30 Sutton Place Corp.

National Labor Relations Board - Board Decisions

Feb 15, 1979

240 N.L.R.B. 752 (N.L.R.B. 1979)

752 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 30 Sutton Place Corporation and Local 32B-32J, Ser- vice Employees International Union, AFL-CIO, Petitioner. Case 2 RC-17914 February 15, 1979 DECISION ON REVIEW AND DIRECTION OF ELECTION BY CHAIRMAN FANNING AND MEMBERS MURPHY ANI) TRUIISDAIA.t On April 21, 1978, the Regional Director for Re- gion 2 issued her Decision and Order dismissing the petition in the above-entitled proceeding. The Re- gional Director declined to assert jurisdiction over the Employer, a residential cooperative, citing Point East Condominium Owners Association, Inc., 193 NLRB 6 (1971), wherein the Board declined to assert jurisdiction over a residential condominium. The Re- gional Director found dispositive the fact that the cooperative, like the condominium in Point East, was a "collective instrumentality" devoted to property maintenance, rather than a "business" engaged in commercial activities. Thereafter, in accordance with Section 102.67 of the National Labor Relations Board Rules and Reg- ulations, Series 8, as amended, the Employer filed a request for review of this finding. The Employer, in agreement with the Petitioner, contended that the Board had jurisdiction in this case. It cited the joint stipulation of the Employer and the Petitioner that the Employer is engaged in interstate commerce within the meaning of the Act. The Employer further asserted that the cooperative and condominium housing industry should be covered by the Board's $500,000 gross annual revenue jurisdictional stan- dard as applied to the apartment house industry in Karl Gerber, Maxr Tactic, Nathan Met: & Etate of' Bernard Katz, Co-Partners d h a Parkview Gardens, 166 NLRB 697 (1967). By telegraphic order dated July 27, 1978, the Board granted the Employer's request for review. The Board has considered the entire record in this case with respect to the issue under review, including the document supporting the Employer's position ·iled by the Realty Advisory Board on Labor Rela- tions, Incorporated,' and makes the following find- ings: The Employer, 30 Sutton Place Corporation, is a t 1he Realty Advisor Board on Labor Relations, Incorporated (RAB). is a multiemployer bargaining association which represents apartment build- ings and office buildings in the city of New York Of the approkimatel 1,70( apartment buildings represented b RAB. 475 are cooperatise or con- dominium buildings. 240 NLRB No. 94 business corporation under the laws of the State of New York. It owns and manages a residential coop- erative apartment building located at 30 Sutton Place, New York, New York. The Petitioner, Local 32B-32J, Service Employees International Union, AFL-CIO, seeks to represent all full-time and regular part-time doormen, elevator operators, porters, handymen, and other building service employees employed by the Employer. As established by the Employer's articles of incor- poration, stock is allocated in blocks to the building's apartments. Those who purchase the stock are enti- tled to a proprietary lease to the apartment to which the stock has been allocated. There are 46 apart- ments presently occupied by the stockholders of the Employer-corporation. In addition, the record indi- cates that the Employer-corporation rents one apart- ment. The expense of maintaining the 46 apartment units and the cooperative apartment building as a whole is shared proportionately by the individual stockholders. A board of directors manages the affairs of the Employer-corporation. The Employer's gross income for the calendar year ending December 31, 1977, ex- ceeded $500,000. This amount derived primarily from tenant-stockholder assessments together with minor income from rent and storage fees. Almost all of the Employer's gross income was expended in managing the apartment building. These expendi- tures included approximately $183,000 for payroll, $59,000 in mortgage interest payments to Dry Dock Savings Bank of New York, $58,000 in steam, elec- tricitv, and gas payments to Consolidated Edison Company of New York, $51,000 for maintenance services and supplies (hardware, waterproofing and scaffolding materials, uniforms, and telephone), and $13,000 in insurance payments to Atlantic Mutual Insurance Company, Blue Cross and Blue Shield, and First Rehabilitation Insurance Company of America. In Point East, supra, issued in 1971, the Board de- clined to assert jurisdiction over a residential con- dominium. In this case the Employer and the Peti- tioner both urge us to assert jurisdiction over condominiums and cooperatives, applying our apart- ment house standard. They point to the recent accel- erated growth of condominiums and the prominent place of both condominiums and cooperatives in the housing resources of the Nation. For the following reasons, we are persuaded that cooperatives and con- dominiums are engaged in the business of concerted home management and maintenance. Furthermore, we are persuaded that this business has a substantial impact on interstate commerce, warranting our asser- tion of jurisdiction 2 so that employees of coopera- 30 SUTTON PLACE CORPORATION 753 tives and condominiums, and these entities them- selves when acting as employers, may invoke the rights and privileges of the Act. In their stipulations entered in lieu of record, the Employer and the Petitioner cite the HLUD Condomi- nium/Cooperative Studi of 1975, an exhaustive col- lection of data and analysis prepared by the Secre- tary of Housing and Urban Development in response to congressional directive. This study reveals that: approximately 4 million Americans now live in 1.69 million cooperative and condominium housing units across the Nation: in 1973 and 1974 condominiums represented one-quarter of the new housing starts in the United States; some urban areas have been sig- nificant conversions from rental properties to con- dominiums or cooperatives, with condominium con- version being most intense along the eastern seaboard between Boston and Washington: and while cooperative ownership generally declined in popularity during the early 1970's, this form of resi- dence continues to be a significant factor in major urban areas, notably the New York City metropoli- tan area, where cooperatives have long been a fea- ture of the housing market) Today's cooperatives and condominiums are in- volved in commercial activitv on a large scale. Al- though they may vary in size and in the types of services offered to occupants, many provide such amenities as reception and answering services, 24- hour security and valet services, laundry and storage space, covered parking areas, medical facilities and day-care centers, swimming pools, tennis courts, golf courses, saunas, playgrounds. and function and re- creation rooms.4 Thus a typical enterprise may hire more than a score of employees, who perform a vari- ety of functions. For these employees, the coopera- tive or condominium must meet a payroll which may include tax, insurance, and workmen's compensation payments. The enterprise will also typically purchase maintenance supplies and energy for heating and cooling and make payments covering mortgage costs. sewage and water fees, and real estate taxes. Some- times the cooperative or condominium hires an agent to manage the property or contracts out certain maintenance and support tasks, thereby utilizing out- side profitmaking enterprises. All these activities in- dicate that cooperatives and condominiums are en- gaged in the business of concerted home 2 In hi respect. e note the irrelevance ,of the leg.ll differences hetueenl cooperatiles and c)ndominiusl Our concern ih with the ilipact on IIiter- state cornmerce of the actlisit t of concerted home ilanalcemenlt and ill.lnte- nance. which atl'it is uIlidertaken h c.otperaties .and Co)ndonillmnil alike See t (ndom irnii ( .p.c.raic SStudi. ,alqt, 1. 1I 7. 1I I1 1, I 1 II. See t1D ( ondomlinm ('lpr tllll .lzldl. upra. sol I. I I I 2 management and maintenance. Furthermore, this business impacts on interstate commerce, for it is de- pendent upon the free flow of supplies and labor and in this sense necessarily involves other institutions which operate in interstate commerce. As indicated above, we now find that, unlike indi- vidual homeowners, present-day condominiums and cooperatives, consisting of numerous owners acting in concert to manage and maintain their collective properties. are engaged in business having a signifi- cant impact on interstate commerce.5 Accordingly. condominiums and cooperatives fall within the Act's jurisdictional mandate.F However. we believe that it will effectuate the policies of the Act to limit asser- tion of jurisdiction to those enterprises which realize at least $500,000 in gross revenue per annum.7 Our experience with retail operations, the hotel and motel industry, and the apartment house industry indicates that such a standard guarantees jurisdiction over those enterprises which have a substantial impact on interstate commerce. At the same time this standard does not involve the Board in cases of little economic import. Moreover, the minimum $500,000 gross an- nual revenue standard provides predictability and ease to employers. employees. labor organizations. and the Board alike. As indicated previously. 30 Sutton Place Corpora- tion has a gross annual revenue in excess of $500,000. Substantial portions of this sum are used to cover energy costs, mortgage payments, maintenance ser- \'We Lote 01t our lurisuition is , arralled , hetlher or n1ot cotdoillnlUit anrd tooperailic entlerprlses are \iewed .s cnrllercilal ctl II\ in tile eller lII iccepled senile F:or in recent ears the Board his heldt ha;l dis-carc aIld gciicrl cenlers. prilve c llCeg,, educalltionl telIeilS.ill Itllli. .lid dd.llc recreational enterprises .re all uhbjecl to the Brd' llrlsdlctional Inalldall 2. , in those cases. the hsli fr our .llrisdlctlion herr dersles from lite glcrlerl Impactl on Interstate conlinierce of the cterprlse (here. a rideni- ial c.tpeiattle ocr ctndotminium) rather th.an iolellent i1n raditiula coiimmercilal actls its See. gener.all~. Sat & Pppr c rl crl . ho[ da Ailndcr iortci \,, '2. 222 N LRB 1295 (1976h (da -care entert: Drc. e loiw /t 182 NI. RB 1(4i ' 1970) (geril;tric center: ( ,rl/l I ni,,,,lli, 1 83 NL.RB 32 4 197)) Iprl.ate collegeS: I eer Spt lo..rtd I/,' i dt I }ldxll .[lln,. , d i AI SI II. 217 Ni RB419(1975)(educaitonal teleltlsi.iton)ill. lh (,h, niili [I d,/t.r,thc , tr,i ldiltln, 224 N RB 718 (I 1'7¢) (dida.titi recrC.itlon.al enlerprlse) Ihe etlusin of dmestic emplo.ees from the 4 1cts urisdlctiln Sec 2(2) does not preclude (our asserilton of jurlsdllctijrl i Ihl c;Ie F r there I .1 lihstlantial difference between emplomient bh a sinile himeov.l ier and erinplo,,siient bh a c peratise or Coindominiiun entits In the first inlsance. a;l ild Ilditl Ial and personal relatinnship is crea ted betwieen the hmeot nier and the ein lpoee: i tihe ecolId nstiance. the emplosee', relaloinship with the cmpltoer. the lcooperaltile oir condominium entilt. is n different fromil tha.t of an emploee performinig sImilar work fr ail partillile holue r office hilding enltrepreneu r "D)onmeic serlice itpllc e plo\nl ient n :1in ridi.idutI iltd peroilal hamis ald cannolt be enl.ired t include malinte- Ilincec re, or a lericall aff for a 1471 unit hilsng coniplex' .uc*t Aplimnt nl I k t -It i. 1.l t-h. 99 RRM 1t9t. 3171 (('onn Sup (t 1 978 In ltc lIrc Idh j, 4 itlii .... Im 236 NI1 RB 102 (1978), the Bard dechlied to ie ssa ill iadstlsr\ opiltitn n the issue f the .,,sertluonl of Board Iirlxditiiion e\cr .a ClldollilllUil Ifie B.Loard tcited Itii llit. llpri, hut Inidicated in1 fn the crcumstances which led to thl hldine In an! eetcl. to the e\xtIeC th.at Pini Ljt 1s Is ilconsistentl with iour declionl itn his ca.e. it i hecrebh oiecrruled 30 SUTTON PLACE ORPORATION 754 DECISIONS OF NATIONAL LABOR RELATIONS BOARD vices and supplies, and insurance-expenditures largely involving entities in interstate commerce. Ac- cordingly, we find that the Employer's operations af- fect commerce within the meaning of Section 2(6) and (7) of the Act, and as the Employer's annual gross revenues exceed $500,000, we find that it will effectuate the policies of the Act to assert jurisdiction herein. The labor organization involved is a labor organi- zation within the meaning of Section 2(5) of the Act, as stipulated by the parties at the hearing. This labor organization claims to represent certain employees of the Employer. A question affecting commerce exists concerning the representation of employees of the Employer within the meaning of Sections 9(c)(1) and 2(6) and (7) of the Act. We find that the following employees of the Em- ployer, as stipulated by the parties at the hearing, constitute a unit appropriate for the purposes of col- lective bargaining within the meaning of Section 9(b) of the Act: All full-time and regular part-time doormen, ele- vator operators, porters, handymen and other building service employees employed by the Employer at its 30 Sutton Place, New York, New York, location, excluding superintendent, office clerical employees, guards, watchmen, professional employees, and supervisors as de- fined in the Act. [Direction of Election and Excelsior footnote omit- ted from publication.]