December 05, 2025|Franchise Frontlines
December 5, 2025 | National Labor Relations Board, Division of Judges | JD-89-25
Executive Summary
In Trader Joe’s East, Inc. and Trader Joe’s United, JD-89-25, 2025 WL 3514480 (NLRB Div. of Judges Dec. 5, 2025), Administrative Law Judge Sarah Karpinen found that Trader Joe’s East violated Sections 8(a)(1) and 8(a)(3) of the National Labor Relations Act by issuing a “final warning” to a crew member shortly after a successful union election. Applying the burden-shifting framework of Wright Line, 251 NLRB 1083 (1980), the ALJ concluded that the discipline was motivated by union animus, relying on evidence of disparate enforcement of timekeeping practices, deviation from past disciplinary procedures, and the absence of a clearly established rule. The ALJ rejected the employer’s defense that it would have issued the same discipline absent protected activity and ordered rescission of the incident report. The decision provides detailed guidance on how administrative law judges assess pretext and disparate discipline in organizing contexts.
Relevant Background
Trader Joe’s East operates a retail grocery store in Louisville, Kentucky. In late 2022, employees organized with Trader Joe’s United and filed a representation petition in December 2022. A majority voted for union representation in January 2023.
Crew member Zachary Smith openly supported the union and was closely associated with the store’s lead organizer. Supervisors acknowledged knowing that Smith supported the union.
On February 2, 2023—shortly after the election—Smith was verbally counseled by a supervisor for (1) clocking in and then putting away personal belongings and (2) allegedly taking a break longer than ten minutes. On February 19, Smith again clocked out using a laptop located in the back of the store rather than the dedicated time-clock tablet at the front.
On February 20, Smith received a written “final warning” citing:
• clocking in before putting belongings away;
• taking a 19-minute paid break; and
• using the back-room laptop to clock in and out despite having been told not to do so.
The warning characterized his conduct as lacking integrity and insubordinate and stated that any further incidents could result in termination.
The General Counsel alleged that the discipline was retaliatory and intended to discourage union activity.
Decision
The ALJ applied the Wright Line framework, under which the General Counsel must show: (1) protected activity; (2) employer knowledge; and (3) that protected activity was a motivating factor in the adverse action. If that burden is met, the employer must prove it would have taken the same action absent the protected conduct.
Protected activity and employer knowledge were undisputed. The dispute centered on motive.
The ALJ found several indicia of animus and pretext.
First, there was no clearly established rule prohibiting employees from using the back-room laptop as a time clock. Although management testified that employees were “expected” to use the front tablet, there was no written rule, no handbook reference, and no consistent communication to employees. Multiple crew members—including at least one who clocked out immediately before Smith—had used the same laptop without discipline.
Second, the ALJ found disparate treatment. Time records demonstrated that numerous employees clocked in or out using the back-room laptop. Several were counseled after Smith’s discipline, but none received a written warning, much less a “final warning.” The ALJ concluded that singling out a known union supporter while treating similarly situated employees more leniently supported an inference of discriminatory motive.
Third, the ALJ identified deviation from past practice. Smith had already been verbally counseled on February 2 for the alleged extended break and clock-in conduct. The decision to issue a written “final warning” on February 20—covering conduct already addressed and not shown to have been repeated—was characterized as an unexplained escalation inconsistent with the employer’s typical progressive discipline approach.
Fourth, the ALJ emphasized the employer’s failure to call the decisionmaker, former Captain Craig Wood, to testify regarding the rationale for the discipline. The absence of testimony from the individual who issued the warning undermined the employer’s ability to carry its burden under Wright Line.
The ALJ concluded that the stated reasons for discipline were either unsupported or exaggerated and therefore pretextual. Because the employer failed to establish that it would have issued the same discipline absent Smith’s protected activity, the ALJ found a violation of Sections 8(a)(1) and 8(a)(3).
As a remedy, the ALJ ordered rescission of the February 20 incident report, removal of references to it from personnel files, and a standard notice posting.
Looking Forward
Although this is an Administrative Law Judge decision and may be subject to Board review, it offers practical compliance guidance for multi-unit employers and franchisors operating in union-sensitive environments.
First, informal “expectations” are insufficient. If an employer intends to enforce a timekeeping or break rule, it should ensure that the rule is clearly articulated, consistently communicated, and uniformly applied. The presence of a system feature—such as a time-clock application on multiple devices—can undermine claims that use of one device violates an established policy.
Second, disparate enforcement is powerful evidence of pretext. Discipline imposed on a known union supporter—while others engaging in similar conduct are merely counseled or not addressed—creates significant litigation risk.
Third, escalation matters. Moving directly to a “final warning,” particularly for conduct already addressed through counseling, can signal retaliatory intent if not supported by documented progressive discipline history.
Fourth, documentation consistency and decisionmaker testimony are critical. Failure to present testimony from the supervisor who issued discipline may significantly weaken a Wright Line defense.
Finally, timing remains central. Discipline imposed shortly after an election or during active organizing will be scrutinized closely, especially when supervisors have acknowledged awareness of protected activity.
For franchisors and brand systems, the broader lesson is structural: during organizing campaigns, operational consistency becomes a legal safeguard. Policies that may function informally in non-union environments can generate unfair labor practice findings when selectively or aggressively enforced against union supporters.
This article is based solely on the opinion of the Administrative Law Judge in this matter. The author has not conducted any independent investigation into the facts. For the avoidance of doubt, each statement related to the law and facts in this article is drawn from the ALJ’s decision in this case.
Thomas O’Connell is a Shareholder at Buchalter LLP and Chair of the firm’s Franchise Practice Group. For questions about this article or media inquiries, you can contact Tom at toconnell@buchalter.com.
This communication is not intended to create, and does not create, an attorney-client relationship or any other legal relationship. No statement herein constitutes legal advice, nor should it be relied upon or interpreted as such. This communication is for general informational purposes only and is not a substitute for legal counsel. Readers should not act or refrain from acting based on any information provided without seeking appropriate legal advice specific to their situation. For more information, visit www.buchalter.com.
