Orkin Exterminating Co., Inc.

National Labor Relations Board - Board Decisions

Feb 28, 1956

115 N.L.R.B. 622 (N.L.R.B. 1956)

622 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Construction Trades Council, AFL-CIO, are not and have not been
lawfully entitled to force or require Farnsworth & Chambers Co.,
Inc., to assign the duty of signing for all materials to members of the
Teamsters rather than to other employees.
2. Within ten (10) days from the date of this Decision and Determi-
nation of Dispute, the Respondents, the Teamsters and the Council,
shall notify the Regional Director for the Sixteenth Region, in writ-
ing, as to what steps they have taken to comply with the terms of this
Decision and Determination of Dispute.
Orkin Exterminating Company, Inc. (of Kentucky) ' and Inter-
national Chemical Workers Union , AFL-CIO,2 Petitioner. Case
No. 9-I?C-2508. February ,28,1956
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing was held before Richard C. Curry, hearing
officer. The hearing officer's rulings made at the hearing are free from
prejudicial error and are hereby affirmed.
Upon the entire record in this case, and the entire record and decision
in Case No. 5-RC-1498,3 which is hereby incorporated in and made a
part of the record in this case, the Board finds :
1. The Employer, a Kentucky corporation, is engaged in termite
and exterminating work in and around Louisville, Kentucky. The
Petitioner herein seeks to represent a unit of all production and main-
tenance employees at the Employer's operations in Louisville. The
Employer contends that the petition should be dismissed because its.
operations are local in character and do not meet the Board's minimum
standards for the assertion of jurisdiction.
The record shows that for the fiscal year ending October 31, 1954, the
Employer's purchases from out of State amounted to approximate-
ly $9,620. For the same period the total sales and services rendered
by the Employer amounted to approximately $131,402, of which
amount $26,594 were out-of-State sales. These operations of the Em-
ployer, considered alone, do not meet the Board's jurisdictional stand-
ards.4 The Petitioner contends, however, that the Employer is an
integral part of a multistate enterprise whose total operations meet
' The name of the Employer appears in the caption as amended at the hearing.
2 The AFL-CIO having merged since the hearing in this case , we are amending the
identification of the Petitioner's affiliation.
8 Orkin "The Rat Man," Incorporated, 112 NLRB 762 . The parties herein requested
the Board to take official notice of the record and decision in that representation case.
4 Jonesboro Grain Drying Cooperative, 110 NLRB 481; Central Valley Pipe Company„
111 NLRB 233.
115 NLRB No. 93.
ORKIN EXTERMINATING COMPANY, INC. 623:
Board standards, and that the Board should therefore assert its juris-
diction.
The Employer is one of a number of Orkin corporations engaged
in pest control work in approximately 25 States. In Case No. 5-
RC-1498, supra, the Board considered the operations of the Virginia-
Orkin corporation and made the following factual findings :
The Employer is one of 29 "Orkin" corporations engaged in
pest control work in 25 States. The aggregate business of all 29
corporations for the calendar year 1954 was approximately $12,-
500,000. One of the corporations, Orkin Exterminating Com-
pany of Atlanta, Georgia, a purchasing and distribution corpora-
tion, for the fiscal year ending October 31, 1954, made out-of-state
sales to other pest control businesses in the amount of
$194,000. . . . Out-of-state sales and services rendered by the
other corporations during the fiscal year ending October 31, 1954,
exceeded $307,000. A majority of the stock in each of the 29
"Orkin" corporations is owned by Otto Orkin and his immediate
family. All the corporations have identical officers, and 4 di-
rectors of each corporation are the same. Thus Otto Orkin is
the president, treasurer, and a director of each corporation; M.
C. Young is secretary of each; and Sanford H. Orkin, William
B. Orkin, and Perry Kaye are vice presidents and directors of all
the corporations.
Each corporation employs a manager to conduct its business
operations . Payment for the manager's services is usually on a
profit-sharing or incentive basis, the amount of his income being
dependent on the earnings of the corporation he manages. Each
corporation operates independently of the others. Each main-
tains its own accounts and files separate tax returns.' Each man-
ager uses his own discretion as to when and where to make pur-
chases and the quantity thereof. There is no centralized control
of the labor relations of the corporations. Thus each manager
does his own hiring and firing, sets wage rates, and establishes
vacations and other benefits. Similarly, there is no interchange
of either employees or managers between corporations.
a One Sim of accountants in Atlanta, Georgia, makes out the income tax returns
for each corporation.
Upon the basis of those facts, the Board concluded that the Virginia
Company was not an integral part of a multistate enterprise for juris-
dictional purposes and dismissed the petition therein.
As indicated, the parties requested the Board to take notice of the
facts in Case No. 5-RC-1498, supra. The record in the instant case
discloses the following additional facts :
1624 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Employer's manager exercises his own discretion and judgment
in hiring and discharging employees; he sets the rates of pay of his
employees; and determines holidays, hours of employment, the need
for overtime, and vacation policy.' He maintains records of all trans-
actions, makes up his own payroll, has the power to obligate the Em-
ployer's credit, and shares in the Employer's profits each year.
The Employer's officers have their offices in Atlanta, Georgia.
Copies of all clerical records maintained in the Employer's Louisville
office, such as payroll, purchase, and sales records, are sent to the
Atlanta office. The Employer's manager submits information con-
4-erning conditions of employment of a newly hired employee to the
Atlanta office, where an employment contract, which is in the form
of an agreement not to compete with the Employer for 2 years after
the termination of employment, is prepared and returned to Louis-
ville for the employee's signature. Such agreements are executed on
behalf of the Employer by the Employer's vice president and secre-
tary. The Employer's payrolls are prepared in Louisville; they are
then submitted to Atlanta, where paychecks are prepared and sent to
Louisville for distribution.
The Atlanta office maintains a list of available suppliers of mer-
chandise used in exterminating operations. The Employer's manager
is not compelled to purchase his supplies from the listed suppliers.
In practice, however, he purchases most of his supplies from them
because of price advantages. In such cases, he submits a purchase
order, showing his needs and the name of the listed supplier from
which they are to be obtained, to the Atlanta office, which then places
the order. When the manager purchases locally from nonlisted sup-
pliers, he places the orders himself. Payment for purchases from
the listed suppliers are made by check drawn by the Atlanta office on
an Atlanta bank. Payment for purchases from the nonlisted sup-
pliers are also made by check drawn by the Atlanta office, but are
drawn on a Louisville bank. The Employer's manager deposits the
Employer's receipts in the Louisville bank.
All checks, whether payroll or otherwise, drawn to pay the Em-
ployer's obligations are drawn on "The Orkin Exterminating Com-
pany." The record does not otherwise identify that company. In
addition the checks bear the Orkin trademark, a small figure with
the expression "Call Otto the Orkin Man." This trademark is used
in all Orkin newspaper and television advertising.
For the last 4 years, technical employees from the Atlanta office
have held annual meetings in Louisville. These meetings each lasted
6 The Employer's manager testified that when he was first employed by the Employer
in 1946 there was no vacation plan in effect in Louisville, and that on his own initiative
he set up a vacation plan of 2 weeks' vacation after 1 year's service He also testified
that this plan had been company policy for about 10 years.
ORKIN EXTERMINATING COMPANY, INC. 625
I`day and were conducted as training schools for Orkin sales and serv-
ice employees. The Employer's employees as well as employees from
Orkin corporations in other States were present at these meetings.
In 1953 a joint meeting of Orkin managers and sales employees was
held in Atlanta. Mr. Otto Orkin and other Orkin officers spoke at
this meeting. The meeting was also addressed by entomologists
from universities, by sales and technical men from different manu-
facturing plants, by Government public health officials, and by other
Orkin employees. The Employer's manager and 2 of his sales em-
ployees were present at this meeting as well as managers and em-
ployees from over 20 other Orkin corporations.
The Atlanta office has a national sales organization which solicits
business from large interstate companies. Such accounts are then
assigned on a territorial basis to be serviced by the various Orkin
corporations, including the Employer. The Employer is charged
for a proportionate share of the expenses of this sales organization.
The Atlanta office also maintains a file of advertising films and slides
for use on television programs which are available for use by all Orkin
corporations throughout the United States. The Employer's manager
negotiates and executes contracts for television advertising on a local
station. These contracts, the contents of the programs, and the use
of the Orkin trademark are cleared through the Atlanta office.
The Employer's employees participate in "The Orkin Companies
Contributory Pension Plan" if they so desire and otherwise meet the
eligibility requirements. The Employer's manager had no part in
formulating or negotiating this plan. It was established for all Orkin
companies and its eligibility requirements for participation in the
plan include active employment on a full-time basis and "5' full years of
continuous service with one or more Orkin Companies." 6 The Em-
ployer as well as participating employees share in the co'st of the
pension plan.
There has been no interchange between the Employer's "employees
and employees of other Orkin companies for at least the past 2 years.
When the Employer's manager finds he has more help than he needs,
he advises the Atlanta office of that fact and inquires whether any of
the other Orkin corporations can use his surplus employees. The
Atlanta office will then communicate this information to other Orkin
The Orkin Companies Contributory Pension Plan provides that
Wholly owned subsidiaries and companies where 50% or more of the voting stock
is owned by Orkin Exterminating Company, Inc, participate in this Plan pursuant to
action by their Boards of Directors. Each such pat ticipating company's contributions
shall be determined separately with relation to its own employees
In computing continuous service, employment by any one or more of the partici-
pating companies shall be counted Transfer from one such company to :mother
shall not constitute termination of omployment
390609- i6-vol. 115-41
626 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
companies.' Surplus employees, however, are not transferred directly
should another Orkin company desire to use their services. Rather
they are terminated by the Employer and are hired by the company
engaging their services as new employees. New contracts of em-
ployment are then executed.
The Board rested its decision in Orkin "The Rat Man," Incorpo-
rated, Case No. 5-RC-1498, supra, that the Virginia Company was
not an integral part of a multistate enterprise for jurisdictional pur-
poses, on its conclusion that all the "Orkin" companies were operated
independently of each other- with no showing of a common control of
the companies' labor relations policies. That decision was based on
the record then before the Board. However, it appears that the facts
of the present case show a greater degree of common operation of the
Orkin companies than was shown in the earlier case. Under such
circumstances and on the basis of the entire record herein, we find that
for jurisdictional purposes the Employer constitutes an integral part
of a multistate enterprise. As stated above, the sales for all the Orkin
corporations for the year 1954 were in excess of $12,500,000. This
amount meets the standards established by the Board for asserting
jurisdiction over an integral part of a multistate enterprise.8
Accordingly, we find that the Employer is engaged in commerce
within the meaning of the Act and that it will effectuate the purposes
of the Act to assert jurisdiction herein.
2. The labor organization involved claims to represent certain
employees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of employees of the Employer within the meaning of Section
9 (c) (1) and Section 2 (6) and (7) of the Act.
4. The following employees of the Employer constitute a unit
appropriate for the purposes of collective bargaining within the
meaning of Section 9 (b) of the Act: All pest control operators'and
trainees and termite operators and helpers of the Employer at its
Louisville, Kentucky, operations, excluding office clerical and pro-
fessional employees, salesmen, guards, and supervisors as defined in
the Act.
[Text of Direction of Election omitted from publication.]
MEMBER MURDOCK, concurring :
I agree with my colleagues' conclusion that the various Orkin Cor-
porations are integral parts of a 'single multistate enterprise as stated
1 In all correspondence with the Atlanta office and other Orkin companies, the Employer
uses stationery supplied by Atlanta without a letterhead but bearing the heading "Inter-
office Correspondence "
a Jonesboro Crain Drying Cooperatt?, e, supi a
THE KLEINHANS COMPANY 627
in my dissenting opinion in the earlier Orkin "The Rat Man," Incor-
porated case.' The contrary conclusion of my colleagues in that case
resulted not from an absence of evidence showing the integrated na-
ture of the operations of the Orkin corporations, but rather from the
failure realistically to evaluate the factors of common ownership,
common officers and directors, and the fact that all of the corporations
were engaged in the same type of business, which conclusively
showed that those corporations were in fact a single integrated enter-
prise. The absence of a centralized control of labor relations and the
absence of employee interchange relied on by my colleagues in the
earlier Orkin case and in such cases as Modern Linen c6 Laundry
Service, Inc.,10 and Safeway Transit Company 11 as a basis for their
refusal to find "single employer" are factors which are more appro-
priately considered in determining the appropriate unit. To rely
exclusively on such factors in determining the jurisdictional question
of whether a "single employer" exists is to confuse unit and jurisdic-
tional questions to the detriment of employees seeking the benefits of
collective bargaining.
Accordingly, because the 29 Orkin corporations are commonly
owned and have the same officers and directors who exercise a com-
mon control over the policies of all corporations, I filed that they con-
stitute an integrated multistate enterprise and that it will effectuate
the policies of the Act to assert jurisdiction herein.
0112 NLRB 762.
10 110 NLRB 1 305, 111 NLRB 166
u 111 NLRB 1359
The Kleinhans Company and Retail Clerks International Associ-
ation , Local 212, AFL-CIO, Petitioner . Case No. 3-RC-1604.
February 28,1956
SUPPLEMENTAL DECISION AND CERTIFICATION OF
REPRESENTATIVES
Pursuant to the Board's Decision and Direction of Election, dated
November 17,1955,1 an election was conducted under the direction and
supervision of the Regional Director for the Third Region. Upon con-
clusion of the election the parties were furnished a tally of ballots
which shows that of approximately 79 eligible voters, 76 cast valid
ballots of which 40 were for the Petitioner, 36 were cast against the
Petitioner, and 2 voted challenged ballots. The challenged ballots are
not sufficient in number to affect the results of the election.
I Not reported in pi inted volumes of Bow d Decisions and Orders
115 NLRB No 96