PJ Cheese, Inc.

National Labor Relations Board - Administrative Judge Opinions

Jun 6, 2014

10-CA-113862 (N.L.R.B. Jun. 6, 2014)

JD(ATL)–18–14
Birmingham, AL
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
ATLANTA BRANCH OFFICE
PJ CHEESE, INC.
and CASE 10–CA–113862
JAMES SULLIVAN, An Individual
Kerstin I. Meyers, Esq.,
for the Government. 1
William K. Handcock, Esq.,
for the Company.2
Mark Potashnick, Esq.,
for the Charging Party.
3
DECISION
Statement of the Case
WILLIAM NELSON CATES, Administrative Law Judge. This case was tried before
me on April 28, 2014, in Birmingham, Alabama. The charge initiating this matter was filed on
September 23, 20134, and amended on November 15 and 17 and again on December 27. The
General Counsel issued a complaint and notice of hearing (complaint) on January 3, 2014. The
Government alleges the Company, since on or about January 2010, has maintained a mandatory
arbitration policy which contains provisions that unlawfully prohibits employees from engaging
in protected concerted activities and that leads employees reasonably to believe they are
prohibited from filing charges with the National Labor Relations Board (Board). It is stipulated
that Charging Party Sullivan, on November 30, 2010, signed the Company’s Agreement and
Receipt for Dispute Resolution Program in which Sullivan agreed, as a condition of his
employment, that all work place disputes would be submitted to final and binding arbitration on
an individual basis and not on a class-wide basis. It is stipulated that on July 9, Charging Party
Sullivan filed a fair labor standards complaint against the Company in the United States District

1 I shall refer to counsel for the General Counsel as Counsel for the Government and the General Counsel as
the Government.
2 I shall refer to Counsel for the Respondent as Counsel for the Company and shall refer to the Respondent as
the Company. It is noted that in the parties partial stipulation of facts, set forth elsewhere here, the
Company is referred to as the Respondent.
3 I shall refer to James Sullivan as the Charging Party and counsel for Sullivan as Counsel for the Charging
Party.
4 All dates herein are 2013, unless stated otherwise.
JD(ATL)–18–14
2
Court for the Northern District of Alabama, Western Division, captioned James Sullivan v. PJ
United, Inc., and Douglas Stephens Civil Action No.7: 13-cv-01275-LSC. It is alleged that since
on or about July 17, the Company, in response to Sullivan’s suit, has sought to enforce the
arbitration agreement by filing with the court a Motion to Stay the Trial of This Civil Action and
require the matter be arbitrated on an individual basis. The Government alleges, that by the 5
conduct just described, the Company has been interfering with, restraining, and coercing
employees in the exercise of their rights guaranteed in Section 7 of the National Labor Relations
Act (the Act) and is in violation of Section (8)(a)(1) of the Act.
In essence, this is another case raising issues concerning arbitration policies that effect 10
collective bargaining and representational rights related to D. R. Horton, Inc., 357 NLRB No.
184 (2012), enf. denied in pertinent part 737 F.3d 344 (2013).
The Company, in its answer to the complaint, and at trial, denies having violated the Act
in any manner alleged in the complaint.15
The parties were given full opportunity to participate, to introduce relevant evidence, to
examine and cross-examine witnesses, and to file briefs. Only one witness was called (by the
Company) and the parties were able to stipulate to the matters about which the witness testified.
I have studied the whole record including the parties partial written stipulations of fact which, I 20
received in evidence, as Joint Exhibits 1–9, and based on the detailed findings and analysis
below, I conclude and find the Company violated the Act essentially as alleged in the complaint.
Findings of Fact
25
The Charge
The Company in its post-trial brief contends the complaint was not preceded by a valid
charge. The Company correctly notes the original and each of the three amended charges were
filed by the Charging Party’s attorney on behalf of the Charging Party. The Company asserts no 30
evidence was presented at trial to establish Charging Party Sullivan authorized Charging Party
Attorney Potashnick to file and amend the charges on his behalf. The Company also contends
the charge was not “sworn to” as required by the Board’s Rules and Regulations Section 102.11.
I find the original and each of the amended charges were validly filed. See: Appex35
Investigation & Security Co. 302 NLRB 815, 818–819 (1991). In Appex, such a procedural
defense was addressed, in part, as follows:
Section 102.9 of the Board’s Rules and Regulations provides that a charge may be
filed “by any person”. . . . 40
“The simple fact is that anyone for any reason may file charges with the Board.”
Operating Engineers Local 39 (Kaiser Foundation), 268 NLRB 115, 116 (1983).
It is clear the Charging Party’s attorney may validly file a charge on behalf of the 45
Charging Party. Section 102.1 of the Board’s Rules and Regulations defines the term “person”
JD(ATL)–18–14
3
as inter alia a “representative” for the person. Charging Party Attorney Potashnick signed the
charge, and amended charges, with the following “Declaration” which states: “I declare that I
have read the above charge and that the statements are true to the best of my knowledge and
belief.”
5
I conclude and find the Company’s contention that the complaint here was not preceded
by a valid charge is without merit.
I. Jurisdiction and Supervisory Status
10
The Company is an Alabama corporation with an office and place of business in
Birmingham, Alabama, from which it operates a number of retail restaurant facilities in
Alabama, Louisiana, Texas, Mississippi, Tennessee, Illinois, Missouri, Ohio, Virginia, and Utah.
During the calendar year ending December 1, the Company in conducting its business operations
derived gross revenues in excess of $500,000, and purchased and received at its Alabama 15
facilities goods and products valued in excess of $50,000 directly from points located outside the
State of Alabama. The parties admit and I find the Company is an employer engaged in
commerce within the meaning of Section 2(2), (6), and (7) of the Act.
The parties do not contest that Company Director of Human Resources Becky 20
Gwarjanski is a supervisor of the Company within the meaning of Section 2(11) of the Act.
II. Alleged Unfair Labor Practices
A. Issues25
The principle issues in this proceeding are whether the Company has violated, and is
violating, Section 8(a)(1) of the Act by maintaining a mandatory arbitration agreement which
contains provisions that unlawfully prohibits employees from engaging in protected concerted
activities; and whether the language of the mandatory agreement also leads employees 30
reasonably to believe that they are prohibited from filing charges with the Board.
B. Facts
The stipulated facts (on the record and by exhibits) are, in pertinent part, as follows:35
1. Sullivan voluntarily ended his employment with the Company in early
January 2012.5 (Tr. p. 23 LL. 20–23.)
2. Company Director of Human Resources Becky Gwarjanski, in a written 40
declaration given under oath (Jt. Exh. 2)6 and in trial testimony here (Tr. p.
26 LL. 13–14), indicated the Company is a wholly-owned subsidiary of PJ
United, Inc. Gwarjanski also indicated PJ United developed the Dispute
Resolution Program (DRP) which covers all of the Company’s employees,

5 I shall refer to the transcript as Tr. with “p. or pp.” indicating the page(s) and “L. or LL.” as the line(s).
6 I shall refer to the “joint exhibits” as Jt. Exh. with the number assigned each joint exhibit.
JD(ATL)–18–14
4
and has been modified from time to time, with the most recent modified
version being in 2010. A copy of the 2010 modification of the DRP was
received in evidence (Jt. Exh. 3). Relevant portions of the DRP read as
follows:
5
DISPUTE RESOLUTION PROGRAM
This Dispute Resolution Program is adopted for PJ United, Inc., PJ
Cheese, Inc., PJ Louisiana, LLC, PJ Chippewa, LLC, PJ Utah, LLC,
and Ohio Pizza Delivery Company, all of which are collectively 10
hereinafter referred to as the “Company.”
* * * *
THIS PROGRAM IS A CONDITION OF YOUR EMPLOYMENT
AND IS THE MANDATORY AND EXCLUSIVE MEANS BY
WHICH THOSE PROBLEMS MAY BE RESOLVED, SO READ 15
THE INFORMATION IN THIS PROGRAM BOOKLET
CAREFULLY.
Program Rules
20
Claims Subject to Arbitration
Claims and disputes subject to arbitration include all those legal
claims you may now or in the future have against the Company (and
its successors or assigns) or against its officers, directors, 25
shareholders, employees or agents, including claims related to any
Company employee benefit program or against its fiduciaries or
administrator (in their personal or official capacity), and all claims
that the Company may now or in the future have against you,
whether or not arising out of your employment or termination, 30
except as expressly excluded under the “Claims Not Subject to
Arbitration” section below.
The legal claims subject to arbitration include, but are not to be
limited to:35
 Claims for wages or other compensation,
 Claims for breach of any contract, covenant or warranty
(expressed or implied);
 Tort claims (including, but not limited to, claims for 40
physical, mental or psychological injury, but excluding
statutory workers compensation claims);
 Claims for wrongful termination,
 Sexual harassment,
 Discrimination (including, but not limited to, claims based 45
on race, sex, sexual orientation, religion, national origin, age,
JD(ATL)–18–14
5
medical condition or disability whether under federal, state
or local law);
 Claims for benefits or claims for damages or other remedies
under any employees benefit program sponsored by the
Company (after exhausting administrative remedies under 5
the terms of such plans);
 “whistleblower” claims under any federal, state or other
governmental law, statute, regulation or ordinance;
 Claims for a violation of any other noncriminal federal, state
or other governmental law, statute, regulation or ordinance, 10
and
 Claims for retaliation under any law, statute, regulation or
ordinance, including retaliation under any workers
compensation law or regulation.
15
Claims Not Subject to Arbitration
The only claim or disputes not subject to arbitration are as follows:
 Any claim by an employee for benefits under a plan or 20
program which provides its own binding arbitration
procedure.
 Any statutory workers compensation claim; and
 Unemployment insurance claims.
25
Neither the employee nor the Company has to submit the items
listed under this “Claims Not Subject to Arbitration” caption to
arbitration under this Program and may seek and obtain relief from a
court or the appropriate administrative agency.
30
The parties also agree that any arbitration between the employee and
the Company is their individual claim and that any claim subject to
arbitration will not be arbitrated on a collective or a class-wide
basis, provided however, that this provision shall not apply to any
prospective class or collective action based on alleged violations of 35
wage and hour laws if, and only if, such claim should cause the
agreement to arbitrate to be unenforceable under the prevailing law.
Also, any nonlegal dispute is not subject to arbitration. Examples
include disputes over a performance evaluation, issues with co-40
workers, or complaints about your work site or work assignment
which do not allege a legal violation.
3. Charging Party Sullivan signed the Agreement and Receipt for Dispute
Resolution Program on November 30, 2010, which was received in 45
evidence (Jt. Exh. 4). Relevant portions of the Receipt reads as follows:
JD(ATL)–18–14
6
Agreement And Receipt For
Dispute Resolution Program
MUTUAL PROMISE TO RESOLVE CLAIMS BY BINDING 5
ARBITRATION. The Company and I agree that all legal claims
or disputes covered by the Agreement must be submitted to binding
arbitration and that this binding arbitration will be the sole and
exclusive final remedy for resolving any such claim or dispute. I
also agree that any arbitration between the Company and me is of an 10
individual claim and that any claim subject to arbitration will not be
arbitrated on a multi-claimant, a collective or a class-wide basis.
The mutual obligations set forth in this Agreement shall constitute a
contract between the Employee and the Company but shall not 15
change an Employee’s at-will relationship or any term of any other
contract or agreement between the Company and Employee. This
Policy shall constitute the entire agreement between the Employee
and Company for the resolution of Covered Claims. The submission
of an application, acceptance of employment or the continuation of 20
employment by an individual shall be deemed to be acceptance of
the dispute resolution program. No signature shall be required for
the policy to be applicable.
Legally protected rights covered by this Dispute Resolution Program 25
are all legal claims, including claims for wages or other
compensation, claims for breach of any contract, covenant or
warranty (expressed or implied); that claims (including, but not
limited to, claims for physical, mental or psychological injury, but
excluding statutory workers compensation claims); claims for 30
wrongful termination, sexual harassment; discrimination (including,
but not limited to, claims based on race, sex, religion, national
origin, age, medical condition or disability, whether under federal,
state or local law); claims for benefits or claims for damages of
other remedies under any employee benefit program sponsored by 35
the Company (after exhausting administrative remedies under the
terms of such plans); “whistleblower” claims under any federal,
state or other governmental law, statute, regulation or ordinance, and
claims for retaliation under any law, statute, regulation or ordinance,
including retaliation under any workers compensation law or 40
regulation.
I understand and agree that by entering into this Agreement, I
anticipate gaining the benefits of a speedy, impartial dispute
resolution procedure. This procedure is explained in the Dispute 45
JD(ATL)–18–14
7
Resolution Program Booklet, which I acknowledge I have received
and read or have had an opportunity to read.
MULTI-STATE BUSINESS. I understand and agree the Company
is engaged in transactions involving interstate commence and that 5
my employment involves such commerce. I agree that the Federal
Arbitration Act shall govern the interpretation, enforcement, and
proceedings under this Agreement.
4. Sullivan, on July 9, filed a Complaint in United States District Court, 10
Northern District of Alabama, Western Division, against the Company in
James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No. 7:
13-cv-1275-LSC. (Jt. Exh. 5.) Relevant portions of the Complaint read as
follows:
15
COMPLAINT
Plaintiff James Sullivan, individually and on behalf of all other
similarly situated delivery drivers, for his Complaint against
defendants PJ United, Inc. and Douglas Stephens, alleges as follow:20
2. Plaintiff James Sullivan, and all other similarly situated
delivery drivers, work or previously worked as delivery
drivers at Papa John’s restaurants owned and operated by
Defendants. This lawsuit is brought as a collective action 25
under the Fair Labor Standards Act (FLSA), 29 U.S.C. §
201, et seq., to recover unpaid minimum wages owed to
Plaintiff and all other similarly situated workers employed
by Defendants.
30
Collective Allegations
38. Plaintiff Sullivan brings this FLSA claim as an “opt-in”
collective action on behalf of similarly situated delivery
drivers who opt-in to this case pursuant to 29 U.S.C. §35
216(b).
39. Plaintiff, individually and on behalf of other similarly
situated employees, seeks relief on a collective basis
challenging Defendants’ practice of failing to pay employees 40
federal minimum wage. The number and identity of other
plaintiffs yet to opt-in may be ascertained from Defendants’
records, and potential class members may be notified of the
pendency of this action by regular mail.
45
JD(ATL)–18–14
8
5. In response to Sullivan’s Complaint the Company filed with the Federal
District Court a Motion to Stay the Trial of this Civil Action on July 17. (Jt.
Exh. 6.) Relevant portions of the Motion read as follows:
1. The Company has adopted a Dispute Resolution Program (the 5
“Program”). (Gwarjanski Dec., Exh. 1.)
2. Sullivan twice signed an Agreement and Receipt for Alternative
Dispute Resolution (the “Agreement”), once on November 30, 2010
and once on May 28, 2008. (Gwarjanski Dec., Exhs. 2 and 3.)10
3. The Program reflects that all legal claims, including claims for
wages, that arise from employment with the Company shall be
resolved through arbitration as provided in the Program.
(Gwarjanski Dec., Exh. 1.)15
4. The Program defines the Company to include PJ United, Inc.;
certain related companies, including Sullivan’s employer, PJ
Cheese, Inc. (“PJ Cheese”); and the Company’s officers, directors,
shareholders, and employees, including Douglas Stephens. 20
(Gwarjanski Dec., Exh. 1, p. 6; Doc. 1, par. 6.)
5. Each signed Acknowledgement reflects that Sullivan received a
copy of the Program; that he read or had the opportunity to read the
Program; that he agreed that all legal claims between himself and 25
the Company, including claims for wages, “must be submitted to
binding arbitration,” that the mutual obligations set forth in the
Agreement constitute a contract between Sullivan and the Company;
that “the Company is engaged in transactions involving interstate
commerce and that [Sullivan’s] employment involves such 30
commerce,” and that Sullivan voluntarily entered into the
Agreement. (Gwarjanski Dec., Exhs. 2 and 3.)
* * * *
35
6. In each signed Agreement, Sullivan unambiguously stated: “I also
agree that any arbitration between the Company and me is of an
individual claim and that any claim subject to arbitration will not be
arbitrated on a multi-claimant, a collective or a class-wide basis.”
(Gwarjanski Dec., Exhs. 2 and 3.) The Program contains the same 40
provision. (Gwarjanski Dec., Exh. 1, p. 6.)
7. Each signed agreement constitutes a written agreement to arbitrate
within the meaning of Section 3 of the Federal Arbitration Act
(“FAA”), 9 U.S.C. § 3.45
JD(ATL)–18–14
9
8. Sullivan’s Complaint reflects a dispute concerning wages, which
dispute arises from his employment with the Company. (Doc. 1.)
8. [9.] Section 3 of the FAA requires this Court to stay the trial of this civil
action “until such arbitration has been had in accordance with the 5
terms of the agreement.”
* * *
11. The Company has submitted an arbitration demand to the American 10
Arbitration Association seeking arbitration of Sullivan’s individual
claims against the Company and therefore is not in default in
proceeding with arbitration under the signed Agreements.
WHEREFORE, the Company respectfully moves this Court to enter 15
an order staying the trial of this civil action until arbitration of
Sullivan’s dispute with the Company has been had on a single-
claimant/noncollective or class-wide basis in accordance with the
terms of the Agreements and the Programs.
20
6. On August 5, the Company filed a Response to Sullivan’s Attempt to Show
Cause. (Jt. Exh. 7.)
7. On September 10, United States District Court Judge L. Scott Coogler
issued a Memorandum of Opinion (Jt. Exh. 8) in which Judge Coogler 25
concluded the Company’s Motion to Stay Trial Pending Arbitration would
be granted, but, the Company’s request to the Court to order Sullivan to
pursue his arbitration only on a single claimant basis would be denied
because Judge Coogler concluded the arbitrator must decide whether the
collective action waiver applies in this case. 30
8. On September 10 United States District Court Judge Coogler issued an
Order (Jt. Exh. 9) in accordance with the Memorandum of Opinion set forth
above.
35
I first address the issue of whether the allegations of the complaint are time-barred. The
Company contends the entire complaint should be dismissed because it is time-barred by Section
10(b) of the Act in that the complaint is based on events that occurred outside the applicable
limitations period. Section 10(b) of the Act in part provides “. . . no complaint shall issue based
upon any unfair labor practice occurring more than six months prior to the filing of the charges 40
with the Board . . . ” It is undisputed Charging Party Sullivan signed the most recent Agreement
and Receipt for Dispute Resolution Program containing the mandatory arbitration policy, at issue
here, on November 30, 2010, well outside the 10(b) period. As noted elsewhere, here the
original charge was filed on September 23. It is alleged the Company, about July 17, has
enforced the mandatory arbitration policy, by filing a Motion to Stay Trial in the United States 45
District Court for the Northern District of Alabama, Western Division, and, by subsequent
JD(ATL)–18–14
10
responsive pleading. The allegations are within the 10(b) limitations period, but, are they
inescapably grounded in pre-10(b) events? They are not. The Company’s July 17, filing of its
Motion to Stay Trial of this (Sullivan’s) civil action in which the Company sought to stay the
proceedings until Sullivan’s dispute with the Company has been decided on a single-
claimant/noncollective or class-wide basis pursuant to the mandatory arbitration policy signed by 5
Sullivan, is clearly within the 10(b) limitation period. The enforcement action by the Company,
based on Sullivan’s signed mandatory arbitration policy agreement, took place approximately 2
months before the charge here was filed. This action, by the Company, demonstrates it was
enforcing its mandatory agreement policy within the applicable time period.
10
More specifically, I find the Company’s 10(b) defense without merit. While it is clear
Sullivan signed the mandatory arbitration agreement policy on November 30, 2010, well outside
the 10(b) period, the Company continued to maintain and enforce the mandatory arbitration
policy well into the 10(b) period. The Government’s allegation the Company has, since July 17,
2013, a time within the 10(b) period, continued to maintain its mandatory arbitration policy is 15
established. The Company’s motion filing on July 17, a time clearly within the 10(b) period,
was grounded on Sullivan’s having signed the mandatory arbitration policy in which he agreed to
arbitration on an individual basis. In these circumstances, the date Sullivan signed the
mandatory arbitration policy is not controlling or relevant. What is controlling and relevant is
the Company continued to maintain and enforce Sullivan’s signed mandatory arbitration policy20
agreement within the 10(b) period. By continuing to maintain and enforce the mandatory
arbitration policy within the 10(b) period establishes the conduct and action by the Company is
not inescapably grounded in pre-10(b) events. The Board, in Lafayette Park Hotel, 326 NLRB
824 (1998), held an employer commits a continuing violation of Section 8(a)(1) of the Act
throughout the period an unlawful rule, is maintained and enforcement is sought. Stated 25
differently, the Board has held that, where an employer, as here, enforces an unlawful rule during
the 10(b) period it violates Section 8(a)(1) of the Act. Such is a continuing violation. See:
Teamsters Local 293 (R. L. Lipton Distributing) 311 NLRB 538, 539 (1993). The continuing
violation I find here precludes the Company from a valid 10(b) defense.
30
I reject the Company’s contention that Charging Party Sullivan was not an employee of
the Company at the time the Company filed its Motion to Stay in response to his James Sullivan
v. PJ United, Inc., and Douglas Stephens Civil Action No. 7: 13-cv-01275-LSC, case. The
Company’s argument that since Sullivan voluntarily terminated his employment with the
Company outside the 10(b) limitations period his right to engage in concerted activities or file 35
actions related thereto had long ended when the Company filed its Motion to Stay. I find
Sullivan remained an employee within the meaning of the Act at all times, material herein. The
Company, for example, still considered him an employee when it filed its Motion to Stay
because the Motion to Stay was grounded on documents signed by Sullivan as an employee of
the Company.40
The Company asserts Sullivan was not engaging in “protected concerted activity” when
he filed his litigation in James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action
No.7: 13-cv-01275-LSC. The Company asserts Sullivan was not involved in any group action
when he filed his class action lawsuit because he did not seek support of others before filing his45
suit. The Company’s argument is without merit. The Board in D. R. Horton, Inc., held that
JD(ATL)–18–14
11
filing a class action lawsuit is protected concerted activity. The Board in so holding relied on
Meyers Industries, 281 NLRB 882, 887 (1986) for the proposition that the actions of a single
employee, such as Sullivan here, are protected, if the employee “seek[s] to initiate or to induce or
to prepare for group action.” D. R. Horton, Inc., slip op. at 4. The Board further held “an
individual who files a class or collective action . . . in court . . . seeks to initiate or induce group 5
action and is engaged in conduct protected by Section 7.” The filing of a class action lawsuit to
address wages, hours, and other terms and conditions of employment, as is the case here,
constitutes concerted protected activity, unless done with malice or in bad faith of which there is
none demonstrated here.
10
As noted elsewhere, here the complaint alleges the Company has violated Section 8(a)(1)
of the Act by, since about January 2010, maintaining and enforcing its mandatory arbitration
policy that unlawfully prohibits employees from engaging in protected concerted activities, and,
that leads employees reasonably to believe that they are prohibited from filing charges with the
Board.15
The arbitration policy here is mandatory. The policy in all capital letters states; “THIS
PROGRAM IS A CONDITION OF YOUR EMPLOYMENT AND IS THE EXCLUSIVE
MEANS BY WHICH THOSE PROBLEMS MAY BE RESOLVED, SO READ THE
INFORMATION IN THIS PROGRAM BOOKLET CAREFULLY.” Some of the specifically 20
stated claims subject to the mandatory arbitration policy includes, in limited part; wages, legal
claims regarding termination, discrimination based on sex, sexual orientation, religion, national
origin, age, medical condition or disability whether under federal, state or local law; and, claims
for a violation of any other noncriminal federal, state or other governmental law, statute,
regulation or ordinance. The only claims not subject to arbitration are; any claim by an 25
employee for benefits under a plan or program which provides its own binding arbitration
procedure; any statutory workers compensation claims; and, unemployment insurance claims. In
the Agreement and Receipt for Dispute Resolution Program that employees are required to sign,
reads in part; “The Company and I agree that all legal claims or disputes covered by the
Agreement must be submitted to binding arbitration and that this binding arbitration will be the 30
sole and exclusive final remedy for resolving any such claim or dispute. I also agree that any
arbitration between the Company and me is of an individual claim and that any claim subject to
arbitration will not be arbitrated on a multi-claimant, a collective or a class-wide basis.”
In looking at the overall content of the mandatory arbitration policy here, it is necessary 35
to review the rules the Board has established for doing so.
In evaluating whether a rule applied to all employees, as a condition of continued
employment, including the mandatory arbitration policy at issue here, violates Section 8(a)(1) of
the Act, the Board, as noted in D. R. Horton, Inc., at 4–6, applies its test set forth in Lutheran 40
Heritage Village-Livonia, 343 NLRB 646 (2004), citing U–Haul Co. of California, 347 NLRB
375, 377 (2006), enfd. 255 Fed. Appx. 527 (D.C. Cir. 2007). Pursuant to Lutheran Heritage the
inquiry, or test to be applied, is whether the rule explicitly restricts activities protected by Section
7 of the Act. If so, the rule is unlawful. If it does not explicitly restrict protected activity, the
finding of a violation is dependent upon a showing of one of the following: (1) employees 45
would reasonably construe the rule to prohibit Section 7 activity; (2) the rule was promulgated in
JD(ATL)–18–14
12
response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7
rights.
The Company’s mandatory arbitration policy explicitly restricts activities protected by
Section 7 of the Act and, as such, is unlawful under Section 8(a)(1) of the Act. In this regard the 5
Board in D. R. Horton, Inc., supra slip op. at 13, held an employer violates Section 8(a)(1) of the
Act “by requiring employees [as here] to waive their right to collectively pursue employment-
related claims in all forums, arbitral and judicial.” The Board noted at 10 “The right to engage in
collective action—including collective legal action—is the core substantive right protected by
the NLRA and is the foundation on which the Act and Federal labor policy rests.” Stated 10
differently, the Board in D. R. Horton, Inc., supra determined that as a condition of employment
“employers may not compel employees to waive their NLRA right to collectively pursue
litigation of employment claims in all forums arbitral and judicial.” D. R. Horton, Inc., slip op.
at 12.
15
The General Counsel also alleges the mandatory arbitration policy leads employees
reasonably to believe that they are prohibited from filing charges with the Board. I agree. The
agreement language, which in part, states: “The Company and I agree that all legal claims and
disputes covered by the agreement must be submitted to binding arbitration and that this binding
arbitration will be the sole and exclusive final remedy for resolving any such claim or dispute” 20
would lead employees to reasonably believe that employment, wage, discrimination, and
termination issues must be submitted exclusively to binding arbitration and not to the Board.
The only employment issues not subject to the mandatory arbitration policy here involves
workers compensation and unemployment insurance claims or any benefit plan that has its own
arbitration procedure. Simply stated the language of the mandatory arbitration policy here may 25
reasonably be construed, by employees, to restrict them from, concertedly or individually, filing
charges under the NLRA and such interferes with the employees Section 7 rights and violates
Section 8(a)(1) of the Act.
The Company, in its post-trial, brief notes the Government seeks, as party of any remedy, 30
the Company reimburse Charging Party Sullivan for his reasonable litigation expenses related to
the Company’s Motion to Stay in his civil action James Sullivan v. PJ United, Inc., and Douglas
Stephens Civil Action No. 7: 13-cv-01275-LSC. The Company contends the requested relief
cannot be granted because PJ Cheese, the Company here, did not file the Motion to Stay in the
civil action but rather PJ United, which is not named as a party in this proceeding, filed the 35
action.
I find no merit in the Company’s contention. First, I note PJ Cheese is a wholly-owned
subsidiary of PJ United. PJ United adopted the Dispute Resolution Program for its PJ Cheese
employees. The Acknowledgement and Receipt for the Dispute Resolution Program that 40
Charging Party Sullivan signed was used by the Company in its defense to the civil action
brought by Sullivan against PJ United. In fact, without the Company’s (PJ Cheese) active
participation in the civil suit PJ United would not have had, or been able to advance, the defense
it did in Charging Party Sullivan’s civil suit. Stated differently, PJ United lacked any agreement
with Charging Party Sullivan and in order to prevail in the civil suit, as it did, PJ United needed,45
and obtained, the Company here, PJ Cheese’s, direct participation in its legal defense based on
JD(ATL)–18–14
13
provisions of the Dispute Resolution Program. I note Company (PJ Cheese) Director of Human
Resources Becky Gwarjanski provided a sworn declaration in PJ United’s defense outlining the
fact Charging Party Sullivan had signed and was bound by the Dispute Resolution Program for
employees of the Company here (PJ Cheese). The Company’s actions directly caused the
accrual of legal fees and I conclude Charging Party Sullivan should be compensated for those 5
expenses as explained in the Remedy section of the decision.
CONCLUSIONS OF LAW
1. The Company, PJ Cheese, Inc., Birmingham, Alabama is, and has been, an 10
employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act.
2. By maintaining a mandatory arbitration policy, that waives the right of its
employees to maintain class or collective actions in all forums, judicial or arbitral, the Company
has engaged in unfair labor practices affecting commerce within the meaning of Section 2(6) 15
and (7) of the Act and violates Section 8(a)(1) of the Act.
3. By maintaining a mandatory arbitration policy, that leads employees reasonably
to believe they are prohibited from filing charges with the National Labor Relations Board the
Company has engaged in unfair labor practices affecting commerce within the meaning of 20
Section 2(6) and (7) of the Act and violates Section 8(a)(1) of the Act.
4. By, on July 17, 2013, enforcing the mandatory arbitration agreement by asserting
the provisions thereof in litigation brought against the Company in James Sullivan v. PJ United,
Inc., and Douglas Stephens Civil Action No. 7: 13-cv-01275-LSC and by filing a motion to, in 25
essence, compel plaintiffs to individually arbitrate their class-wide wage and hour claims against
the Company, the Company has engaged in unfair labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act and has violated Section 8(a)(1) of the Act.
REMEDY30
Having found the Company has engaged in certain unfair labor practices, I shall
recommend it cease and desist therefrom and take certain affirmative action designated to
effectuate the policies of the Act.
35
I recommend the Company be ordered to rescind, modify or revise its mandatory
arbitration policy to clearly inform its employees the agreement does not constitute a waiver, in
all forums, of their right to maintain employment-related class or collective actions and/or to
prohibit them from filing charges with the National Labor Relations Board, and, to notify its
employees the mandatory arbitration policy has been rescinded, modified or revised and provide 40
a copy of any modified or revised agreement to all employees.
I recommend the Company be required to reimburse Charging Party James Sullivan for
any litigation and related expenses, with interest to-date, and in the future, directly related to the
Company’s filings in James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No.45
7: 13-cv-01275-LSC. See: Federal Security, Inc., 359 NLRB No. 1, slip op. at 14 (2012).
JD(ATL)–18–14
14
Determining the applicable rate of interest on the reimbursement will be as outlined in New
Horizons for the Retarded, 283 NLRB 1173 (1987), (adopting the Internal Revenue Service rate
for underpayment of Federal taxes). Interest on all amounts due to Charging Party Sullivan shall
be computed on a daily bases as prescribed in Kentucky River Medical Center, 356 NLRB No. 8
(2010). 5
I recommend the Company be required upon request, to file a joint motion with Charging
Party James Sullivan to vacate United States District Court Judge L. Scott Coogler’s Order of
September 10, 2013, granting the Company’s motion to stay the trial of Sullivan’s civil action in
James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No.7: 13-cv-01275-LSC. 10
See: Federal Security, Inc., supra.
On these findings of fact and conclusions of law and on the entire record, I issue
the following recommended7
15
ORDER
The Company, PJ Cheese, Birmingham, Alabama, it officers, agents, successors, and
assigns, shall
20
1. Cease and desist form
(a) Maintaining a mandatory arbitration policy, that waives employees’ right
to maintain class or collective actions in all forums; whether arbitral or judicial.
25
(b) Maintaining a mandatory arbitration policy that leads employees
reasonably to believe that they are prohibited from filing charges with the National Labor
Relations Board.
(c) Seeking to enforce its mandatory arbitration policy by filings in any court 30
to compel individual arbitration pursuant to the terms of its mandatory arbitration policy.
(d) In any like or related manner, interfering with, restraining or coercing
employees in the exercise of their right under the Act.
35
2. Take the following affirmative action designed to effectuate the policies of the
Act.
(a) Within 7 calendar days after the Board enters its Decision, and upon
request of Charging Party James Sullivan, file a joint motion with Sullivan to vacate United 40
States District Court Judge L. Scott Coogler’s Order of September 10, 2013, granting the
Company’s motion to stay the trial of Sullivan’s civil action in James Sullivan v. PJ United, Inc.,
and Douglas Stephens Civil Action No. 7: 13-cv-01275-LSC.

7 If no exceptions are filed provided by Section 102.46 of the Board’s Rules and Regulations, the findings,
conclusions, and recommended Order shall, as provided in Section 201.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all purposes.
JD(ATL)–18–14
15
(b) Reimburse Charging Party James Sullivan for any legal and related
expenses incurred, to-date and in the future, with respect to James Sullivan v. PJ United, Inc.,
and Douglas Stephens Civil Action No. 7: 13-cv-01275-LSC, with interest, as described in the
remedy section of this decision.5
(c) Rescind, modify or revise its mandatory arbitration policy to ensure its
employees the mandatory arbitration policy does not contain or constitute a waiver, in all forums,
of their right to maintain employment-related class or collective actions.
10
(d) Rescind, modify or revise its mandatory arbitration policy to ensure its
employees the mandatory arbitration policy does not prohibit them from filing charges with the
National Labor Relations Board.
(e) Notify its employees of the rescinded, modified or revised mandatory 15
arbitration policy and provide a copy of any modified or revised policy to each employee.
(f) Within 14 days after service by the Region, post at its Birmingham,
Alabama facility, copies of the notice marked “Appendix.”8 Copies of the notice, on forms
provided by the Regional Director for Region 10, after being signed by the Company’s 20
authorized representative, shall be posted by the Company and maintained for 60 consecutive
days in conspicuous places including all places where notices to employees are customarily
posted. Reasonable steps shall be taken by the Company to ensure that the notices are not
altered, defaced, or covered by any other material. In addition to the physical posting of paper
notices, notices shall be distributed electronically, such as email, posting on an intranet or an 25
internet site, or other electronic means, if the Company customarily communicates with its
employees by such means. In the event that, during the pendency of these proceedings, the
Company has gone out of business or closed the facility involved in these proceedings, the
Company shall duplicate and mail, at its own expense, a copy of the notice to all current
employees and former employees employed by the Company at any time since July 17, 2013.30
Dated at Washington, D.C., June 6, 2014
35
______________________________
William Nelson Cates
Administrative Law Judge

8 If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading
“Posted by Order of the National Labor Relations Board” shall read “Posted Pursuant to a Judgment the
United States Court of Appeals Enforcing an Order of the National Labor Relations Board.”
JD(ATL)–18–14
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 Federal labor law and has
ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
WE WILL NOT maintain or enforce a mandatory arbitration policy that waives employees’
right to maintain class or collective action in all forums, arbitral or judicial.
WE WILL NOT maintain or enforce a mandatory arbitration policy that prohibits you from
filing charges with the National Labor Relations Board.
WE WILL NOT enforce, or attempt to enforce, any agreement, by filing petition(s) in any
court, to compel you to individually arbitrate your work related concerns.
WE WILL NOT in any like or related manner, interfere with, restrain, or coerce employees in
the exercise of their rights under the Act.
WE WILL within 7 days after the Board Order, and, upon request of Charging Party James
Sullivan, file a joint motion to vacate United States District Court Judge L. Scott Coogler’s
Order of September 10, 2013, granting the Company’s motion to stay the trial of Sullivan’s civil
action in James Sullivan v. PJ United, Inc., and Douglas Stephens Civil Action No. 7: 13-cv-
01275-LSC.
WE WILL reimburse Charging Party James Sullivan any reasonable legal and other expenses
incurred related to our various responses to his civil action in James Sullivan v. PJ United, Inc.,
and Douglas Stephens Civil Action No. 7: 13-cv-01275-LSC, plus interest.
WE WILL rescind, modify or revise our mandatory arbitration policy to make clear to you our
policy does not constitute a waiver in all forums of your right to maintain employment-related
class or collective actions and to make clear to you our policy does not prohibit filing charges
with the National Labor Relations Board.
JD(ATL)–18–14
WE WILL notify our employees we have rescinded, modified or revised our mandatory
arbitration policy and provide each of you a copy of any revised or modified policy.
PJ CHEESE, INC.
(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.
233 Peachtree Street, NE, Harris Tower, Suite 1000, Atlanta, Georgia 30303-1531
(404) 331-2896, Hours: 8:00 a.m. to 4:30 p.m.
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/10-CA-113862 or by using the
QR code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National
Labor Relations Board, 1099 14th Street, N.W., 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, (205) 933-3013