Eureka Newspapers, Inc.

National Labor Relations Board - Board Decisions

Sep 14, 1965

154 N.L.R.B. 1181 (N.L.R.B. 1965)

EUREKA NEWSPAPERS, INC. 1181
tamed by it for at least 60 consecutive days thereafter , in conspicuous places,
including all places where notices to employees are customarily posted. Reasonable=
steps shall be taken by the Respondent to insure that said notices are not altered,
defaced , or covered by any material.
(c) Notify the Regional Director for Region 25, in writing, within 20 days from
the date of receipt of this Decision , what steps it has taken to comply herewith.2
2 In the event that this Recommended Order be adopted by the Board , this provision
shall be modified to read: "Notify the Regional Director for Region 25, in writing, within
10 days from the date of this Order , what steps it has taken to comply herewith."
APPENDIX
NOTICE TO ALL EMPLOYEES
Pursuant to a Recommended Order of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor Rela-
tions Act, as amended, we hereby notify our employees that:
WE WILL, upon request, bargain with District 153 of the International Associa-
tion of Machinists, AFL-CIO, as the exclusive representative of all the employees
in the bargaining unit described below with respect to rates of pay, wages, hours
and other conditions of employment, and, if an understanding is reached,
embody such an understanding in a signed agreement.
WE WILL NOT interfere with the efforts of District 153 of the International
Association of Machinists, AFL-CIO, to bargain collectively.
The bargaining unit is:
All production and maintenance employees employed at the Employer's
Evansville, Indiana, plant, including a leadman and the truckdrivers; but
excluding all office clerical employees, foreman, plant clerical employees,
professional employees, guards, and supervisors as defined in the Act.
SHAWNEE PLASTICS, INC.,
Employer.
Dated------------------- By-------------------------------------------
(Representative) (Title)
This notice must remain posted for 60 consecutive days from the date of posting,
and must not be altered, defaced, or covered by any other material.
If employees have any question concerning this notice or compliance with its pro-
visions, they may communicate directly with the Board's Regional Office, 150 West
Market Street, Indianapolis , Indiana, Telephone No. Melrose 3-8921.
Eureka Newspapers , Inc. and Teamsters , Warehousemen and
Auto Truck Drivers Local 684, International Brotherhood of
Teamsters , Chauffeurs , Warehousemen and Helpers of America,
Petitioner. Case No. 2O-RC-641. September 14, 1965
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, as amended, a hearing was held before Hearing Officer
Joe R. McCray of the National Labor Relations Board. The Hearing
Officer's rulings made at the hearing are free from prejudicial error
and are hereby affirmed.
Pursuant to the provisions of Section 3(b) of the Act, the Board
has delegated its powers in connection with this case to a three-member
panel [Chairman McCulloch and Members Brown and Zagorial.
154 NLRB No. 102.
1182 DECISIONS OF NATIONAL LABOI RELATIONS BOARD
Upon the entire record in this case, the Board finds :
1. The Employer is engaged in commerce within the meaning of the
Act and it will effectuate the purposes of the Act to assert jurisdiction
herein.
2. The labor organization involved claims to represent certain
employees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of certain employees of the Employer within the meaning of Sec-
tion 9(c) (1) and Section 2(6) and (7) of the Act.
4. The Petitioner seeks a unit of three district dealers who are
engaged in the sale and distribution of a newspaper published by the
Employer. The Employer contends that the district dealers are inde-
pendent contractors and, alternatively, that they are supervisors.
The Employer has entered into contracts with the dealers' which
designate them as independent contractors. The contracts provide
that the dealer will purchase from the Employer copies of the news-
paper "at the price herein set forth, or at such other prices as from
time to time may be fixed by the Company in accordance with the pro-
visions of this agreements [sic]."' The delivery areas are unilaterally
established by the Employer, who has even required one of the dealers
to service an account he did not wish to service. The dealer acquires
no interest in his territory and may not assign or transfer any rights
under the contract without the written consent of the Employer. Any
attempt to do so gives the Employer grounds for immediate termina-
tion of the agreement. The contract requires dealers to prepare and
maintain full, correct, and up-to-date lists of the names and addresses
of subscribers in their territory, indicating advance payments, and to
furnish such reports to the Employer upon request. The evidence fails
to establish, however, that the Employer has enforced the contract in
this respect.
Under the contract, the dealer agrees to sell the newspapers at rates
established by the Employer, and not to distribute with them any
advertising matter other than that furnished by the Employer, or
copies of any other newspapers, and not to enter into any agreement
for the sale or distribution of other materials except upon the written
consent of the Employer. The contract also provides that all advance
payments beyond a 31-day period shall be turned over to the Employer,
to be deposited in a bank of the Employer's choice and refunded to the
district dealer on the basis of credits to the dealer's account each month
as a subscription becomes payable. The Employer replaces papers
lost in delivery, and accepts returns of unsold papers. It has instructed
the dealers to wax papers to protect them in inclement weather.
1 At the time of the hearing , these contracts had expired , but the parties thereto had
a practice of continuing expired contracts in effect until new ones were executed.
EUREKA NEWSPAPERS, INC. 1183
The contracts are terminable by either party upon 30 to 45 days' writ-
ten notice. They are also terminable by the Employer without notice in
the event of a strike or other labor disturbance. In the event of ter-
mination, the dealer is required immediately to pay to the Employer
all sums due and all advance payments, and furnish to the Employer a
statement of the names and addresses of such subscribers and the period
for which they have paid in advance of the termination date.
Dealers own and maintain their own transportation facilities and
carry their own insurance. They are required to purchase their own
bonds from a private bonding company, which company must be
approved by the Employer. The Employer makes no deduction for
social security or withholding tax for the dealers, who receive no fringe
employment benefits. Dealers determine their own vacation time, and
hire and pay their replacements. Dealers also hire and pay carrier
boys to help in the distribution of the newspapers. They are required
to carry workmen's compensation insurance for the benefit of any
employees they hire to assist them, and are responsible for tax deduc-
tions and unemployment insurance for such employees. Although the
Employer does not exercise supervision over the carrier boys, it has
prohibited the employment of carrier boys who use motorcycles in
making deliveries, and has requested the discharge of boys who violate
this regulation. Dealers do not stand the losses caused by nonpayment
by carrier boys; a special insurance fund, into which carrier boys pay
fixed amounts each month, is kept and administered by the Employer
to protect the dealers from such losses.
The Employer assists dealers in obtaining new subscribers through
promotional programs and contests, financed by the Employer, but they
are not required to use the promotional material offered by the
Employer. Dealers have desk space at the Employer's offices, for which
they are not charged. They are, however, charged a fixed amount for
supplies, stationery, and use of the telephone. There is a pool, consist-
ing of the three district dealers and one of the Employer's employees,
who alternate in spending an hour each evening receiving calls from
complaining customers? Complaints are handled without regard to
the district involved.
The Board has frequently held that, in determining the status of
persons alleged to be independent contractors, the Act requires appli-
cation of the "right of control" test. Where the person for whom the
services are performed retains the right to control the manner and
means by which the result is to be accomplished, the relationship is one
of employment; while, on the other hand, where control is reserved
2 Subscribers who call during the day to complain about nondelivery of newspapers are
advised to call back between 6 and 7 p.m., or a message is taken and given to the dealer
involved.
1184 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
only as to the result sought, the relationship is that of an independent
contractor. The resolution of this question depends on the facts of
each case, and no one factor is determinative.
On the basis of the foregoing and the entire record, we are satisfied
that the dealers are not independent contractors. We are aware that
the evidence discloses several factors which are usually considered to
indicate an independent contractor status, but the presence of these
factors does not alone establish such status. Thus, we are not per-
suaded and do not regard as controlling the fact that a written agree-
ment defines the relationship as one of independent contractor; that
the dealers provide their own equipment; that the Employer does not
make the usual payroll deductions for the dealers; or that the dealers
hire and pay the carrier boys who deliver the newspapers.
The result to be accomplished through the distributorship arrange-
ment is the circulation of the Employer's newspapers for resale to the
general public. In accomplishing this result, the dealers bear slight
resemblance to the independent businessman whose earnings are con-
trolled by self-determined policies, personal investment and expendi-
ture, and market conditions. The dealers do not have a proprietary
interest in their routes, and cannot assign them without the written
consent of the Employer. They must resell the newspapers at the
price set by the Employer, and within a territory determined and con-
trolled by the Employer. The Employer has required a dealer to serv-
ice a subscriber despite the dealer's opposition. The dealers are not
permitted to sell or distribute any other newspapers, and must turn
over to the Employer all advance payments beyond a 31-day period.
It is thus clear that the dealer's opportunities for profit are limited
by the Employer's control of essential factors of employment, and are
not controlled primarily by the efficiency of the dealers in performing
their work. The element of risk of loss is another factor to be consid-
ered in determining whether the status is that of employer-employee
or that of an independent contractor. Here, the dealers' risk of loss is
minimized to a significant extent by the Employer's acceptance of
returns for credit, its replacement of papers lost in delivery, and its
establishment of a special insurance fund to protect dealers from losses
because of nonpayment by carrier boys. The Employer also exercises
a measure of control over the manner and means by which the dealers
distribute the papers. Dealers have been instructed to wax papers to
protect them in inclement weather, and have been prohibited from
employing carrier boys who use motorcycles in making deliveries.
Although the contracts provide for termination by either party upon
notice, the Employer has the additional option of terminating the con-
tracts without notice in the event of a labor disturbance. The con-
tracts also provide that nonperformance of the agreement by the
dealer because of sickness or injury shall constitute a breach of the
ROSEN SANITARY WIPING CLOTH CO., INC. 1185
agreement. Where the Employer has the right to terminate the rela-
tionship at will, it indicates an employer-employee relationship, and
not that of an independent contractor.'
Accordingly, on all the facts, we conclude that the Employer has
reserved the right to control the manner and means, as well as the
result, of the dealers' work and that they are, therefore, not independ-
ent contractors .4
As noted above, the Employer contends that, even if the Board finds
that the dealers are not independent contractors, the proposed unit
is nevertheless inappropriate on the ground that the dealers are super-
visors within the meaning of the Act. It is clear, however, that the
carrier boys are not employees of the Employer. As the dealers do not
exercise supervisory authority over any employees of the Employer,
we find that, in their employment relationship with the Employer,
which is the only relationship relevant here, the dealers are not super-
visors within the meaning of the Act.5
Accordingly, we find that a unit of the following employees is appro-
priate for the purposes of collective bargaining within the meaning
of Section 9 (b) of the Act :
All district dealers employed by the Employer in the distribution and
circulation of the Employer's newspapers, excluding all other employ-
ees and supervisors as defined in the Act.
[Text of Direction of Election omitted from publication.]
8 Site Oil Company of Missouri, 137 NLRB 1274, 1287.
4 The Vindicator Printing Company, 146 NLRB 871, 875-876; Lindsay Newspapers,
Inc., 130 NLRB 680, 681-682; Site Oil Company o f Missouri, 137 NLRB 1274, 1287-1288;
Buffalo Courier-Express, Inc., 129 NLRB 932, 935-936 ; San Antonio Light Division,
Hearst Consolidated Publications , Inc., 130 NLRB 619, 620, 624-.629.
a Buffalo Courier -Express, Inc., 129 NLRB 932 , 937 ; Textile Workers Union of America,
139 NLRB 800, 802.
Rosen Sanitary Wiping Cloth Co., Inc . and General Truck Driv-
ers, Chauffeurs, Warehousemen & Helpers, Local 270, affiliated
with International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America , Ind. Case No. 15-CA-
d560. September 15, 1965
DECISION AND ORDER
On May 12,1965, Trial Examiner John F. Funke issued his Decision
in the above-entitled proceeding, finding that the Respondent had
engaged in and was engaging in certain unfair labor practices and rec-
ommending that it cease and desist therefrom and take certain affirma-
tive action, as set forth in the attached Trial Examiner's Decision.
154 NLRB No. 105.
206-448-66-vol. 154-76