McCormick Steamship Co.

National Labor Relations Board - Board Decisions

Jul 17, 1940

25 N.L.R.B. 587 (N.L.R.B. 1940)

In the Matter of MCCORMICK STEAMSHIP COMPANY and NATL. ORG.
OF MASTERS, MATES & PILOTS OF AMERICA, LOCAL No. 17, INC.
In the Matter of MCCon [Icic STEAMSHIP COMPANY. AGENTS FOR PA-
CIFIC-ARGENTINE-BRAzIL LINE and NATL. ORG. OF MASTERS, MATES
& PILOTS OF AMLPICA, Loo r, No. 17, INC.
Cases Nos. R-1828 and R-1829.-Decided July 1 '7, 1940
Jurisdiction : water transportation uidnstry
Investigation and Certification of Representatives : existence of question where
employer denies employment relationship; election ininecessary : certification
upon stipulation of the parties
Unit Appropriate for Collective Bargaining : all pilots engaged in piloting the
Companies' vessels from-Astoria to Portland and Vacouver, Washington, and
from Vancouver, Washington, and Portland to Astoria on the Columbia and
Willamette Rivers and its tributaries and uitermedt.rte points
Definitions
Employei-employee relationship held to exist between Companies and
pilots engaged in piloting their vessels, who are members of an association
contracting for their services, where the Companies retain the ultimate
power of selection or rejection of the pilots proffered by the pilots' associa-
tion and the sole direction and control of the pilots while at work, and
in fact pay their wages
Mr. Thomas P. Graham, Jr., for the Board.
Mr. Gunther F. Krause and Mr. William Y. Powell, both of Port-
land, Oreg., for the Company.
Mr. James Landye, of Portland, Oreg., for Local No. 17.
Mr Ben Anderson, of Portland, Oreg., for the Intervenor.
Mr. Edwin L. Swope, of counsel to the Board.
DECISION
AND
CERTIFICATION OF REPRESENTATIVES
STATEMENT OF THE CASE
Oil December 1, 1939, Nation, ii Organization, Masters, Mates &
Pilots of America, Local No. 17, Inc.,' herein called Local No. 17,
'Incorrectly designated in some of the pleadings as Nat 'l Org Masters , Mates & Pilots
of America , Local No. 17, Inc
25 N. L R B No 67 587
588 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
filed with the Regional Director for the Nineteenth Region (Seattle,
Washington), separate petitions alleging that questions affecting
commerce had arisen concerning McCormick Steamship Company,
agents for Pacific-Argentine-Brazil Line, both of Portland, Oregon,
herein called the Companies. The petitions requested an investiga-
tion and certification of representatives pursuant to Section 9 (c) of
the National Labor Relations Act, 49 Stat. 449, Herein called the Act.
On April 10, 1940, the National Labor Relations Board, herein
called the Board, acting pursuant to Section 9 (c) of the Act and
Article III, Section 3, and Article III, Section 10 (c) (2), of Na-
tional Labor Relations Board Rules and Regulations-Series 2, as
amended, ordered an investigation and authorized the Regional Di-
rector to conduct it and to provide for an appropriate hearing upon
due notice, and further orderec4 that the cases be consolidated for
purposes of hearing and that one record of the hearing be made.
On April 17, 1940, the Regional Director issued a notice of hearing,
copies of which were duly served upon the Companies and upon
Local No. 17. Pursuant to notice, a hearing was held on May G,
1940, at Portland, Oregon, before Thomas E. Wilson, the Trial
Examiner duly designated by the Board. At the commencement of
the hearing, the Trial Examiner granted, over the objection of Local
No. 17, a petition to intervene filed by Licensed Marine Deck Officers
L. I. Union, Local No. 998. herein called Local No. 998, a labor
organization which claimed to iepresent employees of the Companies.
The Board, the Companies, Local No. 17, and Local No. 998, appeared
and each was represented by counsel. All participated in the hear-
ing. Full opportunity to be heard, to examine and cross-examine
witnesses, and to introduce evidence bearing on the issues was af-
forded all parties. During the hearing Local No. 17 made and there-
after renewed a motion to disallow the intervention of Local No.
998 and to strike all evidence adduced by that organization. At the
end of the hearing it developed that no members of Local No. 998
were working for the Companies, and the Trial Examiner granted
the motion to disallow Local 998's intervention but did not grant
the motion to strike. During the course of the hearing the Trial
Examiner made several other rulings on motions and objections to
the admission of evidence. The Board has reviewed all the rulings
of the Trial Examiner and finds, that no prejudicial errors were
committed. The rulings are hereby affirmed. After the hearing the
Companies and Local No. 17 filed briefs with the Board.
Upon the entire record in the case, the Board makes the following :
\MIc'CORD'IICK SITS 1_AlSHIP COMPANY
FINDiNGD OF FACT
1. TEE BUSINESS OF THE COMPANIES 2
589
McCormick Steamship Company and Pacific-Argentine-Brazil
Line, both California corporations authorized to do business in the
State of Oregon, are engaged in the general steamship business,
acting as common carriers of cargo with filed tariffs.
McCormick Steamship Company operates about 25 vessels in 2
trade routes, 1 of which is the coastwise trade on the Pacific Coast
and the other the intercoastal trade between the west and east coasts
of the United States. Pacific-Argentine-Brazil Line is a wholly
owned subsidiary of the McCormick Steamship Company,' and did
operate, but is not at present operating, vessels in the trade route
from the Pacific Coast, of the United States to the east coast of South
America.4
In the conduct of such business a number of vessels are operated
into the Columbia River carrying cargo between Oregon and Wash-
ington ports and ports of other States and foreign countries. No
intrastate cargo is carried between any two ports of Oregon.
Both Companies admit and we find that they are engaged in inter-
state commerce.
A. The contention of the Companies
The basic issue in this case is whether the pilots are employees of
the Companies or of the Columbia River Pilots, herein called the
Association, an organization of men engaged in piloting ocean-going
vessels upon the Columbia and Willamette Rivers and its tributaries.
The Association was established about 50 years ago by certain pilots
on the Columbia Rivers who set up a dispatching office for the steam-
ship companies to call when they desired the services of a pilot.6 It
now has about 30 members and is governed by certain rules and regu-
lations which were adopted by its members on December 1, 1928.
2 The findings in this section are based upon a stipulation of facts between counsel for
the Board and counsel for the Companies
'Petitioner Exhibit No 7 shows that McCormick Steamship Company also is the agent
of Pacific -Argentine -Brazil Line and, accordingly , will be so treated herein.
4 There is no further showing in the record concerning the discontinuance of these opera-
tions and there was no motion to dismiss as to the Pacific -Argentine-Brazil Line. Under
these circumstances we construe the language of the stipulate--n to mein that there has
been a temporary cessation of the operations in question
6 There is no compulsory pilotage law in the State of Oregon , as ui some jurisdictions ; nor
does Oregon law require membership in a pilots' association
6 The pilot ' s work is irregular in nature and a lob usually does not last more than a day.
590 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Under these rules and regulations the Association has the power to
select, discipline, and suspend its members.7
Local No. 17 was organized in 1917 and is composed of masters,
mates, and pilots of river vessels, operators of gas boats and pilots of
ocean-going vessels navigating the Columbia and Willamette Rivers
and its tributaries. It has about 150 members, of which about 30 are
engaged in piloting ocean-going vessels. On November 19, 1935, the
Association and Local No. 17 entered into an agreement providing
that all pilotage be done exclusively by members of the Association
and that all members of the Association be members of Local No. 17.
The Companies have no agreement with the Association, but they
use the Association exclusively for their pilotage service. The Asso-
ciation fixes and furnishes the Company with its rate schedules based
upon the tonnage and draft of the vessels; s when the Companies need
a pilot, they call the Association dispatcher and advise him where they
desire the pilot to board their ship and where he is to take the ship.
The Association dispatcher sends the pilots out in rotation but the
Companies may request the services of a particular pilot or reject
those of any pilot proffered.s After the trip is made the Association
bills the Companies for the service and the Companies then send the
Association a check in payment executed in the name of the Associa-
tion. The check is deposited in a bank by the Association's treasurer,
the Association's expenses are paid, and at the end of the month the
remaining fends are divided among the members according to the
time worked.",
° These rules and regulations also provide aniong other things that the Association be
governed by three directors with full authority to handle all its business , that it have a
treasurer and a secretary ; that its net earnings be divided among the pilots each month
that new members, when required, be selected by ballot from all applications on file, and
be required to receive a majority vote of the active membership and serve 1 year on pro-
bation ; that all members be entitled to 1 day's vacation, with full pav, for each 12 days
worked during the preceding year; that pilots losing both their Federal and State licenses
be carried on full pay for a period of 30 days; and that pilots guilty of certain infractions
of the rules be penalized.
'The laws of the State of Oregon establish maximuni pilotage rates but not minimum
pilotage rates.
9 The Companies have on occasion requested that they be furnished a named pilot, and the
Association has honored the request.
w The precise method used by the Association In dividing the funds is set forth In its
rules and regulations as follows
1. The bank balance at the end of the month shall be considered the gross earnings
for the month
2 All expenses for the month shall be deducted from the gross earnings and the
remainder shall be considered the net earnings Division shall be made of this amount
among all members according to the time worked
3 The net earnings divided by the number of active pilots and the number of days
in the month, shall be the net earnings per month, per day.
4 To arrive at the share of each pilot the earnings per man, per day, will be multi-
plied by the number of days on duty.
5 All money lost by pilots off duty shall be handled as net earnings (paragraph 3)
and division made in the same manner
0 The division at the end of each month shall be considered as payment in full for
all past business, whether or not collection has been made, except in case of per-
manent retirement in which case a full settlement shall be made on all unpaid
collectible accounts
McCORD'MICh STEAMSHIP COMPANY 591
The Companies contend that the Association is a partnel;ship 11
with which the Companies contracted for the professional services of
its members who are in its employ; and, in the alternative, assert that,
even if it is conceded that the Association is not an independent
contractor, each of the pilots is an independent contractor rendering
professional services to the Companies. The Companies argue that
the Association is the employer because, by virtue of its power to select
and discipline its members, it has the power to select, to control, and
to discharge the pilots, and also because it actually pays their wages.
We find no merit in this contention. While it is true that member-
ship in the Association is a prerequisite for selection for pilotage
service obtained through the Association, this fact is not controlling
upon the issue since the ultimate power of selection or rejection of
any pilot proffered by the Association remains solely with the Com-
pany. Similarly, it is specious to argue that the Association pays the
pilots' wages because, with their consent, it collects and distributes
their wages which are, in fact, paid by the Company. Further, the
pilots are not independent contractors since, while engaged in the per-
formance of their duties, they are under the Companies' sole direction
and control and do not act in an independent capacity. The Com-
panies also direct our attention to facts that on July 10, 1937, in
announcing an increase in pilotage rates, the Association sent cards,
addressed "To Our Patrons," to owners and operators of vessels,
including the Companies' and that pursuant to regulations of the
Federal Government requiring employers to make information returns
regarding the wages, salaries, and commissions paid to their employees,
the Association has annually made a report to the Government stating
the amount of money, received by each of its members during the fiscal
year, and in return has named itself as the employer. Although these
facts are relevant we do not, for reasons hereinafter discussed, con-
sider them controlling upon the issue of whether or not the pilots are
employees of the Companies within the meaning of the Act.
Although the pilots' affairs are handled through the Association in
the manner heretofore described, the Companies control the essential
incidents of their employment. The Companies have the power to
select and hire any pilot whom they desire; they pay for the pilots'
work at rates,which must be satisfactory to them ; 12 and finally they
have the actual direction and control of the performance of the pilots'
u It is unnecessary to pass upon this phase of the contention in order to determine the
issues in this case , and we do not.
z2 As we have noted above, the Oregon law establishes maximum pilotage rates but does
not fix minimum rates, and the current rates are less than the maximum provided by law.
While the Association announces the pilots ' rates the Companies are, of course , under no
obligation to use their services unless the rates fixed are satisfactory.
592 DECISIONS OF NArIONAL LABOR RELATIONS BOARD
w'ork.13 Upon these facts we are of the opinion and find that the
Companies are the employers of the pilots both under applicable com-
mon law principles 14 and the Act.'
II. THE URGANI'/. 1TIONS IN\ OL\-1;1)
National Organization, Masters, Mates R Pilots of America, Local
No. 17, Inc., is a labor, organization affiliated with the American
Federation of Labor. It admits to membership masters, mates, and
pilots of river vessels, operators of gas boats, and pilots of ocean-
going vessels navigating the Columbia and AVillaniette Rivers an([
its tributaries.
"'While engaged in the performance of their duties, the pilots are solely under the
Companies' direction and control inasmuch as the masters of the vessels on which the pilots
work are in complete charge of the vessels at all tines and the pilots are not only subject
to the masters' orders but can be relieved of their duties by the masters at any time
14 In Singer Manufacturing Co v Rahn, 132 U 8 518, the Court states the basic, criterion
of the master-servant relationship as follows : "The relation of master and servant exists
whenever the employer retains the right to direct the manner in which the business shall
be done as well as the result to be accomplished, or, in other words, not only what shall
be done, but how it shall be done." See also Guy v. Donald, 203 U S 399, 51 L Ed. 245,
where in a libel suit brought by the owners of a steamer against the members of the
Viiginia Pilots' Association to hold them liable for the alleged negligence of one Guy, a
pilot who was a member of that Association, the Supreme Couit held the steamship com-
pany and not the Association was the employer on the ground, among others, that the
Association could not control or direct the pilots in the performance of their duties The
Companies contend in their brief that the facts in the Guy case are distinguishable from
the facts in this proceeding because the Virginia Pilots' Association, which apparently was
iequired to adroit all duly licensed pilots to membership, dud not have the powei to select or
to suspend its members while, in the present lsie, the Asroci:rtion under no simiiai iestiaint
possesses that power we agree however with the position taken by the Court in The
Griffdu, The Eldena, Charles Nelson Co. v United States, 25 Fed (2d) 312, where, in fol-
lowing the rule laid down in the City case, it stated "that decision did not, as respondent
contends, turn upon the question of the voluntary or involuntary character of the associa-
tion It turned upon the primary and controlling consideration that no member of the
association could control or do ect any other member of it in the performance of his duties
as pilot It turned upon the entire absence there, as here, of any feature of joint manage-
ment and control of a business or enterprise " In Dampscktbsselskabet Atalanta AIS et al.
v United States, 31 Fed. (2d) 961 the Court also followed the rule laid down in the
Guy case, stating "The fundamental principle underlying the exemption of pilots' associa-
tions from liability for negligence of their members in psi foumng their duties as pilots
is that the association exercises no control over the manner in which those duties are to
be peiforined, and therefore a pilot cannot be said to be an agent of the association in
that respect " In Ctty of Los Angeles v. Standard Transportation Co, 32 Fed (2d) 988,
the court, in holding that a pilot was a servant of the steamship company, pointed out
that the pilot's "duties were not completely those of the master, and the authority of the
master was not superseded or suspended by the presence of the pilot Ile still iemanned
master, in full charge of the vessel and crew, and upon hinn nested the responsibility of
the safety of the ship and all on board " See also • Restatement of the Lard of Agency
(Amer Lau; Inst ), Vol 1, p. 483, where a servant is defined as follows .
A servant is a person employed to perfoim service for another in his affairs and who,
with respect to his physical conduct in the perfoiinanee of the service, is subject to
the other's control or right to control
L5 Apart from its consonance with the established principles governing the employer-
employee relationship, to hold otherwise would be to defeat the express policy of the Act
to encourage the practice and procedure of collective bargaining since collective bargaining
with respect to the pilots as employees must of necessity be conducted with the Companies
which control all the essential incidents of their employment
McCOR1LICli STEAMSEIIP COMPANY
III THE QUESTION CONCERNING REPRESENTATION
593
On September 6 and 7, 1939; respectively, Local No. 17 sent letters
to the Companies advising them that Local No. 17 represented all
their employees engaged in piloting their vessels on the Columbia
and Willamette Rivers, and requesting a collective bargaining con-
ference. On September 15, 1939, the Companies replied by letter
that it would be impossible for theun to bar gain collectively with
Local No. 17 inasmuch as they- had no pilots in their employ. In
Section L A. supra, we have discussed that position taken by the
Companies. As there set forth, we find that the pilots are employees
of the Companies.
We find that a question has arisen concerning I epreseutation of
employees of the Companies.
1V. THE EFFFCT OF TILE QUESTION CONCERNING.REPRES7:NT.AIION UPON
COM MERCE
We find that the question concerning representation which has
arisen, occurring in connection, with the operations of the Com-
panies described in Section I above, has it close, intimate, 'and sub-
stantial relation to trade, traffic, and commerce among the several
States, and tends to lead to labor disputes burdening and obstructing
commerce and the free flow of couunerce.
V. TILE APPROPRIATE UNIT
Local No. 17 contends that all the pilots engaged in piloting the
Companies' vessels from Astoria to Portland and Vancouver, Wash-
ington, and from Vancouver, Washington, and Portland to Astoria
on the Columbia and Willamette Rivers and its tributaries and
intermediate points, constitute a unit appropriate for the purposes
of collective bargaining. No evidence was offered at the hearing
to show that such unit is inappropriate.
We find that all the pilots engaged in piloting the Companies'
vessels from Astoria to Portland and Vancouver, Washington, and
from Vancouver, Washington, and Portland to Astoria on the
Columbia and Willamette Rivers and its tributaries and intermediate
points, constitute a unit appropriate for the purposes of collective
bargaining and that said unit will insure to the employees of the
Companies the full benefit of their right to self-organization and to
collective bargaining and otherwise effectuate the policies of the Act.
vL. TIIE DETERMINATION OF REPRESENTA'II\'ES
The parties stipulated at the hearing that in the event the Board
held that the Companies were the employers of the pilots involved
594 DECISIONS OF NATIONAL 'LABOR- RELATION'S BOARD
here, and that the unit claimed by Local No. 17 was appropriate, the
Board could certify Local No. 17 without an election. Since we
have found that the Companies are the employers of the pilots
involved and that the unit claimed by Local No. 17 is appropriate,
and since the record shows that all the Companies' pilots are members
of Local No. 17, we find that Local, No. 17 represents a majority of
the employees in the unit found to be appropriate for the purposes
of collective bargaining. Local No. -17 is, therefore, the exclusive
representative of all the pilots in such unit for the purposes of
collective bargaining, and we will so certify.
Upon the basis of the foregoing findings of fact and upon the
entire record in the case, the Board makes the following.
CoNCLUSIO\S or LAW
1. A question affecting commerce has arisen concerning the rep-
resentation of employees of McCormick Steamship Company and
of McCormick Steamship Company, agents for Pacific-Argen-
tine-Brazil Line, both of Portland, Oregon, within the meaning of
Section 9 (c) ,and Section 2 (6) and (7) of the National Labor
Relations Act.
2. All the pilots engaged in piloting the Companies' vessels from
Astoria to Portland and Vancouver, Washington, and from Van-
couver, Washington, and Portland to Astoria on the Columbia and
Willamette Rivers and its tributaries and intermediate points, con-
stitute a unit appropriate for the purposes Of collective bargaining,
-within the meaning of Section 9 (b) of the National Labor Relations
Act.
3. National Organization, Masters, Mates & Pilots of America,
Local No. 17, Inc., is the exclusive representative of all the pilots in
such unit for the purposes of collective bargaining, within the
meaning of Section 9 (a) of the National Labor Relations Act.
CERTIFICATION OF REPRESENTATIVES
By virtue-of and pursuant to the power vested in the National
Labor Relations Board by Section 9 (c) of the National Labor Rela-
tions Act, and pursuant to Article III, Section 8, of National Labor
Relations Board Rules and Regulations-Series 2, as amended, ,
IT IS HEREBY CERTIFIED that National Organization, Masters, Mates
& Pilots of America, Local No. 17, Inc., has been designated and
selected by a majority of the pilots employed by McCormick Steam-
ship Company and by McCormick Steamship Company, agents for
Pacific-Argentine-Brazil Line, both of Portland, Oregon, to pilot
their vessels from Astoria to Portland and Vancouver, Washington,
McCORMICK STEAMSHIP COMPANY 595
and from Vancouver, Washington, and Portland to Astoria on the
Columbia and Willamette Rivers and its tributaries and intermediate
points, as their representative for the purposes of collective bar-
gaining and that, pursuant to the provision of Section 9 (a) of the
Act, National Organization, Masters, Mates & Pilots of America,
Local No. 17, Inc., is the exclusive representative of such employees
for the purposes of collective bargaining in respect to rates of pay,
wages, hours of employment , and other conditions of employment.
MR. WILLIAM M. LEISERSON took no part in the consideration of
the above Decision and Certification of Representatives.