Colchester Egg Farms, Inc.

National Labor Relations Board - Board DecisionsNov 4, 1974

214 N.L.R.B. 612 (N.L.R.B. 1974)

612 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Colchester Egg Farms , Inc. and Local 531, Service Employees' International Union , AFL-CIO, Peti- tioner . Case 1-RC-13131 November 4, 1974 DECISION AND DIRECTION OF ELECTION Pursuant to a petition filed on February 1, 1974, by Petitioner with the Regional Director for Region 1, seeking representation of a unit of the Employer's employees, described below, a representation hearing was held before Hearing Officer G. Rosalyn Johnson on February 13, 1974. Thereafter, the Regional Di- rector for Region 1 transferred this proceeding to the Board for a determination as to whether the Employer's operations constitute agriculture within the meaning of section 3(f) of the Fair Labor Stan- dards Act (29 U.S.C.A. 203(f) ), as contended by the Employer. Subsequently, the Employer filed a brief in support of its contention. The Board has reviewed the Hearing Officer's rul- ings made at the hearing and finds they are free from prejudicial error. They are hereby affirmed. The Board has considered the entire record in this case, including the brief, and makes the following findings: 1. The Employer, a Connecticut corporation, is engaged in the processing and selling of eggs. Annu- ally it ships goods valued in excess of $50,000 from its Franklin, Connecticut, location to points located outside the State of Connecticut and annually pur- chases supplies valued in excess of $50,000 from points located outside the State of Connecticut. We find in agreement with the parties that the Employer is engaged in commerce and that it will effectuate the policies of the Act to assert jurisdiction herein. We find, contrary to the contention of the Em- ployer, that the employees sought by the Union are not "agricultural laborer[s] " as defined in Section 2(3) of the Act.' 2. The labor organization involved claims to rep- resent certain employees of the Employer. 3. A question affecting commerce exists concern- ing the representation of employees of the Employer within the meaning of Section 9(c)(1) of the Act for the following reasons: The Petitioner seeks to represent a unit of truckdri- vers and one mechanic engaged in the transportation of the Employer's product.' The Employer contends Sec. 2(3) exempts from the definition of "employee" "any individual em2ployed as an agricultural laborer The duties of these drivers consists of picking up eggs from the Rytman- Alfieri Farms and transporting them to the Colchester plant , picking up eggs from the contract farms and transporting them to Colchester , hauling that these individuals are "agricultural laborers," ex- empt from the Act's coverage by virtue of the defini- tion of "employees" contained in Section 2(3) of the Act. The Employer is owned by three individuals; 50 percent of its stock is owned by Julis Rytman, 25 percent by John Fedorowicz, and 25 percent by Nicholas Alfieri. It is engaged in the processing and selling of eggs, some of which are produced by chick- ens on farms owned jointly and separately by Ryt- man and Alfieri.' The processing plant is on land owned by Rytman. None of the owners of Colchester receives a salary except Alfieri, whose time is devoted almost exclusively to sales and sales promotion of the processed eggs from Colchester. The eggs are sold to supermarkets and other dealers. Colchester, in addi- tion to securing eggs for processing and sale from the Rytman and Alfieri jointly and separately owned farms, also secures about 25 percent of its eggs from contract farms 4 In addition, at the time of the hear- ing, the Employer received about 10 percent of its total eggs for processing from farms in Maine.' The Employer's basic contention is that because Alfieri and Fedorowicz jointly own Colchester with Rytman, and they separately and jointly own farms supplying the eggs Colchester processes for market, Colchester is engaged in farming operations and thus its employees are individuals engaged in agriculture and are therefore exempt from the Act as agricultural laborers. It is clear from the record that Colchester is jointly owned by individuals who are engaged in farming and their employees would normally be exempt un- der Section 2(3) of the Act. In the instant case, how- ever , we conclude that Colchester' s operations inso- far as it involves the employment of truckdrivers and a mechanic does not constitute agriculture as that term is used in section 3(f) of the Fair Labor Stan- dards Act (29 U.S.C.A. 203(f) )6 Colchester secures 25 percent of its eggs from con- tract farms. It appears clear that the employees of the eggs for hatching to Fedorowicz ' hatchery , and transporting processed eggs to customers of Colchester i Fedorowicz operates a hatchery on a farm owned by him which hatches egfs supplied by Rytman These contract farms produce eggs from poultry furnished by Rytman and Alfieri 5 These were brown eggs acquired to supply a market demand The record discloses that the Employer was attempting to obviate the necessity of se- curing out-of-state eggs by building up its poultry flock so as to be able to meet the brown egg market demand 6 Since 1947 the appropriation acts for the Board have regularly carried a nder which provides that the term "agricultural laborer" shall be defined in accordance with sec 3(f) of the Fair Labor Standards Act (29 U S C A 203(f)) which reads in part as follows "Agriculture" includes farming in all its branches and includes . any practices performed by a farmer or on a farm as an inci- dent to or in conjunction with such farming operations [Emphasis supplied I 214 NLRB No. 64 COLCHESTER EGG FARMS, INC. contract farmers would fall within the Section 2(3) exemption of the Act. It is equally well settled that the truckdrivers employed to pick up eggs from these contract farms do not come within the exemption. It is likewise clear that Colchester is engaged in the de- livery of processed eggs to various purchasers and that this is accomplished through an established sales organization of which Alfieri is the principal sales- person . In addition, the truckdrivers pick up and de- liver to Colchester eggs from 12 contract farms. These eggs are intermingled with those produced on the Rytman-Alfieri farms. We conclude that, while Colchester is owned by individuals who in their other operation may well be exempt from the Act by virtue of Section 2(3), the employees employed by Colchester in the pickup and delivery of eggs to and from Colchester, including deliveries to retail chains and other retail outlets, are not exempt from our Act. The fact that Colchester has maintained a sales force for the disposal of its product, together with the fact that a substantial percentage of the eggs comes from contract farms and are intermingled with its other eggs which the truckdrivers pick up and deliv- er, leads us to conclude that they are employees with- in the meaning of the Act.' Therefore, we shall assert jurisdiction in this case.' 4. We find upon the entire record, including the stipulation of the parties, that the following employ- ees of the Employer constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act: All truckdrivers and mechanics employed by the Employer at its Franklin, Connecticut, loca- tion, excluding all other employees. [Direction of Election and Excelsior footnote omit- ted from publication.] CHAIRMAN MILLER AND MEMBER KENNEDY, dissent- ing: 7 See Department of Labor's regulations 29 CFR 780, 138, 147, 152, 167, 169, 172 8In arriving at this conclusion , we have given full effect to the United States Department of Labor Regulations interpreting sec 3 (f) of the Fair Labor Standards Act (29 U S C A 203 (f)) Although, we recognize that the Fifth, Eighth, and Ninth Circuit Courts of Appeals have refused to accept the Department of Labor's interpretation of sec 3(f) of the FLSA, we be- lieve that sound Government policy requires that we refrain from interpret- ing this legislation in a manner inconsistent with the expressed views of the Agency charged with the responsibility for administering that Act We also believe that , by following such a policy, we are giving full effect to the direction by Congress that we define the term "agricultural laborer" in ac- cordance with sec 3 (f) of the FLSA In arriving at this conclusion , Member Fanning has accorded great weight to the Department of Labor's interpretation of sec 3(f) of the FLSA See Bodine Produce Company, 147 NLRB 832 at 840 (1964) 613 The majority decision ignores significant facts, governing statutory provisions, and judicial authority construing those provisions. Its rationale has been repudiated consistently by court decisions. We be- lieve that the petition must be dismissed because it seeks an election among agricultural laborers,' and we, therefore, dissent. The facts show that the individuals whom Peti- tioner would include in a bargaining unit are "agri- cultural laborers" and not employees within the meaning of Section 2(3) of the Act. They are, there- fore, not covered by our Act and the Board is pre- cluded from directing an election in this case. Colchester Egg Farms, Inc., is engaged in a farm- ing operation and was formed solely to process and market the eggs produced by its farmer owners. Its facilities are not available to other egg producers. Colchester's owners, Julius Rytman, John Fedo- rowicz, and Nicholas Alfieri, individually and in partnership, raise poultry for egg production. They supply their entire production to Colchester and con- trol and actively manage Colchester. None receives a dividend and only Alfieri, who devotes substantially full time to sales, receives a salary. Rytman individu- ally owns the real estate, owns the building where Colchester conducts its business, and owns the equipment. Rytman and Alfieri own all the eggs produced. There are 270,000 birds on egg-producing farms which Rytman owns. Rytman also rents farms under agreements with farm owners to grow birds owned by him. Rytman has placed about 650,000 birds on such farms. About 225,000 of the birds are egg pro- ducing and 430,000 have not reached the laying stage. The latter remain on the farms until they are productive at which time Rytman transfers them to farms owned by him and Alfieri under the partner- ship name of Al-Ryt. The Al-Ryt farms have about 300,000 birds. Rytman also has agreements with other "contract farms" to grow meat birds, a product which does not involve Colchester. Rytman owns about 360,000 meat birds under such arrangements. Rytman has total control over the placement and removal of birds on his contract farms. He supplies food,10 water, and veterinary service to the birds and makes all decisions as to their care. He communi- cates daily as to the condition of the birds and Ryt- man pays the farmer for services rendered to his birds. Fedorowicz operates a hatchery which receives all of its eggs from Rytman and Al-Ryt farms. After the 9 Since 1946, Congress has added a rider to the bill governing the Board's appropriations providing that no part of our appropriation shall be "used in connection with bargaining units composed of agricultural laborers" as set forth in sec 3(f) of the FLSA 10 All feed consumed by the birds is produced by Rytman Grain 614 DECISIONS OF NATIONAL LABOR RELATIONS BOARD eggs are hatched, they are transferred to contract farms, to Al-Ryt's egg-producing farms, or to Rytman's meat poultry farms. Colchester processes Rytman's and Al-Ryt's eggs before they are sent to the hatchery as well as before they are sent to market. There is no charge for this prehatchery processing. When it markets the eggs, it gives Rytman and Al-Ryt the market price, less the processing cost of about 10 cents a dozen. The Col- chester activity includes washing, spraying, candling, and grading the eggs and placing them in cartons. Of the eggs processed by Colchester, 90 percent are owned by Rytman and Al-Ryt, of which 25 per- cent come from chicks grown on contract farms. Col- chester does not process eggs for egg producers other than its owners. When necessary to meet customer needs, Colchester purchases eggs from other sources. The bulk of the outside egg buying has been due to a temporary shortage of brown eggs, which Rytman and Al-Ryt are now taking steps to produce. The truckdrivers whom Petitioner seeks to repre- sent spend about 40 percent of their time transport- ing eggs from the Rytman-owned or leased farms to Colchester for processing. There is some delivery to the hatchery, but the largest portion of the drivers' work is the delivery of processed eggs from Colches- ter to retail stores or egg distributors. The drivers also occasionally perform trucking work for Rytman or assist in egg processing at the Colchester plant. The courts have long recognized that raising of poultry and production of eggs are within the defini- tion of agriculture and the work performed by truck- drivers is "incident to or in conduction with" such raising and the "preparation for market" and the "delivery to market" of the poultry products." Our colleagues err, we think, in failing to recognize that the Employer's operations are a totally integrated farming operation. The truckdrivers are performing a transportation function related to the Employer's farming operation. The majority opinion of our colleagues simply ig- nores the court decisions which have held that indi- viduals performing work similar to the truckdrivers and mechanics in this case are clearly agricultural laborers under the standards prescribed by Congress. ii Sec 3(f) of the FLSA defines "agriculture" as follows "Agriculture" includes farming in all its branches and among other things includes the cultivation and tillage of the soil , dairying, the pro- duction, cultivation, growing, and harvesting of any agricultural or hor- ticultural commodities (including commodities defined as agricultural commodities in section [ 15(g) of the Agricultural Marketing Act, as amended] ), the raising of livestock , bees, fur-bearing animals , or poul- try, and any practices (including any forestry or lumbering operations) performed by a farmer or on a farm as an incident to or in conjunction with such farming operations , including preparation for market , deliv- ery to storage or to market or to carriers for transportation to market 129 U S C A 203(f)] The statute's definition of "agriculture" exempts "farming in all its branches and among other things includes . . . the raising of . . . poultry." It further encompasses "any practices," whether or not they are farming practices, "performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for mar- ket, delivery to storage or to market or to carriers for transportation to market." 12 The Board has held that egg-processing , mainte- nance, and truckdriver employees working for an employer who produced, processed, and sold eggs were exempt as agricultural laborers because the em- ployees' activities were incidental to and in conjunc- tion with their employer's farming operation. See McAnally Enterprise, Inc., 152 NLRB 527 (1965). Our colleagues do not follow the McAnally case here. They reason that the employees who handle or haul eggs or chickens lose their statutorily exempt status as agricultural laborers because the chickens are placed on contract farms. The courts have repeatedly rejected this Board's attempt to compartmentalize what is essentially a total "farming" activity. McEI- rath Poultry Company v. N.L.R.B., 494 F.2d 518 (C.A. 5, 1974); Abbott Farms, Inc. v. N.L.R.B., 487 F.2d 904 (C.A. 5, 1973); N.L.R.B. v. Victor Rykebosch, Inc., 471 F.2d 20 (C.A. 9, 1972); N.L.R.B. v. Strain Poultry Farms, Inc., 405 F.2d 1025 (C.A. 5, 1969). See also Wirtz v. Tyson's Poultry, Inc., 355 F.2d 255 (C.A. 8, 1966); Mitchell v. Georgia Broiler Supply, Inc., 186 F.Supp. 341 (D.C. Ga., 1960)." A principal decision under the Fair Labor Stan- dards Act, construing the agricultural definition, is strikingly similar to this case. In Writz v. Tyson's 12 Farmers Reservoir & Irrigation Co v McComb, 337 U S 755, 762-63 (1949) U In fn 8 , supra, the majority suggests that we should refrain from inter- preting sec 3(f) of the FLSA in a manner inconsistent with the views of the Department of Labor We note that said footnote is inconsistent with the view expressed by Member Fanning in the dissent in Bodine Produce Com- pany, 147 NLRB 832, in which he stated "While we agree with our col- leagues that great weight is to be accorded to the Labor Department 's opin- ion for which we want utmost respect, in the final analysis we are charged with responsibility for our own jurisdictional determinations " [Emphasis sup- plied ] We, too, are unwilling to abdicate to the opinion of the Department of Labor for the Board is charged by Congress with ensuring that our ap- propriations are not "used in connection bargaining units composed of agricultural laborers " Indeed the Department of Labor's Interpretative Bul- letin for Title 29, part 780 , recognizes that its interpretations are advisory as to those "matters which have not been determined by the courts " and that the "ultimate decisions on interpretations of the Act are made by the courts ." See secs . 780.5 and 780 .6. We note that the Department of Labor has not revised in pertinent part its interpretation of the agricultural exemp- tion since 1961 Under these circumstances , the Department of Labor's 1961 Interpretative Bulletin cannot be accorded the controlling weight given it by the majority In our view , the above-cited decisions of the Fifth , Eighth, and Ninth Circuit Courts of Appeals are authorative decisions and should be followed We have refrained from dissenting in earlier cases to afford the Board an opportunity to petition for certiorari in cases in which we have received adverse decisions A majority of the Board has been unwilling to file such a petition COLCHESTER EGG FARMS, INC Poultry, Inc., supra, Tyrson's Poultry, a subsidiary of Tyson's Foods, processed and marketed eggs. It graded , handled , sized , candled , packed , and shipped eggs . It did not own any farms but obtained all of its eggs from a sister farming company, Poultry Grow- ers, also a subsidiary of Tyson ' s Foods. Twenty-sev- en percent of the eggs supplied to the processing plant were grown by independent growers under contract , whereby Poultry Growers furnished the in- dependent contractors with the birds (which Poultry Growers continued to own) and supplied food and medicine for the birds . Poultry Growers paid the contractors a price per bird for the service . The court held that all employees of the three corporations, in- cluding those working in the egg-processing plant, were engaged in a "single and completely integrated farming operation ." It said: We are here concerned with a single and com- pletely integrated farming operation carried on and headed up by appellees through their affili- ated corporation , Poultry Growers, Inc. As found by the District Court, the appellees are farmers and are the ones who initiated the farm- ing operations here involved . Without appellees the independent growers arguably would never have undertaken the initial and continuing cost of acquiring the birds and producing the eggs. The contract growers merely aid the appellees, whom the District Court found to be the ones qualified to claim the agricultural exemption un- der the Act as to their employees engaged in the "handling , cooling, grading, candling and pack- ing" of eggs . [355 F.2d at 258] The court concluded that all of the egg-producing activities, including that of the contract farmers, the egg raising by Poultry Growers, and the egg pro- cessing by Tyson's Poultry, constituted a "self-sus- tained and operated entire `agricultural function' " and were thus exempt from coverage of the Fair La- bor Standards Act. 355 F.2d at 261. The Court of Appeals for the Fifth Circuit fol- 615 lowed the Tyson's Poultry decision in N.L. R.B. v. Strain Poultry Farms, supra, and held that raising poultry, whether by the employer or the independent grower, was a part of the employer's "farming" oper- ation . The court further held that truckers who hauled chicken coops to independent growers of the employer' s chickens and hauled the chickens from the growers to market were exempt because the haul- ing activity, like the contract growing, was an integ- ral part of the employer' s raising of poultry. The court of Appeals for the Ninth Circuit reached the same conclusion in the Rykebosch case , supra. The court held that the drivers who transport the grown chickens to market are exempt. In Abbott Farms, Inc., supra, the Fifth Circuit ap- plied the Strain holding in finding employees of a feed mill and truckers hauling the feed to indepen- dent growers were exempt agricultural laborers be- cause the activities were all a part of the employer's exempt poultry raising operation . Accord McElrath Poultry Co., supra, involving both mechanics and drivers. We cannot agree with our colleagues ' conclusion that, because some of Colchester's eggs are produced on contract farms, the drivers who pick up eggs from the contract farms are not agricultural laborers. The Board refuses to seek a definitive answer to the issue here posed from the Supreme Court. A majority of the Board has been unwilling to file a petition for certiorari not withstanding adverse decisions in Mc- Elrath Poultry Co., supra; Abbott Farms, Inc., supra; Victor Rykebosch, Inc., supra, and Strain Poultry Farms, Inc., supra. After 5 years of adverse decisions, we think we should now acquiesce in the views of the Fifth, Eighth, and Ninth Circuit Courts of Appeals. The agricultural laborer exemption forecloses our protecting individuals included in the unit in their organizing efforts. We therefore think we do those individuals a serious disservice in encouraging them to participate in one of our elections . Elementary fairness, we believe , requires that we dismiss the in- stant case.