Brown & Root, Inc. v. National Labor Relations Board

United States Court of Appeals
Fifth Circuit
F I L E D
June 24, 2003
IN THE UNITED STATES COURT OF APPEALS
Charles R. Fulbruge III
Clerk
FOR THE FIFTH CIRCUIT
_____________________

No. 01-60635
_____________________
BROWN & ROOT, INC.,

Petitioner-Cross-Respondent,

versus

NATIONAL LABOR RELATIONS BOARD,

Respondent-Cross-Petitioner.
__________________________________________________________________

Petition for Review and to Set Aside an Order
of the National Labor Relations Board
and Cross Application for Enforcement

_________________________________________________________________

Before JOLLY, DUHÉ, and DENNIS, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

In this appeal we are concerned with whether Brown & Root,

Inc. (“Brown & Root”) became liable under the National Labor

Relations Act, as a successor employer, to the former employees of

Brown-Eagle Contractors (“Brown-Eagle”) at Ciba Specialty Chemical

Corporation’s facility in McIntosh, Alabama (“Ciba”). After it

bested Brown-Eagle for the contract, Brown & Root met with the

Brown-Eagle employees and announced that, upon application, they

would be considered for employment with other applicants. As one

might expect, this news was not well received by the Brown-Eagle

employees. They became upset and began to ask about the future of
their union. Brown & Root, which already had some 200 employees in

another operation at the facility, stated in unambiguous terms that

it was non-union and would remain non-union. When Brown & Root

completed its application and hiring process, about twenty-five

percent of the Brown-Eagle employees who had applied had been

hired. The National Labor Relations Board was not favorably

impressed. The Board found that Brown & Root had coerced Brown-

Eagle employees when it stated its position vis a vis the union;

discriminated against all former Brown-Eagle employees whom it

failed to hire; refused to recognize and bargain with the union;

and unilaterally set initial terms and conditions of employment.

The Board entered what can be fairly characterized as a sweeping

order. It ordered Brown & Root to: reinstate with back pay some 48

former Brown-Eagle employees;1 recognize and bargain with the union

without an election; and adopt retroactively the terms and

conditions that had been in place under Brown-Eagle until new terms

and conditions were negotiated or a bargaining impasse was reached.

In sum, after reviewing the entire record, the decisions of

the Board and the ALJ, and the briefs of the parties, we hold that

1
There has been some confusion as to the exact number of employee applicants at issue in this
case. What is clear is that ‘at least’ 66 of Brown-Eagle’s 68 employees submitted applications to
Brown & Root. 334 NLRB No. 83, *2. The number 48 is arrived at by reference to the Board’s
decision adopting the remedial order of the ALJ, which listed the 48 employees it found Brown &
Root had refused to hire. The 17 hired, plus the 48, yield a total of 65. Apparently, one or more of
the approximately 66 applications filed by Brown-Eagle employees with Brown & Root was never
completed and some Brown-Eagle employee applicants were unreachable by Brown & Root; this
accounts for the discrepancy in the totals.

2
the employer speech at issue with regard to its non-union position

-- the only basis for a finding of an independent violation of

Section 8(a)(1) against Brown & Root -- is protected under Section

8(c) of the Act and consequently did not constitute coercive speech

in violation of Section 8(a)(1).

Without this alleged Section 8(a)(1) violation as a predicate

upon which the Board’s finding of motive was largely built,

substantial evidence does not support the remainder of the Board’s

findings that Brown & Root violated Sections 8(a)(3) and (5) of the

Act. We therefore conclude that the Board erred in finding that

Brown & Root had unlawfully denied employment to any Brown-Eagle

employees, and consequently, in ordering reinstatement with back

pay for all 48 former Brown-Eagle employees who were not hired by

Brown & Root. It follows that the Board erred in finding that

Brown & Root had successorship obligations to the union and,

consequently, in ordering Brown & Root to recognize and bargain

with the Union and to restore retroactively the terms of employment

that existed when Brown & Root assumed the packaging and materials

handling operations. We therefore deny enforcement of the Board’s

order.

I

In 1998, Brown & Root was awarded a subcontract for packaging

and materials handling work at Ciba. This work had previously been

3
done by Brown-Eagle.2 At the time Brown-Eagle lost its contract

with Ciba, its 68 rank and file employees were represented by the

United Food and Commercial Workers Union, Local 1657, AFL-CIO (“the

Union”). Brown & Root, however, was no new-comer at the McIntosh

facility; it had performed construction and maintenance services

for Ciba continuously since the plant had been constructed in 1953.

It employed over 200 workers. They had never been represented by

a union.

Under the newly awarded contract with Ciba, Brown & Root was

scheduled to assume the packaging and material handling operations

on June 10, 1998. On May 26 and 27, Brown & Root’s project manager

Bill Outlaw and project superintendent Gordon Sloat held three

shift meetings with Brown-Eagle employees. Outlaw told them that

their employment with Brown-Eagle would be terminated, but that

they could apply with Brown & Root. At two of these meetings, the

atmosphere became heated after Bill Outlaw’s answers to a variety

of employment-related questions, all raised from the floor by the

employees. Some questions related to the future of the Union.

Although the record is not uniform concerning the precise responses

given by Outlaw to questions about the continuation of union

representation, there is no question but that Outlaw indicated that

2
Despite the similarities in their names, Brown & Root is unrelated to Brown-Eagle. Brown
& Root is now Kellogg, Brown & Root, Inc.

4
Brown & Root was non-union and would remain that way. The

employees were neither happy nor content with what they heard.

Nevertheless, beginning May 29, 66 of some 68 Brown-Eagle

employees applied for jobs with Brown & Root. However, consistent

with its position that it was a new employer, and with its

obligations to the U.S. Office of Federal Contract Compliance

Programs, on May 28 Brown & Root posted an ad for applicants in a

local newspaper. Brown & Root accepted applications from walk-in

applicants, referrals from the state job service, and from current

and former Brown & Root employees. Brown & Root accepted some 367

applications, including those from former Brown-Eagle employees.

Brown & Root’s written hiring policy established a system of

preferential consideration among the applicants: first, current

Brown & Root employees, second, former employees, third, applicants

referred by a Brown & Root employee or supervisor, and fourth,

others. This policy was not a guarantee of employment and does not

appear to have been uniformly followed.

Between May 29 and June 10, Brown & Root processed the 367

applications. Applicants were given a written test in arithmetic,

followed by a “structured” interview consisting of questions and

answers, and finally an interview with either Outlaw or Sloat. In

order to progress to the structured interview, most applicants had

to achieve a passing score on the written test. However, Brown-

Eagle applicants progressed to the structured interview regardless

5
of test score, in apparent recognition of the skills they likely

possessed as Brown-Eagle employees performing similar duties.

By June 10, after processing all applications, Brown & Root

had hired 77 unit employees, of which 17 were former Brown-Eagle

employees. Of the 14 unit supervisors Brown & Root hired, 11 were

formerly employed by Brown-Eagle.

II

On charges filed by the Union, the Board’s General Counsel

issued a complaint alleging that Brown & Root had violated Sections

8(a)(1), (3), and (5) of the Act; that is, the Complaint alleged

that Brown & Root threatened employees, refused to hire employees

formerly employed by Brown-Eagle, and failed to recognize and

bargain with the Union. The Complaint further alleged that Brown

& Root violated the Act by unilaterally changing the terms and

conditions of employment. After a hearing, the Administrative Law

Judge (“ALJ”) dismissed the allegations of the Complaint with

respect to three of the alleged discriminatees. He further found

that Brown & Root had not violated the Act by establishing initial

terms of employment. However, the ALJ concluded that Brown & Root

had violated the Act by refusing to hire 48 former Brown-Eagle

employees, and by refusing to recognize and bargain with the Union.

The Board was not altogether satisfied with the ALJ’s

decision. Although the Board adopted the ALJ’s findings, it

clarified his opinion, to make explicit the additional finding of

6
a distinct Section 8(a)(1) violation for the statements made by

Outlaw at the employee meeting. Furthermore, the Board reversed

the ALJ’s finding that Brown & Root was free to set its initial

terms and conditions of employment; instead, relying on its finding

that Brown & Root had attempted to avoid its successorship

obligations by refusing to hire, it found that Brown & Root had

illegally refused to bargain and imposed its own terms and

conditions of employment.

In its remedial order, the Board was not shy. It ordered

Brown & Root to hire all 48 former Brown-Eagle employees with back

pay, to recognize the Union, without an election, as exclusive

bargaining representative for the packaging and material handling

employees, and to adopt retroactively the terms and conditions of

employment that existed at the time of the transfer of operations.

Brown & Root filed this petition for review of the decision and

order. The National Labor Relations Board cross-applied for

enforcement of its order.

III

When the Court of Appeals reviews the Board’s findings, it

must determine whether, on the record as a whole, those findings

are supported by substantial evidence. 29 U.S.C. § 160(e).

Substantial evidence is “such relevant evidence as a reasonable

mind would accept to support a conclusion.” Universal Camera Corp.

v. NLRB, 340 U.S. 474, 477 (1951). Because the Court is not left

7
merely to accept the Board’s conclusions, the Court must be able to

“conscientiously conclude that the evidence supporting the Board’s

determination is substantial.” NLRB v. Mini-Togs, Inc., 980 F.2d

1027, 1032 (5th Cir. 1993); see also NLRB v. Brookshire Grocery

Co., 837 F.2d 1336, 1340 (5th Cir. 1988). This court reviews the

Board’s conclusions of law de novo, but must enforce orders if the

construction is reasonably defensible. NLRB v. Morotola, Inc., 991

F.2d 278, 282 (5th Cir. 1993). Accordingly, we must determine

whether substantial evidence on the record as a whole supports the

Board’s findings that Brown & Root violated Sections 8(a)(1), (3),

and (5) of the Act.

IV

The Board contends that the statements that Outlaw made at the

employee meeting violated Section 8(a)(1). It relies on this

finding as a predicate for further violations of the Act for

refusal to hire and refusal to recognize and bargain with the union

in the sense that it is the only direct evidence alleged to

establish anti-union motive for Brown & Root to violate the Act.

Yet, Section 8(c) explicitly provides protection for employer

speech. Because we find that the speech at issue in this case was

protected, the 8(a)(1) violation cannot be sustained.

Section 8(a)(1)

Section 8(c) of the Act explicitly provides that an employer

has the right to express “any views, argument, or opinion” so long

8
as “such expression contains no threat of reprisal or force or

promise of benefit.” 29 U.S.C. § 158(c). Under Section 8(c) an

employer is free to communicate to employees a statement of opinion

about the union as well as predict the effect of unionization on

the workplace so long as such a prediction is based on objectively

verifiable facts and it does not contain a threat of reprisal or

force. See Tellepsen Pipeline Services, Inc. v. NLRB, 320 F.3d 554

(5th Cir. 2003); Selkirk Metalbestos, N.A. v. NLRB, 116 F.3d 782,

788 (5th Cir. 1997). Section 8(c) “merely implements the First

Amendment” rights already possessed by employers. Allentown Mack

Sales and Service, Inc. v. NLRB, 522 U.S. 359, 386 (1998)

(Rehnquist, C.J., concurring). “[A]n employer’s free speech right

to communicate his view to his employees is firmly established and

cannot be infringed by a union or the Board.” NLRB v. Gissel, 395

U.S. 575, 617 (1969). Section 8(c) thus affirmed the continued

existence of employers’ First Amendment rights, which must be

balanced against the protection afforded by Section 8(a)(1) to

employees’ right to engage in union activity.

“Section 8(a)(1) prohibits employers from expressing anti-

union views where the expression is accompanied by a threat of

reprisal or force.” Poly-America, Inc. v. NLRB, 260 F.3d 465, 484

(5th Cir. 2002); see also Gissel, 395 U.S. at 618. The test for

determining “whether an employer has violated Section 8(a)(1) is

whether the employer’s questions, threats or statements tend to be

9
coercive, not whether the employees are in fact coerced ... The

coercive tendencies of an employer’s conduct must be assessed

within the totality of the circumstances surrounding the occurrence

at issue.” NLRB v. Pneu Electric, Inc., 309 F.3d 843, 850 (5th

Cir. 2002) (citations and quotations omitted).3

An unlawful threat is established if the totality of the

circumstances reveals an employee reasonably could conclude the

employer is threatening economic reprisals if the employee supports

the union. Selkirk, 116 F.3d at 788. The prohibitions of Section

8(a)(1) include statements that tell employees selection of a

bargaining representative would be futile. See, e.g. In re

Whirlpool Corp., 337 NLRB No. 117, *9 (July 5, 2002) (citing Trane

Co., 137 NLRB 1506 (1962)). However, this Court has only found

comments to be unlawful statements about futility when accompanied

by a threat or implication that the employer will take some action

3
The dissent’s statement that the finding of a violation must be upheld if there is substantial
evidence that the statements were specifically intended to discourage union involvement or threaten
employees -- an inquiry into the employer’s subjective intent -- mischaracterizes, we think, the
standard for evaluating employer speech under § 8(a)(1). Such an inquiry seems to be in conflict with
the dissent’s own admonition that the key determination is whether the statements tend to be
coercive, a more objective inquiry based on the totality of the circumstances.

Furthermore, the dissent’s statement that the relative sophistication of the Brown-Eagle
employees or whether they nevertheless applied for jobs after Outlaw’s comments is irrelevant is
incorrect because unlawful threats are assessed under the totality of the circumstances. The inquiry
is whether “an employee could reasonably conclude that the employer is threatening economic
reprisals if the employee supports the union.” Selkirk, 116 F.3d at 788. Although it is true that the
inquiry is not whether employees were in fact coerced, but rather whether the statements tend to be
coercive, Pneu Electric, 309 F.3d at 850, the totality of the circumstances logically may include,
objectively, consideration of the sophistication and past union experience of a particular type of
audience and the likely response of such audience.

10
to render union support futile. NRLB v. Laredo Coca Cola Bottling

Co., 613 F.2d 1338, 1341 (5th Cir. 1980) (statements that strike

replacements were permanent constituted unlawful prediction of

futility); NLRB v. Varo, 425 F.2d 293, 299 (5th Cir. 1970)(stated

willingness of employer to shut down business indicated futility in

violation of Section 8(a)(1)).

The precise content of Bill Outlaw’s statements at the shift

meetings on May 26 and 27 has been contested throughout this

litigation. The Board, in adopting the ALJ’s decision, found that

“[a]ccording to the credited testimony of employees . . . Outlaw

responded that ‘Brown & Root was a non-union company and was going

to stay that way,’ and that ‘if the [Brown-Eagle] employees came to

work for them they would be non-union.’” Brown & Root, 334 NLRB

No. 83, *2 (July 19, 2001).4

Although the Board and its ALJ are accorded deference when a

factual finding rests on a resolution of witness credibility, Blue

Circle Cement Co., Inc. v. NLRB, 41 F.3d 203, 206 (5th Cir. 1994)

(citing NLRB v. Motorola, Inc., 991 F.2d 278, 282 (5th Cir. 1993)),

the issue here does not turn on credibility. We accept the

4
It is unclear fro m the decisions of the Board and the ALJ what they determined to be the
exact content of Outlaw’s statements. Differing testimony was presented, and while the Board and
ALJ credited the General Counsel’s witnesses, each failed to make explicit precisely what they found
Outlaw to have said at the meetings, using different quotes in different parts of their decisions. In
clarifying what it found to be Brown & Root’s Section 8(a)(1) violation, the Board noted that the
ALJ “found from the credited evidence that Outlaw announced to the Brown-Eagle employees, in
specific response to their questions about retaining their union, that the Responded was a ‘non-union
company’ and ‘intended to stay that way.’” Id. at *3.

11
credibility findings of the Board, but find that the Board’s

determination that Outlaw’s statements violated Section 8(a)(1) is

not supported by substantial evidence that the speech was unlawful.

Therefore it cannot stand.

An examination of the circumstances surrounding Outlaw’s

statements demonstrates that employees could not reasonably

conclude Brown & Root was threatening reprisals for their support

of the union. Except for Outlaw’s responses at the employee

meetings, the Board does not contend that the record contains any

evidence of threats, intimidation or coercion by Outlaw or any

other Brown & Root representative. Nor does the record reveal any

statements that any discriminatory action would be taken or that

the union members of Brown-Eagle would be disfavored in the hiring

process. Because there was no threat of reprisal or coercion,

because these employees could not reasonably feel unlawfully

threatened by Outlaw’s remarks, and because Section 8(c) protects

employers’ right of free expression of opinion and fact, we hold

that the statements did not violate Section 8(a)(1).

At the outset we note that the employee group was not naive,

having its first experience with the union when Outlaw spoke to

them; instead, the group had a lengthy experience working in a shop

with a union contract. In the totality of the circumstances it

cannot be assumed, objectively, that such a group would be quick to

infer threats from otherwise permissible statements of position and

12
fact. Bill Outlaw addressed Brown-Eagle employees at shift

meetings to, among other things, inform them about their job

opportunities at Brown & Root and the application process. Outlaw

was telling employees, whom he knew to be union members, that they

had an opportunity to be employed on the same basis as other

applicants. Outlaw, who was not trained in labor law, responded

extemporaneously to questions from the floor by these union members

about a variety of topics. The atmosphere at the meetings did

become heated as the employees became dissatisfied with his

responses to questions about vacation and insurance. Outlaw did

not volunteer any unsolicited comments about the Union’s future; he

only responded to specific questions, stating Brown & Root’s

position, that “Brown & Root was a non-union company and was going

to stay that way,” and that “if the [Brown-Eagle] employees came to

work for them they would be non-union.” These statements were made

in the context of a plant where Brown & Root already employed 200

non-union employees and if there were only one bargaining unit, 70

union employees would not change Brown & Root’s non-union status.

Furthermore, only if the doctrine of successorship applied - a

doctrine that Outlaw was unacquainted with - would the employees

initially “come to work” for Brown & Root as union employees. In

sum, Outlaw’s comments should be viewed as protected statements of

Outlaw’s opinion, Brown & Root’s preferences, or objectively

verifiable statements of the current state of affairs at Brown &

13
Root -- that it was non-union -- and of Brown & Root’s wholly

lawful intention and preference that its Ciba employees remain non-

union. Illegal connotations cannot be attached to these lawful

statements in the absence, as here, of any independent violations

of labor law, and we believe the dissent is incorrect to say

otherwise.

The record contains no evidence of any other comments or

actions by Outlaw or any other Brown & Root employee that would

lead the Brown-Eagle employees reasonably to feel coerced in the

exercise of their Section 7 rights -- and the Board does not

contend to the contrary.5 Finally, the fact that 66 of 68

employees persisted in applying to Brown & Root despite these

allegedly threatening statements supports a reasonable inference

that no threat was conveyed to these employees and that they were

not unlawfully intimidated by Bill Outlaw.

The authority cited by the Board does not otherwise convince

us that these statements were unlawful. The Board relies

principally on Galloway School Lines, Inc., 321 NLRB 1422 (1996) to

support its assertion that an employer violates Section 8(a)(1) by

telling employees it will remain non-union. Galloway involved a

Section 8(a)(1) violation by a contract successor who informed its

5
Discussing the threatening nature of Outlaw’s statements, the dissent gives substantial
weight, in concluding that the statements were unlawful, to the fact that Outlaw was in a managerial
position and had final decision-making authority with respect to hiring; this fact, the dissent urges,
imbues his comments with inherent coercion because they would be taken seriously. The unadorned
fact of rank in managerial status, however, cannot transform otherwise lawful statements into threats.

14
predecessor’s employee applicants that “his Company was not union,

would never be union, that he would not hire union, and that he

would do whatever he could to stay nonunion.” Id. at 1422.

Furthermore, when the employees in Galloway sought applications,

the employer effectively informed them that the company would

intentionally commit unfair labor practices by refusing to hire any

union employees. Galloway is not this case. The employer

statements in Galloway were not in response to employee questions

at an unscripted meeting as here. Outlaw answered factually and

responsively to spontaneous questions by Brown-Eagle employees.

Further, Brown & Root never made any assertions to Brown-Eagle

employees that reasonably could be interpreted to imply that it

would commit an unfair labor practice to avoid a potential

bargaining obligation. In fact, Outlaw told workers, whom he knew

to be union, that they had an opportunity to be hired. The facts

of Galloway make it inapposite to the case presently before us.

Furthermore, each of the cases cited by the ALJ, Pacific

Custom Materials, Inc., 327 NLRB 75 (1998), Kessel Food Market,

Inc., 287 NLRB 426 (1987), and Ryder Truck Rental, Inc., 318 NLRB

1092 (1995), to support his conclusion that Outlaw’s comments were

coercive, relies on facts that are fundamentally different from

this case. In Pacific Custom Materials, the Board found a

violation of Section 8(a)(1) in explicit statements by the

successor’s management to prospective employees that hiring would

15
be “a numbers thing” and that only a certain percentage of

predecessor employees would be hired because the parent corporation

was afraid they would vote the union back in. Id. at *1. In

Kessel, the General Counsel presented testimony that management

instructed supervisors “to stay under 50 percent of the

[predecessor’s] workforce” and that prospective employees were

informed of a “quota” for union employees. Kessel, 287 NLRB at

427. Finally, in Ryder Truck, there was ample additional evidence

of coercion where the employer admitted in testimony that, had

potential transferees not resigned the union, they would not have

been transferred to a new non-union facility. Ryder Truck, 318

NLRB at 1095. The violations found in these cases clearly were

supported by substantial evidence of threats that explicitly

informed employees the employer intended to commit unfair labor

practices to avoid its bargaining obligation. The statements by

Outlaw do not contain any threat, implied or explicit, and there is

no evidence of other statements made by Brown & Root that would

affect the meaning of its lawful statements; thus these cases are

inapposite.

In our view, the facts of this case are more like P.S.Elliot,

300 NLRB 1161 (1990), which the Board attempted to distinguish. In

P.S. Elliot, a successful bidder on a contract held a meeting with

the displaced employer’s workforce, at which the employees asked if

the new jobs would be union. The company representative replied,

16
“we are a non-union company.” The Board wrote that “Respondent did

not violate . . . the Act by Elliott’s statement to the former . .

. employees that it was a ‘non-union company.’ Elliott’s statement

was in response to an employee question and was not accompanied by

any threats, interrogations, or other unlawful coercion. Further,

in light of Respondent’s pre-existing operation as a nonunion

company, Elliott’s statement, constituted a truthful statement of

objective fact.” Id. at 1162. Although Outlaw’s comments were

more extensive than those in P.S. Elliott (largely because Outlaw’s

statement were in response to union members’ questions), the facts

and the statements bear a closer resemblance to P.S. Elliott than

the cases relied upon by the Board; here, as in P.S. Elliott, the

statements at issue are statements of position and objective fact.

For the reasons stated above, none of the various statements

credited by the ALJ and Board as having been said by Outlaw

constitute unlawful coercion, but instead were permissible

statements of opinion or objective statements of fact.

In sum, we conclude that Outlaw’s statements were not coercive

because they contained no threat, express or implied, of reprisal

or futility. Moreover, Outlaw’s statement to the union employees

of Brown-Eagle was protected as free speech under Section 8(c) of

the Act and consequently was not a violation of Section 8(a)(1).

Section 8(a)(3)

17
 Once the Board’s finding of illegality of Outlaw’s statements

is rejected, the finding that Brown & Root violated Section 8(a)(3)

by refusing to hire 48 former Brown-Eagle employees is seriously

undermined; we say this simply because its finding of this 8(a)(1)

violation is a predicate upon which the Board built the illegal

motive to taint Brown & Root’s applicant choices for hire. We

begin our analysis of the Board’s case - in the absence of an

independent violation of 8(a)(1) - with the premise that successor

employers are not under any obligation to hire predecessors’

employees; at the same time, however, an employer who declines to

hire employees simply because they are members of a union commits

a § 8(a)(3) violation. See NLRB v. Burns Int’l Sec. Serv., Inc.,

406 U.S. 272, 280 (1972). The proper test to be applied in refusal

to hire cases is whether there is substantial evidence that an

adverse employment decision was motivated by unlawful animus toward

the union, not whether an employer’s failure to hire employees was

“solely” because of employees’ affiliation with the union. NLRB v.

Houston Distribution Services, Inc., 573 F.2d 260, 263-64 (5th Cir.

1978). Although this Court’s review is “more than a mere rubber

stamp,” Asarco, Inc. v. NLRB, 86 F.3d 1401, 1406 (5th Cir. 1996),

a reviewing court will uphold the Board’s decision if it is

reasonable and supported by substantial evidence on the record

taken as a whole. Valmont Indus., Inc. v. NLRB, 244 F.3d 454, 455

18
(5th Cir. 2001). We can reverse only if we find that the Board’s

decision is not supported by substantial evidence.

We once again review the relevant facts relating to hiring.

Brown-Eagle had 68 rank-and-file employees at the Ciba facility at

the time it lost the contract to Brown & Root. Of the 66 who

applied for jobs with Brown & Root, 17, or slightly more than

twenty-five percent, were hired. Out of a pool of 367 applicants,

Brown & Root, applying its field hiring policy,6 hired a total of

77 non-supervisory employees. Based on a presumed motive to

discriminate, derived from the finding that Outlaw’s comments

violated Section 8(a)(1), further supported by certain inferences

it drew from statistical evidence, and individual comparisons, the

Board found that Brown & Root had unlawfully discriminated en mass

against the 48 former Brown-Eagle employees who were not hired.

We cannot say this finding is supported by substantial

evidence. As we have indicated, it is crucial to the Board’s

8(a)(3) findings that Outlaw’s remarks to the Brown-Eagle employees

violated Section 8(a)(1). From Outlaw’s response to employee

questions, the Board drew a general inference of illegal union

animus and a presumption that because Brown & Root stated that it

6
The Board does not challenge that Brown & Root had an established hiring policy that set
out preferences to be applied in the context of other job qualifications. The Board does, however,
rely heavily for its case on the fact that it was applied non-uniformly and seems not to have influenced
several of the hiring decisions. But the question is not whether Brown & Root applied its hiring
policy uniformly, but whether it applied it in non-uniformly in a discriminatory manner against Brown-
Eagle employees because of their union affiliation.

19
intended to remain non-union, it had a motive to illegally

discriminate. Although the record contains no evidence that Brown

& Root would not give union members fair consideration for

employment and no evidence that it considered any applicant’s union

affiliation in any of the 77 hiring decisions, the ALJ reasoned

that “the evidence did show that Respondent was motivated to insure

that a majority of its unit employees did not come from the

unionized Brown-Eagle work force.” Brown & Root, 334 NLRB No. 83,

*13 n.21. Although the statements of Outlaw indisputably allow an

inference that Brown & Root had a strong preference to remain non-

union, that preference was lawful. It seems too much of a stretch

to conclude, as the dissent does, that the Board may draw an

inference, based on Brown & Root’s lawful preference, that it would

violate the law simply because it had a preference, even a strong

preference.7

7
Under recent Board decisions, non-coercive statements protected by 8(c) may be used as
evidence of an unfair labor practice in limited circumstances. See Sunrise Health Care Corp., 334
NLRB No. 111, *2 (Aug. 2, 2001); John W. Hancock, Jr., Inc., 337 NLRB No. 183, n.8 (Aug. 1,
2002) (citing Overnite Transportation, 335 NLRB No. 33, *4, n.15 (2001) and Affiliated Foods, Inc.,
328 NLRB 1107 (1999)). The admissibility of such protected speech is currently contested by
members of the NLRB. In Hancock, the Board noted members’ willingness to overturn Board
precedent in the light of language of Section 8(c), that “the expressing of any views, argument, or
opinion, . . . shall not constitute or be evidence of an unfair labor practice . . . if such expression
contains no threat of reprisal or force or promise of benefit.”). Certain members feel that the
admission of such protected speech directly contravenes the plain language of Section 8(c). See
Overnite Transportation, supra at *10, n.5 (Hurtgen, Chairman, dissenting). Some Courts of Appeals
have agreed. See e.g., Medeco Security Locks, Inc. v. NLRB, 142 F.3d 733, 744 (4th Cir. 1998)
(rejecting use of protected employer statements as evidence of union animus to support violation of
Act); BE & K Constr. Co. v. NLRB, 133 F.3d 1372, 1375-76 (11th Cir. 1997).

With respect to this issue, we find the view of the minority of the Board to be more

20
 Of course, the finding of a Section 8(a)(3) violation may be

supported through circumstantial, rather than direct evidence, NLRB

v. Esco Elevators, Inc., 736 F.2d 295 (5th Cir. 1984). That

evidence, however, must be substantial, not speculative, nor

derived from inferences upon inferences. Mini-Togs, 980 F.2d at

1032 (emphasis added). The Board, relying on a variety of

circumstantial evidence, concluded that although Brown & Root hired

17 former Brown-Eagle employees, Brown & Root refused to hire the

remaining 48 former Brown-Eagle employees because of their union

sympathies. We will review this circumstantial evidence to

determine whether the Board’s finding is supported by substantial

evidence.

(A)

In this respect the Board’s decision singled out ten of the 48

to demonstrate discrimination against all of Brown-Eagle’s former

employees. It found evidence to support a violation of 8(a)(3) in

the fact that these ten former Brown-Eagle employees who were

entitled to a hiring preference had not been hired when Brown &

Root had hired 18 non-Brown-Eagle applicants who had no preference.

This departure from its established policy was interpreted as

evidence that Brown & Root failed to hire these applicants because

persuasive, particularly in this case. A lawful statement of a lawful position does not in itself allow
inference that one is willing to enforce that position through illegal means. Accordingly, we reject
any reliance on Outlaw’s statements as evidence of illegal union animus. To hold otherwise, any
successor employer in Brown & Root’s position would be virtually prohibited from freely stating its
position to employees, even though that position is protected by Section 8(c).

21
of their union activity, and this, in turn, was evidence to support

a finding of massive discrimination against all 48. The Board

specifically noted that “18 of the non Brown-Eagle applicants who

were hired had no packaging and material handling experience and

were not entitled to any preference under [Brown & Root’s] written

hiring policy. By contrast, ten Brown-Eagle applicants [who were

not hired] not only had applicable experience but were entitled to

preference under that policy.” Brown & Root, 334 NLRB No. 83, at

*3.

In drawing its conclusion of illegal discrimination against

these ten from these facts and using it as evidence of

discrimination against all 48, the Board stopped short of a

thorough analysis of Brown & Root’s application of its policy. An

evaluation of the record as a whole seems to demonstrate that Brown

& Root’s hiring policy was not applied unevenly against Brown-Eagle

applicants. Out of a total of 367 applicants, 144 possessed at

least one of the three preferences. Of the 20 Brown-Eagle employee

applicants who possessed at least one preference under the hiring

policy, 10 were not hired (50%). Of the non-Brown-Eagle applicants

with a preference, 82 were not hired, a rejection rate of 66%.8

Thus, although it is true that the statistics indicate that Brown

8
Of the 223 applicants who had no preferences under the policy, Brown-Eagle applicants fared
better than their non-Brown-Eagle counterparts; Brown-Eagle applicants without a preference were
hired at a rate of roughly 15%, while non-Brown-Eagle employees without a preference were hired
at a rate of 10%.

22
& Root did not apply its preference policy to assure employment to

qualified applicants, and although there seems to be no uniformity

in its application, there is no demonstrated pattern that the

policy operated to discriminate against the Brown-Eagle applicants

when compared to other applicants.

Without some evidence that tends to show that the failure to

hire these ten was based on their union activity or sympathy -- and

there is no such evidence -- there is not substantial evidence to

support the Board’s conclusion that Brown & Root’s failure to hire

the ten constitutes evidence of illegal discrimination against

either them or the additional 38 Brown-Eagle employee applicants.9

(B)

As further circumstantial evidence that Brown & Root violated

Section 8(a)(3) by failing to hire all Brown-Eagle employee-

applicants, the Board placed some emphasis on what it considered

Brown & Root’s departure from its stated intention to “retain as

many Brown-Eagle employees as possible.” Brown & Root, 334 NLRB

No. 83, at *1. The Board drew this conclusion from Brown & Root’s

proposal to Ciba which stated: “Brown & Root understands the

benefits of using a large portion of the existing Material Handling

9
The same can be said for the ALJ’s reliance on the fact that Brown & Root hired two
inexperienced applicants who had not worked for Brown-Eagle and failed its battery of tests, while
it refused to hire four former Brown-Eagle employees that had failed the same tests. The ALJ relied
on this as circumstantial evidence of an unlawful refusal to hire all 48. Other than the impermissible
inference of anti-union animus from Outlaw’s statements, the general counsel has not presented any
evidence that Brown & Root actually discriminated against these particular employees, or the
remaining Brown-Eagle employees, because of their union activities.

23
work force and their immediate supervisors to provide continuity of

that service and it is our plan to do so.” The Board also relied

on a follow-up letter which stated “Brown & Root plans to hire a

significant number of the existing work force to assure a smooth

changeover . . ..” Id.

The Board’s apparent theory is that Brown & Root had an

intention to retain as many Brown-Eagle workers as possible at the

time it made its proposal (although it was fully aware of their

union status), and then retreated from that plan and acquired an

illegal anti-union animus when the employees expressed themselves

at the May shift meetings.

It is clear, of course, that Brown & Root, having worked at

the Ciba facility for the duration of Brown-Eagle’s contract, knew

at the time it made its proposal that Brown-Eagle’s employees were

represented by the union. Furthermore, Brown & Root’s proposal

simply stated that it understood the benefits of hiring “a large

portion” or a “significant number” of the Brown-Eagle staff. The

record indicates that Brown & Root hired more than 25% of the

Brown-Eagle hourly employees who applied, which may or may not

qualify as “a large portion;” it does seem more than “a small

portion” and not an “insignificant number” of the employee pool.

Brown & Root’s statements made no commitments; they did declare the

general intention that there would be continuity of operations and

it recognized the value of trained employees to achieving that

24
goal. It is particularly difficult to see how Brown & Root’s

commitment to hire employees known to be union demonstrates any

anti-union animus, and the Board apparently does not contend so;

the Board only suggests that Brown & Root’s attitude hardened into

an illegal anti-union animus against these employees as a result of

the May meetings. As far as we can tell from the record, such a

contention is based on speculation. Thus the statements relied

upon by the Board do not add support to a finding of substantial

evidence of illegal discrimination.10

V

In sum, the record taken as a whole does not demonstrate

substantial evidence to support the Board’s finding of blanket

discrimination against the 48 former Brown-Eagle employees who were

not hired by Brown & Root. Accordingly, it follows that Brown &

10
The dissent accepts the NLRB’s theory and interprets the proposals’ statements to establish
Brown & Root’s intention “to hire mostly Brown-Eagle applicants.” (Emphasis added.) We do not
find support for the NLRB’s theory, or the dissent’s characterization of Brown & Root’s intentions,
in the record. Nowhere did Brown & Root evince or state an intention to hire “mostly” Brown-Eagle
applicants; the record establishes that Brown & Root, at best, planned to hire “a large portion” or a
“significant number” of the Brown-Eagle staff. This more limited hiring goal, coupled with Brown
& Root’s preexisting familiarity with the unionized status of the Brown-Eagle employees, renders the
NLRB’s theory -- and the dissent’s -– of intervening pro-union activity as the determinant of Brown
& Root’s hiring decisions, substantially weakened.

25
Root never incurred an obligation to bargain with the union11 and

we deny enforcement of the Board’s order in its entirety.

Petition for relief GRANTED.

Cross-petition for enforcement DENIED.

11
One minor issue should be clarified. After concluding that Brown & Root avoided its
successorship bargaining obligations through massive discrimination against all Brown-Eagle
employees in violation of § 8(a)(3), the dissent cites Galloway for the proposition that “a section
8(a)(3) violation is sufficient to find that the new employer ‘would have employed a sufficient number
of predecessor employees to be a successor employer had it acted lawfully.’” (quoting Galloway, 321
NLRB 1422 at 1425). The dissent appears to unduly broaden the narrow holding of Galloway by
omitting the preceding language in the opinion, which clarified that “the 8(a)(3) violation in this case
warrants” such a finding, due to the number of employees and the appropriate bargaining unit at issue
in that case (emphasis added). We note this merely to avoid any confusion about what sorts of §
8(a)(3) violations trigger § 8(a)(5) liability.

26
DENNIS, Circuit Judge, dissenting:

I respectfully dissent from the majority’s decision granting

Brown & Root’s petition for relief and denying the NLRB’s cross-

petition for enforcement. We must enforce an NLRB decision if it

is “supported by substantial evidence on the record considered as

a whole.” 29 U.S.C. § 160(e). Therefore, if there is “such

relevant evidence as a reasonable mind would accept to support a

conclusion,” we must defer to the NLRB, even if we would have

decided the case differently. Universal Camera Corp. v. NLRB, 340

U.S. 474, 477 (1951). Considering this deference, I would deny

Brown & Root’s petition for relief and enforce the NLRB order in

its entirety.

The NLRB found that Brown & Root violated NLRA sections

8(a)(1), 8(a)(3), and 8(a)(5) when it took over the packaging and

material handling department from Brown-Eagle. It relied on the

following evidence, which showed that: (1) Brown & Root expressly

stated that it intended to hire a “large portion” and “significant

number” of the Brown-Eagle workforce to assure a smooth transition;

(2) Outlaw was the highest ranking Brown & Root official at Ciba

and made the final hiring decisions when Brown & Root took over the

packaging and material handling department; (3) at a meeting to

discuss the takeover, Outlaw responded to questions about the

future of the current union by stating that “Brown & Root was a

27
non-union company and was going to stay that way” and that “if the

[Brown-Eagle] employees came to work for them they would be non-

union”; (4) after the meeting, the Union attempted to deliver

demands for recognition and signed membership cards to Outlaw, who

refused to accept them; (5) Brown & Root hired 78% of the Brown-

Eagle supervisors that applied; (6) although the Brown-Eagle

supervisors were hired before the general application process

began, Brown & Root failed to solicit their advice regarding the

Brown-Eagle applicants; (7) the field hiring policy granted

preferences to applicants who were former Brown & Root employees or

referred by current Brown & Root employees, but not to former

Brown-Eagle employees who had worked in the packaging and material

handling department; (8) Brown-Eagle applicants, however, were not

required to pass a written test before proceeding to the structured

interview because “they were already on the project performing the

work”; (9) during the structured interview, applicants were not

asked about any specific job skills or their recent job

performance; (10) despite its initial intentions to hire Brown-

Eagle employees to ensure a smooth transition, Brown & Root hired

only 25% of the Brown-Eagle employees who applied; and (11) ten

former Brown-Eagle employees with preferences in the Brown & Root

hiring policy were not hired, although eighteen non-Brown-Eagle

employees with no preference were hired. Because this evidence is

28
sufficient to support the NLRB’s findings, its order against Brown

& Root should be enforced.

I. Section 8(a)(1) Violation

The section 8(a)(1) violation must be upheld if, considering

the totality of the circumstances, there is substantial evidence

showing that Outlaw made statements that specifically intended to

impede or discourage union involvement and threatened reprisals if

the employees supported the union. Selkirk Metalbestos, N.A. v.

NLRB, 116 F.3d 782, 788 (5th Cir. 1997); In re Whirlpool Corp., 337

NLRB No. 117, *9 (July 5, 2002). This includes statements by an

employer that it would be futile to select a bargaining agent. In

re Whirlpool Corp., 337 NLRB No. 117, at *9. The key determination

is whether the statements tend to be coercive, not whether the

employees have in fact been coerced. NLRB v. Pneu Electric, Inc.,

309 F.3d 843, 850 (5th Cir. 2002). Therefore, the relative

sophistication of the Brown-Eagle employees or whether they still

applied for positions after Outlaw’s comments is irrelevant.

This violation is supported by substantial evidence. Outlaw

was a person of authority and an official representative of Brown

& Root. He also made the final decisions as to which, if any,

Brown-Eagle applicants would be hired. He stated at a meeting

designed to address the Brown-Eagle employees’ questions about the

transition that “Brown & Root was a non-union company and was going

to stay that way” and that “if the [Brown-Eagle] employees came to

29
work for them they would be non-union.” Obviously, the responses

by a person in Outlaw’s position at an official meeting designed to

answer such questions would be taken seriously and could,

therefore, be considered coercive. It is also clear that these

statements were specifically intended to discourage union

involvement because Outlaw followed through on these promises and

hired only about 25% of the Brown-Eagle applicants. Therefore, the

NLRB could have found that Outlaw’s statements violated section

8(a)(1) because these statements would tend to coerce an employee

that it would be futile to belong to a union at Brown & Root.

Additionally, the NLRB was not required to find that the

statements were protected by section 8(c). An employer’s statement

will be protected by section 8(c) if his comments are true

statements of objective fact or do not constitute a threat of

reprisal. 29 U.S.C. § 158(c); In re P.S. Elliot Serv., 300 NLRB

1161 (1990). But here, Outlaw’s statements were not true

statements of objective fact. Although he did correctly state that

Brown & Root was a non-union company, Brown & Root could not

through lawful means guarantee that the packaging and material

handling department would become non-union when it took over. Nor

could Brown & Root truthfully maintain that the doctrine of

successorship would not prevent its efforts to require a non-union

shop with all non-union employees. His comments could also be

reasonably construed as a threat. By stating that Brown & Root

30
intended to stay non-union, he reasonably could be understood to

imply that it would do what is necessary to stay non-union.

Therefore, the record supports the Board’s finding that Outlaw made

an implied threat that Brown & Root would not hire Brown-Eagle

employees if hiring these employees would result in the

unionization of the department. Accordingly, because Outlaw’s

statements were not protected by section 8(c), the section 8(a)(1)

violation should be upheld.

II. Section 8(a)(3) Violation

I would also enforce the section 8(a)(3) violation. To

establish this violation, the NLRB must find that anti-union animus

motivated an employer to make an adverse employment decision. See

29 U.S.C. 158(a)(3); NLRB v. Houston Distrib. Servs., 573 F.2d 260,

263-64 (5th Cir. 1978). Under the burden-shifting analysis of

Wright Line, the NLRB is first required to show that a motivating

factor in an adverse employment decision was anti-union animus.

See Valmont Indus., Inc. v. NLRB, 244 F.3d 454, 464-65 (5th Cir.

2001). If it does, then the burden shifts to the employer to prove

by a preponderance of the evidence that it would have taken the

same action regardless of its anti-union stance. See id.

Here, there is substantial evidence to show that anti-union

animus was a motivating factor in Brown & Root’s decision not to

hire a majority of the Brown-Eagle applicants. In addition, Brown

& Root has not proven that it would have hired the same number of

31
Brown-Eagle applicants even if it had not been trying to avoid

unionizing the packaging and material handling department.

Therefore, the section 8(a)(3) violation should be upheld.

As the majority explains, under the NLRB’s version of events,

Brown & Root planned to hire mostly Brown-Eagle applicants in order

to ensure continuity when it took over the department. But, as the

NLRB reasonably found, when it realized that these Brown-Eagle

applicants were adamant about remaining unionized, it decided to

avoid any union concerns caused by the successorship doctrine and

hired only a minimal amount of Brown-Eagle applicants. Because the

NLRB could reasonably determine that Brown & Root’s decision not to

hire Brown-Eagle applicants was motivated by its desire to remain

non-union, Brown & Root’s violation of section 8(a)(3) is supported

by substantial evidence.

The majority does not contend that this version of events is

incapable of supporting a section 8(a)(3) violation. Instead it

concludes that the NLRB’s account was not supported by substantial

evidence and thus was mere speculation. I disagree. There is

substantial evidence to support every aspect of the NLRB’s theory.

Therefore, I believe the NLRB proved that a motivating factor

behind Brown & Root’s hiring decisions was anti-union animus.

First, Brown & Root expressly stated that it planned to

provide continuity of service by “using a large portion of the

existing Material Handling work force” and “to hire a significant

32
number of the existing work force to assure a smooth changeover.”

Brown & Root argues that this meant it only intended to hire about

a quarter of the Brown-Eagle applicants. But the NLRB could still

have concluded that this 25% figure was not “large” or

“significant,” and that by its own statements Brown & Root

originally intended to hire more Brown-Eagle applicants than it

actually did.

Second, between the time Brown & Root made these statements

and the hiring process began, the Brown-Eagle applicants made it

abundantly clear that they would insist on remaining unionized. At

the meeting with Outlaw, they asked numerous questions about

unionization. Shortly thereafter, the Union delivered letters to

both Brown & Root headquarters and Outlaw demanding to be

recognized. Even if Brown & Root knew that the department was

unionized before the meetings, it did not necessarily know the

extent of the Brown-Eagle employees’ fervor for remaining union

employees. Therefore, this evidence supports the NLRB’s finding

that Brown & Root re-evaluated its hiring policies and decided to

avoid hiring a majority of Brown-Eagle applicants after these

events occurred.

Third, although it did hire some Brown-Eagle applicants, there

is substantial evidence showing that Brown & Root’s hiring process

as a whole was based more on remaining non-union then on hiring the

best possible applicants. Brown & Root hired only 25% of the

33
Brown-Eagle employees, but hired 78% of its supervisors, who have

no effect on the successorship doctrine. Then it chose not to ask

these supervisors about the qualifications of the Brown-Eagle

employees, even though they would have provided valuable knowledge

about these employees’ abilities.12 Brown & Root then proceeded to

hire a number of non-Brown-Eagle applicants without a preference

under the field hiring policy while rejecting a number of Brown-

Eagle employees who had a preference. In addition, no applicant

was asked about any specific job skills or recent job performance

during the structured interview. Based on this evidence, it was

more than reasonable for the NLRB to conclude that Brown & Root was

more concerned about avoiding the doctrine of successorship than in

hiring the best applicants.

If there were still doubt about Brown & Root’s motivations, it

is alleviated by Outlaw’s statements at the Brown-Eagle employee

meeting. These statements clearly show that Brown & Root was

concerned about the future union status of the department and

explains the primary motivation behind Brown & Root’s actions

during the hiring process - to avoid unionization. Therefore, the

NLRB has adequately proven that anti-union animus was a motivating

factor behind the NLRB’s decision not to hire most of the Brown-

Eagle applicants.

12
This choice was doubly significant because those supervisors could have recom mended
some of the Brown-Eagle applicants, which would have given those applicants a preference under
the hiring policy.

34
 After the NLRB made its case, the burden shifted to Brown &

Root to prove that it would have made the same hiring decisions

even if it had no anti-union animus. It has not done so here. As

noted by the majority, Brown & Root claims that it hired Brown-

Eagle applicants with a preference under the hiring policy at a

somewhat higher rate than non-Brown-Eagle applicants with a

preference. It also hired Brown-Eagle applicants without a

preference at a higher rate than similarly situated non-Brown-Eagle

applicants. Although true, these statistics do not take into

account the fact that Brown-Eagle applicants should have been hired

at a significantly higher rate because of their experience. As

noted above, preferences were not given based on previous

experience with this type of work, but were instead based on being

a former Brown & Root employee or being referred by a current Brown

& Root employee. Thus the numbers that result from comparing

applicants with or without preferences does not take into account

that, as a whole, the Brown-Eagle applicants were vastly more

experienced then their counterparts.

Initially, Brown & Root had admired this experience. It

acknowledged the importance of the Brown-Eagle employees’

experience when it stated that it wanted to hire a significant

number of these applicants to ensure continuity and when it did not

require them to pass the written test before moving on to the

structured interview. But it never provided an adequate

35
explanation why this experience was suddenly irrelevant after the

Brown-Eagle employees displayed pro-union sentiments or why it

rejected so many of these experienced Brown-Eagle employees who

applied for positions. Because Brown & Root failed to provide such

an explanation, the NLRB was not required to find that Brown & Root

would have made the same hiring decisions absent its anti-union

animus. Consequently, the section 8(a)(3) violation should be

upheld.

III. Section 8(a)(5) Violation

Finally, because Brown & Root had a duty to bargain with the

Union as a successor employer, it violated section 8(a)(5) by

refusing to bargain with the Union. Under the doctrine of

successorship, a new employer who takes over a unionized unit has

an obligation to bargain with the union if: (1) that new employer

is in fact a successor of the old employer and (2) the majority of

its employees were employed by its predecessor. Fall River Dyeing

& Finishing Corp. v. NLRB, 482 U.S. 27, 41 (1987). Whether an

employer is in fact a successor “is primarily factual in nature and

is based upon the totality of the circumstances.” Id. at 43. It

focuses on whether “the new company has acquired substantial assets

of its predecessor and continued, without interruption or

substantial change, the predecessor's business operations,” keeping

in mind whether "those employees who have been retained will

understandably view their job situations as essentially unaltered."

36
Id. A new employer will be considered the successor employer of

its predecessor if there is “substantial continuity” between the

two operations. Id.

Brown & Root is a successor employer of Brown-Eagle. First,

Brown & Root did not start a new operation, instead taking over

Brown-Eagle’s contract to run the already-existing packaging and

material handling department for the same customer, Ciba. As a

result, its employees’ positions were essentially unaltered because

they performed the same work under the same conditions for almost

all of the same supervisors. Therefore, there was substantial

continuity between the Brown & Root and Brown-Eagle operations.

Second, but for its discriminatory hiring practices, as found by

the NLRB based on substantial evidence, Brown-Eagle applicants

would have constituted a majority of the Brown & Root workforce in

this department, which would have satisfied the second prong of the

successorship doctrine.

Because it cannot benefit from its unlawful practices, we must

uphold the NLRB’s finding that Brown & Root was a successor

employer and had a duty to bargain with the Union. In re Galloway,

321 NLRB 1422, 1425 (1996) (holding that a section 8(a)(3)

violation is sufficient to find that the new employer “would have

employed a sufficient number of predecessor employees to be a

successor employer had it acted lawfully”). In addition, because

of its discriminatory acts, Brown & Root also lost the right to set

37
the initial terms and conditions before bargaining with the Union.

Id. at 1427. Accordingly, by refusing to bargain with the Union,

Brown & Root violated section 8(a)(5). Therefore, the NLRB was

justified in requiring Brown & Root to abide by the previous

bargaining agreement until a new agreement with the Union can be

negotiated. Id.

IV. Conclusion

In sum, we must defer to the NLRB as long as its findings are

supported by substantial evidence. Because its findings are so

supported in this case, I would deny Brown & Root’s petition and

enforce the NLRB order.

38