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Wells Fargo Guard Services v. National Labor Relations Board

decided: September 15, 1981.



Before Adams, Hunter and Sloviter, Circuit Judges.

Author: Hunter


This case is before the Court on a petition filed pursuant to sections 10(e) and (f) of the National Labor Relations Act (29 U.S.C. §§ 160(e) and (f)) by Wells Fargo Guard Services, Inc. ("Wells Fargo") to review, and a cross-application of the National Labor Relations Board ("NLRB", "Board") to enforce, an order issued by the NLRB against Wells Fargo. The order directs Wells Fargo to bargain collectively with the United Security Guard Guild ("Guild"), and is based upon the Board's decision that Wells Fargo had refused to bargain with the Guild in violation of sections 8(a)(1) and (5) of the National Labor Relations Act (29 U.S.C. §§ 158(a)(1) and (5)).

Whether Wells Fargo committed an unfair labor practice by refusing to bargain with the Guild depends upon whether the Board's certification of the Guild as the exclusive bargaining agent of the Wells Fargo employees was correct. Wells Fargo contends that the Guild should not have been certified by the NLRB because the Guild engaged in improper conduct in the course of the campaign prior to the election won by the Guild. The NLRB rejected Wells Fargo's contentions during the certification proceedings without holding an evidentiary hearing and refused to reconsider them during the unfair labor practice hearing. We conclude that the NLRB's certification decision should not have been reached without holding an evidentiary hearing on one of the alleged pre-election improprieties. Since the Guild was not properly certified as the bargaining representative, Wells Fargo committed no unfair labor practice when it refused to bargain. Wells Fargo will be granted a hearing as set forth below, the Board's petition for enforcement will be denied, and the case will be remanded to the NLRB.


On December 28, 1978, the United Security Guard Guild ("Guild") filed a petition with the National Labor Relations Board requesting that the Guild be certified as the exclusive bargaining agent for the security guards employed at the Lawrenceville branch of Wells Fargo Guard Services ("Wells Fargo"). In a letter sent by the Guild to the security guards in or around November 1978, Harry J. Martin, the president of the Guild, had introduced himself and the Guild to the guards. That letter contains the following paragraph: "Incidently (sic ), I have heard rumors to the effect that my character is questionable and some go as far as to say that I am wanted by the Federal Bureau of Investigation. Well, they have my address and phone number if they want me." Appendix at 165. In a letter dated November 28, 1978 from Wells Fargo to its employees, Wells Fargo included the following as the opening paragraph:

As some of you may know, Harry Martin, an individual who worked for Wells Fargo as a Field Inspector in 1976, is attempting to form a union and to organize our Trenton Office employees. He is calling his union the "UNITED SECURITY GUARD GUILD". He has drawn up a constitution and bylaws under which he has had himself named President and his wife Secretary Treasurer. Martin's union does not now and never has represented any employees of any company. He has never previously organized a union and has never negotiated a union contract. To our knowledge he has no experience whatever in organizing or running a union. By his own admission, Wells Fargo is his first target.

Appendix at 167.

On January 12, 1979, a hearing was held before Louis Verrone, Esq., a Hearing Officer of the NLRB, on the question of whether the Guild was in violation of section 9(b)(3) of the National Labor Relations Act, (29 U.S.C. § 159(b)(3)) which forbids affiliations between unions which have guards as members and unions which do not.*fn1 At the hearing, Harry J. Martin, president of the Guild, testified that he founded the Guild in May 1978 and registered it with the Department of Labor in November 1978. Appendix at 16. At the time of the hearing, the Guild had no members, no funds, and no paid employees. Appendix at 23, 34-39. Mr. Martin further testified that "I consider that I am the United Security Guard Guild." Appendix at 41.*fn2

On January 22, 1979, the hearing officer issued a decision in which he found that the Guild was not in violation of section 9(b)(3) of the National Labor Relations Act and directed that an election be held. Wells Fargo did not appeal from that decision.

The campaign recommenced, and the Guild and Wells Fargo each stated its case in numerous pieces of campaign literature. On or about February 9, 1979, Wells Fargo wrote a letter to its employees on the character and police record of Mr. Martin. Appendix at 178-79. On or about February 12, 1979, Mr. Martin wrote the following in a letter to the guards, defending himself and his character:

My sincere thanks to the many of you who called me on Saturday to inform me of TITKO'S (the Wells Fargo Branch Manager) latest SMEAR CAMPAIGN ....



I am not going to try to defend my mistakes of 20 YEARS AGO, but I will say this, I was not born with a silver spoon in my mouth .... I found out (one) thing during this (campaign) BATTLE; I am up against the best PROPAGANDISTS in the business, but the more THEY try to KNOCK ME DOWN, the more DETERMINED I AM TO FIGHT ON. They know that I can never be BOUGHT OFF, so they STOOP LOW to pick the bones of a roguish kid of 20 YEARS AGO.

Appendix at 236.

On or about February 14, 1979, Wells Fargo distributed materials to its employees which included the information that Mr. Martin, under the alias of Harry Meehan, had pled guilty to and been sentenced to jail for felonious assault and robbery at age 18, had been sentenced to jail for auto larceny at age 20, and in 1962 at age 30 had pled guilty to charges of unlawful possession of a gun and assault and battery and been required to pay restitution to the victim. Appendix at 184-89.

A mailed-ballot election was held between February 16 and February 28, 1979. One of the pieces of campaign literature distributed by Wells Fargo at the beginning of that period was a two-page letter accompanied by a one-page sample ballot. Appendix at 104-06. The first page of the letter and the sample ballot were duplicated onto Wells Fargo letterhead, which is printed in blue and red ink. In the letter, George Titko, the branch manager, explained NLRB voting procedures and encouraged employees to vote against the Guild. The sample ballot consisted of a page of Wells Fargo letterhead in blue and red, with the sample ballot duplicated beneath the letterhead. The ballot was marked "sample" across its face, and was designated a sample ballot in printing beneath the ballot itself. Beneath the second sample ballot designation was printed the following:


Beneath that sentence was printed "George M. Titko, Branch Manager." The "no" box on the ballot was filled by an X which, though duplicated like the rest of the sample ballot in black ink, was irregular in shape.

The Guild lost the February 1979 election by eight votes (62 to 54, with approximately 172 eligible to vote and 120 ballots cast). On March 6, 1979, the Guild filed objections to the election, but pursued only one objection: that Wells Fargo had impermissibly distributed a facsimile ballot before the election in violation of the rule of Allied Electric Products Inc., 109 NLRB 1270 (1954).

On March 23, 1979, Arthur Eisenberg, Regional Director of the National Labor Relations Board, issued a Supplemental Decision, Order and Direction of Second Election after conducting an investigation and allowing the parties to submit evidence. In his decision, the Regional Director ruled that the distribution of the facsimile ballot rendered the election invalid under Allied Electric. He concluded that the distribution of the facsimile ballot had interfered with the election, particularly in light of the facts that an X had been placed in the "no" box, that the facsimiles had been mailed out on the same day as the real ballots, and that the NLRB has a history of "strict and continuing adherence" to the Allied Electric doctrine. The Regional Director also decided that the presence of the letterhead, the "sample" designations and the partisan message were insufficient to "neutralize" the impact of the facsimile. Appendix at 110-11. He ordered that a second election be held. The NLRB denied Wells Fargo's request for review, and the second campaign began shortly thereafter.

In early April, 1979, Mr. Martin/Meehan wrote a letter to the security guards in ...

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