John McCormack Co.

National Labor Relations Board - Board Decisions

Dec 29, 1953

107 N.L.R.B. 606 (N.L.R.B. 1953)

606 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
CONCLUSIONS OF LAW
1. Lakeview Creamery Company, a copartnership, is engaged in and during all times
material herein was engaged in commerce within the meaning of Section 2 (6) and (7) of the
Act.
2. International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of
America, AFL, Local No. 911, is a labor organization within the meaning of Section 2 (5)
of the Act.
3. Since June 2, 1952, the Teamsters has engaged in and is engaging in unfair labor
practices within the meaning of Section 8 (b) (4) (A) of the Act, by engaging in and encouraging
the Company's employees and employees of other employers to engage in a concerted
refusal in the course of their employment to use, manufacture, process, transport, or
otherwise handle or work on any goods, articles, materials, or commodities, or to perform
any services, where the object was to force or require three partners of the Company to
join the Teamsters.
4. The aforesaid unfair labor practices are unfair labor practices affecting commerce
within the meaning of Section 2 (6) and (7) of the Act.
[Recommendations omitted from publication. ]
THOMAS BULEN McCORMACK, d/b/a JOHN McCORMACK
CO. and C. N. HILL and UNITED FRESH FRUIT AND
VEGETABLE WORKERS, LIU #78, CIO, Petitioner. Case
No. 20-RC-2329. December 29, 1953
DECISION AND ORDER
Upon a petition duly filed under Section 9 (c) of the National
Labor Relations Act, a hearing was held before LaFayette D.
Mathews, Jr., hearing officer. The hearing officer's rulings
made at the hearing are free from prejudicial error and are
hereby affirmed.'
Upon the entire record in this case, the Board finds:
1. Thomas Bulen McCormack, d/b/a John McCormack Co.,
herein called McCormack, owns and operates a number of
fruit ranches in the State of California. McCormack also
owns a fruit packingshed located at Walnut Grove, California,
where the fruit grown on McCormack's ranches is graded and
packed by C. N. Hill, a licensed labor contractor who operates
the packingshed under an oral contract with McCormack.
McCormack contends that the employees who work in the
packingshed are employees of Hill and not of McCormack.
McCormack pays Hill 14 cents per box of fruit packed. Hill
has sole authority to hire, discipline, and discharge the em-
ployees working in the packingshed and sets their wages
which he pays. Hill makes the required deductions for un-
employment insurance, social security, and withholding taxes.
iC N. Hill, although served with notice of the hearing, did not appear at the hearing, but a
letter from him disputing the Petitioner's showing of interest was read into the record The
Petitioner's showing of interest is an administrative matter and is not litigible at the hearing.
Furthermore we are administratively satisfied that the Petitioner has made an adequate
showing of interest.
107 NLRB No. 133.
JOHN McCORMACK CO. 607
Hill supervises the employees in the performance of their
duties. McCormack's only control over the employees is an
indirect control over their hours of employment by virtue
of the fact that the shed operates as long as fruit is delivered
to the shed by employees of McCormack . However, if the
shed has to work overtime because of the amount of fruit
delivered in a day , Hill is paid an overtime rate per box.
McCormack also gives Hill instructions as to what grade of
fruit is to be packed but leaves to Hill the manner in which
such instructions are to be carried out. After the fruit is
packed, it is delivered to railroad cars as directed by Mc-
Cormack. Title to the fruit remains in McCormack until
delivery is made to the railroad cars.
Hills receives approximately $ 10,000 per season from
McCormack for his services in operating the packingshed.
The value of the fruit graded and packed by Hill was in excess
of $32,000 during the 1952 season and in excess of $27,000
during the 1953 season. All this fruit was shipped to points
outside the State of California.
In view of the foregoing and on the entire record in these
proceedings , we find that C. N. Hill is an independent con-
tractor , 2 and that the employees working in the packing shed
are employees of C. N. Hill and not of McCormack . Accord-
ingly, the petition is hereby dismissed insofar as it refers
to McCormack as the employer.
The foregoing facts also make it plain that Hill ' s business
consists of furnishing services which are necessary to the
operations of an employer who produces and ships goods in
interstate commerce. In view thereof , we believe that the
question of whether jurisdiction should be asserted over
Hill must be decided under that part of the Board's juris-
dictional plan enunciated in Hollow Tree Lumber. 3 91 NLRB
635, where, to the extent here pertinent , the Board said:
The Board has determined that it will exercise juris-
diction over those enterprises which affect commerce
by virtue of the fact that they furnish goods or services
necessary to the operations of other employers engaged
in commerce . . . where such goods or services are
valued at $ 50,000 per annum or more , and are sold to
. . . enterprises engaged in producing or handling goods
destined for out-of - State shipment . . . in the value of
$25,000 per annum or more ." ( Emphasis in original.)
Applying the Hollow Tree criteria to the facts of this case,
we find no warrant for asserting jurisdiction over Hill inasmuch
2Giffin, Inc., 106 NLRB 764; cf. Garner Aviation Service Corporation and Lynchburg
Air Transport & Sales Corporation, 101 NLRB 517; John B. Shriver Co., 103 NLRB 23;
Mahoning Mining Co., 61 NLRB 792.
3Referred to in the dissent as "category 5 of the plan."
608 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
as the services he furnishes to McCormack are valued at
less than $50,000 per year.
Our dissenting colleague maintains that "category 4 of the
plan," which embraces, among others, enterprises handling
goods destined for out-of-State shipment which are valued
at $25,000 a year, should be applied in this case, and that
jurisdiction should be asserted thereunder, because Hill
prepares and packs fruit valued in excess of $25,000 per
year, all of which is loaded into railroad cars by Hill for
shipment in interstate commerce. In our opinion, however,
this approach overlooks the critical fact that the "handling
[of ] goods destined for out-of-State shipment" which it would
attribute to Hill consists of the physical handling of Mc-
Cormack's fruit described above, all of which is part of the
services necessary to McCormack's operation that Hill fur-
nishes McCormack under their oral contract. In the light of
all the facts, it seems plain that to find that Hill "falls within
the specific provision of category 4 of the plan" by equating
his contractual services to the handling of goods destined
for out-of-State shipment, within the meaning of category 4,
as our dissenting colleague does, would be to rely upon a
literal interpretation of that part of the plan which would
extend its scope beyond its intended limits, in total disregard
of the Hollow Tree formula. Such an approach was obviously
not contemplated by the Board when it adopted the juris-
dictional plan.
Nor are we, on the basis of all the facts, able to agree with
Member Murdock's view that Hill's operations affect com-
merce directly, and not indirectly, and that the "spirit"
of the Board's jurisdictional plan therefore requires the
application of category 4, rather than the Hollow Tree formula,
to the facts of this case. Had Hill returned the fruit to its
owner immediately after their grading and packing, to be
thereafter shipped out of the State by McCormack, his activity
undoubtedly would have affected commerce only indirectly.5
The added fact present in this case, namely, that Hill, at'
McCormack's direction, placed the latter's fruit on rail-
road cars for shipment to their ultimate destination, does
not, in our opinion, warrant a contrary finding. 6
4Cf. Giffen, Inc., 106 NLRB 764, where the Board applied the Hollow Tree formula in
the case of an employer who washed, graded, and prepared for interstate shipment potatoes
owned by another. It was the brokerage firm selling the potatoes out-of-State, for whom the
Board found that the employer's services were rendered, which was deemed to be the enter-
prise handling goods destined for out-of-State shipment.
5 See the Giffin case, supra.
61n either event, it is McCormack's business alone which affects commerce directly. It is
noteworthy in the instant connection that Member Murdockhimself does not "attach controlling
significance to the role played by Hill in placing the fruit handled by his employees, in rail-
road cars..."
The Supreme Court's decision in N. L. R. B. v. Fainblatt, 306 U. S. 601, upon which the
dissent relies , deals only with the test to be applied in determining whether an employer is
subject to the Act and is therefore not dispositive of cases such as this where the issue
JOHN McCORMACK CO. 609
On the basis of all the foregoing, we shall dismiss the
petition. 7
[The Board dismissed the petition.]
Member Murdock, dissenting:
I believe that the spirit and letter of the Board's juris-
dictional plan and prior decisions thereunder require the
assertion of jurisdiction over the Employer in this case.
C. N. Hill, the Employer, prepares and packs for interstate
shipment fruit grown and owned by John B. McCormack Com-
pany. The fruit thus handled by Hill is valued in excess of
$25,00 per annum, all of which is loaded into railroad cars
by employees of Hill for shipment in interstate commerce.
The Employer thus falls within the specific provision of
category 4 of the plan, which embraces . .. .
(4) Enterprises engaged in producing or handling goods
destined for out of state shipment valued at $25,000
per annum. 8
My colleagues - instead apply category 5 of the plan which
covers intrastate enterprises furnishing goods or services
valued at $50,000 per year to firms engaged in interstate
commerce9 and refuse to assert jurisdiction because Hill
receives less than $50,000 for such services. The latter
standard is not the proper one against which to measure the
jurisdictional facts present in the instant case. For that
standard is designed to enable the Board to determine whether
the policies of the Act will be effectuated by. asserting juris-
diction over an "intrastate enterprise" which does not place
goods directly in interstate commerce, but which does fur-
nish materials or services to an enterprise which is engaged
in producing or handling goods destined for out-of-State
shipment. It applies to employers whose operations affect
interstate commerce indirectly rather than directly. Hill,
however, handles and places goods valued in excess of
$25,000 directly in interstate commerce. The disruption
of his operations resulting from a strike by his employees
would have a direct effect on interstate commerce. For
this reason the Board has applied the category 4 provision
of the plan to a set of facts analogous to this in Tule River
Cooperative Gin, Inc. 10In that case the Board asserted juris-
presented is whether it would effectuate the policies of the Act to assert jurisdiction over an
employer whose operations concededly affect commerce to some extent . To the extent that our
holding herein is inconsistent with the Board's holding in Tule River Cooperative Gin, Inc.,
102 NLRB 1523 , to which the dissent refers , that decision is hereby overruled.
7 However , by this decision , Chairman Farmer and Member Rodgers do not adopt as per-
manent policy the category 4 and Hollow Tree jurisdictional criteria discussed above
8Stantslaus Implement & Hardware Co., Ltd., 91 NLRB 618.
9 Hollow Tree Lumber , 91 NLRB 635.
10102 NLRB 1523.
61 0 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
diction over a cotton gin that ginned cotton on behalf of the
growers of cotton which thereafter was shipped outside
the State . At no time did the cotton gin acquire title to the
cotton . In its decision the Board specifically pointed out
that it was " immaterial " that the employer acquired no
title to the cotton and did not even itself ship the cotton
directly out-of-State; it asserted jurisdiction on the ground
that the
employer is an enterprise engaged in processing or
handling goods destined for out-of - State shipment, which
goods have a value of $25,000 and more a year , that its
activities meet the jurisdictional tests recently estab-
lished by the Board , and that it will effectuate the policies
of the Act to assert jurisdiction herein.4 ( Emphasis
added.)
4Cf. Stanislaus Implement and Hardware Co ., Ltd.,
91 NLRB 618: National Gas Company , supra.
The majority states that to find that Hill falls within the
specific provision of category 4 of the plan "would be to rely
upon a literal interpretation of that part of the plan which
would extend its scope beyond its intended limits, in total
disregard of the Hollow Tree formula. Such an approach
was obviously not contemplated by the Board when it adopted
the jurisdictional plan." Yet the majority finds it necessary
to overrule the Tule River case in which the Board affirmed
just such an approach . Of course as pointed out by the
majority, in the Tule River case, the Employer did not itself
ship the goods it processed directly in interstate commerce,
and although I do not attach controlling significance to the
role played by Hill in placing the fruit handled by his em-
ployees , in railroad cars, I believe such circumstance suf-
ficiently distinguishes the instant case from the Tule River
case to require us to assert jurisdiction over Hill even
though the latter case is overruled . To hold that Hill, who
actually places the fruit processed by his employees in
interstate carriers , is not engaged in handling goods destined
for out-of - State shipment is to rob words of their meaning,
and effectively eliminates that clause from category 4 of
the plan.
If Hill owned the $25 , 000 worth of fruit processed by his
employees and placed by them in interstate carriers, I
assume that the Board would assert jurisdiction under category
4 of the plan . By refusing to apply category 4 and to assert
jurisdiction over Hill because he does not have title to the
fruit , the Board is in effect holding that the fortuity of title
to goods handled by an employer determines the effect the
employer's operations have on interstate commerce. The
VACUUM COOLING COMPANY 611
Supreme Court expressly rejected this approach in the
Fainblatt case. 11
Apparently the majority must believe that because Hill
does not own the fruit processed by his employees, a dis-
ruption in his operations resulting from a strike of his em-
ployees , would have only an indirect effect on interstate
commerce , but that if Hill did own the fruit, such inter-
ference would have a direct effect on interstate commerce.
I fail to see how the accident of who has title to the fruit
changes the nature of the effect on interstate commerce of
a strike by Hill employees . The resulting interference with
the movement in commerce of the fruit which Hill contracted
to process and load on railroad cars would be precisely the
same regardless of who owned the fruit . The fact that the
handling of the fruit is a part of the services required of
Hill under his oral contract with McCormack , does not
thereby lessen the effect of a strike by Hill's employees,
on the movement of the fruit in interstate commerce.
Accordingly , I believe that reason and logic as well as
past decisions 1 require that the Board find that inasmuch
as Hill is engaged in handling goods destined for out-of-State
shipment which have a value of $25,000 and more a year,
his activities affect commerce within the meaning of the Act,
and that it would effectuate the policies of the Act to assert
jurisdiction over Hill.
11306 U. S. 601 ( 1939). See my dissent in Brooks Wood Products , 107 NLRB 237.
12 Tule River Cooperative Gin, Inc., 102 NLRB 1523 . Cf. National Gas Company , 99 NLRB
23, Stanislaus Implement & Hardware Company Ltd., 91 NLRB 618.
VACUUM COOLING COMPANY and BOXMAKERS UNION LO-
CAL NO. 2721 , UNITED BROTHERHOOD OF CARPENTERS
AND JOINERS OF AMERICA , AFL, and INTERNATIONAL
BROTHERHOOD OF TEAMSTERS , CHAUFFEURS, WARE-
HOUSEMEN AND HELPERS OF AMERICA , LOCAL UNION
NO. 898, AFL , Petitioner
VACUUM COOLING COMPANY and UNITED FRESH FRUIT
AND VEGETABLE WORKERS , LOCAL INDUSTRIAL UNION
NO. 78, C.I.O., Petitioner . Cases Nos. 21-RC - 2939 , 21-RC-
2969, and 21-RC-2979 . December 29, 1953
DECISION AND ORDER
On June 26, 1953 , the Board issued a Decision and Direction
of Election in these proceedings, directing an election in a
single unit embracing all operating locations of the Employer. 1
1105 NLRB 794.
107 NLRB No. 136.