Raley's

National Labor Relations Board - Administrative Judge Opinions

Oct 10, 2007

20-CA-024973 (N.L.R.B. Oct. 10, 2007)

JD(SF)–27-07
Sacramento, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
SAN FRANCISCO BRANCH OFFICE
DIVISION OF JUDGES
RALEY’S
and Cases 20-CA-24973
20-CA-25354
INDEPENDENT DRUG CLERKS ASSN.
RALEY’S (United Wholesalers & Retailers Union,
Party to the Contract)
and Cases 20-CA-25649
20-CA-26294
UNITED FOOD AND COMMERCIAL WORKERS
UNION, LOCAL 588, UNITED FOOD AND
COMMERCIAL WORKERS INTERNATIONAL UNION
UNITED WHOLESALERS & RETAILERS UNION (Raley’s)
and Case 20-CB-9623
CHRIS ZICARELLI, An Individual
and Case 20-CB-9742
UNITED FOOD AND COMMERCIAL WORKERS
UNION, LOCAL 588, UNITED FOOD AND
COMMERCIAL WORKERS INTERNATIONAL UNION
and Case 20-CB-9932
THOMAS MOORE, An Individual
Paula R. Katz and Kathleen Schneider, Attys.,
for the General Counsel.
Henry F. Telfeian, Atty., for the Applicant.
SUPPLEMENTAL DECISION
Statement of the Case
WILLIAM L. SCHMIDT, Administrative Law Judge. On September 29, 2006, the
National Labor Relations Board issued its decision in this matter affirming the findings and
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conclusions of Administrative Law Judge Timothy D. Nelson (the ALJ), and adopting his
recommended Order with minor modifications. After 63 days of hearing between August 19,
1996, to August 25, 1997, the ALJ concluded that Respondent Raley’s violated the Act in a few
minor respects, comparatively speaking, and that Respondent United Wholesalers & Retailers
Union (Union or UWRU) had not violated the Act, as alleged, and had not benefited from any
unlawful assistance by Raley’s when it pursued recognition as the exclusive collective
bargaining representative of Raley’s pharmacy clerks throughout northern California in 1993.1
On October 26, 2006, UWRU filed a verified application for attorney’s fees and costs
under the Equal Access to Justice Act (EAJA) and under the implementing portion of the
Board’s Rules and Regulations, §§ 102.143 – 102.155. It seeks reimbursement in the amount
of “not less than $175,793.16” plus as yet unknown amounts of added fees and expenses
required to prosecute the application. The General Counsel submitted an Answer to the
Application and the UWRU submitted a Reply to that Answer. The Application, the Answer, and
the Reply have been referred to me for consideration and ruling because the ALJ retired shortly
after his decision issued, and, therefore, is unavailable within the meaning NLRB Rules and
Regulations, § 102.26.
In pertinent part, EAJA provides: “An agency that conducts an adversary adjudication
shall award, to a prevailing party other than the United States, fees and other expenses incurred
by that party in connection with that proceeding, unless the adjudicative officer of the agency
finds that the position of the agency was substantially justified or that special circumstances
make an award unjust.” 5 U.S.C. § 504(a)(1).
The General Counsel concedes that the Applicant has established that it meets the
basic EAJA eligibility requirements, i.e., that it is an association with a net worth of less than
$7,000,000, and 500 or fewer employees. However, the General Counsel avers that the
Applicant does not qualify as a “prevailing party” with respect to one allegation, and that its
litigation of the remaining allegations was substantially justified. The General Counsel also
asserts that certain fees and costs are not reimbursable under EAJA. The General Counsel
makes no claims about special circumstances that would make an award “unjust” within the
meaning of EAJA.
The Applicant’s Reply asserts that the General Counsel’s “legal theories lacked
substantial justification thereby making the existence of ‘supporting facts’ irrelevant,” and that
certain facts relevant to “viable theories based on extant Board law, were clearly legally
insufficient to support the Complaint and fail to establish that General Counsel was substantially
justified.”
Based on my findings, analysis, and conclusions below I will recommend that the
Application be dismissed in its entirety.
Findings of Fact
A. Factual Overview
Raley’s, the respondent-employer in the underlying case, operates 51 supermarkets with
“Drug Centers” (pharmacies) throughout northern California and maintains a headquarters in

1 The ALJ’s decision is a colossus. As originally formatted, it ran approximately 300 single-
spaced pages. As reformatted for attachment to the Board’s decision, it is 174 pages long.
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Sacramento. United Food and Commercial Workers Local 588 (Local 588) represents the
grocery employees at most of Raley’s supermarkets. However, Raley’s drug center employees
have historically been represented by unaffiliated labor organizations. In the 30-year period
before 1993, the Independent Drug Clerks Association (IDCA) represented the drug center
employees in two separate units, one for the pharmacists and the other for the drug clerks. The
last collective bargain agreement applicable to the drug clerks expired in the latter part of 1992.
Over the years, Raley’s maintained written rules barring employees from using its phone
and fax equipment for any purpose other than official company business except in emergency
situations. In addition, the company also maintained written rules barring solicitation and
distribution during work time. However, local managers enforced the phone/fax systems rule
only when they felt an employee abused the systems by tying up the transmission lines. And
usually, the local managers allowed on-duty employees to visit with off-duty, or even offsite,
employees either on the sales floor or in back room areas, including the break rooms.
For the first 28 years of IDCA’s existence, Kay Sordillo served as the IDCA’s chief
executive. She and the IDCA officers aligned with her always viewed Local 588, the grocery
clerks’ representative, as a “representational rival.” Shortly before October 1992, Gilbert (Gil)
Eidam and a group of his allies gained control of the IDCA executive offices and soon aligned
themselves with Local 588. Early on Eidam appointed a few Local 588 officials to IDCA’s
negotiating team when it began bargaining with Raley’s for a new drug clerks’ agreement.
Eidam and his Local 588 allies set wage and benefit parity with the grocery clerks as a high
priority in these negotiations. Later, Eidam appointed or “deputized” thirty or so Local 588
business agents to administer the IDCA’s day-to-day affairs with Raley’s despite the fact that
the IDCA had maintained a steward in virtually every drug center for years.
Raley’s strongly disapproved IDCA’s informal alliance with Local 588 under Eidam’s
leadership. Around the same time, Raley’s became locked in a bitter dispute with Local 588
over that union’s demands for card-check recognition of grocery clerk units not already covered
by Local 588's multi-employer agreement. On October 23, 1992, Raley’s chief labor negotiator
sent a memo to every drug center employee decrying the emerging IDCA-Local 588 ties. He
charged that the IDCA executive committee had effectively turned the Association’s reins over
to Local 588. His memo alludes to the fact that Eidam designated Local 588 business agents to
serve as IDCA agents in servicing the collective-bargaining agreement. The memo declared
that Raley’s would continue to deal with IDCA’s store stewards but it would not allow the Local
588 agents to “interrupt your work or hold you hostage during store hours.” until the company
received a satisfactory explanation for their involvement in IDCA’s business.2
A series of confrontations between local managers and the deputized Local 588 agents
occurred when the latter began visiting Raley’s drug centers insisting they had a right to visit
with the drug clerks, and to enter the employee break rooms to look at work schedules and
other similar documents typically posted there. In a couple of instances the local managers
caused the arrest of business agents for an unlawful trespass.
These developments soon caused a rift within IDCA membership ranks. Edwin (Ed)
Wright, a clerk at Raley’s Grass Valley, California, drug center, and others opposed to

2 This memo was also posted at the drug centers and formed the basis of one complaint
allegation that Raley’s violated Section 8(a)(1). The Board and the ALJ found no merit to the
memo allegation. However, this matter occurred well before the UDCEA came into existence
and, hence, it did not implicate any interest of that organization.
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representation of any kind by Local 588 aggressively criticized the actions taken by the IDCA
executives. This early opposition reached its zenith in the Spring of 1993 when the dissidents
held a four-hour meeting on April 25 in Roseville, California, attended by nearly 200 drug clerks
including about 20 IDCA stewards. The meeting produced two resolutions, one demanding that
Eidam appoint a new negotiating committee that excluded the Local 588 executives, and the
other demanding that he rescind the letter purporting to appoint Local 588 agents to act as
IDCA representatives. Eidam declined to act on either demand.
Complaint paragraphs 9 through 17 allege conduct attributed to Raley’s agents between
October 1992 and May 1993, prior to UDCEA’s existence. Similarly, paragraphs 31 (a May
1993 warning to Eidam) and 34 (involving IDCA’s use of Local 588 agents to service its
agreement) have no direct bearing on this Application. For this reason, those events serve only
to provide a context for later events that are relevant.3
For whatever reason, active opposition to the Eidam regime petered out for the next few
months. In addition, Wright suffered a work-related injury (a herniated disk) and began a leave
of absence on May 13, 1993, that lasted for a year, well beyond any of the critical events in this
proceeding. Early in his disability period, however, Wright again became the outspoken leader
of a faction opposing the IDCA leadership. Ultimately, his activities led to the formation of a new
labor organization initially called the United Drug Center Employees Association (UDCEA) and
later renamed the United Wholesalers & Retailers Union (UWRU).4 As described more fully
below, the UDCEA/UWRU succeeded the IDCA as the representative of Raley’s drug clerks
and effectively thwarted the efforts by Eidam and his allies to facilitate a successful organizing
drive among the drug clerks by Local 588.
By mid-July 1993 Raley’s and the IDCA still had not concluded a new drug clerks’
agreement. Around this time, Raley’s presented its “best and final” offer to the IDCA negotiators
and, in anticipation of a ratification vote, its labor relations chief explained its terms in a memo to
the drug clerks. Following the best and final offer, IDCA officials held a series of meetings with
the drug clerks around northern California to describe the offer’s terms, and to conduct a
ratification vote. The IDCA officials recommended rejection of the best and final offer.
After Wright and other like-minded clerks became aware of the final-offer meetings, they
began to attend them and actively campaigned for acceptance of the offer. In one instance,
Wright and five of his co-worker from the Grass Valley store made a 100-mile trip to the meeting
in Red Bluff, California, where he argued for an affirmative vote on Raley’s offer. Following a
lengthy and heated exchange at the Red Bluff meeting, those in attendance voted and their
ballots were mingled with ballots cast at other similar meetings and counted. A narrow majority
voted against accepting Raley’s best and final offer.
Following its rejection in the IDCA-conducted polling, Raley’s implemented its best and
final offer on September 1. Two weeks later, on September 14, Eidam faxed a letter to Raley’s
management disclaiming IDCA’s interest in representing the drug clerks’ unit effective
immediately.5 Eidam also notified the IDCA members in the clerks’ unit by letter that IDCA, in

3 Raley’s did not file an application. It size and scope undoubtedly would preclude it from
qualifying for a reimbursement under EAJA.
4 UDCEA’s formation occurred in mid-September 1993. Its name change to UWRU
occurred a month later after Local 588 asserted ownership of the UDCEA name, threatened to
sue Wright for using it, and demanded that Raley’s cease dealing with him on behalf of UDCEA.
5 However, IDCA continued to represent the pharmacists’ unit.
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effect, no longer represented them and explained his reasons for taking this action. In effect, he
charged that Raley’s had taken advantage of the drug clerks over the years because the prior
IDCA leadership had been unwilling or too weak to confront management for better contract
terms. Eidam recommended that the drug clerks look to Local 588 for future representation.
Eidam’s explanation caused the ALJ to conclude that Eidam deliberately withdrew as the drug
clerks’ representative so that Local 588 could organize them.
While opposing Eidam’s IDCA regime during the earlier negotiation period, Wright built a
network of Raley’s drug clerks opposed to Local 588. When Wright became aware of IDCA’s
disclaimer on September 15, he promptly consulted with several allies and, together, they
agreed to organize a new independent clerks’ union, the UDCEA. Almost immediately, Wright
telephoned Raley’s new labor relations manager, Daniel Abfalter, to advise that his group
intended to organize the drug clerks and would be forwarding signed petitions to the company.
Meanwhile, James Teel, the co-chair of Raley’s board of directors, replied to Eidam’s
disclaimer in a memo dated September 15. Teel arranged for a copy of his memo to be sent to
each drug center and to the drug clerks individually. His memo acknowledged Eidam’s
disclaimer, criticized Local 588’s recent involvement in IDCA’s affairs, and accused Eidam of
attempting to turn IDCA over to Local 588. He also assured the clerks that their recent pay
increases would remain secure. In addition, Teel informed the clerks that they might be
solicited to sign a petition for a new independent union organized by a group of their “fellow
employees.” Teel assured employees that the company would recognize “any union that you
wish” but that a union seeking recognition “must prove to us that over 50% of you want them.”
The next day, Abfalter addressed the fallout from the disclaimer and the clerk’s lack of
representation in two memos to the drug center managers. The first memo directed the
managers to bar IDCA officers from using company time for union business. It also advised that
the “Grocery Clerks Local #588 members and agents” had no right “to interfere” with drug center
employees while on duty. Further, Abfalter’s first memo stated that that Local 588 business
agents and organizers “have no right to visit with our Drug Center employees” and that they had
“no right of access to our break rooms or back room.” The memo then turned to the Wright’s
home-grown organizing effort. About this subject, Abfalter’s memo reported that the company
had been approached “by a group of Raley’s Drug employees who want to represent the Drug
Center employees in their own union.” It added that this group had “the right to demand
recognition from Raley’s” but the company would have to be convinced that they represented a
majority of the Drug Center employees before we recognize them.” In conclusion, the memo
advised the drug center managers that, “[a]s you are presented with someone claiming that they
have cards or a petition to present to you, IMMEDIATELY CALL YOUR SUPERVISOR OR DAN
ABFALTER . . . for instructions on what to do.”
In his second memo of the day to the drug center managers, Abfalter directed them to
post Eidam’s disclaimer letter and Teel’s reply. It also instructed managers to reassure clerks
that the processing of retroactive pay continued and “[t]he October (pay) increase will happen.”6
Brenda Peterson, a clerk at the Rancho Cordova drug center and a Local 588 supporter,
claimed that she saw the first Abfalter memo posted in the break room at her store. Based on
that, the General Counsel argued the restrictions detailed in the memo against potential

6 Raley’s best and final offer to the IDCA included a retroactive pay component conditioned
upon an affirmative ratification vote. However, when it implemented the offer, Raley’s included
the retroactive feature despite the rejection by the IDCA members.
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organizing activities by Local 588, their grocery-clerk members, and their other supporters when
coupled with the failure to state similar restrictions for UDCEA organizers and supporters
conveyed a coercive message company executives planned to assist the unaffiliated
organization. However, the ALJ discredited Peterson’s recollection about the posting of
Abfalter’s memo (and nearly everything else), and rejected inferences sought by the General
Counsel grounded on employee knowledge of Abfalter’s key directions to the local managers.7
Regardless, the ALJ and the Board found that Raley’s expressed a strong preference for an in-
house union, if any at all.
The Board, apparently thinking that the ALJ had concluded that the reference “Grocery
Clerks Local #588 members and agents” did not include Raley’s employees, adopted that
conclusion and agreed that Abfalter’s memo did not convey an unlawful instruction to assist the
UDCEA organizing drive. Actually, the ALJ explicitly acknowledged that the phrase “Local #588
members and agents” in Abfalter’s memo would include Raley’s employees. Thus, he stated:
“And insofar as the memo obliquely addressed what Local 588’s “grocery”-employee “members”
could do, it stated only that they could not “interfere with drug clerks while on duty.” 348 NLRB
No. 25 at p. 76. Regardless, for many other reasons the ALJ clearly concluded (as the Board
found) that Abfalter’s memo limiting the activities of Raley’s grocery employees failed to
establish that Raley’s coerced employees or unlawfully assisted UDCEA/ UWRU.
Between September 15 and 23, 1993, Wright and his allies engaged in “intensive
activity” seeking to obtain majority support for the UDCEA in the clerks’ unit. As the Board
found, much of this activity “occurred at Raley’s stores, including those in Grass Valley (Wright’s
home store when actively employed), Benicia, Fair Oaks, and Placerville.” The Board further
found that the UDCEA’s “campaign activity involved in-store visits, telephone calls to other
stores, and the faxing of copies of the petition to employee supporters, often using Raley’s
telephones and fax machines,” much of which occurred during work time. The ALJ found that
Wright, in the period between September 16 and 21, actively solicited support for UDCEA, often
speaking to employees on the floor during their work time, in the employee break rooms, and in
other areas inaccessible to the general public during personal visits to widely-scattered stores,
including those at Auburn, Benicia, Citrus Heights, Folsom, Granite Bay, El Dorado Hills, West
Sacramento, Windsor, and Rohnert Park.
Several complaint allegations pertinent to this EAJA application grew out of the
UDCEA’s organizing drive that occurred from September 15 through September 23 and Raley’s
conduct toward Local 588’s officials and supporters during this period. In these allegations, the
General Counsel asserted that unlawful conduct by Raley’s local managers and supervisors
coerced employees, and unlawfully assisted the UDCEA organizing effort. One allegation
alleged that Raley’s provided legal assistance for the new independent union in the post-
recognition period and that Raley’s and the new drug clerks representative sought to enforce an
unlawful fee under the a contractual union-security provision. Below, I have summarized the
disposition of the allegations that pertain to the Application.
v Condoning the use of company fax machines and telephone system at several locations
to circulate its organizing petitions and to submit them to the headquarters’ office.
(Complaint ¶18) The Board largely adopted The ALJ’s conclusions that this allegation
lacked merit because it amounted to little other than “ministerial aid” inasmuch as the

7 The judge found Peterson to be “passionate” in her support of Local 588. For this and
other reasons he also rejected her testimony as to much more damning matters involving
conduct at the Rancho Cordova store.
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evidence established employees commonly used of the company’s communications for
personal purposes contrary to official written policies limiting their use to official business
purposes and that discipline occurred only on a rare occasion when an employee was
deemed to have abused the privilege established by practice.8 The ALJ repeatedly
noted that Eidam transmitted the IDCA’s disclaimer letter over company equipment.
Even so, the ALJ concluded that the use of company fax machines to transmit UDCEA
petitions and its demand for recognition amounted to an official use sanctioned by the
company’s formal policy. The Board declined to adopt this latter finding because it
implicated an outcome in other pending cases.
v Allowed Wright to solicit support for the UDCEA during a lengthy meeting he conducted
with employees during their work time in a company office at Benicia and a supervisor
instructed an employee to speak with Wright during work time. (Complaint ¶19) Benicia
supervisor Wallis told employee Hernandez during his work time that Wright wanted to
talk to him in an upstairs office about a union and to take as much time as needed. The
Board adopted the ALJ’s dismissal of this allegation because Wright, as a Raley’s
employee, enjoyed a Section 7 right of access to the Benicia store because the evidence
established that Raley’s had always tolerated visits by off-duty, offsite employees with
on-duty employees in both work and non-work areas. Likewise, the judge inferred from
the credited evidence that Wallis had spoken as a friend rather than as a supervisor
when he told Hernandez that a union guy (Wright) wanted to speak with him upstairs
and that he could take all the time he needed.
v Denied store access to Local 588 officials seeking to visit with the drug clerks at
Fairfield, Fair Oaks, and Rohnert Park during periods when the UDCEA widespread
store access to solicit employee support. (Complaint ¶20 and ¶23) This allegation is
based on the efforts of Local 588 officials to gain access to certain stores immediately
after Wright’s visit to the Benicia store. Raley’s managers uniformly barred their access
to the drug centers in order to solicit the support of the drug clerks. Relying on
Lechmere, Inc. v. NLRB, 502 U.S. 527 (1992), the ALJ dismissed these allegations on
the ground that the employer could lawfully bar nonemployee organizers while permitting
employees access for similar organizing purposes. The Board found that the ALJ
correctly distinguished between off-duty employees’ right of access to their workplace to
engage in Section 7 activity and nonemployee union supporters’ more limited rights of
access. 348 NLRB No. 25 @ p. 5. In addition, the Board concluded that Lechmere’s
exception based on a discriminatory access practice did not apply here because all of
“UDCEA’s active supporters were Raley’s employees.” 348 NLRB No. 25, fn. 21.

8 Wright frequently used the equipment at the Grass Valley store where he worked and the
nearby Yuba City store to transmit organizing materials and talk with his allies. A Grass Valley
supervisor gave Wright a verbal warning for using store equipment on September 18 and the
Grass Valley store manager gave him a written warning on September 21 for using the
telephone in his office to campaign. On September 23, Wright transmitted his demand for
recognition from the fax machine in the store manager’s office at Grass Valley. At the very
least, The headquarters staff paid little attention to the source of the UDCEA’s transmissions. In
any event, the ALJ viewed the fax headers as hearsay. 348 NLRB No. 25, p. 61. However, the
prevailing view treats fax headers as non-hearsay because they do not qualify as a “statement”
under Rule 801(a) of the Federal Rules of Evidence since they amount to data generated by a
machine rather than assertions or non verbal conduct of a “person.” U.S. v. Khorozian, 333
F.3d 498, 506 (3rd Cir. 2003), and the treatise cited there.
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v Told employees that they could not talk to Local 588 agents on company time or in the
store (Rohnert Park); and told employees they should not talk to Local 588 agents
(South Lake Tahoe). (Complaint ¶23 and ¶25) The ALJ dismissed the allegation
pertaining to the conduct of the Rohnert Park manager. In doing so, he discredited the
account of Cindy Shephard, the General Counsel’s employee witness, supporting the
allegation, and credited the testimony of store manager Kiehlmeier and two other
employee witnesses, all of whom claimed that the store manager only said that he
preferred they not talk to representatives of either union during work time.
The ALJ also dismissed the South Lake Tahoe allegations after discrediting the account
provided by two employee witnesses called by the General Counsel to support them.
He found their testimony too unreliable “to support any feature of paragraph 25.”
Affirmatively, the ALJ, based on the credited testimony of Raley’s manager Forkner
found that the store management had not encouraged employee support for UDCEA.
Interrogated a employee, created the impression among the employees that their union
activities were under surveillance, and told an employee that Local 588 representatives
would be barred from the Ukiah store even though Raley’s granted access to UDCEA
agents. (Complaint ¶24) The ALJ dismissed the Ukiah allegations. As to the allegation
that manager Graves told employees that he would escort Local 588 agents from the
store, the ALJ concluded the statement, if made, would have been lawful. But in any
event, the ALJ credited Graves’ denial that he ever told employees as much. As to the
surveillance and interrogation allegations, the ALJ discredited the testimony of the
General Counsel’s witnesses that the alleged interrogation which implied surveillance
occurred three days before Raley’s recognized the UDCEA. The ALJ found the
testimony of employees Jack and Harmon unreliable in face of Graves’ denial of the
statements they attributed to him. The ALJ concluded that the so-called Local 588
“pizza meeting” (Jack and Harmon keyed their claims about Graves’ questioning from
this meeting) occurred a few days after Raley’s recognized the UDCEA rather than
before as the two employees claimed.
v Removed Local 588 authorization cards and a button left at the store by a Fair Oaks
employee; told an employee to cease wearing a Local 588 button; and encouraged
employees to sign the UWRU petition so they would get raises sooner. (Complaint ¶21)
In the absence of exceptions, the Board affirmed the ALJ’s finding the Raley’s violated
Section 8(a)(1) when Fair Oaks manager Haring admittedly told employee Lee to
remove a button that signified his support for Local 588 and when he admittedly
removed Local 588 authorization cards from a break room bulletin board. However, the
Board rejected the General Counsel’s exceptions seeking a finding that this same
conduct violated Section 8(a)(2) and tainted UDCEA/UWRU’s majority.9 The Board
concluded that the evidence failed to establish that employees at other locations knew
about this “isolated” conduct. The ALJ largely discredited Lee’s testimony about the
events found unlawful and other Lee testimony elicited to show that Haring also directed
employees to sign the UDCEA/URWU petition, interrogated employees as to whether
they had done so, and explained a rival union petition he left posted on the ground that
“only memoranda supported by . . . Raley’s belonged on the bulletin board.”

9 No employees from Fair Oaks or Placerville (where 8(a)(1) conduct also occurred) signed
a UDCEA petition.
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v Permitted employees to circulate pro-UDCEA petitions at the Rancho Cordova store
during work time and told employees after the organizing drive that Raley’s executives
instructed managers to be actively involved with the UDCEA organizing. (Complaint
¶22) The ALJ found that some unknown individual faxed a UDCEA petition to the
Rancho Cordova pharmacy where employee Brenda Peterson (a vocal Local 588
supporter) received it, gave it to supervisor Renfree, and made a fuss over UDCEA’s
use of the company’s fax machines to organize. Shortly afterward, Peterson discovered
the petition on the break room table and confronted Renfree again. She insisted that he
call headquarters (she says Abfalter; he says he could not remember who he ultimately
called) to report a violation of company policy. When he did so, Renfree received an
instruction to secure the petition in the store manager’s desk which he did. Meanwhile,
Ruthie Gordon, a pro-UDCEA employee and a former IDCA steward, confronted
Renfree concerning the whereabouts of the petition. Renfree told her that it had been
secured in the manager’s “office.” Three or four days later, Peterson saw the petition in
Gordon’s possession with two signatures, including Gordon’s. Peterson asserted that
both Gordon and Renfree admitted to her that Renfree gave the quarantined petition to
Gordon. However, the ALJ, crediting Gordon’s testimony that employee Eddie Pine
(who died before the hearing) surreptitiously retrieved the petition from the manager’s
office over Peterson’s testimony, rejected the allegation that the company aided
Gordon’s solicitation effort. The ALJ also credited claims by store supervisors that they
lacked knowledge of Gordon’s solicitation activities, and found no evidence that Gordon
solicited signatures for the UDCEA petition during work time.
v Questioned a Placerville employee as to whether he or other employees had signed the
UDCEA petition or a Local 588 authorization card. (Complaint ¶26) The ALJ found the
Placerville manager Beard unlawfully interrogated employee Miser in violation of Section
8(a)(1) when she called him to her office during his lunch break and “wondered aloud” in
an irritated manner why no one had signed the UDCEA petition on the break room table.
When Beard added that it was in the employees’ own “best interests” to be represented
by a union, Miser disagreed and left her office. But the ALJ further held that the General
Counsel failed to show that Beard unlawfully assisted the UDCEA in violation of § 8(a)(2)
because of uncertainty as to whether this conversation occurred after Local 588 started
an active campaign.10 The Board concurred at least in the result and went further. It
found that the divergent enforcement practices of the local managers relating to Raley’s
rules about solicitation and distribution during work time, derived largely from
accumulated evidence about the IDCA years, precluded finding a pattern of disparate
enforcement. For that reason, the Board concluded that the contrasting managerial
conduct at Placerville (leaving UCDEA petition in the break room) and at Fair Oaks

10 Seemingly, the ALJ thought that, for purposes of § 8(a)(2), the General Counsel’s burden
included the elimination of all evidentiary ambiguity as to whether the Beard/Miser confrontation
occurred after Local 588 started active campaigning. Obviously, he declined to infer the
existence of a rival union situation, with all its attendant implications, based on Teel’s
September 15 memo and Abfalter’s two directives the following day which Beard presumably
received and read. And elsewhere, the ALJ found that Local 588 mailed literature with enclosed
authorization cards to unit employees on September 17 and directed its organizers on
September 20 to visit Raley’s stores, distribute authorization cards, and mobilize support among
employees. Finally, the ALJ found that from the time of Eidam’s September 14 disclaimer until
September 23, a number of Raley’s drug clerks engaged in concerted activity on behalf of Local
588 and against the UDCEA.
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(removing Local 588 cards from the break room) insufficient to establish disparate
enforcement company rules. 348 NLRB No. 25, fn. 19.
v Provided legal assistance to UWRU beginning in October 1993 at a time when its
attorney performed work for Raley’s or was being paid to represent Raley’s and provided
financial assistance to Wright in the form of two payments unrelated to his wages,
disability, or benefits. (Third and Fourth Amended Consolidated Complaints ¶27)
Following Wright’s testimony denying, in essence, that he received payments from
Raley’s to aid in organizing the UDCEA, the General Counsel effectively withdrew this
allegation by issuing the Fourth Amended Consolidated Complaint that contains no
reference to the allegation about Wright found in ¶27(b) of the Third Amended
Consolidated Complaint.
However, the General Counsel continued to press the legal assistance allegation in
Complaint ¶27(a). The ALJ dismissed this after concluding from his factual analysis that
attorney Henry Telfeian had actually concluded his services for Raley’s prior offering to
represent the UDCEA and the lack of evidence that Raley’s retained Telfeian further.
The Board affirmed the ALJ’s conclusion. It said the ALJ had found that: (1) Telfeian
ceased representing Raley’s in September 1993; (2) Telfeian acted on his own acted on
his initiative in seeking the UDCEA work; (3) Raley’s expressed disapproval of his action
but had no authority to stop him; (4) even if a conflict existed, it would not have
implicated Raley’s; (5) no simultaneous representation occurred; and (6) the services
Telfeian performed for the UDCEA were confined to matters in which Raley’s had no
interest or involvement. 348 NLRB No. 25, fn. 24.
The ALJ, by contrast, found that Telfeian concluded his work on behalf of Raley’s on
October 15 when he finished drafting a letter to Local 588 related to the UDCEA name
dispute. Due to administrative procedures at Keck, Mahn, and Cate (the law firm that
engaged Telfeian as a substitute when its partner, Patrick Jordan, Raley’s regular labor
relations attorney, left for an extended vacation in mid-September), the letter was dated
and mailed on October 18. On October 15, after completing the Raley’s UDCEA letter,
Telfeian attempted unsuccessfully to reach Wright to offer his legal services to the
UDCEA, purportedly motivated his contempt Local 588’s hounding of the UDCEA over
the name issue. A few days later Wright returned Telfeian’s call and the two entered into
an arrangement for Telfeian to represent UDCEA. During the first week of October,
Telfeian disclosed his intentions to Jordan but the ALJ found that Telfeian’s first direct
disclosure to any Raley’s official occurred when he sent a letter to Teel on November 10,
supposedly about two weeks after Wright and Telfeian struck a deal.11 In his letter to
Teel, Telfeian asked Teel to advise if he objected to his arrangement with the UWRU.
Teel never responded.
v Recognized the UDCEA and entered into a collective bargaining agreement with it (by
then renamed the UWRU) with a union security clause at a time when that union did not
represent a majority or an uncoerced majority in the drug clerks unit. (Complaint ¶29

11 Although not explained, the Board’s finding that Raley’s expressed disapproval of
Telfeian’s plan to offer his services to the UDCEA appears to be based on a lunch conversation
between Jordan and Telfeian before the latter finished performing work for Raley’s in which
Jordan strongly advised Telfeian against doing so. Presumably, the Board treated Jordan as
Raley’s agent for purposes of this disclosure even though, at the time, both worked for the same
law firm performing services for Raley’s.
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and ¶30) Throughout the period from September 16 through 23, Wright and his allies
faxed signed UDCEA petitions to Raley’s headquarters. On September 23 Wright faxed
a letter to Abfalter claiming that UDCEA represented a majority of the drug clerks and
demanding recognition. In the early evening, Raley’s sent a letter to Wright recognizing
UDCEA as the new bargaining agent for the drug clerks. On October 24, the UWRU
and Raley’s entered into a 3-year contract, retroactive to October 3, containing a union-
security clause.
During the hearing, the General Counsel abandoned its allegation that the UDCEA never
acquired a numerical majority after conceding the Regional Office made an error
calculating the number of signed petitions the UDCEA submitted to Raley’s. However,
the General Counsel continued to advance the parallel claim that the UDCEA never
represented an uncoerced majority and, hence, the recognition, and the subsequent
execution and maintenance of the UWRU contract were unlawful.
The ALJ concluded that Raley’s lawfully recognized the UDCEA and that the parties
entered into a valid contract.12 In the process, he resolved numerous contentions about
the unit scope, employee eligibility, and signature authenticity that permitted him to find
ultimately that the UDCEA submitted petitions to Raley’s containing 355 valid signatures
in a unit of 673 employees, or 18 more signatures than necessary for a majority.
Further, he found, in effect, Raley’s 8(a)(1) conduct during the organizing campaign
insufficient to taint the UDCEA’s showing of a majority because its support came from
stores where no unlawful conduct occurred, and because the violations found were too
isolated and unknown at other locations.
v Written threats by the UWRU to certain employees during the period from March through
August 1994 that it would seek their discharge by Raley’s and subsequent requests that
the employer to do so because the employees refused to pay a reinstatement fee (a/k/a
late fee) the union charged habitually delinquent dues payers. Written threats by Raley’s
to discharge these employees for failing to pay “period dues and uniformly required
initiation fees.” Complaint ¶32, ¶33, and ¶36. These allegations stem from the UWRU’s
efforts to enforce its internal late fee rule through the contractual union-security clause in
1994 and 1995. At that time, the late fee amounted to a dues or initiation fee surcharge
of five dollars for every month of delinquency.13 The Board affirmed the ALJ’s
conclusion that the late fee constituted an integral part of the UWRU’s established dues
structure. The ALJ found the late fee analogous schemes found in to cases where the
Board concluded that arrangements providing for discounts upon the timely or early
payment of dues were lawful. Both rejected the argument that the late fee amounted to
a penalty or a fine as found in early cases never overruled by the Board. Hence, both
concluded that collection of the fee under the union-security contract was lawful.
B. Analysis and Conclusions
1. Complaint ¶ 27(b): The Prevailing Party Question

12 Raley’s attorney told the General Counsel that “negotiations with UDCEA/UWRU were
held on September 27, September 30, October 8 and 13, and that a “wrap-up meeting was held
on or about October 28.” GC Answer: 53.
13 Later, the UWRU modified this fee provision in its by-laws but the revised provision was
not challenged in this case.
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The Applicant claims prevailing party status as to all § 8(a)(2) allegations that would
affect its status as the lawfully recognized employee representative. Counsel for the General
Counsel asserts that the Applicant does not qualify as a prevailing party under EAJA as to
Complaint ¶27(b) (alleging employer payments to assist Wright’s organizing campaign) because
the Regional Director voluntarily withdrew the allegation before the hearing closed.
To be a “prevailing party” under federal fee-shifting statutes, an applicant must have
achieved a judicially-sanctioned “material alteration of the legal relationship of the parties.”
Buckhannon Board and Care Home, Inc. v. West Virginia Department of Health and Human
Resources, 532 U.S. 598 (2001). Buckhannon holds that federal fee-shifting statutes require a
disposition by means of a judicially enforceable order or a settlement agreement enforceable
through a consent decree. Id at 604. However, an applicant will not be considered a prevailing
party under a federal fee-shifting statute if the “material alteration” resulted from the
government’s voluntary action. Id. at 605.
Although Buckhannon did not arise out of an EAJA claim (the appendix in Marek v.
Chesny, 473 U.S. 1, 49 (1985), shows more than 100 federal fee-shifting statutes), several
courts have concluded the majority’s sweeping language makes clear that it applies to all such
statutes using the phrase “prevailing party.” The Ninth Circuit, where this dispute arose, has
specifically applied the Buckhannon rule to EAJA. Carbonell v. INS, 429 F.3d 894 (9th Cir.
2005); Perez-Arellano v. Smith, 279 F.3d 791 (9th Cir. 2002). And in Morillo-Cedron v. District
Director, 452 F.3d 1254 (11th Cir. 2006), the court noted all federal appellate courts that have
considered the question to date have applied the Buckhannon rule to EAJA.
Seemingly, however, no case involving the impact of Buckhannon on the prevailing-party
rule utilized by the Board has been decided. In the past, the Board treated EAJA applicants as
the prevailing party even as to significant allegations voluntarily withdrawn by the General
Counsel prior to a decision by an ALJ or the Board. For example, in Shrewsbury Motors, 281
NLRB 486, 487-488 (1986), the Board found an applicant qualified as a prevailing party under
EAJA where the regional director withdrew a complaint in two stages, the last just days before
the scheduled hearing. Later, in K & I Transfer & Storage, 295 NLRB 853 (1989), the Board,
relying on Shrewsbury, found an applicant qualified as a prevailing party as to a Johnnie’s
Poultry allegation withdrawn by the regional director so the hearing could proceed without delay.
In Shrewsbury, the ALJ relied on his reading of the legislative history and several federal
cases finding applicants to be prevailing parties on matters not actually decided following
litigation. In effect, the ALJ adopted the “catalyst” theory as applied by various courts of appeals
at the time. That theory treated an applicant as a prevailing party in an administrative
proceeding if it achieved a desired result even though brought about by the agency’ voluntarily-
implemented change. In fact, two of the cases cited by the judge explicitly applied the catalyst
theory14 and the others unmistakably applied it without using the precise terminology. When
Shrewsbury came before the Board, it adopted the ALJ’s rationale without comment.
The Buckhannon majority emphatically rejected the catalyst theory in favor of the
combined judicially-sanctioned, material-alteration concept. For that reason, continued
application of Shrewsbury and its progeny would be at odds with the Supreme Court’s
interpretation of a “prevailing party” under federal fee-shifting statutes.

14 See Dawson v. Pastrick, 600 F.2d 70, 79 (7th Cir. 1979); Williamson v. HUD Secretary,
533 F.Supp. 542, 544 (E.D.N.Y. 1982).
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To the extent that the ALJ here in any way approved the withdrawal of Complaint ¶27(b),
I find his involvement amounted only to a procedural, housekeeping step.15 Standing alone, the
voluntarily withdrawal of Complaint ¶27(b) lacks any character of a settlement between the
parties. Undoubtedly, a withdrawal of a complaint allegation induced by consideration that
serves as a remedy for some alleged violation of the Act might qualify as a judicially-sanctioned,
material alteration within the meaning of Buckhannon but that plainly is not the case here.
Accordingly, I find that the Applicant is not a prevailing party as to Complaint ¶27(b) of the Third
Amended Complaint. Buckhannon, supra.
2. The General Counsel’s Substantial Justification Defenses
The General Counsel invokes EAJA’s “substantial justification” defense for the remaining
complaint allegations affecting the Applicant. Those allegations involved the Applicant’s
organizing drive in mid-September 1993, its status as the collective-bargaining representative of
Raley’s drug clerks, its collective-bargaining agreement with Raley’s, and its effort to enforce the
union-security provision in that collective bargaining agreement.
Preliminarily, the substantial justification requirement of the EAJA establishes a clear
threshold an agency must meet to defeat a prevailing party's eligibility for fees. It properly
focuses on the governmental misconduct giving rise to the litigation. Commissioner, INS v.
Jean, 496 U.S. 154, 165 (1990). The mere fact that the General Counsel lost or advanced a
position contrary to prior precedent does not mean the litigation lacked substantial justification
within the meaning of EAJA. Wyandotte Savings Bank v. NLRB, 682 F.2d (6th Cir. 1982).
Under EAJA, the litigation does not require justification “to a high degree” but it does
require a rationalization beyond “merely undeserving of sanctions for frivolousness.”16 Pierce v.
Underwood, 487 U.S. 552, 565-66 (1988). In Pierce, the Supreme Court selected between two,
“almost contrary” connotations suggested by the word “substantially” as used in the federal fee-
shifting statutes. On the one hand, the Court noted, the word refers to large or considerable in
amount or value as in the statement, “He won the election by a substantial majority.” On the
other hand, the word connotes the essence of something, or, based on the dictionary the Court
cited, “such in substance or in the main” as in the statement, “What he said was substantially
true.” The Pierce opinion rationalizes the Court’s judgment that the word “substantially” as used

15 From the time the hearing opens until the case is transferred to the Board, the ALJ rules
on all motions. NLRB Rules and Regulations, § 102.25 and § 102.47.
16 The Board rejected arguments by the Applicant and Raley’s seeking attorney-fee awards
from the General Counsel under Tiidee Products, 194 NLRB 1234 (1972), enf’d. 502 F.2d 349
(D.C. Cir. 1974). In Tiidee, the Board sanctioned the respondent employer for engaging in
frivolous litigation by ordering the reimbursement of the charging party union for its attorney
fees. The Applicant and Raley’s claimed that the General Counsel, in essence, abused the trial
process by conducting a post complaint investigation and by pursuing frivolous theories of
liability. The Board rejected this claim on the ground that sovereign immunity precluded the
application of Tiidee sanctions against the General Counsel and on the further ground that the
record would not justify such sanctions even if Tiidee applied. The General Counsel’s Answer
frequently refers to the Board’s characterizations about the complexity of this litigation. The
Applicant correctly argues that the justification required by EAJA differs significantly from the
Tiidee test and, therefore, little or no consideration should be accorded to the Board’s complex-
litigation dicta. Although I recognize that the Pierce and Tiidee standards differ quantitatively,
the Board’s observations about the complexity of this litigation have some relevance to the
questions presented here and have been considered.
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in EAJA derives its meaning from the latter connotation, that EAJA requires justification only to
“a degree that would satisfy a reasonable person.” Accordingly, the Court concluded EAJA
requires government agency litigation to have a reasonable basis in both law and fact in order to
satisfy the “substantially justified” standard under EAJA. 487 U.S. at 564-465.
The General Counsel has the burden of proving that fees should not be awarded.
Timms v. United States, 742 F.2d 489, 492 (9th Cir.1984), Meaden Screw Products Co., 336
NLRB 298, 299-300 (2001). See also NLRB Rules and Regulations, § 102.144(a). Where the
General Counsel presents evidence which, if credited by the fact finder, would constitute a
prima facie case of unlawful conduct, then the General Counsel satisfies EAJA’s “substantially
justified” standard. Auto Workers (B.F. Goodrich Co.), 343 NLRB 281 (2004), and the cases
cited there. If it is possible to draw a set of inferences from the circumstances present in a case
that would have supported the General Counsel’s position, then the Board treats the General
Counsel’s arguments as substantially justified. Europlast, Ltd., 311 NLRB 1089 (1993), affd. 33
F.3d 16 (7th Cir. 1994). Reasonable differences of opinion about witness credibility, the weight
accorded various aspects of the evidence, and the inferences permissible from a given set of
events influence the outcome of litigation and bear heavily on the question of substantial
justification under EAJA. Mathews-Carlsen Body Works, 327 NLRB 1167, 1168. (1999).
Similarly, where the General Counsel’s position is substantially justified if he possesses
evidence at the time a complaint issues that could reasonably lead an administrative law judge
to find a violation and does not possess evidence that clearly would defeat the allegation. Lion
Uniform, 285 NLRB 249, 253-54 (1987).
In addition to the foregoing principles, the appellate court in Martinez v. Secretary of
Health & Human Services, 815 F.2d 1381, 1383 (10th Cir. 1987), confronted the problem that
arises when the existing law lacks clarity. The court, quoting dicta from a prior case and citing
its antithesis in a later case, concluded that the clarity of the governing legal principles, or lack
thereof, must be taken into account when assessing substantial justification under EAJA. Thus,
the court stated:
“For purposes of the EAJA, the more clearly established are the governing norms, and
the more clearly they dictate a result in favor to the private litigant, the less ‘justified’ it is
for the government to pursue or persist in litigation.” Spencer v. NLRB, 712 F.2d 539,
559 (D.C. Cir. 1983), cert. denied, 466 U.S. 936 (1984). Conversely, if the governing
law is unclear or in flux, it is more likely that the government’s position will be
substantially justified. See Washington v. Heckler, 756 F.2d 959, 961-62 (3d Cir. 1985).
EAJA “aims to penalize unreasonable behavior on the part of the government without
impairing the vigor and flexibility of its litigating position. Pullen v. Bowen, 820 F.2d 105 (4th Cir.
1987). But EAJA is not intended to deter the government from bringing forward close questions.
Abell Engineering, 340 NLRB 133 (2003).
a. The Coercion and Assistance Allegations
Unrelated to Store Access and Late Fee Issues
Complaint ¶28 alleges that Raley’s assisted and supported the UWRU in violation of
§8(a)(2) by the conduct alleged in Complaint ¶18 through ¶27, including various subparagraphs.
An employer commits unfair labor practice under § 8(a)(2) if it dominates or interferes with the
formation or administration of a labor organization or by contributing financial or other support to
a union seeking to represent its employees. “[T]he difference between unlawful assistance and
unlawful domination is one of degree, as is the difference between permissible cooperation and
unlawful assistance.” Homemaker Shops, 261 NLRB 441, 442. (1982).
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Complaint ¶37 alleges that Raley’s independently violated §8(a)(1) by the conduct
described in Complaint ¶9 though ¶17, and ¶19(a)(1), 21(a)(4), 24(c), 25(a), and 26(a). An
employer engages in an unfair labor practice within the meaning of §8(a)(1) if it interferes with,
restrains or coerces employees for exercising their §7 rights. The conduct alleged in Complaint
¶9 though ¶17 predates the formation of UDCEA/UWRU and has no relationship to this
Application. The remaining independent 8(a)(1) allegations in Complaint ¶37 bear on the
allegation only to the extent that conduct found unlawful also was found to violate §8(a)(2) or
otherwise affected the Applicant’s majority standing.
Six of the unlawful assistance allegations grew out of the disparate access issues that
will be discussed separately in the next section. Fifteen other allegations charge that Raley’s
coerced employees and interfered with or assisted with the formation of the UDCEA during the
September 1993 organizing campaign. The Board adopted the ALJ’s conclusion that the
General Counsel sustained the burden of proof as to two coercion allegations but rejected
argument that the same conduct also constituted unlawful assistance. As both infractions
occurred at stores where the UDCEA failed to secure support anyway, the ALJ also found these
allegations insufficient to taint any petition signatures that union relied on to show its majority
status or to taint the entire process.
The ALJ resolved the remaining thirteen allegations (that also claimed interference and
assistance) against the General Counsel largely on the basis of his credibility resolutions, the
inferences he drew, and the weight he accorded various aspects of conflicting evidence offered
in support of, and to rebut, the allegations. Had that ALJ resolved credibility and made
inferences favorable to the General Counsel, a basis would have existed for the Board to find
that Raley’s managers and supervisors:
v Informed employees around September 15 that ICDA officials and the Local 588 grocery
clerks would not be allowed to engage in Section 7 activities on work time while
permitting UDCEA supporters to circulate its petitions on work time.
v Condoned the use of its facsimile system to circulate the UDCEA petitions even in face
of protests from employee Peterson at Rancho Cordova who supported rival Local 588
and notwithstanding Raley’s written rule limiting the use of that system to official
company business.
v Directed an employee at Benicia to use work time to visit with Wright about the UDCEA.
v Encouraged employees at the South Lake Tahoe store to support the UDCEA while
discouraging them from talking with Local 588 organizers.
v Interrogated Ukiah employees about their activities on behalf of Local 588 and created
the impression their activities were under surveillance.
v Told employees at Fair Oaks to sign the UDCEA’s petition, interrogated employees as to
whether they had done so, and told employees that the UDCEA’s petition had been left
on the bulletin board because Raley’s supported that union.
v Assisted the UDCEA at the Rancho Cordova store by providing the UDCEA petition
quarantined to the manager’s desk drawer by headquarters management to a UDCEA
sympathizer for the purpose of circulating it without limitation as to time.
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The General Counsel initially challenged the mathematical basis for UDCEA’s majority
status claim but abandoned that theory during the litigation. Thereafter, the General Counsel
relied on a theory, or theories, that Respondent’s various acts of assistance and interference
tainted the UDCEA’s majority status.
In Dairyland USA Corp., 347 NLRB No. 30 (2006), the Board summarized the legal
standards applied to 8(a)(2) cases over the years where the General Counsel alleges that the
employer’s pattern of unlawful assistance tainted a union’s majority standing. That case states:
An employer violates Section 8(a)(2) of the Act when it extends recognition to a union
that does not represent an uncoerced majority of employees. ILGWU v. NLRB
(Bernhard-Altmann), 366 U.S. 731 (1961). The General Counsel does not need to show,
with mathematical precision, that the union lacks the support of an uncoerced majority of
employees. SMI of Worcester, Inc., 271 NLRB 1508, 1520 (1984); Clement Brothers
Co., 165 NLRB 698, 699 (1967) (holding that coercion of 7 employees out of 129 who
signed authorization cards in a unit of approximately the same size was sufficient to infer
a larger pattern of coercion amid other violations), enf’d. 407 F.2d 1027 (5th Cir. 1969).
Rather, “‘[a] pattern of company assistance can be sufficient to invalidate all cards.’”
Famous Castings Corp., 301 NLRB 404, 408 (1991) (quoting Amalgamated Local 355 v.
NLRB, 481 F.2d 996, 1002 fn. 8 (2d Cir. 1973)). In determining whether a pattern of
unlawful assistance exists, the Board examines the totality of the circumstances,
including conduct occurring both before and after recognition of the union. Farmers
Energy Corp., 266 NLRB 722, 722–723 (1983) (determination of whether employer’s
pre- and post-recognition unlawful acts tainted majority status depends on the entire
“‘general contemporaneous current of which they were integral parts’”) (quoting
International Assn. of Machinists, Tool and Die Makers Lodge No. 35 (Serrick Corp.) v.
NLRB, 110 F.2d 29, 35 (D.C. Cir. 1939), affd. 311 U.S. 72 (1940)), enf’d. 730 F.2d 1098
(7th Cir. 1984); Windsor Castle Health Care Facilities, 310 NLRB 579, 592 (1993)
(finding that “circumstances occurring after the execution of the collective-bargaining
agreement further manifest[ed] a pattern of assistance”), enf’d. in relevant part 13 F.3d
619 (2d Cir. 1994).
When General Counsel’s coercion and assistance allegations collapsed under the ALJ’s
credibility determinations and unfavorable inferences, the basis for the General Counsel’s
allegations about UDCEA’s tainted majority (Complaint ¶29), its recognition (also Complaint
¶29), and its union-security clause (Complaint ¶30) also collapsed.
The Applicant argues that the ALJ’s credibility resolutions were unnecessary as that the
General Counsel’s case could have been cast aside with a motion to dismiss at the end of the
hearing. However, I find that contention to be largely ipse dixit; at least the Reply makes no
attempt to support it with any cohesive argument. It is abundantly obvious that the ALJ rejected
a similar argument when the Applicant made to him. Plainly, the ALJ’s credibility resolutions
and inferences largely determined the overall result in this case. Indeed, in its decision the
Board makes four separate references to its reliance on the “credited record.”
Examples abound demonstrating the effect of the ALJ’s credibility determinations. Thus,
Wright’s visit to the Benicia store constituted a key component of the General Counsel’s case
relating to conduct during the Applicant’s organizing drive. As to the specific coercion and
assistance allegations arising from that mid-September visit, the inference made by the ALJ that
Willis’ statement to Hernandez amounted to nothing more than one friend talking to another was
critical to resolving this allegation. By stark contrast, the Board affirmed an ALJ’s conclusion in
Famous Castings Corp., 301 NLRB 404 (1991), that an employer “blatantly” assisted a labor
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organization in violation of §8(a)(1) and (2) where its supervisor told an employee to go
“upstairs” to talk to the union representatives and later gave the employee union cards. The
ALJ’s conclusions about this tell-tale incident, shaped largely from his subjective inference
about the degree of Hernandez’ personal relationship with Wallis (who did not testify), had an
important impact on this critical issue.
Likewise, the ALJ’s wholesale rejection of Brenda Peterson’s testimony except where
corroborated by a supervisor or an employee aligned with the UDCEA also proved significant. It
precluded a finding that Abfalter’s first memo to the store managers had been publicized to
employees and that the Rancho Cordova store manager provided the quarantined UDCEA
petition to Ruth Gordon for circulation among the employees.
I also find the General Counsel substantially justified with respect to the allegation in
Complaint ¶27(a). Again, the credibility determinations and inferences made by the ALJ and the
Board had a significant impact on the outcome of this issue. Wright provided the General
Counsel with an affidavit in January 1994 that substantially contradicted the credited testimony
he and Telfeian provided at the hearing on which the findings about these allegations rest.
Thus Wright, whose hearing testimony the ALJ credited on virtually every contradicted point,
told the General Counsel in that affidavit that:
Sometime in the middle of October, I received a call from Mr. Henry Telfeian. He said
he had heard that I was running a new labor organization. He then told me about
himself. He told me he was a retired labor attorney who was interested in a new
approach to labor. He told me that if [I] was interested in representation by him, I should
call him. He gave me his number. I asked him where he had heard about us. He said
that, in the past, he had had ties with Raley’s counsel, Pat Jordan. That’s about all I can
recall to the conversation. I did not decide to hire Mr. Telfeian at that time.
* * * * *
After discussing the matter with four other representatives, the UWRU decided to hire
Mr. Telfeian. We hired Mr. Telfeian sometime in mid-October, prior to October 18.
In labor relations law, counsel switching sides is virtually an unheard of occurrence. If Wright’s
affidavit statements are credible, this switch would have been all the more abnormal because it
occurred in the midst of collective-bargaining negotiations with an misleading disclosure to the
new client and a very belated disclosure to the old client. Where the overall context included
Raley’s enthusiastic embrace of the UDCEA’s organizing effort, I find a substantial basis existed
for reaching inferences quite contrary to those ultimately made as to this allegation particularly
in view of the timing of the move.
Even the allegation about the use of Raley’s telephone and fax systems (complaint ¶18)
for UDCEA organizing purposes shows the complex, litigation judgments the General Counsel
faced. Although the ALJ appears to have relied primarily on the testimony that emerged on
cross-examination of the General Counsel’s witnesses to resolve this issue, the ALJ obviously
chose to accord much less weight to other evidence favorable to the General Counsel. Thus,
Raley’s unquestionably maintained a written policy limiting the use of its telephone and fax
systems to official company business except in case of emergencies. As with other policies,
rule enforcement was obviously left to the whim of local managers and supervisors, a situation
entirely susceptible of an opposite conclusion, i.e., that their claims about these subjects
amounted largely to self-serving declarations. Clearly, Abfalter’s first memo following the IDCA
disclaimer reinforced the company’s expectations about the enforcement of existing policies.
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And the directions given supervisor Renfree by Abfalter or some other headquarters’ official to
quarantine the UDCEA petition in the store manager’s desk after it had been faxed the Rancho
Cordova pharmacy and intercepted by Brenda Peterson provides a specific example that would
lend support to a conclusion that the company intentionally provided Wright and his allies
widespread access to the Raley’s phone and fax equipment during their organizing effort.
Accordingly, I have concluded that the dismissal of virtually all of the General Counsel’s
case discussed in this section resulted from the inferences and credibility resolutions made by
the ALJ and affirmed by the Board. Had the ALJ’s credibility determinations and inferences
been more favorable to the General Counsel, I find an ample basis would have existed for
concluding that Raley’s conduct tainted UDCEA’s majority standing. Such a finding, of course,
would have vitiated the collective-bargaining relationship, including the collective-bargaining
agreement with its union-security clause. For these reasons, I find the General Counsel met the
burden of proving the allegations addressed in this section were reasonable and substantially
justified within the meaning of EAJA.
b. The Access Issues
Relying on Lechmere and the fact the all of the UDCEA organizers were Raley’s
employees, the Board and the ALJ resolved disparate access claims against the General
Counsel. To be sure, Lechmere plainly justifies an employer’s denial of access to nonemployee
union organizers such as the Local 588 agents because, as that case reiterates, nonemployee
organizers enjoy only a derivative § 7 right of access to an employer’s private property that
applies only in rare circumstances where the employees are deemed inaccessible by other
reasonable means. Although Lechmere distinguishes the rights of nonemployees from
employees, its holding applies to nonemployees only.
The six access allegations at issue claim, in essence, that Raley’s local managers
denied Local 588 nonemployee organizers access to its stores while it permitting Wright access
to whatever store he wanted to visit in order to solicit on behalf of UDCEA during the critical
mid-September 1993 period. The General Counsel’s Answer characterizes these allegations as
“novel.” I find little novelty in them at all. Wright’s off-duty status during the organizing
campaign presented an issue that has had a contentious history.
Based on Wright’s employee status, the Board and the ALJ concluded that § 7 protected
his right to visit various Raley’s stores where, as here, local Raley’s managers purportedly made
no little or no effort to control access by off-duty or offsite employees, a remarkable practice
considering the large quantities of pharmaceuticals presumably present in and around the areas
outside employees were supposedly permitted to freely visit.17
The Board rejected the General Counsel’s contention that Raley’s “gave discriminatory
campaign access to UDCEA.” In the Board’s view, the fact that “all of UDCEA’s active
supporters were Raley’s employees” precluded the application of Lechmere’s exception relating
to disparate access in rival union situations. In addition, the Board adopted the ALJ’s finding
that local store managers “could not continuously monitor all of their store areas for [union]
activity, and when pro-UDCEA employees from other stores came to solicit local employees for
signatures, local managers did not immediately become aware of their presence or their

17 In addition, the process by which a local management distinguishes an offsite employee
dressed in street clothes from an ordinary shopper is not at all apparent.
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activity.”18 But with respect to the critical Benicia situation, the same supervisor who told
Hernandez to speak with Wright in an upstairs office intercepted and ejected the Local 588
agent who appeared at the store only a day or two later.
Regardless, I find that the General Counsel was substantially justified in bringing the
disparate access allegations. In my judgment, the existing case law provided an ample basis
for the General Counsel to prosecute this issue. Thus, in Duane Reade, Inc., 338 NLRB 943
(2003), the Board held that an employer violates Section 8(a)(2) by permitting the nonemployee
organizers access to its premises during an organizing campaign while excluding a rival union’s
nonemployee organizers. And in Ernst Home Centers, Inc., 308 NLRB 848, 849-50 (1992), a
case remarkably similar to this, the Board found that an employer violated §8 (a)(1) by denying
a nonemployee union agent access to employees on its sales floor while permitting an
employee promoting a decertification petition wide ranging access to the sales floors at several
store locations.
In addition, even though Wright clearly was an employee throughout the mid-September
campaign period, he was on a medical leave of absence and, hence off duty on a full-time
basis. For reasons detailed below, the developing Board and court precedent applicable to the
access by off-duty and offsite employees fully warranted the General Counsel’s litigation that
implicated Raley’s unusually permissive attitude toward Wright’s access to its stores while on
leave. The General Counsel use of disparate treatment language in casting the complaint’s
access allegations called for a rational analysis of the legal basis for Raley’s denial of access to
the Local 588 agents and, separately, a reasoned analysis for granting access to Wright.
As noted, Lechmere certainly would explain the conclusions reached by the Board and
the ALJ as to the Local 588 agents but the legal basis for Wright’s widespread access to the
sales floors and other areas at several stores while in a leave status is much murkier. As
illustrated below the basis for, and degree of, access by off-duty and offsite employees, to an
employer’s property has a long and turbulent history. If in the final analysis, the Board and the
ALJ been determined that basis for Wright’s access was grounded on Raley’s permissive
attitude toward him and his activities rather than on solid § 7 grounds, then far different
conclusions about the access allegations and the entire case would have been compelled.19
The contentious history concerning access by off-duty employees to which I refer began
with GTE Lenkurt, 204 NLRB 921 (1973). There, the Board (members Fanning and Jenkins
dissenting) reversed an ALJ’s holding that the employer violated § 8(a)(1) by maintaining a rule
barring access to its premises by off-duty employees. The Lenkurt majority alluded to the
distinction between employees and nonemployees for purposes of engaging in union solicitation
on an employer’s premises and concluded that the “status (of an off-duty employee) is more
nearly analogous to that of a nonemployee, and he is subject to the principles applicable to
nonemployees.” [Emphasis mine] Going further, the majority described both as “invitees” so
that “one is no more entitled than the other to admission.” 204 NLRB 922.

18 As there is an absence of a clear finding by the Board or the ALJ identifying any other
employee who solicited at a store other than their own during the UDCEA’s organizing effort, I
find the words “pro-UDCEA employees” is a euphemistic reference to Wright and Wright alone.
19 Even so, the Board and the ALJ found that store managers and supervisors often lacked
knowledge about the activities of Wright and his supporters at the stores. But where the
evidence shows they promptly intercepted Local 588 organizers when they entered stores,
these findings implicitly involve credibility judgments favorable to Raley’s and the UDCEA.
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But the following year in Bulova Watch Co., 208 NLRB 798 (1974), the Board began to
limit Lenkurt. It held that an employer violates the Act by denying employees access to areas
outside the plant for handbilling purposes during periods shortly before their work shifts. Two
years later, the Board concluded in Tri-County Medical Center, 222 NLRB 1089 (1976), that
Lenkurt must be narrowly construed to prevent undue interference with the rights of employees
under § 7 to freely communicate their interest in union activity to those who work on different
shifts. 222 NLRB 1089. Separately, Chairman Murphy specifically disagreed with the Lenkurt
majority’s view that off-duty employees are analogous to nonemployees for purposes of
restricting their access to parking lots and adjacent roadways. 222 NLRB 1098, fn. 4.
Following the Lechmere, the Board again confronted the Lenkurt majority’s comparison
between off-duty employees and nonemployees. In Nashville Plastic Products, 313 NLRB 462
(1993), the respondent-employer appealed the ALJ’s conclusion that it violated the Act by
barring off-duty employees from handbilling on its premises in areas outside the plant. The
Board rejected the employer’s contention “that the access rights of off-duty employees equate to
those of nonemployees.” Although the Board acknowledged the Lenkurt majority made a
similar analogy, it said that it would continue to adhere to Tri-County’s narrow construction of
Lenkurt. The Board specifically rejected the employer’s contention that Lechmere applied to off-
duty employees. Lechmere, the Board asserted, only distinguished the access rights of
nonemployees from the rights of employees as originally established in seminal case of
Babcock & Wilcox, 351 U.S. 105 (1956). As in Tri-County, the Board upheld the ALJ’s
conclusion because the employer had barred the off-duty employees from distributing union
literature in outside areas of the employer’s plant.
More recently, the Board, in ITT Industries, 331 NLRB 4 (2000), found that an employer
violated § 8(a)(1) by barring offsite employees from distributing union literature in the parking lot
at a sister plant not too distant from the plant where they worked. Relying on Tri-County, the
ALJ found a violation and the Board adopted the ALJ’s decision without comment.
When the DC Circuit initially reviewed the Board’s decision, it refused to enforce the ITT
Industries order because of the Board’s failure address the tresspassory character of offsite
employees entering their employer’s property at locations other than where they worked. ITT
Industries, Inc. v. NLRB, 251 F.3d 995 (D.C. Cir. 2001). Accordingly, the court remanded the
case to the Board with an instruction to “consider and craft” a decision in light of the various
concerns the court noted throughout its lengthy review of federal access cases. The court
summed up its concerns as follows at 251 F.3d 1004:
[T]he Board failed even to acknowledge that the question of off-site employee access
rights was an open one, i.e., that . . . § 7 and the [Supreme] Court’s cases are silent on
the issue. Rather, the Board decided sub silentio that § 7 guarantees all off-site
employees, whether members of the same bargaining unit or not, some measure of free-
standing, nonderivative access rights. * * * Indeed, by applying the Tri-County balancing
test, the Board decided without analysis that trespassing off-site employees possess
access rights equivalent to those enjoyed by on-site employee invitees. Because it is by
no means obvious that § 7 extends nonderivative access rights to off-site employees,
particularly given the considerations set forth in the[Supreme] Court’s access cases, the
Board was obliged to engage in considered analysis and explain its chosen
interpretation.
During the period that this case (Raley’s) was pending on exceptions, the Board
specifically decided the issue posed by the ITT Industries court but in another case. Hillhaven
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Highland House, 336 NLRB 646 (2001), enf’d. 344 F.3d 523. (6th Cir. 2003). In Hillhaven, the
Board concluded:
(1) under Section 7 of the Act, offsite employees (in contrast to nonemployee union
organizers) have a nonderivative access right, for organizational purposes, to their
employer’s facilities; (2) that an employer may well have heightened private property-
right concerns when offsite (as opposed to onsite) employees seek access to its
property to exercise their Section 7 rights; but (3) that, on balance, the Section 7
organizational rights of offsite employees entitle them to access to the outside,
nonworking areas of the employer’s property, except where justified by business
reasons, which may involve considerations not applicable to access by off-duty, onsite
employees. To this extent, the test for determining the right to access for offsite visiting
employees differs, at least in practical effect, from the Tri-County test for off-duty, onsite
employees. 336 NLRB 648.
The Board reasoned in Hillhaven that offsite employees were different in important
respects from persons who have no employment relationship with the employer involved such
as nonemployee union organizers. Offsite employees, the Board noted, are “not only
‘employees’ within the broad scope of Section 2(3) of the Act, they are ‘employees’ in the
narrow sense: ‘employees of a particular employer’ (in the Act’s words), that is, employees of
the employer who would exclude them from its property.” Consequently, the § 7 rights
implicated involve employees who work for the same employer, rather than simply a shared
interest resulting from belonging to the working class generally or because they work in the
same industry or community. As nothing in the Act or in the Supreme Court’s prior access
cases suggest that, as against their own employer, the rights of offsite employees were
“somehow derivative of other employees’ rights, when they are exercised at a location other
than the customary site of employment,” employees who seek to encourage the organization of
“similarly situated” employees at another employer facility seek to further their own welfare
through the strength of numbers. Even though employees who work for the same employer
may work at different locations, they often have common, albeit not always identical, interests
and concerns related to wages, benefits and other workplace issues that may be addressed
through concerted action. For these reasons the Board found that “the Section 7 rights of offsite
employees are “nonderivative and substantial.” 336 NLRB 648-49
But Hillhaven also recognized that access accorded to offsite employees could also
involve distinct considerations when accommodating the tension between employee § 7 rights
and their employer’s property rights. Even though the Board recognized that offsite employees
might be strangers in one sense, the existence of the employment relationship distinguishes
them from persons who are complete strangers. Because of that relationship, the Board felt
that it is easier for an employer to regulate the employee’s conduct than it would be to regulate
a complete stranger’s conduct. But problems nonetheless abound because the employer’s
control of the disputed premises often implicates security, traffic control, personnel, and like
issues that do not arise with access by onsite employees. 336 NLRB 649-50.
Therefore, in balancing the employees § 7 rights with the employer’s property interests,
the Hillhaven Board concluded that offsite employees should be permitted access to outside,
nonworking areas of the employer’s property, except where justified by business reasons. But
having reached that conclusion, the Board cautioned that it would take into account an
employer’s predictably heightened property concerns and might in certain cases limit or bar
access where “the influx of offsite employees might raise security problems, traffic control
problems, or other difficulties.” 336 NLRB 650.
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In Hillhaven, the Board’s acknowledged that an employer is “arguably” free to define the
terms of its invitation to employees so that “any employee engaged in activity to which the
employer objects on its property might be deemed a trespasser, not an invitee.” Therefore, the
balance struck by the Board’s in Hillhaven represented its effort to heed the Court’s
admonishment in Babcox & Wilcox that it reconcile employees’ § 7 rights and an employers’
property rights “with as little destruction of one as is consistent with the maintenance of the
other.” 351 U.S. 105, 112 (1956).
When a Board panel turned to the remanded ITT Industries case, it applied the Hillhaven
rationale and found those offsite employees enjoyed a substantial “nonderivative right of
access” especially where, as there, they sought to organize a three-plant unit. ITT Industries,
341 NLRB 937 (2004). This latter fact caused the Board panel to conclude that the employees
in ITT Industries shared common concerns even greater than those which existed in Hillhaven.
The Board then balanced the employer’s property concerns, grounded on security and past
instances of vandalism, against the offsite employees’ access rights and concluded (with
Chairman Battista dissenting) that the employer’s concerns did not justify its total ban on their
handbilling in the plant parking lot. Subsequently, the DC Circuit enforced the Board’s order
based on its supplemental decision. ITT Industries v. NLRB, 413 F.3d 64 (DC Cir 2005).
Arguably Wright’s wide ranging access in mid-September 1993 to store interiors and
non-public areas cannot by explained by the rationale in ITT Industries and Hillhaven. Despite
the unique circumstances arising from his lengthy leave during that period, the Board and the
ALJ appear to have treated him virtually as an on duty employee throughout that period. Of
course had it been concluded that the degree of access accorded him did not flow from some
basis grounded in § 7 but rather from the employer’s leniency toward him because it favored his
activities, the outcome would necessarily have favored the General Counsel. However, the
Board seemingly lumped Wright with all other employees and concluded on the basis of the
type of access previously accorded them in other contexts, they enjoyed a § 7 right of access to
Raley’s sales floors and back area anywhere, anytime even though it strictly controlled access
by the Local 588 organizers, Local 588 grocery clerks, and former IDCA officers. Regardless,
considering the General Counsel’s important role as the gatekeeper in the development of
national labor policy, I find he was substantially justified in litigating the access issues presented
by these peculiar facts.
c. The Late Fee Issue
The General Counsel argues that these allegations presented a “close question.”
involving “difficult legal issue which necessitated a protracted analysis by the judge.” The
Respondent argues that the cases relied upon by the General Counsel had been “superseded.”
The ALJ candidly stated that the resolution of the question presented by the late fee allegations
was “particularly murky” and “may depend on which cases you read.”
The General Counsel’s principal theory underlying the allegations that the UWRU (f/n
UDCEA) and Raley’s violated the law when they threatened to enforce the contractual union-
security provision in 1994 (complaint ¶32 and ¶33) collapsed with the dismissal of the
allegations about coercion and assistance during the mid-September organizing drive. The ALJ
specifically found these allegations fell because:
I have earlier concluded, in substance, that the General Counsel failed to rebut that
presumption, i.e., failed to establish any credible factual or legal basis for finding that
UDCEA’s majority-showing on which the recognition was based was the “tainted”
product of “coercion” or any other form of unlawful “assistance” by Raley’s. Thus, the
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recognition was lawful, and it created a lawful 9(a) relationship between Raley’s and the
new union, one in which the parties were legally free to enter into a labor agreement
containing a union-security clause, and to “maintain” and “enforce” the clause.
Accordingly, all counts are dismissed which allege either unlawful “maintenance” of a
union-security agreement by the respondent parties, or which suppose that routine acts
of enforcement of the agreement were unlawful because Raley’s and UWRU had no
right to enter into or maintain the agreement in the first place. 348 NLRB No 25, slip op
159.
But even assuming the lawfulness of the union-security provision, the General Counsel
also claimed that the UWRU’s effort to collect the late fee using that mechanism was unlawful.
On this point, the analytical focus by the Board and the ALJ centered the language in § 8(a)(3)
that exempts union-security agreements from the general union-based discrimination
prohibition. That exemption is made up of two provisos. The second proviso was at the core of
this allegation. It effectively prohibits the discharge of an employee under a union-security
contract if the employer has reasonable grounds for believing that (the employee’s union)
membership was terminated for reasons other than the failure of the employee “to tender the
periodic dues and initiation fees uniformly required as a condition of acquiring or retaining
membership.” Where all of the statutory criteria are met and the union meets its fiduciary
obligations to the employee, then it may enforce the payment of the requisite dues and fees
required by demanding that the employer terminate the dues-delinquent employee. If the fine or
assessment lacks the uniform and periodic character required by the statute, then the union is
usually left to collect that type of membership obligation elsewhere, typically in the state courts.
Operating Engineers Local 542C (Ransome Lift), 303 NLRB 1001, 1003 (1991).
The UWRU justified its reinstatement surcharge or late fee on the ground that it always
had been an integral and uniform part of its periodic dues structure. Its function, as
distinguished from its form, the UWRU argued, was no different from that served by certain
dues-discount programs previously approved by the Board. The ALJ agreed and concluded
that the UWRU’s late fee, uniformly assessed against all employees who failed to pay their dues
on time, was analogous to the dues discount provisions upheld in previous Board cases.
The Board adopted the ALJ’s result with an overt reference to the discount analogy.
Instead it simply found that the late fee was not a penalty or an assessment but rather a
legitimate component of “periodic dues” within the meaning of § 8(a)(3). Because the Board felt
that the amount of the late fee ($5 per month) was “not disproportionate to the cost the (UWRU)
incurred in collecting late dues and was not an arbitrary, excessive, or irregular,” it did not fall
outside the protection of § 8(a)(3).
The Board cited three cases for its conclusion. In one, Retail Store Employees Local
322 (Ramey Supermarkets), 226 NLRB 80 (1976) (the Local 322 case), the Board adopted
without comment the ALJ’s conclusion that the union could lawfully threaten to seek the
discharge of a “financial-core” employee under a union-security agreement where the employee
refused to pay a $50 “reinitiation fee” uniformly charged all unit employees who failed to pay
dues for three months or longer. Even the ALJ stated that “[t]he legal situation with respect to
the reinitiation fee is not so clear” where, as in that case, the fee would not be an incident to
acquiring membership or the benefits of membership. But ultimately the ALJ found that efforts
to collect the reinitiation fee lawful even as to nonmembers because it was a charge the union
“uniformily” levied on everyone after they became 3 months delinquent in their dues payments.
226 NLRB 91. Although the ALJ cited precedent for the proposition that a union could lawfully
charge a union member a fee to regain lost membership, he cited no precedent for applying a
similar result to financial-core employees.
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The Board also cited Teamsters Local 959 (RCA Service Co.), 167 NLRB 1042 (1967)
(the Teamsters Local 959 case) and Machinists Lodge 1345 (Cobak Tool), 157 NLRB 1020
(1966) (the Machinists Lodge 1345 case), both discount cases. In the Teamsters Local 959
case, the Board held that the union’s scheme discounting regular dues by 30% if paid 15 days
early to be lawful; in the Machinists Lodge 1345 case, the Board affirmed a trial examiner’s
conclusion that a 6% discount for prompt dues payment did not amount to an unlawful penalty
against those who failed to qualify for the discount.
Obviously, the Board and the ALJ rejected the General Counsel’s contention that
Raley’s and the UWRU violated the Act by using the union-security clause to compel payment
of the UWRU’s late fee because it failed to meet the statutory definition of “periodic dues and
initiation fees uniformly required.” But I find the General Counsel reliance on the Board’s
decision in the The Great Atlantic & Pacific Tea Company (Bakery Workers Local 12), 110
NLRB 918 (1954) (the A & P case) to be reasonable and justified. Despite Respondent’s claim
that the case has been superseded, it has never been overruled.
A & P held that the use of the union-security clause to collect a one dollar surcharge
against members who did not pay their dues for more than a month unlawful. The Board found
the added charge, mandated by the union’s constitution, was not periodic by nature because it
was intermittently imposed, i.e., whenever an employee failed to pay dues on time.20 For that
reason, the Board concluded that the surcharge amounted to a “punishment for the nonpayment
of dues on time.” Arguably the $5 per month charge here is indistinguishable from the A & P
surcharge, save for an inflation adjustment. In fact, even the ALJ, in adopting the UWRU’s
argument stated that “both dues-discount programs and delinquency surcharge programs
commonly serve a twofold function, both as an incentive to timely payment and as a disincentive
to delinquency.”
But the final result in a subsequent, related case, Bakery and Confectionery Workers’
Local 12, 115 NLRB 1542 (1956), enf’d. denied, 245 F.2d 211 (3rd Cir. 1957) (the Local 12 case)
found the technical difference between a discount and a surcharge to be controlling. The Local
12 case involved the same union that appeared in the A & P case. By the time the second case
came along, Local 12 had increased its standard dues by one dollar and added a provision
granting members a one dollar discount for the timely payment of dues. But the Board
(Murdock and Peterson dissenting) reached the same result as it had in the A & P case. The
majority reasoned that the union’s discount scheme essentially included the problematic
assessment or fine found in the earlier case as a part of its regular dues structure.
The court of appeals refused to enforce the Board’s order in the Local 12. It
distinguished the discount case from the surcharge case (A & P) on the ground that the discount
scheme met the “technical requirements” of § 8(b)(2) whereas, by implication, the surcharge
case did not. The court’s opinion finds no fault whatever with the Board’s decision in the A & P
case. Rather, it went to some length to explain that the Board simply added a surcharge for
failure to pay dues in a timely manner to a growing list of other intermittent assessments that
cannot be collected through the “medium of an existing union-security contract,” i.e., fines for
engaging in dual unionism, fines for failing to attend union meetings, and fines for refusing to

20 The union’s constitution in that case required members to pay their dues by the end of the
month or be subject to a $1 assessment. The constitution also provided that members who
failed to pay the delinquent dues plus the assessment by the middle of the following month “will
then be removed from their jobs.” The case arose when A & P terminated an employee that
Local 12 reported as two months delinquent in the payment of dues and the added assessment.
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picket. Accordingly, I find the General Counsel could quite reasonably and very logically to read
the court’s opinion as saying essentially this: surcharges for the failure to pay dues on time do
not meet the “technical requirements” of § 8(a)(3) and § 8(b)(2); a discount for paying dues on
time does meet those “technical requirements.”
No doubt the UWRU’s contention, which the ALJ and the Board effectively adopted, that
its surcharge serves the same purpose as the approved discounts has a certain practical
appeal. But this argument is not without shortcomings, not the least of which is that the
surcharge uniformity is grounded on the fact that it is written into the union’s governing
documents. Arguably, according significant weight to that factor poses a clear threat to the
continued vitality of the second union-security proviso in § 8(a)(3) as it would mean that unions
could avoid the consequences of that proviso by simply writing a designated fine directed at
unwanted behavior into their by-laws and restrain employees at will. And no one should be
surprised if lexicologists scorned the discount/surcharge analogy as comparable to a straight
line/twisted pretzel analogy.
Regardless, using the scale established by the Martinez court, I find the clarity of guiding
precedent would rank quite low. For that reason and the fact that A & P has never been
overruled, I have concluded that the General Counsel’s prosecution of the reinstatement or late
fee issue to have been substantially justified under EAJA.
3. Summary of Findings
To summarize, the Applicant is not a prevailing party as to the allegation in ¶27(b) of the
Third Amended Consolidated Complaint. In addition, the General Counsel was substantially
justified in bringing the other allegations that pertained directly to the Applicant or that sought to
affect the status or interests of the Applicant. Therefore, I conclude that the Application should
be dismissed in its entirety. Having reached these conclusions, consideration of the parties’
contentions about specific fees or costs submitted with the verified Application is unnecessary.
Conclusions of Law
1. The Applicant is a labor organization within the meaning of Section 2(5) of the Act.
2. The Applicant is a association qualified as a “party” under 5 U.S.C. § 504(b)(1)(B)(ii).
3. The Applicant is not a prevailing party within the meaning of 5 U.S.C. § 504(c)(1) as to
¶27(b) of the Third Amended Consolidated Complaint issued in this proceeding.
4. The General Counsel’s allegations in the Fourth Consolidated Amended Complaint,
insofar as they pertained to the Applicant or sought to affect the Applicant’s status under
Section 9(a) of the Act or its other interests, were substantially justified within the meaning of 5
U.S.C. § 504(c)(1).
Based on the foregoing findings of fact and conclusions of law, I issue the following
recommended21

21 Pursuant to NLRB Rules and Regulations § 102.48(a) the Board will adopt these findings,
conclusions, and recommended Order absent the filing of timely and proper exceptions as
provided under NLRB Rules and Regulations § 102.154,and all objections and exceptions to
them will be deemed waived for all purposes.
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ORDER
The Application for allowable fees and costs under the Equal Access to Justice Act filed
by the United Wholesalers and Retailers Union is hereby dismissed in its entirety.
Dated: Washington, D.C. October 10, 2007
_______________________
William L. Schmidt
Administrative Law Judge