San Francisco janitors went public with complaints about working conditions, pay and sexual harassment. What followed included threats, reduced work, a canceled cleaning contract and firings. Twelve years later, a federal appeals court upheld the labor-law violations.
Workers’ RightsTL;DR
- In 2014, janitors working for Preferred Building Services and Ortiz Janitorial Services sought help from SEIU Local 87 union chapter over what they described as poor working conditions, low pay and sexual harassment.
- The unionized workers picketed outside San Francisco office buildings and publicly identified Preferred as the cleaning contractor they were protesting.
- After the protests, Ortiz’s founder demanded immigration and work-authorization documents from two participants, threatened another worker with losing her job, and told another she would no longer clean certain offices because he was upset by the picketing. Classic union busting activity!
- On November 19, Preferred terminated its cleaning-services contracts with Harvest Properties for two buildings and ended its subcontract with Ortiz. That evening, Ortiz fired two picketing employees; additional employees were terminated as the contracts wound down.
- The NLRB ultimately found Preferred and Ortiz to have acted as joint employers and violated workers’ rights under Sections 8(a)(1) and 8(a)(3) of the National Labor Relations Act.
- The D.C. Circuit’s August 21, 2026 decision rejected Preferred’s defenses and ordered enforcement of the Board’s decision. The court did not find that the picketing was unlawful secondary or organizational/recognitional picketing.
The important part of this case is what the record says happened after workers publicly complained about their jobs: the Board found unlawful interference and retaliation, and the federal appeals court upheld that result.
Transparency Notice
This article is based on the August 21, 2026 opinion of the U.S. Court of Appeals for the District of Columbia Circuit in Preferred Building Services, Inc. v. National Labor Relations Board, No. 24-1384, together with the factual history described in that opinion. The opinion describes findings and conclusions reached by the NLRB and administrative law judge as well as arguments made by Preferred and Ortiz. Where the record distinguishes an allegation, a party’s argument, an agency finding and a judicial holding, this article preserves that distinction. The D.C. Circuit affirmed the Board’s findings at issue here; it did not independently decide every factual question from scratch.
The Facts
Preferred Building Services provided janitorial services in the San Francisco Bay Area. It subcontracted with Ortiz Janitorial Services to clean several commercial buildings, including 55 Hawthorne Street, 631 Howard Street and One Kearny. Harvest Properties managed 55 Hawthorne and 631 Howard.
In 2014, several janitors working for Preferred and Ortiz approached SEIU Local 87. The court’s opinion says the employees raised concerns about poor working conditions, low pay and sexual harassment. At the union president’s suggestion, they decided to picket.
The first picket took place October 29 outside 55 Hawthorne. The workers walked in a circle on the sidewalk, carrying signs and chanting. Their signs named Preferred and included messages such as “Preferred Building Services unfair” and “We Prefer no more sexual harassment.” The signs also stated that the demonstration was an informational picket, not a strike or building boycott, and that the workers were in a labor dispute with the cleaning contractor.
The workers’ leaflets went beyond the sidewalk itself. They identified Preferred as their employer, explained that they cleaned KGO Radio’s offices at 55 Hawthorne, and called on KGO to take “corporate responsibility” for ensuring that the janitors received higher wages.
That distinction became important later. The employers argued that the picketing was aimed unlawfully at neutral businesses rather than at the janitorial companies. The NLRB and, ultimately, the courts rejected that defense on the record before them.
What Happened After the Workers Spoke Up
The most consequential events came after the first picket.
Workers picketed outside 55 Hawthorne, identifying Preferred as the target of their labor complaints and raising issues including pay, working conditions and sexual harassment.
Ortiz founder Rafael Ortiz demanded immigration and work-authorization documentation from two participating employees. The opinion also records a threat that one employee would no longer work because she attended the picket, and a statement to another that she would no longer clean certain offices because Ortiz was upset by the picketing.
Employees staged a second picket outside 55 Hawthorne. Later that day, Preferred’s executive vice president terminated Preferred’s cleaning-services contracts with Harvest Properties for 55 Hawthorne and 631 Howard, as well as Preferred’s subcontract with Ortiz.
Ortiz fired two employees who had participated in the picketing.
As the Preferred and Ortiz contracts for 55 Hawthorne and 631 Howard concluded, Ortiz terminated several additional employees.
Workers picketed outside One Kearny and demanded, among other things, $15 per hour, a full eight-hour day and the right to organize without retaliation.
The sequence matters because the legal dispute was not about an abstract disagreement over union tactics. The Board found that the employers’ responses interfered with protected employee activity and included unlawful discharges. The D.C. Circuit later upheld those conclusions.
The Workers Were Trying to Put Pressure on Their Employer
The protests were public, but the record did not establish that their object was to force the building tenants to recognize or bargain with the union. The signs identified Preferred. The leaflets described the janitors’ dispute with their cleaning contractor. The Board found no evidence that the workers were asking employees to join the union, demanding recognition, tendering a union contract, or conditioning an end to the picketing on the employer signing such a contract.
The D.C. Circuit accepted that factual assessment under the substantial-evidence standard. In practical terms, the court was not deciding whether every aspect of the protests was admirable or effective. It was deciding whether the NLRB had a legally sufficient evidentiary basis for finding that the protests were protected rather than prohibited organizational or recognitional picketing.
On that question, the court upheld the Board.
The Employer’s Defense Focused on the Picketing
Preferred and Ortiz argued that the employees’ demonstrations were unlawful secondary picketing. That distinction is important because federal labor law generally protects employees’ concerted activity, while imposing limits on certain attempts to pressure neutral businesses into cutting ties with a primary employer.
The Board uses the Moore Dry Dock framework when picketing occurs at a location where the primary employer and a neutral business operate. Among other things, the picketing must occur when the two businesses share a worksite, while the primary employer is doing its normal business, reasonably close to that site, and in a way that clearly identifies the dispute as being with the primary employer.
The Ninth Circuit had already concluded in 2021 that the picketing was presumptively lawful under that framework and that the evidence did not establish an impermissible secondary object. It specifically rejected reliance on reports that tenants were upset by the demonstrations.
After the case returned to the NLRB, Preferred offered evidence about a later December 24 demonstration at Millennium Towers. Preferred said demonstrators forcibly entered a lobby, struggled with security and threw coal into the lobby and at security personnel. The Board accepted the proffered facts as true for purposes of considering the defense but concluded that they did not establish a prohibited secondary purpose for the earlier conduct. The D.C. Circuit agreed that the later evidence did not connect the conduct to an unlawful secondary object during the earlier events at issue.
What the Board Found
The administrative law judge initially found that Preferred and Ortiz, operating as joint employers, violated the National Labor Relations Act by discharging employees in retaliation for their picketing. The judge ordered remedies including reinstatement and backpay.
The NLRB later reversed part of the ALJ’s reasoning about the employers’ evidentiary defenses, but ultimately reached the same bottom-line conclusion on the workers’ rights. After the Ninth Circuit rejected the Board’s original secondary-picketing finding, the Board revisited the matter and again found that Preferred and Ortiz had violated Sections 8(a)(1) and 8(a)(3).
The Board also concluded that the picketing lacked a prohibited organizational or recognitional object. The D.C. Circuit found substantial evidence supporting that conclusion, pointing to the public-facing signs and leaflets, the absence of requests for employees to join the union, the absence of a contemporaneous demand for recognition and the lack of evidence that the workers conditioned the end of the protests on a union contract.
The Court’s 2026 Decision
Preferred brought the dispute to the D.C. Circuit after the Board’s remand decision. It raised three principal arguments: that it had been improperly prevented from presenting evidence supporting its defenses; that the Board lacked substantial evidence for finding no organizational or recognitional object; and that the Board’s expanded monetary remedy exceeded its authority and violated the Constitution.
The court rejected the first two arguments. It concluded that the Board had considered the evidence Preferred wanted to present and reasonably determined that it would not change the outcome. It also held that substantial evidence supported the Board’s finding that the picketing was not organizational or recognitional.
On the remedy challenge, the court did not reach the merits. Preferred had not properly raised its constitutional and statutory objections to the Board before seeking judicial review, and the court held that the statutory preservation requirement deprived it of jurisdiction to consider those arguments.
The result was straightforward: the D.C. Circuit denied Preferred’s petition for review and granted the NLRB’s cross-petition to enforce the Board’s order.
What the Remedy Means
The Board’s order included compensation for discharged employees’ direct or foreseeable financial harms resulting from the unlawful conduct, including reasonable job-search and interim-employment expenses where applicable, in addition to the existing backpay framework.
Preferred attempted to challenge that broader remedy as exceeding the Board’s statutory authority and violating constitutional protections. But the D.C. Circuit held that Preferred had not preserved those arguments before the Board. The court therefore did not decide whether those substantive objections would have succeeded.
That procedural point is important, but it shouldn’t obscure the underlying result: the appellate court enforced the Board’s order after rejecting Preferred’s preserved challenges to the findings that mattered to the labor dispute.
Why the Corporate Conduct Matters
The record presents a relatively concrete sequence. Employees complained about workplace conditions and pay. They sought outside assistance. They publicly protested. Company-side responses followed, including threats and employment consequences attributed to Ortiz, followed by Preferred’s cancellation of contracts and additional employee terminations as the contracts ended.
The employers did not simply accept the workers’ account. They argued that the protests themselves were unlawful. That defense mattered because, if the picketing had been prohibited, it could have materially changed the legal analysis of the employers’ responses.
The courts ultimately rejected that route. The Ninth Circuit found insufficient evidence of an unlawful secondary object. The NLRB, on remand, found the employers’ other defenses meritless and found violations of the employees’ rights. The D.C. Circuit then upheld those conclusions.
For a reader trying to understand what actually happened, the legal chronology is therefore best understood as the mechanism for testing the underlying dispute. The final appellate decision did not create the workplace conflict. It resolved the employers’ remaining challenges to the Board’s findings about how they responded to it.
What Remains Unresolved
The 2026 decision does not establish every factual allegation that appeared during the twelve-year dispute. In particular, the court did not independently adjudicate every underlying workplace complaint simply because the employees raised it. The opinion records the workers’ concerns about poor conditions, low pay and sexual harassment, but the appellate ruling’s central holdings concern the employers’ responses to protected activity and the defenses they raised.
The court also did not decide the merits of Preferred’s constitutional and statutory challenge to the Board’s expanded monetary remedy because those arguments were not properly preserved before the NLRB.
Those limitations don’t undo the findings that were affirmed. They define their scope.
What a Legitimate Fix Looks Like
At the most basic level, the dispute illustrates what a functioning labor-protection system is supposed to distinguish: workers’ underlying complaints can be disputed, but protected collective activity cannot simply be converted into a separate workplace offense because management dislikes the complaint.
For employers, a legitimate response means addressing workplace complaints through lawful channels without retaliating against employees for protected concerted activity. Where an employer believes picketing crosses a legal line, the record shows why that claim needs evidence tied to the actual conduct and its objective—not simply the fact that neutral businesses or building tenants became aware of the dispute.
What to Watch
- Enforcement of the Board’s order: The D.C. Circuit granted the NLRB’s cross-petition for enforcement.
- Remedial consequences: The Board’s order provides for backpay and compensation for qualifying direct or foreseeable pecuniary harms connected to the unlawful conduct.
- The scope of the ruling: The decision upholds the Board’s findings in this dispute; it does not resolve every question about labor picketing or every workplace allegation described in the record.
Legal Receipts
“We deny Preferred’s petition and grant the Board’s cross-petition.” U.S. Court of Appeals for the D.C. Circuit, Preferred Building Services, Inc. v. NLRB, No. 24-1384, Aug. 21, 2026
“The Board thoroughly examined the totality of circumstances surrounding the picketing and did not find any recognitional or organizational object.” D.C. Circuit opinion describing the NLRB’s finding
“Having had its affirmative defenses fully considered by the Board and reasonably rejected, Preferred has nothing left to complain about.” D.C. Circuit opinion
Source: Preferred Building Services, Inc. v. National Labor Relations Board, No. 24-1384, United States Court of Appeals for the District of Columbia Circuit, decided August 21, 2026. The opinion is the primary source for the factual and procedural account presented here.
