Liquid Transporters, Inc.

National Labor Relations Board - Board Decisions

Aug 6, 1980

250 N.L.R.B. 1421 (N.L.R.B. 1980)

LIQUID TRANSPORTERS, INC.
Liquid Transporters, Inc. and General Drivers, War-
ehousemen & Helpers Local #89, affiliated with
International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America,
Petitioner. Case 9-RC-13117
August 6, 1980
DECISION AND DIRECTION OF
ELECTIONS
BY CHAIRMAN FANNING AND MEMBERS
JENKINS AND TRUESDALE
Upon a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held on October 31 and November 1,
2, 14, and 15, 1979, before Hearing Officer Daniel
J. Roketenetz. Following the hearing and pursuant
to Section 102.67 of the National Labor Relations
Board Rules and Regulations, Series 8, as amended,
the Regional Director for Region 9 transferred this
case to the National Labor Relations Board for de-
cision. Thereafter, the Employer and the Petitioner
filed briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has reviewed the Hearing Offficer's
rulings made at the hearing and find that no preju-
dicial error was committed. They are hereby af-
firmed.
Upon the entire record in this proceeding, the
Board finds:
1. The Employer is engaged in commerce within
the meaning of the Act, and it will effectuate the
policies of the Act to assert jurisdiction here.
2. The parties stipulated, and we find, that the
Petitioner, which claims to represent certain em-
ployees of the Employer, is a labor organization as
defined in the Act.
3. A question affecting commerce exists concern-
ing the representation of employees of the Employ-
er within the meaning of Sections 9(c)(1) and 2(6)
and (7) of the Act. '
4. The Petitioner seeks to represent a unit con-
sisting of all company drivers, owner-operators,
drivers of multiple owners, mechanics, mechanic's
helpers, tank cleaners, and tire changers at the Em-
ployer's Fern Valley Road, Louisville, Kentucky,
i By letter dated October 8, 1979, the Petitioner demanded that the
Employer recognize and bargain with it as the exclusive representative of
its employees. The Employer refused the Petitioner's demands, by letter
dated October 11, 1979. At the hearing, the Employer declined to recog-
nize the Petitioner as the exclusive collective-bargaining representative of
any of its employees unless and until so certified by the Board.
250 NLRB No. 163
location. 2 The Petitioner, however, is willing to
participate in an election in any unit or units found
appropriate here. Contrary to the Petitioner, the
Employer contends that only two separate units
are appropriate, a unit of company drivers and a
unit composed of mechanics, cleaning rack employ-
ees, and checkout lane employees. The Employer
further contends that the owner-operators are inde-
pendent contractors and that the drivers of multi-
ple owner-operators are employees of independent
contractors and thus not properly includable in any
appropriate unit.
The Employer is an interstate common carrier
operating pursuant to a certificate of public con-
venience and necessity issued by the Interstate
Commerce Commission (ICC). The Employer op-
erates throughout the 48 contiguous States hauling
various bulk and dry chemical products. As an in-
terstate carrier, it is subject to certain regulations
of the Department of Transportation (DOT) rela-
tive to driver and vehicle safety.3
The Employer owns about 50 tractors and 200
trailers that operate out of its Fern Valley Road
Terminal. At this terminal, the Employer directly
employs about 51 drivers who operate the Employ-
er's equipment. These company drivers are paid on
a mileage basis and share in health and welfare pro-
grams, pension programs, and a retirement pro-
gram offered by the Employer. These drivers are
dispatched exclusively from the Fern Valley Road
terminal according to their place on the dispatch
board which is composed of company drivers,
single owner-operators, and drivers for multiple
owner-operators.
Owner-Operators and Drivers of Multiple
Owner-Operators
There are about 70 owner drivers and drivers for
multiple owners operating from the Fern Valley
Road terminal. Owner-operators have a minimum
30-day lease agreement with the Employer. After
30 days, the agreement is to be continued thereaf-
ter until terminated "by mutual agreement of the
parties" or "upon ten days previous notice of either
party . . . to the other." The lease agreement pro-
vides that the owner will furnish to the Employer,
referred to as the "carrier," certain specified equip-
ment to be used under the certificate of public con-
venience and necessity issued to the Employer by
the ICC. The Employer retains "exclusive posses-
2 At the close of the hearing, the Petitioner amended its petition to
delete the Campground Road location, which is the Employer's special
commodities division.
3 Insofar as its intrastate activities are concerned, the Employer is also
governed by the rules and regulations of the Kentucky Department of
Motor Transportation
1421
DECISIONS OF NATIONAL LABOR REL ATIONS HOARD
sion, control, and use" of owner-operators' equip-
ment.
Under the lease agreement, the owner-operators
are obligated to furnish competent, qualified, and
experienced drivers. By the agreement's terms,
however, and in accordance with DOT regula-
tions, the Employer must assure that the drivers
provided are qualified under all applicable DOT
rules, regulations, and requirements as well as those
of state regulatory agencies having jurisdiction
over the Employer's operations. According to the
testimony of the Employer's personnel and safety
director, Edgar Estill, DOT regulations necessitate
that all drivers, including single owner-operators
and drivers for multiple owners, go through the
same application and preemployment procedures. 4
If a driver furnished by an owner does not meet all
applicable regulations, the Employer unilaterally
determines that it will not permit the leased equip-
ment to be operated by that individual.
As to all matters concerning the condition and
maintenance of the leased equipment, the agree-
ment requires compliance with all applicable regu-
lations of the DOT and state regulatory agencies.
Thus, owners are obligated, at their own expense,
to keep leased equipment in "good, safe and road-
worthy operating condition and repair, so that said
equipment shall at all times be safe and adequate
for use on the highways." An ICC regulation re-
quires that the leased equipment be clearly identi-
fied with the Employer's name and operating li-
censes. Such identification is either affixed with a
decal or painted on at the owner's option. 5
The lease agreement further provides that the
drivers of leased equipment furnished by the
owner-operators shall at all times be employees of
the equipment owner and not employees of the
Employer. That the lease contains a provision to
this effect is not, of course, determinative of the
drivers' actual status. Our concern is to determine
whether the parties to the relationship have, in
fact, established the drivers as true independent
contractors or have clothed them with employee
status. 6 In this vein, it is noteworthy that the Em-
ployer maintains a single seniority list for all driv-
ers, including owner-operators and the drivers for
multiple owner-operators. This list is used in deter-
mining layoffs and the preference given to drivers
in selecting loads and destinations. All drivers,
4 DOT regulations require that the Employer check the prior years of
employment and driving records of all drivers. All drivers must also be
given road tests, written examinations, and physicals.
Although the lease requires that owners paint their equipment to
comport with the Employer's prescribed colors, this portion of the lease
is generally not enforced.
6 See, e.g., Propane Transport, Inc.. and Propane Chemical Leasing Co.,
Inc., 247 NLRB No. 131, fn. 5 (1980).
whether company or lease, 7 are generally dis-
patched from the Fern Valley Road terminal by a
dispatcher employed by the Employer. 8 Whether
company or lease, all drivers are subject to the
same disciplinary action failure to protect the dis-
patch board. 9 If an owner-operator requests a leave
of absence for himself or one of his drivers, Per-
sonnel and Safety Director Estill has the authority
to deny it. Backhauls are generally arranged by the
Employer. If a driver, whether company or lease,
locates a backhaul on his own, he must receive
clearance from the Employer before accepting. All
drivers are subject to discipline for violating gov-
ernmental regulations and company rules.1 0 In cer-
tain instances, the Employer will discharge the
drivers of owners.1 1 A drivers' committee designed
for the purposes of hearing grievances is available
to all drivers, whether company or lease. The com-
mittee consists of four owner-operators and four
company drivers. The final disposition of any
grievance is with the Employer's officers.
Unlike the company drivers who are paid on a
mileage basis, owners of equipment, in accordance
with the lease agreement, are entitled to 62 percent
of the gross payment received by the Employer for
transportation of the particular commodities in-
volved. When the owner furnishes both the power
unit and the trailer, however, the owner receives
80 percent of the gross revenue generated by the
load. Drivers for a multiple owner-operator are
paid, and appropriate deductions are taken from
their paychecks, by the owner-operator. The non-
owner-drivers are paid whatever amount is negoti-
ated between the equipment owner and the driver,
with no input from the Employer. When owner-
operators or drivers for multiple owners have a
I Unless otherwise specified, the term "lease driver" will be used to
refer to both owner-operators and drivers of owner-operators
8 This is with the exception of drivers operating from the premises of
multiple owner-operator, Alfred Houghton, who dispatches drivers from
his Jeffersonville, Indiana, facility. Only twIo of Houghton's drivers are
dispatched from the Fern Valley Road location. All of Houghton's driv-
ers, however, are on the Employer's seniority list for the Fern Valley
Road location.
9 Dispatching at the Fern Valley Road terminal is generally handled
through the use of two dispatch boards. The chemical board is dis-
patched by senority, whereas drivers on the utility board are dispatched
on a first-in, first-out basis. Upon returning from a delivery, a driver
chooses which of these two boards to sign up on.
For failure to protect the dispatch board by signing up. a driver is sub-
ject to 7 days off for a first offense and to "discharge and/or lease can-
cellation" for a second offense.
iO Owners Jesse Ford, Alfred Houghton, and Barbara Madden, all of
whom lease equipment to the Employer, acknowledged that the Employ-
er had either sent written warnings or taken disciplinary action against
their drivers. This is so notwithstanding a provision in the lease agree-
ment that the owner "shall have the sole and exclusive right to select,
discipline and discharge his employees."
II Owner Jesse Ford testified that the Employer fired one of his driv-
ers, George Skeedo. As Personnel and Safety Director Estill explained it.
the Employer does not fire owner-operators or their drivers, it just tells
them they cannot work for the Employer anymore
1422
LIQUID TRANSPORTERS. INC.
breakdown of equipment necessitating the removal
of this equipment from service for repairs, they
may, depending on availability, be given the use of
an Employer-owned vehicle. In these situations,
the lease drivers are paid on the same basis as com-
pany drivers, with customary deductions being
made by the Employer. At the end of the year,
such lease drivers received a wage and tax state-
ment from the Employer for the amounts earned
while in the direct employ of the Employer.
The Employer provides, at its expense, public li-
ability and cargo insurance to protect the owner
and the Employer against claims for personal
injury, property damage, and cargo loss of damage
resulting from the operator of equipment covered
by the lease agreement when used for the Employ-
er's business. The equipment owner, however, is
required to carry his own "bobtail" insurance to
cover those periods when the equipment is not en-
gaged exclusively in the business of the Employer.
The Employer also furnishes voluntary participa-
tory health and welfare programs, a pension pro-
gram and a retirement program for owner-opera-
tors, and drivers for owner-operators.
Based on the foregoing, it is evident that, while
the owner-operators and drivers for owner-opera-
tors exercise a degree of freedom, the Employer
exercises a considerable degree of control over
these individuals that warrants the conclusion that
they are employees of the Employer and not inde-
pendent contractors within the meaning of the
Act.12 Significant in our determination are the fol-
lowing factors. The Employer's preemployment
procedures apply to owner-operators and all lease
drivers as well as company drivers. Extensive Fed-
eral and state regulation of motor carriers necessi-
tates that the Employer exercises extensive control
over the owner-operators and drivers for owner-
operators. The Employer has exclusive possession,
control, and use of the leased equipment. While the
lease agreement is for 30 days, it remains in effect
until canceled by either party. In effect, therefore,
the duration of employment is indefinite and all
drivers work virtually exclusively for the Employ-
er. The Employer has a uniform set of rules that
apply to all drivers and the Employer imposes dis-
cipline, including discharge, for infractions of these
rules. A single seniority list, which is used in deter-
mining layoffs and the order of selection of certain
loads, applies to all drivers. All drivers dispatched
from the Fern Valley Road terminal must comply
I" We must consider the degree of control exercised over the owner-
operators and their drivers regardless of the reasons for the imposition of
that control; that is, whether inspired by governmental regulations or for
other business reasons. See Propane Transport. Inc. supra: Robbins Motor
Transportation. Inc.., 225 NLRB 761 (1975): and Dixie Transport Company,
218 NLRB 1243 (1973).
with the dispatch procedures established for that
terminal and are subject to discipline by the Em-
ployer for noncompliance."' All drivers have
access to the same grievance procedures. The Em-
ployer assumes certain responsibilities for the
owner-operators and drivers for owner-operators
which minimize their entrepreneurial risk such as
providing liability and cargo insurance. And the
Employer requires that leased vehicles display its
name and operating licenses.
In assessing these factors, we perceive no materi-
al difference between this case and recent decisions
in which the Board determined that individuals
similar to the owner-operators and the drivers of
owner-operators here were employees and not in-
dependent contractors within the meaning of the
Act.'4 We therefore find that the owner-operators
and the drivers for owner-operators are employees
of the Employer and we shall include them in a
unit with the company drivers.15
Permanent Sleeper Teams
The Petitioner also seeks to represent individuals
who lease equipment to the Employer but who op-
erate on certain sleeper runs. At the time of hear-
ing, there were three husband and wife teams,
Kendell and Deborah Goodman, Walter and Beau-
lah Goodman, and Marshall and Wanda Whitaker,
a father and son team, Charles C. and Charles E.
Porter, and Michael Harned and Larry Roark.
Kendell Goodman, Walter Goodman, Marshall
Whitaker, Charles C. Porter, and Michael Harned
are owner-operators who carry seniority on the
Employer's seniority list at the Fern Valley Road
terminal. While the members of their sleeper teams
are not on the Employer's seniority list,16 they are
qualified to drive for the Employer and to operate
under the Employer's authority. Thus, they make
out applications like all other drivers and take writ-
i" Any driver exercises a certain degree of freedom as to whether to
sign the chemical or utility dispatch boards and in the selection of certain
loads. These decisions, however, are made in complaince with the Em-
ployer's dispatch procedures.
Also, as indicated, only two of Owner-Operator Alfred Houghton's
drivers are dispatched from the Employer's Fern Valley Road terminal
In this regard see fn. 15, infra.
"4 See, e g, Mitekell Bros Truck Lines, 249 NLRB 390 (1980): Propane
Transport. Inc., supra.
is We shall include in this unit the drivers of Owner-Operator Alfred
Houghton who are dispatched from Houghton's Jeffersonville, Indiana,
facility but who are subject to the terms of a lease agreement with the
Employer. The only other apparent difference between such drivers and
all other drivers is that they are not represented by the drivers' commit-
tee that handles grievances In all other respects, these drivers share the
same working conditions and are subject to the same rules and restric-
tions as all other lease drivers. We therefore find them to be employees
of the Employer
is In the case of the husband and wife sleeper teams, the wives appar-
ently choose not to have any seniority so they will not be forced to dis-
patch out of the terminal with someone other than their husband
1423
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ten and drivers' tests like all other drivers. The
member of the sleeper team without seniority is not
dispatched independently of the person who carries
seniority. The sleeper teams of Marshall and
Wanda Whitaker and Michael Harned and Larry
Roark operate off of the bid sleeper team board.
A sleeper run is determined by the distance in-
volved. Loads traveling over 500 miles from Louis-
ville are offered to the sleeper teams. 17 While Ken-
dell Goodman, Walter Goodman, and Charles C.
Porter spend a majority of their time operating
with their sleeper team, they also receive dis-
patches on an individual basis. The owners of the
vehicles who carry seniority receive their payment
directly from the Employer. The members of their
sleeper teams receive remuneration from the
owners in much the same fashion as other drivers
for owner-operators. Based on the foregoing, we
conclude that the owners and the members of their
sleeper teams are employees of the Employer who
share a community of interest with all other drivers
and we shall therefore include them in the drivers'
unit. 1 8
Mechanics, Checkout Lane Employees, and
Cleaning Rack Employees
As indicated, the Employer contends that the
mechanics, mechanics' helpers, checkout lane em-
ployees, and cleaning rack employees constitute a
separate appropriate unit whereas the Petitioner
would include them in a unit with drivers. Me-
chanics, mechanics' helpers, 1 9 and checkout lane
employees work in the Employer's maintenance
shop. There are about 25 mechanics who work 7
days a week, 24 hours a day, on three shifts begin-
ning at 7:30 a.m. The mechanics perform mainte-
nance and repair work on the Employer's tractors
and trailers as well as equipment owned by LTL
Leasing, a subsidiary of the Employer. Because
lease drivers are not required to have repair work
done at the Employer's facilities, as a practical
matter, only company-owned vehicles and equip-
ment are maintained there. The only work contact
which the mechanics have with drivers is when the
drivers happen to be in the shop and tell the me-
chanics what the problem is with their vehicle.
These conversations only take about 5 minutes.
" All the loads that pass through the chemical dispatch board which
is based upon seniority apply to the sleeper team runs. Thus, apparently it
is only the distance involved which places the sleeper teams in a special
category for dispatching purposes.
'' At the time of hearing, Charles C. and Charles E. Porter were on
layoff status. Because the record is inadequate to determine whether the
Porters have a reasonable expectancy of recall, we shall permit them to
vote subject to challenge.
i" While the Employer has a classification of mechanic's helper, there
was no one employed in that classification at the time of hearing.
The Employer's three checkout lane employees
work Monday through Friday on three shifts, one
per shift. Their duties are to make certain that the
trailers are ready to load, in complaince with DOT
requirements, when they depart the Employer's
premises. Company drivers have their equipment
checked before each trip, whereas lease drivers
have their equipment checked on a monthly
basis. 20
In the cleaning rack, the Employer employs 12
tank cleaners, with one shift leader and two other
tank cleaners on each of four shifts. 2 The tank
cleaners operate 160 hours per week, leaving only
8 hours on Sunday that the tank cleaning facility is
not operating. There are both interior and exterior
cleaners. The interior cleaners clean the inside of
vessels that are used for transporting chemicals. 22
Tank cleaners generally move the tanks into the
cleaning area by use of a yard tractor after the tank
trailer is dropped off at the Fern Valley Road ter-
minal by the drivers. Like mechanics and checkout
lane employees, the tank cleaners regular work
contacts with drivers is negligible.
The mechanics, checkout lane employees, and
tank cleaners all work on a full-time basis, are paid
an hourly wage rate and have a different payroll
period from the drivers. They also have a seniority
list, employees' committee, and grievance proce-
dure separate from the drivers. During layoffs,
there is no bumping between the two groups.
There are also separate employees meeting for the
maintenance shop and cleaning rack employee and
they have distinct supervision. 23 Based on the fore-
going, we conclude that mechanics, checkout lane
employees, and cleaning rack employees do not
share a community of interest with drivers. 24
Rather, we find that they have a distinct communi-
ty of interest and we shall include them in a sepa-
rate unit. 2
20 Checkout lane employees are only responsible for inspecting the
equipment on the Employer's vehicles. Apparently, there is a separate in-
spector for giving owner-operators their monthly inspection.
21 There are four interior tank cleaner shift leaders and one exterior
tank cleaner who only works on the first shift.
22 The specific duties of exterior cleaners are not described.
23 The director of maintenance, Jim Hawes, is responsible for equip-
ment maintenance throughout the Employer's entire system. Under
Hawes, Supervisor Jim Livesay was responsible for the maintenance shop
at the Fern Valley Road terminal. He was apparently terminated during
the hearing in this case. Larry Hope is the supervisor of the tank cleaning
employees. Hope has the same duties and responsibilities as Livesay had.
Both delegated their authority through shift leaders.
24 Although there is evidence that maintenance shop employees have
performed nonrevenue runs in the Employer's tractors, involving the
picking up or delivering of empty trailers without any charge to shippers,
this occurs infrequently and only when no drivers are available.
26 Larry Hope is supervisor of the waste water treatment plant as well
as the tank cleaning facility. Both are located in the same building with
the maintenance shop. There is one waste water treatment operator who
works the same hours as Hope and who has no contact with the drivers.
Continued
1424
LIQUID TRANSPORTERS, INC.
Shifts Leaders
The Employer employs several shift leaders in
the maintenance shop and the cleaning rack. There
are three shift leaders in the maintenance shop
under Supervisor Livesay. 2 6 As indicated, there
are five shift leaders in the cleaning rack under Su-
pervisor Hope.2 7 Although shift leaders receive a
higher hourly wage, 2 8 they have the same benefits
as other employees. If Livesay or Hope are not on
the premises, the shift leaders will try to call them
about any significant work problems which they
encounter. Because Livesay only works the first
shift it, the maintenance shop and Hope only works
during the day,2 ' there are shift leaders who are
solely in charge of their respective shifts with no
other supevisory personnel on the premises to
whom they are responsible to report. 30 All shift
leaders, however, have the same authority.
While shift leaders spend much of their time per-
forming duties similar to those performed by others
within their respective areas, they also schedule
and assign work to employees under them. In cer-
tain instances, this entails passing along work as-
signments given to them by Supervisors Livesay or
Hope. It is also evident, however, that shift leaders
use their own discretion in assigning employees to
perform various functions. Shift leaders also have
the authority to transfer employees from one job to
another within their respective departments, to
send employees home early, and to call in employ-
ees on overtime to replace individuals who are
absent. Shift leaders also make oral and written
recommendations about employees' work perform-
ance which are reviewed and given weight by the
Employer. We therefore conclude that shift leaders
are supervisors within the meaning of Section 2(11)
of the Act and we shall exclude them from the unit
mechanics, checkout lane employees, and cleaning
rack employees.
Laid-off Employees
The Petitioner would also include certain em-
ployees who are on layoff status.31 At the time of
We shall therefore include the waste water operator in the unit of me-
chanics, checkout lane employees, and cleaning rack employees.
a' The day shift leader is Bob Watson. The other two shift leaders are
Marion Daugherty and Vernon Ridgeway.
at The interior tank cleaner shift leaders are Charles Ashley, Bob
DeLong, Ricky Sparks, and Marty Friedland. The exterior tank cleaner
shift leader, who only works the first shift, is Leon Spears.
s The shift leader differential is 25 cents per hour.
Is Hope works from 7: 30 a.m. to 5 or 5:30 p.m. This apparently would
overlap a couple of shifts in the cleaning rack.
30 Shift leaders will take problems to Night Terminal Manager Young,
who works form 6 p .m to 2 a.m. if they cannot contact Livesay or
Hope. This practice was only begun recently.
hearing, the Employer had six full-time drivers,
one part-time driver, and a permanent sleeper
team 3 2 on layoff status. 3 3 When these drivers were
laid off, they were apparently told that, if business
picked up to the point that their services were
again needed, they would be recalled in accord-
ance with their seniority. Because we conclude that
the record is inadequate to determine whether
these laid-off drivers have a reasonable expectancy
of recall in the immediate future, we shall permit
them to vote in the drivers' unit subject to chal-
lenge.
Based on the foregoing and the entire record, we
find that the following groups of employees consti-
tute units appropriate for the purposes of collective
bargaining within the meaning of Section 9(b) of
the Act:
UNIT A: All truckdrivers employed by the
Employer at its Fern Valley Road terminal,
Louisville, Kentucky, including owner-opera-
tors and nonowner-drivers of equipment leased
by the owners to the Employer;3 4 excluding
all mechanics, mechanics' helpers, checkout
lane employees, cleaning rack employees,
office clericals, dispatchers, guards and super-
visors as defined in the Act.
UNIT B: All mechanics, mechanics' helpers,
checkout lane employees, and cleaning rack
employees 3 5 employed by the Employer at its
Fern Valley Road terminal, Louisville, Ken-
tucky; excluding all truckdrivers, owner-opera-
tors, and nonowner-drivers of equipment
leased by the owners to the Employer, office
clericals, dispatchers, guards, and shift leaders
and other supervisors as defined in the Act.
[Direction of Elections and Excelsior footnote
omitted from publication.]
"1 In its post-hearing brief, the Employer indicated that it would not
take a position on the laid-off employees because the record is insufficient
to determine whether their layoff is temporary or permanent
a2 See fn. 18, supra.
'3 The six full-time drivers on layoff status are Gary Keller, Randall
Sipes, Donald Carpenter, Joseph L Bush, Richard Eastman, and Edward
Gandall The part-time driver is Jack Estes. Keller. Sipes, Eastman, and
Estes are lease drivers.
3a As determined, this includes the drivers leased to the Employer
who work out of Alfred Houghton's facility in Jeffersonville, Indiana.
a5 We use the term cleaning rack employees to include all tank clean-
ers and the waste water operator
1425