meyers II), 281 N.L.R.B. 882,

885 (1986). The critical inquiry is not whether an employee acted

individually, but rather whether the employee's actions were in

furtherance of a group concern. See id. at 887 ("We reiterate, our

definition of concerted activity in Meyers I encompasses . . .

individual employees bringing truly group complaints to the

attention of management.").

In the case before us, the NLRB found that the six

discriminatees raised group complaints; the same complaints, in

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fact, that were aired by members of their Union bargaining unit at

the January 31, 2003 meeting led by Union vice-president Clifford.

That the discriminatees' letters speak to the same concerns raised

at that meeting lends credence to the NLRB's finding that they did

not act alone. This conclusion is further reinforced by the fact

that two of the six discriminatees also urged the District in their

letters to rebid the contract to comport with the conditions of the

then-current collective-bargaining agreement, as per the Union's

urging. One of the letters even appended a draft resolution on

contract specifications to be used in the event of a rebid. Most

importantly, it was the Union, at this meeting, who urged that the

drivers write to the District detailing their concerns regarding

Five Star, and even supplied them with a sample letter and contact

information for the District. Given all of these factors,

substantial evidence supports the NLRB's finding that the

discriminatees' letters constituted concerted activity in

furtherance of a truly group concern.

Under Meyers I, an additional requirement for the finding

of a § 8(a)(1) violation is that "the employer knew of the

concerted nature of the employee's activity." 268 N.L.R.B. at 497.

Though Five Star argues that it was not aware of the concerted

nature of discriminatees' letters, the evidence on the record

adequately rejects this contention. Starting with the January 21,

2003 fax sent by Clifford to Lecrenski, Five Star's president, Five

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Star was on notice that the Belchertown bus drivers were unionized,

and that they were seeking a successor collective-bargaining

agreement. That same fax also warned that the Union would seek to

preserve the conditions of the then-current collective-bargaining

agreement "as aggressively as a labor union could be expected to

protect the hard-won benefits of its members." Less than a month

later, Five Star learned of the fifteen letters written by

Belchertown bus drivers to the District, and upon reading them must

have gathered that the Belchertown bus drivers were acting as a

group to maintain the wages, benefits, and work conditions secured

through the then-current collective-bargaining agreement.2 Taken

as a whole, this served to alert Five Star to the fact that these

were not individual letters but in fact a letter-writing campaign

conducted by the Belchertown bus drivers, possibly associated with

the Union, and aimed at preserving the drivers' then-current

employment package. As such, Five Star knew of the concerted

nature of the drivers' activity, and the NLRB was correct in

finding the discriminatees to be preliminarily protected under the

Act.

2
All fifteen authors identified themselves as Belchertown bus
drivers; all of them enumerated the same work-related concerns
regarding wages, benefits, and safety mechanisms such as on-site
mechanics; most of the authors made direct reference to the
collective-bargaining agreement; and several mentioned the same
three safety incidents that had marred Five Star in 1996. Driver
Donald Caouette also mentioned in his letter that "[m]any of us
discussed not being willing to work" for Five Star.

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 3. Protected Activity

In its sharpest contention, Five Star asserts that even

if the discriminatees engaged in concerted activity, they lost the

protection otherwise afforded them by the Act because their actions

were not part of an ongoing labor dispute, and were otherwise

abusive, reckless, and disloyal. As such, and according to Five

Star, the NLRB erred in distinguishing the discriminatees' letters

from those of the other unprotected drivers because "they contain

the same substantial and serious criticism, disparagement,

disloyalty, and effort to undermine [Five Star's] standing and keep

it from becoming the new bus service contract provider."

It is long established that concerted activity engaged in

for sanctioned purposes may lose the veil of protection afforded it

by the Act if carried out through abusive means. NLRB v. Local

Union No. 1229, Int'l Bhd. of Elec. Workers (Jefferson Standard),

346 U.S. 464, 477-78 (1953) ("Even if the attack were to be treated

. . . as a concerted activity . . . within the scope of those

mentioned in § 7, the means used by the technicians in conducting

the attack have deprived the attackers of the protection of that

section."); NLRB v. Circle Bindery, Inc., 536 F.2d 447, 453 (1st

Cir. 1976) ("We recognize that even activity otherwise protected

under section 7 ceases to be protected if conducted in an excessive

or indefensible manner."). Where concerted activity entails

communications with a third party, such as here the District, such

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activity is protected if it meets a two-part test: (1) the

communication indicates to the third party that it is related to an

ongoing dispute between an employer and employees; and (2) the

communication itself is not "so disloyal, reckless or maliciously

untrue as to lose the Act's protection." In re Am. Golf Corp.

(Mountain Shadows), 330 N.L.R.B. 1238, 1240 (2000), enforced sub

nom. Jensen v. NLRB, 86 Fed. Appx. 305 (9th Cir. 2004); accord

Endicott Interconnect Techs., Inc. v. NLRB, 453 F.3d 532, 537 (D.C.

Cir. 2006). The NRLB found this two-part test to be satisfied, and

our review finds this holding to be adequately supported by the

record.

As to the first part of the Mountain Shadows test, Five

Star and the discriminatees were engaged in an ongoing labor

dispute. This is because the Act defines "labor dispute" broadly

to include "any controversy concerning terms, tenure or conditions

of employment . . . regardless of whether the disputants stand in

the proximate relation of employer and employee." 29 U.S.C.

§ 152(9) (emphasis added). In the instant case, though the

discriminatees were not engaged in a direct employer-employee

relationship with Five Star, there did exist a controversy between

these two parties as to whether the discriminatees would be able to

retain their then-current level of wages, benefits, and work

conditions should Five Star become their employer under the 2003-

2006 bus service contract. See Local 205, United Elec., Radio &

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Mach. Workers of Am. v. Gen. Elec. Co., 233 F.2d 85, 90-91 (1st

Cir. 1956) (holding that "[a]ny controversy between an employer and

a union concerning terms or conditions of employment" is a labor

dispute within the meaning of the Act (internal quotation marks and

citation omitted)). Though Five Star argues that such a

controversy was not ripe because the bus drivers had no evidence to

prove that they would not be as well remunerated by Five Star, the

NLRB found that the drivers held a reasonable belief that this

would be so. The existence of such a belief is supported by the

fact that Five Star has a long history as a non-union employer, had

already rebuffed the Union's advances to pursue a successor

collective-bargaining agreement, and had submitted a bid for the

Belchertown bus service contract that was $300,000 lower than the

then-current First Student contract, thereby leading the bus

drivers to fear that their wages, benefits, and/or work conditions

would be adversely affected. As the NLRB's finding is supported by

substantial evidence, it is deserving of our deference. See

Posadas de P.R. Assocs., Inc. v. NLRB, 243 F.3d 87, 90 (1st Cir.

2001).

Furthermore, though the discriminatees' letters to the

District did not use the term "labor dispute," the existence of

this controversy was apparent from the text of the discriminatees'

letters. All of the letters spoke to the authors' concerns

regarding the award of the bus service contract to Five Star and

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the expected negative effect this would have on their work

conditions. Some of the letters requested that the District rebid

the contract to preserve the conditions of the then-current

collective-bargaining agreement, and one letter even expressed

concern that Five Star was not a union employer. As such, the

District was on notice that there existed an ongoing labor dispute

between Five Star and the discriminatees, and that the letters were

an appeal for support from one of the disputants: the

discriminatees. The first part of the Mountain Shadows standard is

thus fulfilled. See Endicott Interconnect Techs., Inc., 345

N.L.R.B. No. 28, 2005 WL 2115872 at *4 (Aug. 27, 2005), rev'd on

other grounds, 453 F.3d 532 (D.C. Cir. 2006) (finding the first

prong of the Mountain Shadows standard fulfilled because the

employee's communications to a third party "provide[d] more than

enough information for an ordinary reader to understand that a

controversy involving employment [was] at issue").

The second part of the standard, that the discriminatees'

actions not be excessively disloyal, reckless or maliciously

untrue, is also satisfied. It is widely recognized that not all

employee activity that prejudices the employer, and which could

thus be characterized as disloyal, is denied protection by the Act.

Circle Bindery, 536 F.2d at 452 ("[C]oncerted activity that is

otherwise proper does not lose its protected status simply because

it is prejudicial to the employer."). Indeed, were harm or

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potential harm to the employer to be the determining factor in the

Court's § 7 protection analysis, it is doubtful that the

legislative purposes of the Act would ever be realized. See

Jefferson Standard, 346 U.S. at 479-80 (Frankfurter, J.,

dissenting) ("Many of the legally recognized tactics and weapons of

labor would readily be condemned for 'disloyalty' were they

employed between man and man in friendly personal relations.").

Instead, we have held that whether concerted employee activity is

deemed to be protected depends on whether the employees' actions

"appeared necessary to effectuate the employees' lawful aims."

NLRB v. Mount Desert Island Hosp., 695 F.2d 634, 640 (1st Cir.

1982); see also NLRB v. Wash. Aluminum Co., 370 U.S. 9, 17 (1962)

(distinguishing Jefferson Standard on the ground that the employees

in that case were "denied the protection of § 7 . . . because they

were found to show a disloyalty to the workers' employer which this

Court deemed unnecessary to carry on the workers' legitimate

concerted activities").

In this case, the discriminatees' letters to the District

were reasonably necessary to carry out their lawful aim of

safeguarding their then-current employment conditions. This is

because the Union had already contacted Five Star in an effort to

be recognized as the drivers' bargaining representative, and Five

Star had ignored its advances. This, in conjunction with Five

Star's non-union history and its very low bid for the Belchertown

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bus service contract, raised an alarm among the Belchertown bus

drivers that they might not be able to retain the work conditions

they enjoyed under the then-current collective-bargaining

agreement. In response to this reasonably perceived threat, the

drivers' letter-writing campaign was narrowly tailored to

effectuate the drivers' aims: the drivers' letters were addressed

solely to the District, not the public at large; the letters only

requested that the award of the contract be reconsidered or rebid

to preserve the drivers' then-current pay and work conditions; and

the discriminatees's letters "concern[ed] primarily working

conditions and . . . avoid[ed] needlessly tarnishing [Five Star's]

image," Mount Desert Island Hosp., 695 F.2d at 640.3

Furthermore, Five Star's contention that the

discriminatees' letters are indistinguishable from those sent by

their colleagues, which the NLRB deemed unprotected, has one fatal

flaw. It is precedent in this circuit that we leave the balancing

of countervailing employer and employee interests in the first

instance to the NLRB. Circle Bindery, 536 F.2d at 452. This is

because we understand the NLRB to have greater expertise in

scrutinizing the facts of a case under the labor laws -- especially

in a close case such as this one -- so that the legislative purpose

behind the laws may be fulfilled. See Harrington v. Chao, 280 F.3d

3
This was not the case with several of the other drivers'
letters, which led the NLRB to find that those drivers were not
protected by the Act.

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50, 59 (1st Cir. 2002). In this case, the NLRB found the

discriminatees to be protected because their letters primarily

addressed employment-related concerns and did not disparage Five

Star. The NLRB made this finding despite the fact that some of the

discriminatee letters also made tangential references to non-

employment related concerns such as child safety. Another group of

drivers was found to be unprotected, however, because the NLRB read

their letters to primarily address those same non-employment

related concerns. Based on the reasoning underlying Circle

Bindery, however, we "will not reposition a line drawn by the Board

between protected and unprotected behavior unless the Board's line

is 'illogical or arbitrary.'" NLRB v. Parr Lance Ambulance Serv.,

723 F.2d 575, 577 (7th Cir. 1983) (quoting NLRB v. Ben Pekin Corp.,

452 F.2d 205, 207 (7th Cir. 1971) (per curiam)); see also NLRB v.

Lummus Indus., Inc., 679 F.2d 229, 234 (11th Cir. 1982). Here the

NLRB tipped the scale in favor of the discriminatees and such a

finding is not arbitrary or illogical, and it is supported by the

record. Thus, an assignment of protection is warranted.

III. Conclusion

For the foregoing reasons, we deny Five Star's petition

for review and enter judgment enforcing the order of the NLRB.

Enforcement granted.

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