Milk Wagon Drivers & Creamery Wkrs.

National Labor Relations Board - Board Decisions

Apr 1, 1970

181 N.L.R.B. 882 (N.L.R.B. 1970)

882 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Milk Wagon Drivers and Creamery Workers Local
Union No. 66 of Seattle, Washington and Vicinity,
International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of
America; Carnation Company; Dairy Employers
Labor Council;' and Forest Ford Wilgus, Jr. Case
19-CE- 13
April 1, 1970
DECISION AND ORDER
BY MEMBERS FANNING, BROWN, AND JENKINS
On October 30, 1969, Trial Examiner George
Christensen issued his Decision in the above-entitled
proceeding, finding that Respondents had engaged in
certain unfair labor practices within the meaning of
the National Labor Relations Act, as amended, and
recommending that they cease and desist therefrom
and take certain affirmative action, as set forth in
the attached Trial Examiner's Decision. Thereafter,
Local 66 filed exceptions to the Decision and a
supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
powers in connection with this proceeding to a
three-member panel
The Board has reviewed the rulings of the Trial
Examiner made at the hearing and finds that no
prejudicial error was committed The rulings are
hereby affirmed. The Board has considered the Trial
Examiner's Decision, the exceptions and brief, and
the entire record in this proceeding, and hereby
adopts the findings, conclusions, and
recommendations of the Trial Examiner, as
modified herein.
The Trial Examiner found, and we agree, that
Section 1(D)2 of the Fluid Milk Supplemental
Agreement executed on July 24, 1968, by Local 66
and the Council on behalf of Carnation and eleven
other dairy distributors in the Seattle, Washington,
area, violated Section 8(e) of the Act.3 However, we
so find based only on the signing of the agreement
within the 6-month period prior to the filing of the
charge and its continued maintenance thereafter
The Trial Examiner also extended his
recommended remedial order to 16 dairies, including
Carnation, in the Puget Sound area on whose behalf
the Council entered into a Master Dairy Agreement
on July 24, 1968, with Local 66 and eight other
Teamster locals in that area Contrary to the Trial
Examiner, there is nothing in the Master Agreement
which indicates that all separate supplemental
'Respondents are herein respectively called Local 66, Carnation, and
Council
This provides that "all jobbers and/or producer-distributors handling or
delivering milk obtained from the Distributor shall be members of the
Union "
'However, we do not rely on the reasoning in the fourth full paragraph
from the end of Part 5 C of the Trial Examiner's Decision as it is
irrelevant to our finding herein
agreements must or are expected to contain a
provision similar to that of Section 1(D) in the
supplemental` agreement with Local 66. Moreover,
as the Trial Examiner stated, "such supplemental
agreements were not placed in the record and the
unions covered by them have not been made parties
to this proceeding." We therefore find merit in
Local 66's objection to applying the remedy to the
unions and dairies in the Puget Sound area. We
shall modify the Trial Examiner's Recommended
Order accordingly
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the
Recommended Order of the Trial Examiner, as
modified herein, and orders that Respondents, Milk
Wagon Drivers and Creamery Workers Local Union
No. 66 of Seattle, Washington, and Vicinity,
International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of
America; the Dairy Employers Labor Council,
Carnation Company; and the other companies listed
in Appendix A of the Trial Examiner's Decision,
their officers, agents, successors, and assigns, shall
take the action set forth in the Trial Examiner's
Recommended Order, as so modified:
I Delete paragraph A,3 of the Recommended
Order
2 Delete from paragraph B,2 of 'the
Recommended Order the words "Appendix D" and
substitute therefor the words "Appendix C."
3. Delete from the Trial Examiner's Decision
Appendix C and reletter Appendix D to appear as
Appendix C.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
GEORGE CHRISTENSEN, Examiner On May 27, 1969,
the Examiner conducted a hearing at Seattle, Washington
to try issues raised by a complaint alleging that Milk
Wagon Drivers Local Union No 66 (Union or Local 66),
Carnation Company (Carnation) and Dairy Employers
Labor Council' (Council) violated Section 8(e) of the
National Labor Relations Act, as amended (Act) by
executing and maintaining a contract containing a
provision requiring jobbers to acquire and retain
membership in the Union. A charge so alleging was filed
by Forrest Ford Wilgus on October 30, 1968 '
It is not disputed that the Union, Carnation and the
Council satisfy the definitions set out in the Act for the
assertion of the Board's jurisdiction herein, that the unions
in the Puget Sound area with jurisdiction in the, dairy
industry (including Local 66) and the dairies in the same
area (including Carnation), through the Council, executed
a contract on July 24 effective from April I through
March 31, 1970, containing a provision requiring jobbers
All subsequent dates refer to 1968 unless otherwise indicated
181 NLRB No. 141
MILK WAGON DRIVERS & CREAMERY WKRS. 883
doing business with such dairies to acquire and maintain
membership in such unions, and, that Wilgus was a jobber
doing business with Carnation and a member of Local 66
at all times pertinent
The three Respondents contend that this action is
barred by Section 10(b) of the Act, and that the provision
in question generally or with respect to Wilgus is not
violative of Section 8(e) of the Act. The Union further
contends that Wilgus was a Carnation employee at all
times pertinent.
The issues are.
1. Whether Wilgus was an employee of Carnation or an
independent contractor;
2. Whether the Board is barred from considering the
merits of the complaint by Section 10(b) of the Act; and
3. Whether the provision in question is violative of
Section 8(e) of the Act.
All parties appeared at the hearing and stipulated by
counsel that the testimony, exhibits, stipulations,
admissions and concessions introduced before Judge
Lindberg at the U S. District Court proceeding on
February 20, 1969, in Civil Case 8098 on the Board's
application for an injunction pursuant to Section 10(1) of
the Act shall have the same force and effect as if
introduced in this proceeding The Stipulation was
accepted' and the parties agreed to and have submitted
briefs to the Examiner.
Based on his review of the entire record, perusal of the
briefs and research, the Examiner makes the following:
FINDINGS OF FACT
1. JURISDICTION AND LABOR ORGANIZATION
As noted heretofore, the jurisdictional facts alleged in
the complaint, and the assertion that Carnation and the
Council qualified as employers engaged in commerce and
in a business affecting commerce and that the Union
qualified as a labor organization, at all times pertinent, as
those terms are defined in the Act, were admitted by all
parties. The Examiner therefore finds and concludes that
Carnation and the Council were employers engaged in
commerce in a business affecting commerce and the
Union was a labor organization within the meaning of
Section 2(2), (5), (6), and (7) of the Act at all times
pertinent.
H. THE ALLEGED UNFAIR PRACTICE
I The Agreements
On July 24, the Council on behalf of `16 distributors of
dairy products in the Puget Sound area -- including
Carnation - and 9 Teamster Locals -- including Local
66 - entered in an agreement titled "Master Dairy
Agreement" for a 2-year term extending from April I
through March 31, 1970. On the same date, the Council
on behalf of distributors with operations in the Seattle
area -- including Carnation --- and Local 66 executed an
agreement titled "Fluid Milk Supplemental Agreement"
covering the operations of those distributors within Local
'Counsel for all the parties represented that it would not be necessary for
the Examiner to make any credibility determinations , when counsel for the
Respondents noted that there was some conflict between the testimony of
Wilgus for the General Counsel and that of Carnation 's Retail Sales
Manager, Douglas Gray , the General Counsel stipulated that he would
consider himself bound by Gray's testimony
66's jurisdiction, including Carnation's terminal at 2746
N. E. 45th Street, Seattle
Section 1 (D) of the latter agreement provides that
The Distributor agrees that all jobbers and/or
producer-distributors handling or delivering milk
obtained from the Distributor shall be members of the
Union
Sections 1 (E) through (I) of the same agreement in
effect constitute a "grandfather" agreement; i e., they
limit the number of jobbers and producer-distributors the
dairies may do business with to the number they were
doing business with at the time the agreement was
executed and require that all the direct delivery services
performed by the producers' employees at that time
continue to be performed by such employees'
These contractual arrangements have a long history.
Contracts covering employees at Carnation's 45th Street
terminal represented by Local 66 dating back to 1940
contain provisions either identical to or having the same
effect as those just cited.
2. The Union Bylaws
Section 1 (D) of the current contract and prior
agreements had the intended effect of subjecting jobbers
doing business with the distributor dairies covered thereby
to many restrictions contained in the Union's bylaws,'
including:
1. A prohibition against soliciting business from any
storeowner, restaurant, hotel, business establishment,
organization or individual who purchased milk from any
dairy, distributor or jobber covered by the contract;
2. A prohibition against selling milk to any former
customer for 6 months after leaving a route;
3. A requirement for approval of the Union executive
board before a jobber may sell his route;
4. A prohibition against performing any work before
7:00 a.m. or after 4:00 p m.;
5. A prohibition against utilizing any assistants in
making deliveries,
6. A prohibition against working alongside any expelled
member of the Union or any non-member; and
7. Requirements of support for any strike authorized by
the Union, attendance at at least one union meeting per
month or payment of a fine in lieu thereof and payment
of periodic union dues.
Two, four, and five above are duplicated in the
collective bargaining agreement as work rules applicable
to dairy employees covered thereby. The dairies have an
unwritten policy of refraining from soliciting business
from customers serviced by other dairies, distributors or
jobbers, which duplicates 1. above with respect to their
employees' ' work rules. Inasmuch as the agreement
contains a union shop provision, the dairies' employees
are, subjected to the balance of the bylaw provisions
recited above as well.
3. Intent and Purpose
Both the principal Union witness, Arthur W. Hademan,
Secretary-Treasurer of Local 66, and the principal
employer witness, Douglas T Gray, Retail Sales Manager
'The currently effective bylaws were adopted on November 28, 1962, the
Union's Secretary-Treasurer testified without contradiction , however, that
the bylaw provisions recited hereafter have been continuously in effect
since 1926
884 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
FOR Carnation, stated that it was their intent by Section
(D) to require jobbers to comply with the Union's Bylaws,
particularly the first, fourth and fifth prohibitions set out
above.
Both Hademan and Gray described the milk
distribution system in the Puget Sound area prior to such
regulations as "chaotic", i.e., without the regulation
imposed by the combined effect of Section 1 (D) of the
Supplemental Agreement and the Union's Bylaws, jobbers
could buy milk and related products from the dairy
distributors covered by the agreement and.
1. Solicit business throughout the city from customers
purchasing milk delivered by employees of the distributor
from whom the jobber purchased his milk as well as the
customers of other distributors
2. Sell at lower prices,,
3 Offer and provide more desirable delivery times,'
4 Service a larger number of customers,' and
5. Operate at lower costs than the distributors.'
4 Wilgus
Wilgus was employed by Carnation as a milkman in
Tacoma, Washington, in 1961. He became a member of
Teamsters Local 951, which has jurisdiction in that part
of the Puget Sound area. In October of 1966, Wilgus was
promoted to the position of retail supervisor of 20 of
Carnation's retail routes at its Seattle terminal on 45th
Street, also known as its University Village terminal. He
secured an honorary withdrawal card at that time from
Local 951.
On April 30 Wilgus purchased a jobber route and truck
from Gary Giacomini. At that time Giacomini, Jerry
'During the period of approximately January I, 1968 - February 20, 1969,
the Union processed charges against its jobber-members for (1) Four
violations of the starting time prohibition , (2) Two violations of the
quitting time provision ; (3) Three charges of violation of the provision
prohibiting the use of any helpers , and (4 ) One violation of the
no-solicitation provision
'Wdgus and Gray agreed that Carnation placed no restrictions on where
or to whom Wilgus sold the milk Wilgus purchased from Carnation,
though Carnation 's drivers were limited to specific routes and barred from
soliciting business other than new business not previously serviced by any
distributor The Union's bylaws filled that gap, however , by prohibiting
any member of the Union from soliciting business from anyone serviced by
another member , which effectively prevented solicitation of any customer
serviced by any of the employees of the distributors as well as other
jobbers and producer -distributors (Section 65)
'Wilgus made a practice of selling the milk he purchased from Carnation
to his customers at l cent per quart less than the price charged by
Carnation for delivery by its employees and 10 cents less per gallon of ice
cream
'Gray testified that many customers preferred to have their milk and
other dairy products delivered prior to 7 a m Thus an offer for such
earlier delivery would provide a strong inducement if it were possible
Carnation does not require its jobbers to start no earlier than 7 a m , but
the Union 's bylaws do (Section 79)
'It is clear that if the jobbers were not required to be members of the
Union, they would not be limited to working only between 7 am - 4
p m and barred from employing a helper in their deliveries (Sections 70
and 79 ) Carnation does not impose such restrictions Without them , clearly
more customers could be serviced by a jobber each day
'The jobber , selling and personally delivering his products to his
customers , is not subject to many of the costs imposed upon the
distributors by the operation of various public laws and provisions of the
collective bargaining agreement between the distributors and the Union
covering the distributors ' employees (unemployment compensation,
hospital and surgical benefits pension benefits, paid sick leave, paid
vacations and holidays , overtime, payment of union dues ( absent Section 1
(D)), maximum hour and minimum wage requirements , workday and
helper restrictions (again absent section I (D), etc )
I Holman and Al Baunsgard were in business as jobbers,
purchasing their milk and related products from
Carnation at its University Village terminal. An
independent distributor, Paramount Dairy, also purchased
its milk and related products there. Carnation operated 88
routes with its own employees at that terminal.
Giacomini had purchased the business and truck from
Everett Johnson on March 1, 1967, and had not
completed payments on the purchase at the time he sold
the business and truck to Wilgus, Wilgus therefore
assumed the obligation to complete Giacomini's payments
to Johnson (with Johnson's consent) as well as paying
Giacomini for his equity
Carnation does not have any written agreements with
its three jobbers and one distributor. They purchase milk
and other dairy products from Carnation and pay for all
their purchases on a monthly basis They own their own
trucks, purchase their own truck licenses, pay for the
insurance carried on their trucks and operations, and pay
Carnation for any gasoline or oil purchased, and any
maintenance performed by Carnation mechanics, or any
relief driving performed by Carnation employees They
are permitted by Carnation to park their trucks in
Carnation's yard, and as a matter of convenience to
purchase their gas and oil at Carnation's pumps and have
their maintenance and relief driving performed by
Carnation employees, but are free to make their purchases
and to secure their maintenance work and relief drivers
somewhere else Carnation supervisors do not check the
manner, quantity or quality of the service the jobbers and
the distributor supply to their customers. Each jobber does
his own soliciting of business, sale and delivery of
products, billing, collecting, and pay his own city and
sales taxes. As noted heretofore, Wilgus makes a practice
of selling milk at 1 cent per quart less than the price
Carnation charges its customers, 10 cents less for each
gallon of ice cream he sells, and keeps his egg prices
constant for each month (Carnation varies them on a
daily basis)
By virtue of his long previous service with Carnation as
a bargaining unit employee and as a supervisor of a group
of bargaining unit employees, Wilgus came into frequent
contact with jobbers doing business with Carnation and
was familiar with the requirement of the successive labor
agreements requiring jobber membership in the Union On
April 23 (7 days prior to executing the agreement for his
purchase of Giacomini's business and truck), Wilgus
visited the offices of Local 66, informed a representative
of the Local that he was taking over Giacomini's business,
deposited his Local 951 withdrawal card (which exempted
him from paying a new initiation fee to Local 66) and
took out membership in Local 66.
In October a business representative of Local 66 filed
charges against Wilgus for violating Union bylaw 79
(starting work before 7 a.m.). Wilgus subsequently
(October 24) was fined $33 30 (one day's pay for a driver
employee) He did not pay the fine (though he continued
to pay dues). Wilgus complained to Gray about the fine
and stated he believed the collective bargaining provision
requiring him to be a member of the Union to be illegal,
that he shouldn't be forced to maintain union membership
in order to operate as a jobber, and that he was
contemplating going to the Board and filing a charge. He
asked Gray's advice as to whether he should do this and
received a noncommital reply.
On October 30, Wilgus filed the charge in this case
MILK WAGON DRIVERS & CREAMERY WKRS.
On December 12, Wilgus was fined a second time for
violation of Union bylaw 79 The fine was another $33.30
and further provided if the two fines totaling $66.60 were
not paid within 30 days, the fine would be $250 for the
second offense plus the $33 30 original fine On January
10, 1969, Wilgus paid the $66.60 On February 28, 1969,
Wilgus was fined $133.20 for the same offense or $300 if
not paid within 30 days He had made partial payments of
$45 on March 24, 1969, and another $45 on April 28,
1969, by the time of the hearing in this case (May 27,
1969). He continued throughout to pay the periodic dues
required by the Union, with dues at the time of the
hearing paid up through June of 1969
In December, Board attorney John Cronin interviewed
Gray and secured a statement from him. In the course of
that interview, Cronin asked Gray if he ever told Wilgus
that Carnation would refuse to sell him milk if he
terminated his membership in Local 66. Gray stated that
he had not made such a statement to Wilgus because
Wilgus had never asked him that question but added that
he probably would have so replied had Wilgus asked him
that question. Wilgus testified and Gray confirmed that on
the following day Gray related to Wilgus all that he had
stated to Cronin, including his statement that had Wilgus
asked him, he would have told Wilgus that Carnation
probably would cease to sell him milk if he terminated his
membership in Local 66.
On February 19, 1969, (immediately prior to the 10(1)
hearing before the court), Wilgus approached Gray and
asked him if Carnation would refuse to sell him milk if he
(Wilgus) were not a member of Local 66. Gray replied
that he would have to consult with his superiors and Local
66 before he could answer that question.
Since Wilgus approached Local 66, took out
membership therein and has maintained good standing
membership thereafter, Local 66 never has had reason to
ask Carnation to cease doing business with Wilgus for
failure to acquire or maintain membership therein The
record is devoid of any evidence that Local 66 or any
other contracting union has threatened to cause,
attempted to cause, or caused any of the contracting dairy
distributors to cease doing business with any other jobber
because of such jobber's failure or refusal to acquire and
maintain union membership There is a similar absence of
any evidence that any of the contracting dairy distributors
has threatened, or attempted to cease doing business with
any jobber, or actually ceased to do business with any
jobber, because of such jobber's failure or refusal to
acquire or maintain membership in a contracting union,
except for the implications contained in Gray's remarks to
Cronin and Wilgus in December.
5. Concluding Findings
a The Independent Contractor Issue
The Complaint alleged and the Council-Carnation
Answer admitted that Wilgus was an independent
contractor; the Union, on the other hand, denied in its
Answer that Wilgus was an independent contractor and
affirmatively alleged that he was an employee of
Carnation ' °
The facts support a finding that Wilgus at all times
pertinent was an independent contractor. He owned his
own truck, purchased his milk and related dairy products
from Carnation, sold them to his customers at prices
,"The Union did not argue this point in its Brief
885
lower than those charged by Carnation to its customers,
did his own billing and collecting (absorbing whatever
losses occurred), paid Carnation for the dairy products he
purchased and any other goods and services he purchased
(gasoline, oil, maintenance, relief driver service) on a
monthly basis, paid his own taxes, license fees and
insurance, and received no supervision, instruction or
direction from Carnation as to his business policies and
procedures
Based on the foregoing, the Examiner finds and
concludes that Wilgus at all times pertinent was an
independent contractor and not an employee of
Carnation "
b. The 10(b) Issue
Section 10(b) of the Act requires the dismissal of any
complaint issued pursuant to a charge based upon an
alleged unfair labor practice which occurred more than six
months prior to the date such charge was filed.
The charge in this case was filed on October 30. The
most recent contract between the Council and Local 66
covering Carnation and Wilgus containing the disputed
provision was entered into on July 24, less than four
months prior to the date the charge was filed, for a term
extending from April 1, 1968, through March 31, 1970
In essence the Respondents contend that the record
fails to show that any dairy distributor covered by the
contract either threatened or attempted to cease doing
business with any jobber, or actually ceased to do business
with any jobber because of his failure to acquire or
maintain membership in any of the contracting unions,
and that any contracting union threatened to cause,
attempted to cause, or caused any of the contracting dairy
distributors to cease doing business with any jobber for
that reason within the 10(b) period The Respondents
argue that absence of such proof warrants dismissal of the
complaint.
This contention and argument begs the basic question,
Section 8(e) of the Act prohibits employers and unions
representing their employees from entering into
agreements wherein the employers agree to cease doing
business with any other person. If Section 1 (D) of the
July 24 'contract reasonably may be construed as an
agreement wherein Carnation and the other dairies party
thereto agreed to cease doing business with Wilgus or any
other jobber if at any time during the term of that
contract Wilgus or another jobber failed or refused to
acquire or maintain membership in the appropriate union,
the July 24 entry into such agreement, less than four
months prior to the date the charge in this case was filed,
and its continued maintainance thereafter,' 2 certainly falls
within the 10(b) period.
Respondents' contention and argument more properly
relates to the merits of the complaint; i.e., whether
absence of any evidence of enforcement of Section 1 (D)
"L C Sinor & Standard Industries , 168 NLRB No 67
"There has not been any enforcement of Section 1 (D) during the 10(b)
period because no jobber , including Wilgus, has been willing to risk losing
his source of supply by terminating his union membership The parties'
strong support of the need for Section 1 (D), Gray' s December indication
that Carnation `probably' would cease to do business with Wilgus if he
dropped his union membership , Gray's equivocal February 1969, response
with regard to what action Carnation would take if Wilgus terminated his
union membership and the parties ' reservation of their right to implement
Section I (D) in futuro in their stipulation before Judge Lindberg, all
support the continued viability of Section I (D) at all times since the July
24 execution of the current contract
886 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
by a dairy refusal to continue to do business with a jobber
for failure or refusal to acquire or maintain union
membership is a fatal defect in an allegation of 8(e)
violation.
The Examiner finds and concludes on the basis of the
foregoing that the complaint is not subject to dismissal
under Section 10(b) of the Act
c. The I (D) Issue
The Respondents contend first, that the distributors'
agreement to require jobbers with whom they did business
to acquire and maintain union membership cannot be
construed as an agreement to cease doing business with
any jobber who fails or refuses to comply therewith in the
absence of proof of any such cessation upon any such
failure or refusal and, second, that in any event, the
provision in question is a valid primary work or standards
protection provision
The Examiner rejects the first contention. Section 1 (D)
of the contract, requiring jobbers to be members of the
Union, is placed in the same "union security" section of
the contract requiring employees to be Union members; it
never has been necessary to spell out the corollary of the
requirement, i.e., discharge in the case of the employee
who fails or refuses to acquire and maintain his union
membership during the contract term and ceasing to do
business with the jobber who does the same.
In the case of General Teamsters Local 890, 137
NLRB 641, the contract provided that: "All independent
truckdrivers hauling melons between the field and the
packinghouse shall be in good standing with the Union."
The drivers in question were independent contractors. The
Board there held that "an agreement to do business only
with those who meet . . union membership . .
requirements . . . is an agreement, at least by implication,
not to do business with those who do not so qualify." 137
NLRB 641, at 643-644.
As stated heretofore, the absence of proof that
Carnation or another dairy-producer covered by the
contract has ceased to do business with a jobber since the
July 24 execution of the current contract does not imply
that such cessation would not occur if a jobber failed or
refused to acquire or maintain union membership; to the
contrary, the parties' vigorous defense of Section 1 (D),
Gray's confirmation that Section 1 (D) `probably' would
require Carnation to cease doing business with Wilgus if
he dropped his union membership, Gray's evasive
February, 1969 reply to an inquiry as to what Carnation
and the Union would do if Wilgus dropped his
membership, and the parties' preservation of their right to
enforce Section I (D) as they see fit in futuro lead to a
contrary conclusion.
The Union's request for inclusion of the provision in
question and the dairy producers' acceptance thereof on
July 24 thus appears to be within the literal language of
Section 8(e) of the Act making it "an unfair labor
practice for any labor organization and any employer to
enter into any contract or agreement, express or implied,
whereby such employer agrees to cease doing
business with any other person . "
There remains the question of whether the provision in
question may be considered a valid work protection or
maintainance of contract standards provision. The Board
and the courts, including the U.S. Supreme Court, have
examined provisions in labor contracts imposing
restrictions upon the relations between the employer
parties to such contracts and independent persons with
whom such employers do business and classified such
provisions as either primary or secondary, depending on
their degree of identification with the economic interests
of the employees of the contracting employer, as
distinguished particularly from the institutional interests
of the union.
Recognizing that Section 8(e) of the Act came into
being to close a loophole in the secondary boycott
prohibitions of Section 8(b)(4) of the Act - which only
prohibited involuntary entry into "hot cargo" agreements
- the Board and the courts have looked to Section
8(b)(4) distinctions in determining if a contract provision
voluntarily entered into affecting relations between the
contracting employer and persons with whom he does
business violate Section 8(e) of the Act. In the now
famous National Woodwork and Houston Insulation
cases," the Supreme Court ruled that a labor contract
provision barring the purchase and use of products on
which work was done which was capable of performance
by bargaining unit employees related to and protected
such employees against loss of work and therefore was a
lawful, and primary objective outside the ambit of Section
8(e). For the same reason, labor contract provisions
prohibiting any contracting out of bargaining unit work
have been upheld." In similar fashion, labor contract
provisions which limit contracting out of work capable of
performance by bargaining unit employees to contractors
who maintain economic standards equal to or in excess of
those enjoyed by the primary employer's employees have
been held to be legitimate. Meat Drivers Local 710 v.
N L R B, 335 F.2d 709, 713, 715 (C A D.C ).
However, contracts which require that bargaining unit
work shall only be contracted out to contractors whose
employees are members of the union representing the
bargaining unit employees, or to contractors who
themselves are members of such union, have been held to
have an unlawful purpose in that their primary thrust is
enhancement of the unions' institutional interests, with the
unit employees' interests a secondary and more remote
consideration. N L R B v. Teamsters Jt Council 38, 338
F.2d 23, 28, 30-31 (C.A 9), Meat Drivers Local 710,
supra; District 9, Int Assn. Machinists v. N L R B , 315
F.2d 33, 36-37 (C.A.D.C.); etc As the Third Circuit said
in the 1967 case of A. Duie Pyle v. N L R B, (383 F.2d
722): ". . . provisions . that . . . require subcontractees
to become . members of the union . must . . . be
'declared invalid. As in the case of secondary boycotts
generally, a union may not employ a collective bargaining
agreement with one employer as a means of effectuating
its object to coerce another employer to unionize Nor
may it by this means seek to coerce self-employed persons
to become union members "
In the instant case the Union may have accomplished
its alleged objective without running afoul of Section 8(e)
simply by securing agreement from the dairy distributors
to require that all jobbers (and independent distributors
such as Paramount) with whom the dairies did business
meet or exceed the applicable economic standards of the
dairy employees contained in the labor contract.
It might be argued that it makes little difference
whether such standards are protected by subjecting the
jobbers, distributors, producers and producer/distributors
"National Woodwork Mfrs Assn v N L R B. 386 U S 612, Houston
Insulation Contractor Assn v N L R B, 386 U S 664
"Milk Wagon Drivers Local 546 (Minn Milk Co ). 133 NLRB 1314,
enfd 314 F 2d 761 (C A 8)
MILK WAGON DRIVERS & CREAMERY WKRS. 887
to the unions' bylaws or to a contract between them and
the dairies. Such a position, however, has little merit The
dairies may be able to avoid a charge of anti-trust
violation in the absence of an agreement among them to
refrain from soliciting business from one another's
customers and to solicit business only from persons not
presently purchasing dairy products from any of them; but
forcing an independent contractor doing business with
them to agree to refrain from such solicitation would
present no such difficulty By requiring the independent
jobbers, distributors etc. to subject themselves to the union
bylaw prohibiting such solicitation and the unions'
disciplinary powers of enforcement, the dairies may
contend that they do not impose any restraints upon the
manner in which the jobbers etc. conduct their business
inasmuch as they have no control over what rules the
union requires of its membership. It is also clear that
Section 1 (D) does not only require the jobbers, etc. to
limit their solicitations of new business and restrict their
working hours and employment of assistance; it also
requires these independent businessmen to pay dues to the
union, to attend union meetings at least once a month or
pay a fine in lieu thereof, to refrain from working
alongside or employing a person who is not a member of
the union, to secure permission from the union befoie they
may sell their business, and to support any strike the
union may call (which means, to cease operating their
business for the duration of such a strike) In the case of
independent distributors such as Paramount, Section 1 (D)
forces such distributor to require its employees to acquire
and maintain union membership, without regard to their
desires with regard to representation
Section I (D) is thus the very type of coercive,
secondary contract Section 8(b)(4) and 8(e) were intended
to invalidate. Wilgus has been an involuntary member of
Local 66 at least since the time he was first fined by the
union in October for attempting to start work shortly
before 7 00 a m The involuntary nature of his continued
maintenance of union membership certainly has not been
altered by the larger and larger fines imposed upon him
subsequently by the Union for the same offense. He does
not dare drop that membership prior to final decision in
this case, however, for he would risk losing his entire
investment and undoubtedly have rather slim prospects for
continued employment in the industry
Section 8(e) of the Act renders unenforceable and void
any contract provision wherein an employer at the request
of the union representing his employees agrees to cease
doing business with anyone who fails or refuses to acquire
and maintain union membership or to require his
employees to do so. Section 1 (D) of the contract between
the Council and Local 66 is such a provision.
The Examiner therefore finds and concludes that by
their July 24 entry into Section I (D) of the contract titled
Fluid Milk Supplemental Agreement and continuance in
effect thereafter of that provision, the Council, Carnation,
the other dairy distributors covered by such agreement,
and Local 66 violated, and continue to violate, Section
8(e) of the Act
THE REMEDY
Having found the Respondents engaged in unfair labor
practices, it shall be recommended that they cease and
desist therefrom and take certain affirmative action
designed to effectuate the policies of the Act.
The effect of the entry into and continued maintainance
of Section 1 (D) of the Fluid Milk Supplemental
Agreement between the Council on behalf of the dairy
distributors named therein and Local 66 having been fully
litigated in this proceeding, it shall be recommended that
Local 66, the Council and the dairies covered by that
agreement, including Carnation, be ordered to cease and
desist from continuing that Section in effect and to post
notices to that effect where all affected persons may see
them ' S
It is further noted that the Council on behalf of 16
dairies with operations in 40 cities and towns in the Puget
Sound area (including Carnation) entered into an
agreement on July 24 titled "Master Dairy Agreement"
with 9 Teamster locals having jurisdiction over the dairy
industry within that area and at those cities and towns
(including Local 66). It is clear from that agreement that
agreements similar to the Fluid Milk Supplemental
Agreement have been executed with each of those local
unions While such supplemental agreements were not
placed in the record and the unions and dairies covered by
them have not been made parties to this proceeding, the
Council has It shall therefore be recommended that the
Council be directed to cease and desist from entering into
or maintaining in effect any agreement similar to that
contained in Section 1 (D) of its agreement with Local 66,
and to notify all parties to such contracts of this order.
CONCLUSIONS OF LAW
I The Council and Carnation are employers engaged in
commerce in a business affecting commerce and the
Union is a labor organization within the meaning of
Section 2 (2), (5), (6), and (7) of the Act
2. By their July 24 entry into Section I (D) of a
contract titled Fluid Milk Supplemental Agreement and
by their continuance in effect of such provision thereafter,
the Council , Carnation and Local 66 have violated and
continue to violate Section 8 (e) of the Act
3 Such unfair labor practice affects commerce within
the meaning of Section 2(6) and (7) of the Act
RECOMMENDED ORDER
A The Council, Carnation, and the other dairies
represented by the Council who are covered by the July 24
Fluid Milk Supplemental Agreement between the Council
and Local 66, their officers, agents, successors, and
assigns, shall
1 Cease and desist from entering into or continuing in
effect or renewing Section I (D) of such Agreement, and
2 Post at the processing plants of the dairies listed in
Appendix A copies of the attached notice marked
Appendix B the name of the posting employer to be filled
in at the appropriate blank space thereon.'6 Copies of such
Notice shall be furnished to the Council and the dairies by
the Regional Director for the 19th Region and shall be
signed by an authorized representative of each dairy and
posted immediately upon receipt thereof and maintained
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 to
ensure that such notices are not altered, defaced or
covered by other material The Regional Director for
Region 19 shall also be notified in writing within 20 days
"Local 294, Teamsters. 131 NLRB 242
"in the event no execptions are filed as provided by Section 102 46 of
888 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
from the receipt of this decision what steps have been
taken to comply herewith "
3 The Council shall notify the dairies listed on
Appendix C on whose behalf it has negotiated
supplemental agreements to the Master Dairy Agreement
with Teamster Locals 38, 148, 252, 378, 411, 672, 699,
and 951 that any provision contained in such agreements
requiring jobbers, distributors, producers or
producer/distributors doing business with those dairies to
acquire and maintain membership in one of the unions
just noted is null and void and of no force and effect, and
shall notify the unions to like effect. The Council shall
further instruct such dairies and the unions dust listed to
notify any jobbers, distributors, producers and
producer/distributors with whom the dairies are doing
business to the same effect.
B. Local 66, its officers, agents and representatives,
shall:
1. Cease and desist from entering into, continuing in
effect or renewing Section I (D) of the Fluid Milk
Supplemental Agreement it executed with the Council on
July 24; and
2. Post at its business offices and meeting halls copies
of the attached notice marked Appendix "D " Copies of
such Notice shall be furnished to Local 66 by the
Regional Director for Region 19 and shall be signed by an
authorized representative of Local 66 and posted
immediately upon receipt thereof and maintained for at
least 60 consecutive days thereafter in conspicuous places,
including places where notices to members are customarily
posted. Reasonable steps shall be taken to ensure that
such notices are not altered, defaced or covered by other
material The Regional Drector for Region 19 shall be
notified in writing within 20 days from receipt of this
decision what steps have been taken to comply herewith "
the Rules and Regulations of the National Labor Relations Board, the
findings, conclusions , recommendations and Recommended Order herein
shall, as provided in Section 102 48 of the Rules and Regulations, be
adopted by the Board and become its findings , conclusions and order and
all objections thereto shall be deemed waived for all purposes In the event
that the Board 's Order is enforced by a judgment of a United States Court
of Appeals, the words in the notice reading "Posted by Order of the
National Labor Relations Board" shall be changed to read "Posted
pursuant to a Judgement of the United States Court of Appeals Enforcing
an Order of the National Labor Relations Board "
"If these recommendations are adopted by the Board, this provision
shall be modified by the substitution of "10 days from the date of this
Order" for "20 days from the receipt of this Decision
"See fn 16, ibid
"See fn 17, ibid
APPENDIX A
Foremost Foods Company 1300 Rainier South, Seattle.
Wash. 98144
George Swenson Snoqualmie , Wash. 98065
Issaquah Valley Dairy Issaquah , Wash 98027
Paramount Dairy, Inc, 2746 Northeast 45th,
Seattle, Wash 98105
Riverview Farms 15034 Nelson Place,
Renton , Wash. 98055
Smith Brothers Farms, Inc 27441 68th Avenue South,
Kent, Wash. 98031
Strathy Brothers , Inc. P 0 Box 28, Kenmore,
Wash. 98028
Vitamilk Dairy, Inc 427 Northeast 72d, Seattle,
Wash 98115
APPENDIX B
NOTICE TO EMPLOYEES
Posted by Order of the National Labor Relations
Board an agency of the United States Government
After a trial in which all sides had the opportunity to
present their evidence, the National Labor Relations
Board has found that we violated the law when we agreed
that we would stop doing business with any jobber,
distributor, producer or producer/distributor who did not
become and remain a member of Milk Wagon Drivers
Local 66 and has ordered us to stop giving effect to that
agreement.
We therefore by this Notice are informing you that the
jobbers, producers, distributors or producer/distributors
doing business with us are not required to be members of
Local 66 in order to do business with us, and that we will
not enter into, enforce or give effect to Section I (D) of
the contract entered into by the Dairy Employers Council
on our behalf and Local 66 or any similar provision either
now or in the future.
Firm Name Address
Arden Farms Company P.O. Box 3667, Seattle,
Wash. 98124
Carnation Company 2746 Northeast 45th,
Seattle, Wash 98105
Consolidated Dairy Products 4058 Ranier South, Seattle,
Company d/b/a Darigold Wash. 98108
Farms
Consolidated Dairy Products 1318 North 128th, Seattle,
Company d/b/a Darigold Wash, 98133
Farms
Date By
(Employer)
(Representative ) (Title)
This is an official notice and must not be defaced by
anyone
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
Any questions concerning this notice or compliance
with its provisions, may be directed to the Board's Office,
327 Logan Building, 500 Union Street, Seattle,
Washington 98101, Telephone 583-4532
MILK WAGON DRIVERS & CREAMERY WKRS.
APPENDIX C
Firm Name
Carnation Co
Consolidated Dairy Products Co d/b/a Darigold
Foremost Food Co Division of Foremost-McKesson, Inc
Vitamilk Dairy, Inc
Arden Farms
Carnation Co
Consolidated Dairy Products Co d/b/a Darigold Farms
Consolidated Dairy Products Co d/b/a Darigold Farms
Foremost Foods Co Division of Foremost-McKesson, Inc.
George Swenson
Issaquah Valley Dairy
Paramount Dairy, Inc
Riverview Farms
Smith Brothers Farms, Inc
Strathy Brothers, Inc.
Vitamilk Dairy, Inc.
Arden Farms
Consolidated Dairy Products Co d/b/a Darigold
JForemost Foods Co. Division of Foremost McKesson, Inc
Vitamilk Dairy, Inc.
Arden Farms
Consolidated Dairy Products Co d/b/a Darigold
Carnation Co.
Consolidated Dairy Products Co. d/b/a Darigold
Kitsap-Mason Dairymen's Assoc
Arden Farms
Consolidated Dairy Products Co. d/b/a Darigold
Arden Farms
Carnation Co.
Kitsap-Mason Dairymen's Assoc.
Arden Farms
Consolidated Dairy Products Co d/b/a Darigold
Hay's Dairy, Inc.
Arden Farms
Carnation Co.
Consolidated Dairy Products Co t d/b/a Darigold Farms
Foremost Foods Co. Division of Foremost-McKesson, Inc
Oakwood Dairy
Sanitary Cloverleaf Farms
Swan Lake Dairy
APPENDIX D
NOTICE TO MEMBERS
Posted by Order of the National Labor Relations
Board an agency of the United States Government
After a trial in which all sides had the opportunity to
present their evidence, the National Labor Relations
Board has found that we violated the law when we secured
a contract with the Dairy Employers Council requiring the
dairies whose employees we represent to stop doing
business with any jobbers, distributors, producers and
producer/distributors who did not become and remain our'
members
We therefore by this Notice inform you that we will no
longer enter into, maintain or seek a contract from the
dairies requiring them to stop doing business with any
jobber, distributor, producer or producer/distributor who
is not one of our members and such jobbers, producers,
distributors and producer/distributors are no longer
Address
Everett, Washington
Everett, Washington
Everett, Washington
Everett, Washington
Seattle, Washington
Seattle, Washington
4058 Rainier So , Seattle,
1318 North 128th, Seattle
Seattle, Washington
Snoqualmie, Washington
Issaquah, Washington
Seattle, Washington
Renton, Washington
Kent, Washington
Kenmore, Washington
Seattle, Washington
Moses Lake, Washington
-Wenatchee, Washington
Wenatchee, Washington
Wenatchee, Washington
Chehalis, Washington
Chehalis, Washington
Olympia, Washington
Olympia, Washington
Shelton, Washington
Mt. Vernon, Washington
Burlington , Washington
Bremerton, Washington
Bremerton, Washington
Bremerton, Washington
Aberdeen, Washington
Aberdeen, Washington
Hoquiam, Washington
Tacoma, Washington
Tacoma, Washington
Tacoma, Washington
Tacoma, Washington
Tacoma, Washington
Puyallup, Washington
Eatonville, Washington
889
required to be members of our Union in order to do
business with such dairies
Date By
MILK WAGON DRIVERS
LOCAL 66, International
Brotherhood of
Teamsters, Chauffeurs, &
Warehousemen of
America.
(Labor Organization)
(Representative ) (Title)
This is an official notice and must not be defaced by
anyone
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.
Any questions concerning this notice or compliance
with its provisions, may be directed to the Board 's Office,
327 Logan Building, 500 Union Street, Seattle,
Washington 98101, Telephone 583-4532