Montecito Heights Healthcare & Wellness Centre, LP

National Labor Relations Board - Administrative Judge Opinions

Nov 30, 2016

31-CA-129747 (N.L.R.B. Nov. 30, 2016)

JD(NY)-47-16
Los Angeles, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
NEW YORK BRANCH OFFICE
MONTECITO HEIGHTS HEALTHCARE &
WELLNESS CENTRE, LP
and Case 31-CA-129747
SERVICE EMPLOYEES INTERNATIONAL
UNION, UNITED LONG TERM CARE WORKERS
Joanna Silverman, Esq., for the General Counsel.
Kamran Mirrafati, and Richard M. Albert, Esqs.,
for the Respondent.
David A. Rosenfeld, and Lisl R. Soto, Esqs.,
for the Charging Party.
DECISION
STATEMENT OF THE CASE
RAYMOND P. GREEN, Administrative Law Judge. On May 30, 2014, the Service
Employees International Union, United Long Term Care Workers filed a charge in Case 31–CA–
129747. In substance, the complaint alleges that the Respondent violated Section 8(a)(1) of the
Act when it implemented a policy that sought to require its current and former employees to
agree to enter into an alternative dispute resolution policy that required employees to waive their
right to pursue a civil court action in court or any other forum.
On May 12, 2016, the parties filed a joint motion to transfer proceedings to the Division
of Judges and a joint stipulation of facts.
Upon consideration of the stipulated record and the parties’ briefs, I make the following
FINDINGS OF FACT
I. JURISDICTION
The Respondent is a limited partnership with an office and place of business in Los
Angeles, California, where it has been engaged in the operation of a skilled nursing facility
providing personal care and other services. It annually derives gross revenues in excess of
$100,000. At its facility in Los Angeles, Respondent purchases and receives materials and
services valued in excess of $5000 from outside the State of California. It is stipulated and I find
that the Respondent has been and is an employer engaged in commerce. It also was stipulated
and I find that the Union is a labor organization within the meaning of Section 2(5) of the Act.
JD(NY)-47-16
2
II. ALLEGED UNFAIR LABOR PRACTICES
Since about December 6, 2013, the Respondent maintained an alternative dispute
resolution policy and an agreement to be bound by alternative dispute resolution policy (“ADR 5
policy”). The ADR policy included an arbitration provision which, if signed by employees,
requires them to waive the right to bring or participate in class or collective action in all forums,
whether arbitral or judicial.
The ADR policy states that: 10
The ADR Policy will be mandatory for ALL DISPUTES ARISING BETWEEN
EMPLOYEES, ON THE ONE HAND, AND MONTECITO HEIGHTS
HEALTHCARE & WELLNESS CENTRE AND/OR ITS RESPECTIVE
EMPLOYEES AND OFFICERS (HEREINAFTER COLLECTIVELY THE 15
"COMPANY"), ON THE OTHER HAND. Any disputes which arise and which
are covered by the ADR Policy must be submitted to final and binding
resolution through the procedures of the Company's ADR Policy.
For parties covered by this Alternative Dispute Resolution Policy, alternative 20
dispute resolution, including final and binding arbitration, is the exclusive means
for resolving covered disputes (as defined below); no other action may be
brought In court or in any other forum. This agreement is a waiver of all rights to
a civil court action for a covered dispute; only an arbitrator, not a Judge or Jury,
will decide the dispute.25
The ADR policy expressly prohibits employees from joining a class action or
representative action.
The ADR Policy is set forth in a 3-page document, at the bottom of which at the 20th30
paragraph, it states:
Nothing in the Alternative Dispute Policy is intended to preclude any employee
from filing a charge with the Equal Employment Opportunity Commission, the
National Labor Relations Board or any similar federal or state age cy seeking 35
administrative resolution. However, any claim that cannot be resolved through
administrative proceedings shall be subject to the procedures of this ADR
Policy.
The following employees of Respondent constitute a unit appropriate for the purposes of 40
collective bargaining within the meaning of Section 9(b) of the Act:
Included: All employees employed by the Employer at its facility located at 4585
North Figueroa, Los Angeles, California, including the following classifications:
C.N.A.; R.N.A.; Cook; and All Other Positions: Dietary, Housekeeping, Laundry, 45
N.A.
Excluded: Office clerical employees, professional employees, guards, watchmen
and supervisors as defined in the National Labor Relations Act, as amended.
50
JD(NY)-47-16
3
ANALYSIS
This is yet another case involving an employer’s implementation of a policy seeking to
have employees enter into agreements that waive their right to utilize any legal process to
enforce collective interests in relation to wages, hours, and terms and conditions of 5
employment.
The Board’s position, despite reversals by several circuit courts, is that an employer
violates Section 8(a)(1) when it establishes policies that effectively force its employees to only
utilize arbitration to resolve employment disputes and to have them waive the right to act in 10
concert by seeking to preclude class actions whether in court or before an arbitrator.
As an Administrative Law Judge of the NLRB, I am bound to follow Board precedent
irrespective of contrary opinions by circuit courts, unless and until the Supreme Court makes a
definitive ruling on the subject matter in dispute. 15
In my opinion, this case is controlled by the Board’s decision in Murphy Oil USA, Inc.,
361 NLRB No. 72 (2014), enf. denied, 808 F.3d 1013 (5th Cir., Oct. 26, 2015). In that and
subsequent cases, the Board has held that requiring employees to sign class action waivers,
with or without an “opt out” clause, is a violation of Section 8(a)(1) of the Act. 20
The Respondent asserts that its ADR policy does not infringe on Section 7 rights
because the policy was optional and not required as a condition of employment. Strictly
speaking, the policy does not require employees to execute the proferred “Agreement to be
bound by Alternative Dispute Resolution Policy.” But one has to wonder how many employees, 25
being asked to sign the document, typically at the start of their employment, would have
sufficient knowledge to even consider refusing to sign it.
Even so, the Board’s position is that an employer will violate the Act whether or not an
ADR policy is mandatory or voluntary. Thus in On Assignment Staffing Services, 362 NLRB No. 30
189 (2015), the Board held that the arbitration policy violated the Act even if employees could
opt out of the agreement. The Board stated:
[W]e find that even assuming, as the Respondent argues, that the opt-out
provision renders the arbitration agreement not a condition of employment, it is 35
still unlawful because it requires employees to prospectively waive their Section
7 right to engage in concerted activity. Our conclusion follows directly from
Supreme Court decisions holding that individual agreements between
employees and employers cannot restrict employees’ Section 7 rights, from
settled Board precedent to the same effect, and from the Norris-LaGuardia Act, 40
which provides that “any … undertaking or promise in conflict with the public
policy declared in” that statute is unenforceable. For the reasons already
articulated in D. R. Horton and Murphy Oil, the Federal Arbitration Act does not
pose an obstacle to our broader holding today. There is no conflict between the
NLRA and the FAA, and even if there were, the Norris-LaGuardia Act 45
demonstrates that the FAA “would have to yield insofar as necessary to
accommodate Section 7 rights.”
It is also the case that the Respondent’s ADR policy specifically excludes charges that
might be filed with the National Labor Relations Board. But as noted above, this provision is 50
located at the bottom of a 3-page document and contains no explanation of the types of charges
JD(NY)-47-16
4
that might be subject to NLRA jurisdiction. As such, it is my opinion that no reasonable
employee could possibly understand what this provision means and it therefore cannot serve as
a defense. See SolarCity Corp., 363 NLRB No. 83, slip op. at page 6 (2015), where the Board
stated:
5
It would be unclear to the reader (especially to a reader without specialized
legal knowledge) whether and to what extent the subsequent language creating
an exception for filing charges with Federal agencies modifies the previous
broad prohibition on pursuing any form of collective or representative activity…
This ambiguity would lead a reasonable employee to wonder whether he may 10
file an unfair labor practice charge, particularly when the charge is filed with or
on behalf of other employees, and thus serves as another reason to affirm the
judge’s finding that the Agreements unlawfully prohibit filing charges with the
Board.
15
The Union makes an additional argument to the effect that the employer’s policy should
be illegal under Section 8(a)(1) because it also conflicts with the Religious Freedom Restoration
Act. To my mind, this is a unique if unpersuasive argument. The National Labor Relations Board
has not been given the authority to enforce any law other than the National Labor Relations Act.
Whatever merit this argument may have, I don’t think it needs to be addressed by me inasmuch 20
as I have already concluded, based on NLRB precedent, that the Respondent violated Section
8(a)(1) of the Act.
Conclusions of Law
25
By maintaining a policy that seeks to require employees to waive their right to
bring class actions or to act concertedly in regard to their wages, hours and terms and
conditions of employment, the Respondent has violated Section 8(a)(1) of the Act.
Remedy30
Having found that the Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative action designed to
effectuate the policies of the Act.
35
On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended 1
ORDER
40
The Respondent, Montecito Heights Healthcare & Wellness Centre, LP, its officers,
agents, and representatives, shall
1. Cease and desist from
45

1 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and Regulations, the findings,
conclusions, and recommended Order shall, as provided in Sec. 102.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all purposes.
JD(NY)-47-16
5
(a) Maintaining and/or enforcing a policy that seeks to require employees to waive the
right to maintain class or collective actions in any forum.
(b) In any like or related manner interfering with, restraining, or coercing employees in
the exercise of the rights guaranteed them by Section 7 of the Act.5
2. Take the following affirmative action necessary to effectuate the policies of the Act.
(a) Rescind or revise the Alternative Dispute Policy in all of its forms, or revise it in all of
its forms, to make clear to employees that the policy does not constitute a waiver of their right to 10
maintain employment-related joint, class, or collective actions in all forums or that requires
employees to waive their right to maintain employment related class and collective claims in all
forums, whether arbitral or judicial.
(b) Notify all current and former employees who signed or otherwise became bound by 15
the Alternative Dispute Policy in any form that it has been rescinded or revised and, if revised,
provide them with a copy of the revised policy.
(c) Within 14 days after service by the Region, post at its Los Angeles, California facility
location copies of the attached notice marked “Appendix.” Copies of the notice, on forms 20
provided by the Regional Director for Region 31 after being signed by the Respondent’s
authorized representative, shall be posted by the Respondent and maintained for 60
consecutive days in conspicuous places including all places where notices to employees are
customarily posted. In addition to the physical posting of paper notices, the notices shall be
distributed electronically, such as by email, posting on an intranet or internet site, and /or other 25
electronic means, if the Respondent customarily communicates with its employees by such
means. Reasonable steps shall be taken by the Respondent to ensure that the notices are not
altered, defaced, or covered by any other material. In addition, a copy of this notice will be
made available to employees on the same basis and to the same group or class of employees
as the Alternative Resolution Policy was made available to them. In the event that, during the 30
pendency of these proceedings, the Respondent has gone out of business or closed the facility
involved in these proceedings, the Respondents shall duplicate and mail, at its own expense, a
copy of the notice to all current employees and former employees employed by the
Respondents at any time since December 3, 2013.
35
(d) Within 21 days after service by the Region, file with the Regional Director a sworn
certification of a responsible official on a form provided by the Region attesting to the steps that
the Respondent has taken to comply.
Dated, Washington, D.C. November 30, 201640
________________________
Raymond P. Green
Administrative Law Judge 45
JD(NY)-47-16
APPENDIX
NOTICE TO EMPLOYEES
Posted by Order of the
National Labor Relations Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives of their own choice
To act together for other mutual aid or protection
To choose not to engage in any of these protected concerted activities.
WE WILL NOT maintain or enforce the Alternative Dispute Resolution policy or any agreements
made with employees pursuant to that policy that waives the right to maintain class or collective
action in any forum.
WE WILL NOT seek to require employees to sign binding arbitration agreements that prohibit
collective and class litigation.
WE WILL NOT in any like or related manner, interfere with, restrain, or coerce employees in the
exercise of their rights under Section 7 of the Act.
Montecito Heights Healthcare & Wellness
Centre, LP
(Employer)
Dated By
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935 to
enforce the National Labor Relations Act. It conducts secret-ballot elections to determine
whether employees want union representation and it investigates and remedies unfair labor
practices by employers and unions. To find out more about your rights under the Act and how
to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website:
www.nlrb.gov.
11500 West Olympic Blvd., Suite 600, Los Angeles, CA 90064.Phone: (310) 235-7352.
JD(NY)-47-16
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/31-CA-129747 or by using the QR code
below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National Labor Relations Board,
1015 Half Street, S.E., Washington, D.C. 20570, or by calling (202) 273-1940.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF
POSTING AND MUST NOT BE ALTERED, DEFACED, OR COVERED BY ANY OTHER
MATERIAL. ANY QUESTIONS CONCERNING THIS NOTICE OR COMPLIANCE WITH ITS
PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S COMPLIANCE
OFFICER, (310) 235-7352.