Bethlehem-Fairfield Shipyard, Inc.

National Labor Relations Board - Board Decisions

Dec 20, 1943

53 N.L.R.B. 1428 (N.L.R.B. 1943)

In the Matter of BETHLEHEM-FAIRFIELD ' SHIPYARD, INCORPORATED AND
M & M RESTAURANT OPERATING COMPANY, INC. and CONGRESS OF
INDUSTRIAL ORGANIZATIONS '
Case No. 5-R-1373.-Decided December 20, 19/ i
Mr. David H. Werther, for the Board.
Mr. John L. Wynne, of Bethlehem, Pa., for Bethlehem.
Mr. Everett B. Lackie, of Baltimore, Md., for M & M.
Mr. Frank J. Bender, of Baltimore, Md., for the C. 1. 0.
Mr. Joseph A. Padway, by Mr. James A. Glenn, of Washington,
D. C., Mr. Bertram H. Ross, of Philadelphia, Pa., and Mr. Anthony
Glorioso, of Baltimore, Md., for Local 695.
Miss Melvern R. IKrelow, of counsel to the Board.
DECISION
AND
DIRECTION OF ELECTION
STATEMENT OF THE CASE
Upon petition duly filed by Congress of Industrial Organizations,
herein called the C. I. 0., alleging that a question affecting commerce
had arisen concerning the representation of employees of Bethlehem-
Fairfield Shipyard, Incorporated and M & M Restaurant Operating
Company, Inc., Baltimore, Maryland, herein called Bethlehem and
M & M, respectively, the National Labor Relations Board provided
for an appropriate hearing upon due notice before Bernard Cush-
man, Trial Examiner. Said hearing was held at Baltimore, Maryland,
on October 26, 27, 28, and 29, 1943, Bethlehem, M & M, the C. 1. 0.,
and Hotel & Restaurant Employees International Alliance and Bar-
tenders International League of America, Local #695, herein called
Local 695, appeared, participated, and were afforded full opportunity
to be heard, to examine and cross-examine witnesses, and to intro-
duce evidence bearing on the issues. The Trial Examiner's rulings
made at the hearing are free from prejudicial error and are hereby
affirmed. At the commencement. of the hearing, Local 695 made a
motion to dismiss the petition on the grounds that (1) the Board
had no jurisdiction in the matter; (2) a collective bargaining con-
tract between M & M and United Soap and Glycerine Workers Fed-
53 N. L . R. B, No. 261.
1428
BETHLEHEM-FAIRFIELD SHIPYARD, INCORPORATED 1429
eral Labor Union, Local 20983 A. F. of L., herein- called the' Soap
`Yorkers, subsequently assigned to Local 695, constituted a bar to
a 'determination of representatives,' and (3) that' the unit requested
in the petition is inappropriate. A similar motion was made by
M & M. Bethlehem moved that the petition be dismissed on the
ground that Bethlehem is not an employer ' within the meaning of
the National Labor Relations Act, and that' the employees involved
within the scope of the petition are not subject to the jurisd'ictio'n of
the Board. The Trial Examiner reserved rulings on the motions for
the Board. For reasons' hereinafter set forth the motions are hereby
denied. All parties were afforded opportunity to file briefs with,
the Board. "
On November 30, 1943, a stipulation to correct the transcript of
record, entered into between the parties on November 29, 1943, was
filed with the Board. The stipulation is hereby made a part of the
record. '
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FAOT
I. THE BUSINESS OF THE COMPANIES
Bethlehem-Fairfield Shipyard, Incorporated, a Maryland corpora-
tion, operates a shipyard at Fairfield, Baltimore, Maryland, where it
is engaged in the construction of merchant vessels. ' All the shipbuild-
ing facilities are owned by, and all the vessels are being constructed on
a cost plus basis for the United States Maritime Commission. During
1942, approximately 90 percent of all materials used at the shipyard
was furnished by the Commission, and 50 percent of all materials used
was shipped to the shipyard from points outside the State of Mary-
land. During the same period more than 75 Liberty ships were con-
structed by Bethlehem and delivered to the Commission.
M & M Restaurant Operating Company, Inc., a Maryland corpora-
tion, is engaged in the operation of cafeterias, canteens, and kitchens
in defense plants located in and around 'Baltimore, Maryland, where
it prepares, serves, and sells food and related products.' `Under the
terms of a contract hereinafter discussed, M & M operates cafeterias
and canteens'at the Fairfield yard of Bethlehem. Foodstuffs and re-
lated products in the sum, of approximately $900,000' are purchased
annually by M & M for use in the cafeteria and canteens operated by
M & M at the Fairfield yard and are shipped to such cafeteria and
canteens from warehouses of distributors located within the State of
Maryland. A substantial amount of such foodstuffs are shipped to
said warehouses from points outside the State of Maryland. Approx-
imately 11/2 percent of the total purchases by M & M are made from
points outside the State of Maryland. The gross volume of sales by
1430 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
all cafeterias and canteens operated by M & M is approximately
$2,000,000 per year Approximately 65 percent of the persons em-
ployed by Bethlehem in the Fairfield yard patronize and eat in the
cafeteria and canteens at the Fairfield yard. The remaining 35 per-
cent of employees of Bethlehem bring their own food from home for
consumption on the premises.
On June 1, 1943, Bethlehem and M & M entered into a contract in
which M & M "as an independent contractor" received the exclusive
right and privilege to sell foodstuff in the cafeteria and canteen build-
ings provided by Bethlehem. Bethlehem agreed to pay all real estate
and personal property taxes on the facilities and equipment and to
maintain said facilities (but not the equipment) in reasonable repair;
to furnish telephone lines, facilities for heat and electricity, gas and
water, plumbing and sanitary facilities, and to maintain same without
expense to M & M. Bethlehem agreed to reimburse M & M for any
losses suffered by M & M in the operation of the cafeteria and can-
teens.2 M & M agreed "to dismiss from its employ any person or per-
sons whom the Contractor [Bethlehem] in writing states is unsatis-
factory to the Contractor, and to pay such salaries which are not less
than, or in conflict with such scale of wages or salaries as may be estab-
lished by the Contractor," all salaries and wages being subject to ap-
proval in writing by Bethlehem. M & M agreed to serve food during
such hours of the day as Bethlehem should designate. M & M agreed
to furnish Bethlehem with a complete statement of operations within
15 days after the close of each calendar month; to pay Bethlehem
within 15 days after the expiration of each term of 6 months an amount
equal to 5 percent of the gross receipts for the said 6-month period,
this obligation on the part of M & M not to arise until M & M had first
received 21/2 percent of the gross receipts for the 6-month period. .3 In
the event M & M should file a petition in bankruptcy, or if in the opin-
ion of Bethlehem or the United States Maritime Commission any
other event should occur which "might impair the ability of the Oper-
ator [M & M] to perform its obligations under this subcontract to the
satisfaction of the Contractor [Bethlehem] and of the Commission,"
Bethlehem might terminate the contract without notice.
It is clear that the M & M is the employer of the employees involved
herein; they are listed on M & M's pay roll and are paid and supervised
by M & M, which also pays social security taxes, unemployment com-
i M & M also operates cafeterias and canteens at plants in Baltimore operated by other
companies under separate contracts for each.
2 There was a previous contract executed by Bethlehem and M & M on October 23, 1941,
which was terminated in May of 1943 . Under such contract, M & M has been reimbursed
by Bethlehem for losses suffered by M & M prior to the execution of the present contract.
2 No rent or other consideration is received by Bethlehem for permitting the use of the
cafeteria and canteen buildings ; rather, Bethlehem exercises the prerogatives and incurs the
risks of ownership management by sharing in the profits , and by underwriting M & M for
any operating losses suffered by it.
BETHLEHEM-FAIRFIELD SHIPYARD , INCORPORATED • 1431
pensation taxes, and workmen's compensation insurance premiums
for such employees. There remains the question, however, as to whether
Bethlehem is also the employer of such employees. There is testimony
in the record that M & M's operation and supervision of the cafeteria
and canteens and the persons employed therein are, in practice, not
controlled or supervised by Bethlehem, in that M & M has not con-
sulted Bethlehem with reference to the hire, discharge, or transfer
of such employees; Bethlehem has not exercised its right to require
the discharge of employees; no scale of wages has ever been submitted
by M & M to Bethlehem, and the prices of meals have not been set by
Bethlehem. However, we do not believe that this testimony, taken at
its face value, changes the situation in any important respect. We
have already referred to provisions in the contract which give Beth-
lehem complete control over the supervision and operation of the
cafeteria and canteens. That Bethlehem's power of control may not
in fact have been exercised is immaterial, since the right to control
rather than the actual exercise of that right is the touchstone of the
employer-employee relationship. We find that Bethlehem is also the
employer within Section 2 (2) of the Act of the employees involved
herein 4
II. THE ORGANIZATIONS INVOLVED
Congress of Industrial Organizations is a labor organization, ad-
mitting to membership employees of Bethlehem and M & M.
Hotel & Restaurant Employees International Alliance and Bar-
tenders International League of America, Local #695, is a labor
organization affiliated with the American Federation of Labor, ad-
mitting to membership employees of Bethlehem and M & M.
III. THE QUESTION CONCERNING REPRESENTATION
On June 2, 1943, the C. I. O. notified M & M by letter that it repre-
sented a majority of the employees of M & M and requested a collective
bargaining conference.. M & M has refused to recognize the C. I. O.
until the C. I. O. is certified by'the Board. At the hearing counsel
for Bethlehem stated that Bethlehem likewise would not recognize
the C. 1. 0.
On September 19, 1942, M & M and the Soap Workers entered into
a contract providing, inter alia, for recognition of the Soap Workers
.'as the sole and exclusive bargaining agency for all employees who
are eligible for union membership." The contract provides for a
union shop and states that "the terms, provisions of this agreement
shall become effective as of September 19, 1942, and continues in
force until September 19, 1943, and thereafter unless thirty (30)
klee Matter o( Sierra Madre-hamanda Citrus Association, 23 N. It. R. B. 143.
1432 DECISION'S OF NATIONAL LABOR RELATIONS BOARD
days' written notice is given by either party that changes, amendments
or termination is desired." Both M & M and Local 695 contend that
this contract constitutes a bar to a determination of representatives.
Neither party has served upon the other a notice of desire to cancel
the contract, and Local 695 maintains that the contract automatically
renewed itself for a year on August 1b, 1943. Inasmuch as the original
term of the contract has expired and the contract is now terminable at
any time upon 30 days' written notice, we find that the contract is no
bar to this proceeding.5
A statement of the Regional Director, introduced in evidence at
the hearing, indicates that the C. 1. 0. represents a substantial number
of employees in the unit it claims to be appropriate a `
We find that a question affecting commerce Is arisen concerning the,
representation of employees of the Company, within the meaning of
Section 9 (c) and Section 2 (6) and (7) of the Act.
IV. THE APPROPRIATE UNIT
The C. I. O. contends that the appropriate unit should consist of
all employees employed in the cafeteria and canteens located in Fair-
field Yard of Bethlehem who are engaged 'in preparing, handling,
and serving food, including cooks, chefs, bakers, dishwashers, bus
employees, kitchen help, waiters, cashiers and assistant cashiers, truck
drivers, and their helpers, but excluding inspectors, all clerical em-
ployees, managers, assistant managers, chief chefs,, and all other
supervisory employees.7 M & M and Local 695 contend that the
appropriate unit is one which consists of all employees of M & M
at whatever plants these employees may be located. Bethlehem takes
no position with respect to either contention.
Prior to September 19, 1942, M & M had no bargaining relationship
with any labor organization. On May 19, 1943, D. McKaye and
Alfred L. Mathias, President and Vice President, respectively, of
M & M, and the Vice President of Hotel and Restaurant Employees'
International Alliance, had a conference which resulted in an under-
M & M and Local 695 contend that this contract was intended by them to cover all em-
ployees of M & M wherever they may be located The evidence shows , however, as con-
tended by the C. I. 0., that the contract never covered employees working in the cafeteria
and canteens at Bethlehem , but was intended to apply only to the employees at Lever
Brothers , Baltimore , Maryland . Such evidence is discussed hereinafter under Section IV.
6 The Regional Director reported that the C. I. O. presented 578 application card's, 524
dated between April and October 1943, 52 undated, bearing apparently genuine signatures.
Of the 576 cards submitted , 228'bear the names of persons whose names appear on the Com-
pany's pay roll for the weekending August 30, 1943, which contained the names of 514
persons in the alleged appropriate unit.
Local 695 presented no evidence but relied upon its contract.
7 There are no bakers , waiters, inspectors , assistant cashiers or assistant managers now
employed at the Fairfield Yard.
BETHLEHEM-FAIRFIELD SHIPYARD, INCORPORATED 1433
standing 8 that M & M would recognize Local 695 as the sole collective
bargaining 'agent for all employees employed by M & M at the Fair-
field Yard, and that M & M would extend the same relationship to
other plants where cafeterias were operated. It was further under-
stood that no obligation would exist until the above understanding
received the approval of the general president of the International.
It appears that no contract was ever executed, and so far as the record
discloses no approval was given by the general president.
Local 695 contends, as stated above, that the contract executed
between M & M and the Soap Workers or. September 19, 1942, which
was assigned to Local 695 on June 3, 1943, covers the employees at
Bethlehem. However, there is no evidence that the contract was
ever applied to any plant other than that of Lever Brothers. Edward
C. Hall, an employee of Lever Brothers, and a former member of
the executive-board of the Soap Workers, testified that the contract
was to be confined in its application to employees of Lever Brothers'
cafeteria; that discussions during negotiations were limited to such
employees; and that the Soap, Workers had never discussed wages
and hours or working conditions with reference to, employees work-
ing in the cafeteria and canteens at Bethlehem. Mathias testified
that the contract was intended to apply at the outset only to the
Lever Brothers' cafeteria employees, and that during negotiations
it was "probably mentioned" that "we would try this and see how it
worked and if it did we could extend our operations." Further
evidence that it was not the intent of the Soap Workers and M & M
to include Bethlehem in this contract is the fact that, so far as the
record shows, neither the union-shop provision nor any of the other
provisions of the contract were enforced with regard to the Bethlehem
employees. Furthermore, the record fails to show that either the
Soap Workers or Local 695 ever held a meeting of the Bethlehem
employees, that they ever presented evidence of membership among
such employees to, M & M,9 or,that the Bethlehem employees were
ever afforded an opportunity to select either the Soap Workers or
Local 695 as their representative. In view of the foregoing, we are
impelled to, conclude that both the contract of September 19, 1942,
and the entire bargaining history prior to the claims of representation
made by the C. I. 0. on June 2, 1943, did not include employees at
the Fairfield Yard, and that such employees have not been represented
by, and have had no opportunity to freely choose, a collective bar-
gaining'representative io
8 This understanding was embodied in a letter from the International Vice-President to
McKaye and Mathias. Neither Local 695 nor M & M contend that this letter constitutes a
contract.
9 While . Local 695 contends that it has representation among the employees of the Fairfield
Yard , when requested to produce evidence of such membership at the hearing, failed to do so.
10 See Matter of Demuth Glass Works, Inc., 53 N. L. R. B. 451.
1434 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Although there is evidence of employee transfers between the cafe-
teria at the Fairfield Yard and other cafeterias operated by M & M,
and some evidence that operations throughout all the cafeterias are
uniform, it is apparent that the operations conducted by M & M at
the Fairfield Yard are independent of those conducted elsewhere by
M & M, as evidenced by the fact that they are, as found above, con-
ducted as a joint enterprise under M & M's contract with Bethlehem,
which contract is separate and distinct from those entered into between
M & M and other companies serviced by it. In view of the foregoing,
and in the absence, as stated above, of any bargaining history relating
to the Bethlehem cafeteria and canteen employees, we conclude that
a unit limited to such employees in the Fairfield Yard is appropriate.
The parties are in general agreement with respect to the inclusion
and exclusion of the specific categories of employees in the unit here-
inabove found appropriate. There is some dispute, however, with
respect to the following classifications :
Chefs: The C. 1. 0. would include all chefs; Local 695 would exclude
only those chefs who do no actual cooking and spend all of their time
in supervision; M & M's position is not clear. There is a head chef
who has the right to hire and discharge; and three other chefs, who
in addition to engaging in various culinary duties similar to those of
ordinary cooks, direct the cooks in the performance of their duties,
and have the authority to recommend hire and discharge. We con-
clude that all of the chefs are supervisory, and we shall exclude them
from the unit.
Managers: The C. I. 0. and M & M would exclude all managers.
Local 695 would exclude only those having authority to hire and dis-
charge. There is one field manager who has the right to hire and dis-
charge and is in complete control of the cafeteria and canteens. There
are about 40 other managers who are in charge of the various canteens
who have the authority to recommend hire and discharge and whose
recommendations are generally followed. We find that these em-
ployees are supervisory, and we shall, accordingly, exclude them from
the unit.
Cashiers: The C. I. 0. and Local f95 desire the inclusion of cashiers.
M & M would exclude them. Their duties are those ordinarily per-
formed by cashiers. Since their duties are largely clerical and not
directly connected with the preparation and serving of food, we shall
exclude them." -
Timekeepers: The C. I. 0. and M & M would exclude these em-
ployees, and Local 695 would include them. Their duties are entirely
clerical, and we shall, therefore, exclude them from the unit.
11 See Matter of S. d W. Cafeteria of Washington , Incorporated, 20 N. L . R. B. 259;
Matter of The Welfare Association, 45 N. L . R. B. 285.
BETHLEHEM-FAIRFIELD SHIPYARD , INCORPORATED 1435
Steward in the storeroom : The C. I. O. and Local 695 desire his
inclusion ; M & M desires his exclusion . He is engaged in checking
food , keeping records , and handing out supplies on requisitions to the
various canteens . He directs other employees in the storeroom, and
may recommend hire and discharge . We find that he is a supervisory
employee ; we shall exclude him from the unit.
We find that all employees of Bethelehem and M & M in the cafeteria
and canteens located in the Fairfield Yard , who are engaged in pre-
paring, handling , and serving food , including cooks, dishwashers, bus
employees , kitchen help , truck drivers and their helpers, but exclud-
ing cashiers , timekeepers , clerical employees , chefs, managers, the
steward in the storeroom , and all other supervisory employees with
authority to hire, promote,, discharge , discipline , or otherwise effect
changes in the status of employees , or effectively recommend such
action , constitute an appropriate unit for the purposes of collective
bargaining within the meaning of Section 9 (b) of the Act.
V. THE DETERMINATION OF REPRESENTATIVES
We shall direct that the question concerning representation which
has arisen be resolved by an election by secret ballot among the em-
ployees in the appropriate unit who were employed during the pay-
roll period immediately preceding the date of our Direction of Elec-
tion, subject to the limitations and additions set forth therein.
DIRECTION OF ELECTION
By virtue of and pursuant to the power vested in the National Labor
Relations Board by Section 9 (c) of the National Labor Relations
Act, and pursuant to Article III, Section 9, of National Labor Rela-
tions Board Rules and Regulations-Series 3, it is hereby
DuucTED that, as part of,the investigation to, ascertain representa-
tives for the purposes of collective bargaining with Bethlehem-Fair-
field Shipyard, Incorporated, and M & M Restaurant Operating Com-
pany, Inc., Baltimore, Maryland, an election by secret ballot shall
be conducted as early as possible, but not later than thirty (30) days
from the date of this Direction, under the direction and supervision
of the Regional Director for the Fifth Region, acting in this matter
as agent for the National Labor Relations Board, and subject to.
Article III, Sections 10 and 11, of said Rules and Regulations, among
the employees in the unit found appropriate in Section IV, above,
who were employed during the pay-roll period immediately preced-
ing the date of this Direction, including employees who did not work
during said pay-roll period because they were ill or on vacation or
temporarily laid off, and including employees in the armed forces
1436 DECISIONS OF NATIONAL LABOR RELATION 'S BOARD
of the United States who present themselves in person at the polls,
but excluding those employees who have since quit or been discharged
for cause and have not been rehired or reinstated prior to the date
of the election, to determine whether they desire to be represented
by Congress of Industrial Organizations, or by Hotel & Restaurant
Employees International Alliance and Bartenders International
League of America, Local #695, for the purposes of collective bar-
gaining, or by neither.
Mn. GERAUD D. REILLY took no part in the consideration of the above
Decision and Direction of Election.