PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

SOUTHEAST CRESCENT SHIPPING
COMPANY; SOUTHEAST CRESCENT
TERMINAL COMPANY, INCORPORATED,
Petitioners,
                                                         No. 98-2464
v.

NATIONAL LABOR RELATIONS BOARD,
Respondent.

NATIONAL LABOR RELATIONS BOARD,
Petitioner,

v.
                                                         No. 98-2609
SOUTHEAST CRESCENT SHIPPING
COMPANY; SOUTHEAST CRESCENT
TERMINAL COMPANY, INCORPORATED,
Respondents.

On Petition for Review and Cross-application
for Enforcement of an Order
of the National Labor Relations Board.
(11-CB-16155, 11-CB-2483)

Argued: September 23, 1999

Decided: October 20, 1999

Before HAMILTON, LUTTIG, and WILLIAMS, Circuit Judges.
Petition for review denied and cross-application for enforcement
granted by published opinion. Judge Luttig wrote the opinion, in
which Judge Hamilton and Judge Williams joined.

_________________________________________________________________

COUNSEL

ARGUED: Bruce McCoy Steen, MCGUIRE, WOODS, BATTLE &
BOOTHE, L.L.P., Charlotte, North Carolina, for Petitioners. Christo-
pher Warren Young, NATIONAL LABOR RELATIONS BOARD,
Washington, D.C., for Respondent. ON BRIEF: W. T. Cranfill, Jr.,
Robert B. Meyer, MCGUIRE, WOODS, BATTLE & BOOTHE,
L.L.P., Charlotte, North Carolina, for Petitioners. Frederick L. Fein-
stein, General Counsel, Linda Sher, Associate General Counsel, John
D. Burgoyne, Acting Deputy Associate General Counsel, Frederick C.
Havard, Supervisory Attorney, NATIONAL LABOR RELATIONS
BOARD, Washington, D.C., for Respondent.

_________________________________________________________________

OPINION

LUTTIG, Circuit Judge:

Petitioners Southeast Crescent Shipping Company and Southeast
Crescent Terminal Company seek review of the National Labor Rela-
tions Board's determination that an employee with hiring authority
refused to hire a worker because of his support of particular union
leaders, in violation of sections 8(a)(1) and 8(a)(3) of the National
Labor Relations Act. Petitioners also contest the Board's decision that
the hiring employee was a statutory supervisor for whose conduct
they were responsible. The Board cross-petitions for enforcement of
its order. Because we find substantial evidence in the record to sup-
port the Board's determinations, we deny the petition for review and
grant enforcement of the Board's order.

I.

Petitioners Southeast Crescent Shipping Company and Southeast
Crescent Terminal Company (collectively "Southeast") are party to a

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hiring hall agreement with International Longshoremen's Association,
Local 1426 ("Union"). Under the agreement, when Southeast needs a
work crew for a particular job, it seeks the Union's recommendation
for a "header," or senior employee to select and lead the crew. The
header then forms a crew of men based on both their skills and a
seniority plan.

In December of 1993, James Grady became a header, and selected
Emmett Denkins as a member of his seven-man gang. By mid-March
of 1994, it became clear that this gang would soon dissolve. Southeast
subsequently decided to form a three-man gang, with Grady as
header, to begin work on a new full-time project. Grady initially
offered a position on this gang to Denkins.

In early April, Denkins signed a petition supporting Union trustee
John Mackay, who had been appointed by the Union's international
headquarters to run the Union in place of its president, Willie Sloan.
The question whether Sloan or Mackay should head the Union was
a divisive one among members, and Grady in particular was an out-
spoken supporter of Sloan. The petition that Denkins signed was
regarded as "anti-Sloan" among union members, and Grady thus per-
ceived Denkins as having "jumped the fence" separating the Sloan
and Mackay camps by signing the petition.

In mid-July of 1994, Grady received a formal directive from South-
east to select two co-workers for the new gang. Although he had
promised Denkins a position, Grady selected in Denkins' place a
worker who had not signed the petition. Denkins filed a grievance
with the Union upon discovering that he had been passed over. In late
August, he met with Sloan, who told him that Grady had decided to
replace him on the three-man gang because he had signed the petition.
Another union member testified before the Administrative Law Judge
(ALJ) that Grady had told him that Denkins would not be a member
of the three-man gang because Denkins had signed the petition.

After the Union denied his grievance, Denkins filed a charge with
the NLRB. An ALJ found that Southeast had committed an unfair
labor practice under sections 8(a)(1) and (3) of the National Labor
Relations Act (NLRA) by denying Denkins a place on the three-man
gang. In so finding, the ALJ determined that Southeast was responsi-

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ble for Grady's conduct both because Grady was a supervisor acting
within the scope of his authority within the meaning of sections 2(2)
and (11) of the NLRA, and alternatively because Southeast knew or
should have known of Grady's discriminatory motive. Insofar as is
relevant to this case, the Board adopted the ALJ's findings.

II.

Southeast claims that the record lacks substantial evidence to sup-
port the Board's finding that Grady declined to hire Denkins for a
spot on the three-man gang because Denkins signed the petition. Such
discrimination based on union activity constitutes an unfair labor
practice under NLRA sections 8(a)(1) and (3), 29 U.S.C. §§ 158(a)(1)
and (3). See NLRB v. Transportation Mgmt. Corp., 462 U.S. 393, 394
(1983).

This court must determine whether the Board's application of the
law to the facts of this case is "supported by substantial evidence
based upon the record as a whole." Pirelli Cable Corp. v. NLRB, 141
F.3d 503, 514 (4th Cir. 1997). "Substantial evidence `is such evidence
as a reasonable mind might accept as adequate to support a conclu-
sion.'" Id. (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197,
229 (1938)).

We find that the present record contains substantial evidence to
support the Board's conclusion that Grady acted out of statutorily
impermissible motives. Specifically, the record includes: 1) Union
member King's testimony that Grady stated he decided not to give
Denkins the job because Denkins had signed the petition, see J.A.
175; 2) Union member Walker's testimony that Grady angrily con-
fronted Denkins about his decision to shift his support from Sloan to
Mackay, see J.A. 186-87; and 3) Denkins' testimony that Grady had
initially offered the job to him, and that Sloan stated that Denkins was
denied the job because he had signed the petition, see J.A. 80.

Southeast offers two principal responses. First, it claims that the
Board impermissibly relied on Denkins' self-interested testimony. We
reject this argument both because Southeast can point to nothing in
the record to suggest that Denkins' testimony was unreliable and
because, as can be seen from the evidence noted above, the record

                    4
contains evidence from multiple sources that supports the Board's
conclusion. Second, Southeast claims that Grady chose not to hire
Denkins because of his belief that Denkins was not qualified to oper-
ate certain vehicles that the three-man gang would use. However, the
record contains evidence that Denkins knew how to operate the rele-
vant equipment, and that Grady knew of Denkins' qualifications in
this regard. See J.A. 56. Moreover, once the General Counsel had
made out a prima facie showing that the refusal to hire Denkins was
based on his having signed the petition, Southeast had "the burden of
proving by a preponderance of the evidence that, even though dis-
criminatory animus was present, `the employer nonetheless would
have taken the same employment action for legitimate reasons.'" See
Medeco Security Locks, Inc. v. NLRB, 142 F.3d 733, 742 (4th Cir.
1998) (citation omitted). Given that Grady initially offered Denkins
the position and refused to hire him only after he signed the petition,
and the testimony in the record that Grady's specific reason for not
hiring Denkins was that Denkins signed the petition, we do not
believe that Southeast met its burden of proving by a preponderance
of the evidence that Denkins would not have been hired even if he
had not signed the petition.

III.

Southeast also claims that, even assuming Grady acted out of statu-
torily impermissible motives, the record lacks substantial evidence to
support the Board's conclusion that Grady's decision not to hire
Denkins was made in his capacity as a statutory supervisor for South-
east, thus rendering Southeast liable for Grady's conduct. We reject
this claim as well.

For purposes of the NLRA, "[t]he term `employer' includes any
person acting as an agent of an employer." NLRA§ 2(2), 29 U.S.C.
§ 152(2). When acting within the scope of his supervisory authority,
a supervisor is such an agent. See NLRB v. Health Care & Retirement
Corp., 511 U.S. 571, 578 (1994); Amalgamated Clothing Workers v.
NLRB, 365 F.2d 898, 909 (D.C. Cir. 1966). Section 2(11) of the
NLRA defines "supervisor" to include:

          [a]ny individual having authority, in the interest of the
          employer, to hire, transfer, suspend, lay off, recall, promote,

                    5
          discharge, assign, reward, or discipline other employees ...
          [if] the exercise of such authority is not of a merely routine
          or clerical nature, but requires the use of independent judg-
          ment.

29 U.S.C. § 152(11). Thus, to be deemed a statutory supervisor, an
individual must: 1) engage in one or more of the types of conduct
enumerated in section 2(11), and 2) do so "in the interest of the
employer."

In the present case, there is no question that Grady engaged in con-
duct covered by section 2(11): he hired workers for the three-man
gang. Moreover, the record contains substantial evidence that Grady
engaged in this conduct "in the interest of" Southeast. Most impor-
tantly, the record contains a letter indicating that Southeast chose
Grady directly and informed the Union of Grady's appointment and
authority to select qualified workers, see J.A. 449, rather than follow-
ing the standard practice of asking the Union to recommend a header
for the three-man gang. Indeed, counsel for Southeast conceded at
oral argument that this letter establishes that the company directly
selected Grady to hire two co-workers.

Southeast counters by relying on NLRB v. Master Stevedores
Assoc. of Texas, 418 F.2d 140 (5th Cir. 1969), claiming that a hiring
hall arrangement generally allows union headers to act in the interest
of the union, rather than the employer, such that the arrangement does
not evince sufficient kinship between header and employer to warrant
attribution of the former's conduct to the latter. See id. at 142-43.
However, this argument concerning the nature of hiring hall arrange-
ments in general does nothing to controvert the evidence in the record
that, with regard to the particular three-man gang at issue in this
case, Grady was acting on the direct instruction of Southeast, not the
Union.*
_________________________________________________________________
*Because we find that the record contains substantial evidence to sup-
port the Board's conclusion that Grady acted within the scope of his
supervisory authority in failing to hire Denkins, we need not address the
Board's alternative rationale for holding Southeast responsible for
Grady's conduct, that Southeast knew or should have known of Grady's
impermissible motives.

                    6
CONCLUSION

For the reasons stated herein, we deny Southeast's petition for
review of the Board's decision and order, and grant the Board's cross-
petition for enforcement of its order.

It is so ordered

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