Milwaukee City Center, LLC

National Labor Relations Board - Board Decisions

Sep 21, 2009

354 N.L.R.B. 551 (N.L.R.B. 2009)

354 NLRB No. 77
1
NOTICE: This opinion is subject to formal revision before publication in the
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Milwaukee City Center, LLC and Unite Here, Local
122, AFL–CIO, Petitioner. Case 30–UC–419
September 21, 2009
DECISION ON REVIEW AND ORDER
BY CHAIRMAN LIEBMAN AND MEMBER SCHAUMBER
The issue presented is whether the Regional Director
properly accreted the Employer’s employees who work
as baristas and head baristas at a franchise Starbucks
coffee shop located in the Employer’s hotel to the exist-
ing bargaining unit of food, beverage, and other hotel
employees.1 On February 23, 2007, the Regional Direc-
tor for Region 30 issued a Decision and Order granting
petition for unit clarification. The Regional Director
clarified the existing bargaining unit to include the ap-
proximately 10 to 12 baristas and 2 head baristas work-
ing at the Starbucks coffee shop.2
Thereafter, in accordance with Section 102.67 of the
National Labor Relations Board Rules and Regulations,
the Employer filed a timely request for review of the
Regional Director’s decision. The Employer contended
that the Regional Director failed to follow the well-
established accretion standard set forth in Safeway
Stores, 256 NLRB 918 (1981), and that under this stan-
dard,3 the Regional Director erred in accreting the baris-
tas and head baristas to the existing unit. On April 25,
2007, the Board granted in relevant part the Employer’s
request for review.4

1 The Petitioner represents all employees who prepare and serve
food and beverages at the bars and restaurants within the Employer’s
hotel. The Petitioner represents, inter alia, housekeeping, housekeeping
leads, housepersons, lobby porters, night cleaners/turn downs, bellper-
sons, servers, banquet servers, banquet captains, banquet setups, ban-
quet setup supervisors, bartenders, Cabana Cove attendants, extra bar-
tenders, bar porters, beverage supervisors, cocktail servers, cooks,
stewards, food runners, and expediters.
2 The Regional Director also found that the head baristas are not su-
pervisors under Sec. 2(11) of the Act. No party sought review of this
finding.
3 See Safeway Stores, 256 NLRB at 918 (footnotes omitted) (“[T]he
Board has found a valid accretion only when the additional employees
have little or no separate group identity and thus cannot be considered
to be a separate appropriate unit and when the additional employees
share an overwhelming community of interest with the preexisting unit
to which they are accreted.”).
4 The Employer also contended in its request for review that the Re-
gional Director erred by declining to defer to an arbitration award that
denied the Union’s grievance seeking to include the baristas and head
baristas in the existing hotel bargaining unit. The Board denied review
on this issue.
We have carefully considered the entire record.5 Con-
trary to the Regional Director, we have decided, under
the standard set forth in Safeway Stores, supra, and for
the reasons set forth below, that the baristas and head
baristas cannot be accreted to the existing unit. Accord-
ingly, we reverse the Regional Director’s decision to
accrete the baristas and head baristas to the existing unit,
and dismiss the petition.
I. BACKGROUND
The Employer operates the Hilton Milwaukee City
Center (Hilton), an upscale hotel located in downtown
Milwaukee, Wisconsin. The Employer is a subsidiary of
the Marcus Corporation, which owns the Hilton and sev-
eral other hotels in the Milwaukee metropolitan area.
The Petitioner has been the bargaining representative of
the employees in the Employer’s food and beverage divi-
sion for several decades. The Petitioner represents all of
the hotel employees who prepare and serve food and
beverages located in the bars and restaurants within the
Hilton.
Prior to 2005, the Employer operated four food and
beverage establishments within the Hilton (the Milwau-
kee ChopHouse, the Miller Time Pub, the Café, and the
Cabana Cove) and offered in-room dining and banquet
services. The Milwaukee ChopHouse is a fine-dining
establishment with a full bar located in the lower lobby
area of the hotel. The ChopHouse is staffed by cooks,
food runners, expediters, servers, bartenders, and other
wait staff who are members of the bargaining unit. The
Miller Time Pub is a more casual lunch and dinner
bar/restaurant also located in the lower lobby level of the
hotel. The bartenders, servers, and other wait staff are
members of the unit. The Café is a casual breakfast and
lunch restaurant (open for dinner on weekends) located
in the lower lobby area of the hotel. The cooks, servers,
and other wait staff are members of the bargaining unit.
The Cabana Cove, located on the third floor near the
indoor water park, is a casual food and beverage estab-

5 Effective midnight December 28, 2007, Members Liebman,
Schaumber, Kirsanow, and Walsh delegated to Members Liebman,
Schaumber, and Kirsanow, as a three-member group, all of the Board’s
powers in anticipation of the expiration of the terms of Members Kir-
sanow and Walsh on December 31, 2007. Pursuant to this delegation,
Chairman Liebman and Member Schaumber constitute a quorum of the
three-member group. As a quorum, they have the authority to issue
decisions and orders in unfair labor practice and representation cases.
See Sec. 3(b) of the Act. See Snell Island SNF LLC v. NLRB, 568 F.3d
410 (2d Cir. 2009); New Process Steel v. NLRB, 564 F.3d 840 (7th Cir.
2009), petition for cert. filed 77 U.S.L.W. 3670 (U.S. May 22, 2009)
(No. 08-1457); Northeastern Land Services v. NLRB, 560 F.3d 36 (1st
Cir. 2009), petition for cert. filed 78 U.S.L.W. 3098 (U.S. August 18,
2009) (No. 09-213). But see Laurel Baye Healthcare of Lake Lanier,
Inc. v. NLRB, 564 F.3d 469 (D.C. Cir. 2009), petitions for rehearing
denied Nos. 08-1162, 08-1214 (July 1, 2009).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD2
lishment. The attendant working in the Cabana Cove is a
member of the unit. The food and beverages for the in-
room dining and the banquets are prepared and served by
unit employees, including bartenders who work at the
banquet events.
In mid-2005, the Employer entered into a franchise
agreement with the Starbucks Corporation to open and
operate a Starbucks coffee shop located within the hotel.
There is no evidence in the record that the Employer
opened any of the other establishments under a franchise
agreement with another corporation. The coffee shop is
located approximately 75 feet from the Milwaukee
ChopHouse, the Miller Time Pub and the Café, and
downstairs from the Cabana Cove.6 All of the Starbucks
employees, including the store manager, work for the
Employer and not the Starbucks Corporation, and the
Employer determines the wages, hours, and most other
terms and conditions of employment of these employees.
The Starbucks baristas and head baristas prepare and
serve food and/or beverages to customers. The primary
Starbucks products are coffee and coffee-related bever-
ages, such as cappuccinos, espressos, and lattes.
The Starbucks Corporation imposes strict policies on
how franchisees operate their stores, including where to
purchase products and supplies, where and how products
should be displayed, how products should be prepared
and served, how long the preparation time of an order
should take, and how many people should be working in
the store at any given time.
Unlike the other establishments, Starbucks has retail
sales that, according to Nicole Junkins, the Employer’s
Starbucks manager, constitute “[m]aybe 30, to 35 per-
cent” of its gross income. These sales include candy,
coffee beans, mugs, compact discs, gift cards, and other
merchandise.
In the past, when the Employer opened a new food
establishment at the hotel, it recognized the food and
beverage employees as members of the bargaining unit.
This is the first time that the Employer opposed the in-
clusion of food and beverage employees when opening a
new establishment.
II. THE REGIONAL DIRECTOR’S DECISION
Although the Regional Director set out Safeway
Stores’ accretion standard (see fn. 3 above) in clarifying
the unit to include the baristas and head baristas, he did
not apply that standard here. Thus, he did not find that
the Starbucks employees7 had little or no separate iden-

6 All of these establishments have an entrance in the hotel.
7 Although we use the term “Starbucks employees” in this decision,
we emphasize, as explained above, that they are the Employer’s em-
ployees.
tity from the bargaining unit employees and therefore
could not constitute a separate appropriate unit, or that
the community of interest between the two groups of
employees was overwhelming. Instead, the Regional
Director found that the employees shared a “sufficient
community of interest.”
Applying this incorrect test, the Regional Director
found accretion appropriate based on his findings that the
Starbucks coffee shop is integrated with the other Em-
ployer establishments, that the Employer exercises cen-
tralized control over management and labor relations,8
that the Starbucks and bargaining unit employees share
many terms and conditions of employment,9 and that
they have similar skills and functions with respect to
food preparation and customer service. The Regional
Director also relied on the Starbucks employees’ close
geographical proximity to the bargaining unit employees,
the contacts between them, and the Employer’s bargain-
ing history. But, as we explain next, the Regional Direc-
tor did not address other critical factors under the correct
accretion standard, and certain factors relied on by the
Regional Director to find accretion actually militate
against such a finding.
III. ANALYSIS
Under the well-established accretion standard set forth
in Safeway Stores, Inc., 256 NLRB at 918 (footnotes
omitted), “the Board has found a valid accretion only
when the additional employees have little or no separate
group identity and thus cannot be considered to be a
separate appropriate unit and when the additional em-
ployees share an overwhelming community of interest
with the preexisting unit to which they are accreted.”
See also, Frontier Telephone of Rochester, Inc., 344
NLRB 1270, 1271 (2005); E. I. Du Pont, Inc., 341
NLRB 607, 608 (2004), quoting Ready Mix USA, Inc.,
340 NLRB 946, 954 (2003).
In determining whether a new operation is an accre-
tion, the Board has given weight to a variety of factors
including integration of operations, centralization of
management and administrative control, geographic
proximity, similarity of working conditions, skills and
functions, common control of labor relations, collective-
bargaining history, degree of separate daily supervision,

8 The Employer’s human resources department oversees and controls
labor relations for all of the Employer’s establishments, including Star-
bucks. It is involved in decisions regarding the hiring and firing of
employees (the department handles initial employee applications for
hire, conducts background checks, and handles the drug testing of
applicants), establishing wages and benefits, and determining other
terms and conditions of employment.
9 The policies in the Employer’s employee handbook, which is pro-
vided to every employee, apply to all employees who work in the hotel,
including the Starbucks employees.
MILWAUKEE CITY CENTER, LLC 3
and degree of employee interchange. Archer Daniels
Midland Co., 333 NLRB 673, 675 (2001). However, the
Board has held that the “‘two most important factors’—
indeed, the two factors that have been identified as ‘criti-
cal’ to an accretion finding—are employee interchange
and common day-to-day supervision,” and therefore “the
absence of these two factors will ordinarily defeat a
claim of lawful accretion.” Frontier Telephone of Roch-
ester, Inc., 344 NLRB at 1271 and fn. 7.
Applying these criteria here, we find that the baristas
and head baristas have a separate identity from the bar-
gaining unit employees and constitute a separate appro-
priate unit. In reaching this conclusion, we rely espe-
cially on the “critical” factors of employee interchange
and day-to-day supervision, as well as on other factors
set out below.
A. Employee Interchange
As to the first “critical” factor, employee interchange,
there is no evidence that Starbucks employees have tem-
porarily interchanged with employees in the Employer’s
other establishments, or that employees from the Em-
ployer’s other establishments have temporarily worked at
Starbucks. Significantly, several witnesses testified that
Starbucks has a policy against Starbucks employees
working at the Employer’s other establishments, and
therefore employees who could temporarily interchange
among the establishments when they worked for an es-
tablishment in the existing unit could no longer do so
once they began working at Starbucks. The Regional
Director dismissed this testimony because of the lack of
documentation and as hearsay, and because there is no
evidence that any employee from the Starbucks coffee
shop has sought or been denied employment elsewhere in
the building. We find, however, that the testimony is
sufficient to support a finding that Starbucks forbids in-
terchange between the Starbucks baristas and head baris-
tas and the food and beverage employees in the existing
unit.10

10 Significantly, Jonathan Farah, Starbucks’ head barista and a for-
mer bargaining unit employee, testified that he was told when he was
inquiring about the head barista position that Starbucks is considered an
“island department,” and that he (and other Starbucks employees) were
no longer permitted to work in other establishments as he had done
when he was a member of the bargaining unit. He did not know where
the rule came from, but only that since he began working at Starbucks
he has not been permitted to perform work at any other establishment.
Nicole Junkins, the Starbucks manager, testified that she learned during
the opening week from Starbucks trainers that Starbucks employees
were not permitted to work in the Employer’s other establishments.
She also testified that the Starbucks trainers insisted that the Starbucks
operate as an “island.” Karen Spindler, the director of human resources
for the Marcus Corporation, has oversight responsibility over the Em-
ployer’s human resource department. She testified that when an em-
ployee transfers to Starbucks from another Employer establishment, the
Further, although permanent interchange between
Starbucks and other Employer establishments is permit-
ted, there is no evidence to establish any frequency. Four
employees initially transferred to Starbucks from bar-
gaining unit positions in the Employer’s establishment.
There is no evidence of permanent transfers in or out of
Starbucks since then, and only two former bargaining
unit members are currently working at Starbucks. In any
event, permanent interchange is a less significant indica-
tor of community of interest than temporary transfer and
thus is given less weight by the Board in deciding unit
scope issues. See, e.g., Bashas’, Inc., 337 NLRB 710,
711 fn. 7 (2002); Red Lobster, 300 NLRB 908, 911
(1990). Moreover, the Board has historically given little
weight to such transfers where, as in this case, the trans-
fers are from an existing location to a newly-opened fa-
cility. See Alamo Rental Car, 330 NLRB 897, 898
(2000), and cases cited there.
B. Day-to-Day Supervision
As to the second “critical factor”, day-to-day supervi-
sion, there is no immediate common supervision between
bargaining unit employees and the Starbucks employees.
Further, there is no common immediate supervision
among the bargaining unit employees themselves. Thus,
the manager or supervisor of each of the four preexisting
establishments supervises the bargaining unit employees
who work there. The Starbucks coffee shop manager,
Nicole Junkins, supervises the Starbucks employees.
Junkins does not supervise employees from other bars or
restaurants, and the managers of other bars and restau-
rants do not supervise the employees working in the
Starbucks coffee shop.
C. Other Factors Weighing Against Accretion
Other factors also weigh against accretion. We find,
contrary to the Regional Director, that there is (1) a lack
of functional integration between the Starbucks coffee
shop and the Employer’s other establishments and (2)
minimal contact between the Starbucks employees and
other food and beverage employees. We also find that
the Starbucks Corporation exerts significant control over
the baristas’ and head baristas’ terms and conditions of
employment due to the requirements of the franchise
relationship.

employee is told by the Employer’s director of human resources that
the employee cannot work in another department, unlike other restau-
rant employees who commonly work in multiple departments. She also
testified that she was told by the human resources director at the Hilton
Milwaukee that Starbucks does not permit employees to work in other
departments. Finally, Terry Wisman, a server/cashier at the Café,
testified that Starbucks employees never work at other outlets in the
hotel.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD4
1. As to the first of these factors, the evidence fails to
establish that there is functional integration between the
Starbucks coffee shop and the Employer’s other estab-
lishments.11 The Starbucks employees perform their food
and beverage service functions and retail sales functions
on their own, without any reliance on the employees or
functions performed in the other establishments. Further,
unlike the other establishments, Starbucks has a substan-
tial retail aspect to its business because it sells its own
candy, coffee beans, mugs, compact discs, gift cards, and
other merchandise to customers.
2. As to the second factor, the Regional Director
found that the Starbucks employees and the bargaining
unit employees have significant personal contact because
they pass through the same security area, pick up pay-
checks in the same location, use the same cafeteria, and
are invited to periodic employee “rallies” or appreciation
events. We find that these contacts are outweighed by
the fact that the Starbucks employees work in a separate
area from the bargaining unit employees and have no
contact with the bargaining unit employees when per-
forming their job duties. See Archer Daniels Midland
Co., 333 NLRB at 676.
3. Finally, while we agree with the Regional Director
that the Starbucks employees and the bargaining unit
employees share many terms and conditions of employ-
ment, we also find that the Starbucks Corporation exerts
significant control over the baristas’ and head baristas’
terms and conditions of employment due to the require-
ments of the franchise relationship. Thus, the Starbucks
Corporation dictates how products should be prepared
and served,12 and staffing levels in the store (e.g., Star-

11 In finding to the contrary, the Regional Director relied on the fact
that the Hilton website advertised Starbucks, along with the four other
food and beverage service operations, as all being part of the “superb
dining experience” at the Employer. He also relied on the facts that
guests could bill purchases from each of the establishments, including
Starbucks, to their rooms, and that certain supplies for the Starbucks
coffee house (i.e., dairy products) were stored within the hotel cooler
along with supplies for the other restaurants. We find that this evidence
does not establish that there is a functional integration between the
Starbucks coffee shop and other establishments. See, e.g., Towne Ford
Sales, 270 NLRB 311, 311(1984) (the daily operations of two facilities
located across the street from one another—Towne Ford Sales and
Town Imports—were found to be separate and autonomous, notwith-
standing that “[t]he two enterprises engage[d] in joint advertising and
had a joint salesmen corps,” mechanics at Towne Ford Sales occasion-
ally worked on Town Imports cars, and Town Imports mechanics used
some of Towne Ford Sales equipment and tools).
12 Baristas undergo at least 40 hours of training by corporate Star-
bucks (head baristas, who undergo additional training, are trained to
train baristas in the future), where they learn how to make drinks and
handle customers to meet Starbucks specifications, as detailed in the
training manuals. In order to work at Starbucks, baristas must pass a
test showing that they can make drinks to specification, including time
bucks must have at least two employees working at all
times, and a third to cover for breaks; the number of re-
quired employees on staff increases with the number of
customers expected per hour). A district manager for
Starbucks Corporation meets monthly with the store
manager to discuss the store’s performance,13 and if there
are deficiencies, the district manager sets up an action
plan with the store manager.14
D. Factors Favoring Accretion
As discussed, in support of his finding of accretion, the
Regional Director relied on several additional factors,
including centralized control over management and labor
relations, many common terms and conditions of em-
ployment set forth in the Employer’s employee hand-
book, geographic proximity, similar skills and functions,
and bargaining history. We find that these factors do not
outweigh the countervailing factors discussed above,
particularly the “critical” factors of lack of interchange
and common day-to–day supervision.15 See Frontier
Telephone of Rochester, Inc. supra.
Conclusion
Under these circumstances, we find, contrary to the
Regional Director, that the baristas and head baristas

specifications (3 minutes or less from the time that the customer places
the order), and meet cleanliness standards.
13 The district manager uses ratings from secret shoppers to evaluate
the store’s performance in areas such as cleanliness, speediness, and
customer service.
14 To the extent it appears that Starbucks Corporation may require
that the baristas and head baristas perform cleaning functions in the
Starbucks coffee shop, we find that such a requirement would weigh
against a finding of accretion, inasmuch as the unit employees do not
perform similar functions.
15 Chairman Liebman finds, in agreement with the Regional Direc-
tor, that the similarity of skills and training of the Starbucks and unit
employees and the parties’ bargaining history weigh in favor of an
accretion finding. Bartenders in the unit are trained and licensed to
prepare and serve a variety of alcoholic beverages and unit employees
are trained to make coffee, espressos, cappuccinos and the like. Fur-
ther, food and beverage service employees have similar face-to-face
customer contact. As to bargaining history, Petitioner has represented
food and beverage employees for decades. In all previous instances,
food and beverage employees have been included in the bargaining unit
when a new establishment has opened. Member Schaumber, however,
finds that their skills and training do not significantly favor a finding of
accretion because the training that the baristas and head baristas receive
is far more detailed and rigorous than the training that the bargaining
unit employees receive, thereby establishing that the Starbucks em-
ployees have greater skills than the bargaining unit employees in pre-
paring various coffee and related beverages. Member Schaumber also
finds that the collective-bargaining history does not weigh in favor of a
finding of accretion in light of the fact that, in contrast to its other op-
erations, the Employer opened the Starbucks coffee shop under a fran-
chise arrangement with the Starbucks Corporation, unlike its other food
establishments, and that under the arrangement Starbucks Corporation
exercises strict control over important aspects of the Starbucks coffee
shop operation.
MILWAUKEE CITY CENTER, LLC 5
have a separate identity from the existing unit and may
constitute a separate appropriate unit. Accordingly, we
find accretion to be unwarranted.
ORDER
The Regional Director’s Decision and Order Granting
Petition for Unit Clarification is reversed, and the peti-
tion is dismissed.
Dated, Washington, D.C. September 21, 2009
Wilma B. Liebman, Chairman
Peter C. Schaumber, Member
(SEAL) NATIONAL LABOR RELATIONS BOARD