St. Vincent Hospital

National Labor Relations Board - Administrative Judge Opinions

Aug 4, 2004

28-CA-019039 (N.L.R.B. Aug. 4, 2004)

JD(SF)–61–04
Santa Fe, NM

UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
SAN FRANCISCO DIVISION OF JUDGES

ST. VINCENT HOSPITAL

and Case 28-CA-19039

NATIONAL UNION OF HOSPITAL
AND HEALTH CARE EMPLOYEES
DISTRICT 1199 NM, AFSCME, AFL-CIO

John T. Giannopoulos, Esq., of Phoenix, Arizona,
for the General Counsel
George Cherpelis, Esq. of Scottsdale, Arizona,
and Danny W. Jarrett, Esq., of
Albuquerque, New Mexico, for the
Respondent
Shirley Cruse, of Santa Fe, New Mexico,
Lead Negotiator for Respondent’s Nursing
and Technical Units, National Union of Hospital and
Health Care Employees, District 1199NM,
AFSCME, AFL-CIO

DECISION

Mary Miller Cracraft, Administrative Law Judge: At issue is whether St. Vincent Hospital
(Respondent) violated Section 8(a)(1) and (5) of the National Labor Relations Act (the Act)1

• by unilaterally granting sign-on and/or relocation bonuses to applicants for employment
and unilaterally granting a transfer bonus to an employee without prior notice to National
Union of Hospital and Health Care Employees District 1199NM, AFSCME, AFL-CIO (the
Union) and without affording the Union an opportunity to bargain regarding the bonuses
and the effects of these bonuses;

• by refusing to bargain with the Union regarding sign-on bonuses and relocation bonuses
to be offered to applicants for employment;

• by bypassing the Union and dealing directly with unit employees regarding sign-on and
relocation bonuses and a transfer bonus.
1 Sec. 8(a)(1) of the National Labor Relations Act, 29 U.S.C. Sec. 158(a)(1), provides, as
relevant here, that it is an unfair labor practice for an employer to interfere with, restrain, or
coerce employees in their right to engage in union activities. Sec. 8(a)(5) of the Act, 29 U.S.C.
Sec. 158(a)(5) provides that it is an unfair labor practice for an employer to refuse to bargain
collectively with a duly designated representative of its employees.

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On the entire record, 2 including my observation of the demeanor of the witnesses,3 and
after considering the briefs filed by counsel for the General Counsel and counsel for the
Respondent, I make the following

Findings of Fact

I. Jurisdiction and Labor Organization Status

Respondent is a New Mexico nonprofit corporation with an office and place of business
in Santa Fe, New Mexico, where it is engaged in the operation of a general acute care hospital.
During the 12-month period ending October 3, 2003, Respondent derived gross revenues in
excess of $250,000 and purchased and received goods valued in excess of $50,000 directly
from points outside the State of New Mexico. Respondent admits and I find that it is an
employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act and
is a health care institution within the meaning of Section 2(14) of the Act. Respondent admits
and I find that the Union is a labor organization within the meaning of Section 2(5) of the Act.

II. Alleged Unfair Labor Practices

A. Background

Respondent recognizes the Union as the exclusive collective-bargaining representative
of two units of employees: a nursing unit and a technical unit. In 1978, in Case 28-AC-28, the
Union was certified as the exclusive collective-bargaining representative of a unit of nurses, an
appropriate unit within the meaning of Section 9(b) of the Act. At all times since 1978, the Union
has been the exclusive collective-bargaining representative of the nurses unit based on Section
9(a) of the Act. The nurses unit is described as follows:

All registered nurses and licensed practical nurses employed by Respondent,
excluding all other employees, all other professional and technical employees,
confidential employees, clerical employees, aides, orderlies, dieticians,
pharmacists, head nurses, guards, watchmen, and supervisors as defined in the
Act as amended.

In 1989, in Case 28-RC-4642, the Union was certified as the exclusive collective-
bargaining representative of a unit of technicians, an appropriate unit within the meaning of
Section 9(b) of the Act. At all times since 1989, the Union has been the exclusive collective-
bargaining representative of the technicians unit based on Section 9(a) of the Act. The technical
unit is described as follows:

2 This case was tried in Santa Fe, New Mexico, on April 27 and 28, 2004. The charge and
amended charge were filed by the Union on October 3, 2003, and December 19, 2003,
respectively. Complaint issued on December 30, 2003. General Counsel’s motion to correct the
transcript is hereby granted. The motion to supplement GCEx. 2 with 2 missing pages is
unnecessary as the official version of the exhibit is not missing those pages.
3 Credibility resolutions have been made based upon witness demeanor, the weight of
respective evidence, established or admitted facts, inherent probabilities, and reasonable
inferences drawn from the record as a whole. Testimony contrary to my findings has been
discredited on some occasions because it was in conflict with credited testimony or documents
or because it was inherently incredible and unworthy of belief.

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All respiratory therapists, x-ray technicians, radiation therapists, EKG
technicians, EEG technicians, and Polysom technicians, excluding all other
employees, all professional employees, casual employees, guards, watchmen
and supervisors as defined in the Act.

B. Pre-April 2003 Sign-on and Relocation Bonus Plan and Transfer Bonus Plan

The issues in this case arise from the current nationwide shortage of nurses. In 2002,
Respondent began hiring contract nurses or travelers for specified periods of time, usually 13
weeks, to supplement its work force. The expense of travelers is far greater than the expense of
a permanent employee. Respondent and the Union agreed to limit the number of travelers hired
by Respondent.

Although Respondent has been offering a $2000 recruitment bonus to nurse-applicants
since 2001, by August 2002 Respondent nevertheless had 44 vacancies for registered nurses.
Pauline Welborn-Brown, vice-president of human resources, leadership and learning, was
charged with creating a strategy for successful recruitment of permanent nursing staff. Welborn-
Brown’s plan encompassed hiring a professional nurse recruiter as well as offering up to an
$8000 sign-on bonus in addition to a $2000 relocation bonus, already in existence.

Respondent structured the $8000 sign-on bonus to be paid out over a period of 3 years.
One thousand dollars was paid after 6 months’ employment; another $1000 at 12 months; then
$1500 at 18, 24, 30, and 36 months. Each time the bonus was earned, it was reflected as
wages for tax purposes and withholdings, including FICA withholdings, were made from the
bonus amount. If the nurse did not remain employed for the entire 3-year pay out period, the
nurse forfeited whatever amount of bonus remained to be paid.

On August 21, 2002, a regular Wednesday labor management meeting took place.
Present were Jane Brantley, director of human resources; Delma DeLora, president of the
nurses’ unit; Shirley Cruse, head of the technicians’ unit and lead negotiator for both units;
Crystal VonWhipperman, director of clinical recruitment and retention; and Welborn-Brown.
Welborn-Brown explained to DeLora and Cruse that VonWhipperman had been hired to
address the nursing shortage. VonWhipperman then explained the entire bonus program
including an $8000 applicant sign-on bonus as well as bonuses for current employees. In fact,
the $8000 applicant sign-on bonus was already in effect at the time of this meeting. It was
probably instituted a few weeks before the meeting. All parties agree that the Union was not
given notice or an opportunity to bargain with respect to the $8000 applicant sign-on bonus prior
to its implementation.

At the August 21, 2002, meeting, neither Welborn-Brown nor VonWhipperman
specifically suggested bargaining with the Union about the bonus program or any part of the
bonus program. Brantley explained that Respondent asked what the Union thought about the
recruitment program, including the bonuses. At the end of the presentation, DeLora testified that
she requested that Welborn-Brown provide her a written description of the bonus plan. Welborn-
Brown denied that she was asked to prepare a written description of the entire bonus program
including applicant sign-on bonuses. Welborn-Brown recalled that DeLora asked for something
in writing relating to current employees. VonWhipperman agreed with Welborn-Brown’s
testimony. Brantley did not recall any discussion about preparation of a memorandum of
understanding.

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In any event, by memorandum of understanding dated October 1, 2002, from Welborn-
Brown to DeLora, the portion of the bonus program relevant to current nurses was set forth.
Nurses who were willing to transfer to any hard to fill unit including “ICU/CCU/PCU/ED &
Med/Surg” were eligible for the bonus. Welborn-Brown also outlined the portion of the bonus
program relevant to “ICU/CCU/PCU/ED & Med/Surg” per diem nurses who were willing to
convert from per diem status to full-time employment in the hard to fill units. The memorandum
concluded: “We would like to offer the above bonus program to current employees starting
October 10, 2002. We would like your formal acceptance of this program. Please respond no
later than Thursday October 3 at 12 noon.”

On October 20, 2002, Respondent and the Union signed the memorandum of October 1,
2002, which offered an internal $8000 bonus for unit nurses who transferred into hard-to-fill
positions on a full-time basis and per diem nurses in the hard-to-fill units who agreed to transfer
to full-time employee status from their per diem status. In order to qualify, the terms of the
agreement required that individuals opt to take advantage of the internal bonus program
between October 10 and November 19, 2002.

Thus, at least by October 2002, Respondent’s standard hiring process contemplated a
job offer to the applicant as well as the offer of up to an $8000 sign-on bonus and a relocation
bonus. Once these terms were agreed to, Respondent verified the applicant’s licensure and
references and the applicant was required to prove physical fitness for the job. Drug screening
and current immunizations were checked. Once these requirements were satisfactorily met, the
individual was allowed to begin work for Respondent. In many cases, the applicant did not sign
the sign-on bonus agreement until after his or her first day of employment.

C. Alleged unilateral grant of sign-on and relocation bonuses to applicants;
Alleged direct dealing

The parties agree that from April to October 2003, Respondent awarded sign-on
bonuses to Mary Kallenberg, Sherri Chavez, Karen Golus, Kristine Kaskey, and Heather
Schultz. The Union was not involved in discussions between these applicants/employees and
Respondent even though some of these discussions occurred after employment began.

D. Alleged unilateral grant of a transfer bonus to a current employee; Alleged direct
dealing

DeLora and Welborn-Brown executed a second memorandum of understanding on April
9, 2003. It offered an $8000 bonus to per diem nurses who transferred to full-time employment
during the 30-day window from April 1 to April 30, 2003.

Per diem nurse Kathy Raymore transferred pursuant to this program on April 7, 2003.
Although the program was not in effect in July, nevertheless, per diem nurse Damon Lewis
transferred effective July 15, 2003, pursuant to the terms of the second memorandum of
understanding but outside the dates April 1 to April 30, 2003. Respondent concedes that Lewis
transferred outside the timeframe envisioned in the second memorandum of understanding.
This was the only instance of transfer outside the time limits of the second memorandum of
understanding. After receiving the first $1000 installment of the sign-on bonus, Lewis requested
transfer from full-time to per diem status. The Union was not involved in any of the discussions
between Lewis and Respondent.

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E. Alleged refusal to bargain regarding sign-on and relocation bonuses

The parties’ nursing and technical contracts contemplate midterm wage reopening. The
parties may also select additional topics to negotiate. The third midterm negotiation session was
held on September 4, 2003. Present for Respondent were vice-president and general counsel
Alex Valdez; Tom Finley, professional negotiator for Respondent; Brantley; and Jackie Laing,
former chief nursing director.4 Present for the Union were Shirley Cruse, lead Union negotiator
for both the nursing and technical units; and Delma DeLora, head of the nursing unit. At this
meeting the Union presented proposals for applicant sign-on and relocation bonuses and
requested bargaining.

On September 24, 2003, Respondent refused to bargain regarding applicant sign-on and
relocation bonuses. Respondent’s position was that applicants for employment were not
employees within the bargaining unit and, therefore, Respondent had no duty to bargain
regarding their bonuses.

F. Analysis

Although applicants are not “employees” for purposes of Section 8(a)(5) of the Act,5 the
sign-on and relocation bonuses paid to applicants, when they become employees, are wages.6
Thus, the sign-on and relocation bonuses have more than an “indirect or incidental impact on
unit employees.”7 Because the subject of new hire wages “materially or significantly affects unit
employees’ terms and conditions of employment,”8 Respondent was required to bargain
regarding the sign-on and relocation bonuses.9 Finally, the Union did not clearly and
unmistakably waive the right to bargain by agreeing to management rights clauses that ceded
generally to Respondent the right to hire.10 Thus I find that Respondent violated the Act by
unilaterally granting sign-on and relocation bonuses to applicants for employment without prior
notice to the Union, by dealing directly with employees regarding these sign-on and relocation
bonuses, and by refusing to bargain with the Union regarding sign-on bonuses and relocation
bonuses to be offered to applicants for employment. Finally, I find that Respondent bypassed
the Union and dealt directly with unit employees regarding the sign-on bonuses and relocation
bonuses and a transfer bonus.11

4 The current chief nursing director was on a pre-planned vacation. Laing sat in to assist
Respondent’s negotiators on nursing issues.
5 Star Tribune, 295 NLRB 543, 546 (1989); see generally, Allied Chemical & Alkali Workers
v. Pittsburgh Plate Glass Co., 404 U.S. 157, 164 (1971)(“This obligation [to bargain collectively]
extends only to the ‘terms and conditions of employment’ of the employer’s ‘employees in the
unit appropriate for such purposes’ that the union represents.”)
6 Richfield Oil Corp., 110 NLRB 356, 359 (1954), enfd. 231 F.2d 717, 724 (1st Cir. 1956),
cert. denied, 351 U.S. 909 (1956), relied upon by counsel for the General Counsel.
7 United Technologies Corp., 274 NLRB 1069 (1985), enfd. 789 F.2d 121 (2d Cir. 1986).
8 Id. Additionally, although selection of individuals for hire may be entrepreneurial in nature,
the calculation of relocation and sign-on bonuses is not.
9 Monterey Newspapers, Inc., 334 NLRB 1019, 1020 (2001)(“We agree with the judge that
the wage rates that job applicants were offered (and, thus, that newly hired employees were
paid) are mandatory subjects of bargaining.”)
10 See, e.g., Johnson-Bateman Co., 295 NLRB 180, 184 (1989).
11 Respondent’s communications with represented employees regarding wages, to the
exclusion of the Union, constitutes direct dealing. See, e.g., United Technologies Corp., 274
NLRB 1069, 1074 (1985).

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Conclusions of Law

1. By granting sign-on and relocation bonuses to applicants for employment and by
granting a transfer bonus to an employee without prior notice to the Union and
without affording the Union an opportunity to bargain with Respondent with
respect to this conduct and the effects of this conduct, Respondent has engaged
in unfair labor practices affecting commerce within the meaning of Section 8(a)(1)
and (5) and Section 2(6) and (7) of the Act.

2. By refusing to bargain collectively with the Union about sign-on and relocation
bonuses to be offered to applicants for employment, Respondent violated
Section 8(a)(1) and (5) of the Act.

3. By bypassing the Union and dealing directly with unit employees regarding sign-
on and relocation bonuses and a transfer bonus, Respondent violated Section
8(a)(1) and (5) of the Act.

Remedy

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.

On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended12

ORDER

Respondent, St. Vincent Hospital, Santa Fe, New Mexico, its officers, agents,
successors, and assigns, shall

1. Cease and desist from

a. Granting sign-on and relocation bonuses to applicants for employment
without prior notice to the Union and without affording the Union an
opportunity to bargain with Respondent with respect to this conduct and
the effects of this conduct.

b. Refusing to bargain collectively with the Union about sign-on and
relocation bonuses to be offered to applicants for employment.

c. Bypassing the Union as the exclusive representative of employees in the
nurses and technical bargaining units and dealing directly with them by
granting sign-on and relocation bonuses and a transfer bonus.

12 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.

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d. Refusing to bargain collectively with the Union about sign-on and
relocation bonuses to be offered to applicants in the nurses and technical
units.

e. 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.

2. Take the following affirmative action necessary to effectuate the policies of the
Act.

a. On request, bargain with the Union as the exclusive representative of the
employees in the following appropriate units concerning sign-on and
relocation bonuses for applicants for employment and transfer bonuses
for current employees, and, if an understanding is reached, embody the
understanding in a signed agreement:

Nurses Unit: All registered nurses and licensed practical nurses employed
by Respondent, excluding all other employees, all other professional and
technical employees, confidential employees, clerical employees, aides,
orderlies, dieticians, pharmacists, head nurses, guards, watchmen, and
supervisors as defined in the Act as amended.

Technical Unit: All respiratory therapists, x-ray technicians, radiation
therapists, EKG technicians, EEG technicians, and Polysom technicians,
excluding all other employees, all professional employees, casual
employees, guards, watchmen and supervisors as defined in the Act.

b. Within 14 days after service by the Region, post at its facility in Santa Fe,
New Mexico, copies of the attached Notice marked “Appendix.”13 Copies
of the Notice, on forms provided by the Regional Director for Region 28,
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. Reasonable steps shall be taken by the Respondent
to ensure that the Notices are not altered, defaced, or covered by any
other material. In the event that, during the pendency of these
proceedings, the Respondent has gone out of business or closed the
facility involved in these proceedings, the Respondent shall duplicate and
mail, at its own expense, a copy of the Notice to all current employees
and former employees employed by the Respondent at any time since
April 7, 2003.
13 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 of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”

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c. 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 August 4, 2004
San Francisco, California

____________________
Mary Miller Cracraft
Administrative Law Judge

JD(SF)–61–04
Santa Fe, NM
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 grant sign-on and relocation bonuses to applicants for employment or transfer bonuses to current
employees without prior notice to National Union of Hospital and Health Care Employees District 1199NM, AFSCME,
AFL-CIO and without affording the Union an opportunity to bargain with us with respect to the bonuses and the effect
of the bonuses.

WE WILL NOT refuse to bargain collectively with the Union about sign-on and relocation bonuses to be offered to
applicants for employment.

WE WILL NOT bypass the Union and deal directly with unit employees regarding sign-on and relocation bonuses and
transfer bonuses.

WE WILL NOT in any like or related manner, interfere with, restrain, or coerce you in the exercise of your rights.

WE WILL, upon request, bargain with the Union as the exclusive representative of employees in the Nurses Unit and
the Technical Unit concerning sign-on and relocation bonuses and transfer bonuses and WE WILL embody any
understanding reached in a signed agreement.

St. Vincent Hospital
(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.
2600 North Central Avenue, Suite 1800, Phoenix, AZ 85004-3099
(602) 640-2160, Hours: 8:15 a.m. to 4:45 p.m.
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, (602) 640-2146.