The Horn & Hardart Co.

National Labor Relations Board - Board Decisions

Sep 20, 1965

154 N.L.R.B. 1368 (N.L.R.B. 1965)

1368 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Horn & Hardart Company and Local 1199 , Drug and Hos-
pital Employees Union, AFL-CIO , Petitioner. Case No. 2-RC-
13930. September 20, 1965
DECISION ON REVIEW AND ORDER
On June 4, 1965, the Regional Director for Region 2 issued ,,t Deci-
sion and Direction of Election in this case in which he directed an elec-
tion in a -unit of food service employees of the Employer at New York
Medical College, Flower and Fifth Avenue Hospital, referred to
herein as the Hospital. Thereafter, in accordance with the National
Labor Relations Board Rules and Regulations, Series 8, as amended,
the Employer filed a request for review of said Decision and Direction
of Election on the ground, inter ilia, that the Regional Director's
assertion of jurisdiction over the Employer constitutes a departure
from established Board precedent. The Petitioner filed opposition to
the request for review. The Board, by telegraphic order dated
June 30, 1065, granted the request for review and stayed the election
pending decision on review. Thereafter, the parties filed briefs on
review.
Pursuant to the provisions of Section 3(b) of the National Labor
Relations Act, as amended, the Board has delegated its powers in con-
nection with this case to a three -member panel [Chairman McCulloch
and Members Fanning and Jenkins].
The Board has considered the entire record in this case with respect
to the Regional Director's determination under review, including the
briefs of the parties , and makes the following findings:
The Hospital, a voluntary nonprofit institution, is a New York cor-
poration exempt from the Board 's jurisdiction pursuant to Section
2(2) of the Act. It provides patient care, medical education, and
research. Prior to January 1, 1962, the Hospital operated its own food
service facilities, consisting of a kitchen for the feeding of patients, a
cafeteria for its employees, a coffeeshop for hospital visitors, and a
faculty dining room. The Employer, a New York corporation engaged
in the preparation and retail sale of food, entered into a 10-year con-
tract with the Hospital, effective January 1, 1962, in which it under-
took to operate all food service facilities for the Hospital. Approxi-
mately 60 percent of the Employer's revenue from such operations is
derived from patient feeding, 20 percent from the cafeteria and vend-
ing machines, 15 percent from the coffeeshop, and 5 percent from
catering.
The Employer's contract provides that it is to use the existing kitchen
facilities for the preparation of meals for patients, but must replace
154 NLRB No. 129.
THE HORN & HARDART COMPANY 1369
worn out equipment and purchase all additional capital equipment
and supplies at its own expense. The preparation and nutritive con-
tents of the patients' food are subject to the approval of Hospital dieti-
cians, and the contract sets forth certain minimum standards as to the
quality of food and the variety of menus that must be offered to the
various classes of patients. In practice, the Hospital's chief dietician
and staff prepare all menus and decide the times at which food should
be served to patients. Kitchen facilities for patient feeding are kept
open 24 hours a day, 7 days a week. The annual contract price the
Hospital pays the Employer for patients' meals, subject to adjustment
and renegotiation, is $415,000, the money for which comes directly out
of the Hospital's general funds.
Under the contract, the Employer agreed to remodel the cafeteria
and replace the preparation and serving equipment, as needed; make
available there "an attractive selection of foods"; and operate it "solely
for its (the Employer's) account." A list of prices to be charged in
the cafeteria was attached to the contract and changes therefrom are
subject to the Hospital's consent.
The Employer operates the coffeeshop with the equipment previously
used by the Hospital, subject to the same contractual provisions with
regard to the replacement and purchase of equipment as apply to the
patient feeding operation. The Hospital, however, has painted the
coffeeshop and installed a new floor at its own expense. Prices charged
are discretionary with the Employer, but it is required to pay 5 percent
of gross receipts to the Hospital. Food service for the faculty dining
room is provided by the coffeeshop operation. In addition, the
Employer has the right to install vending machines on the prem-
ises, subject to the hospital's approval as to location and payment
to it of 6 percent of gross receipts from all machines except those
located in the cafeteria area. Payments received by the Hospital, as
its percentage of gross receipts from the coffeeshop and vending ma-
chines, are credited to its general operating funds. The Employer
also provides a catering service which delivers lunches to doctors'
offices and caters luncheons and dinners given by various medical
groups at the Hospital.
The contract gives the Employer the right to hire such employees as
it deems necessary and to determine their rates of pay. At the con-
tract's inception, most of the food service employees previously on the
Hospital's payroll were hired by the Employer and those not hired
were given other jobs by the Hospital. Since that time, replacements,
as needed, have been hired through the Employer's central personnel
office, although many of them were initially recommended by Hospital
1370 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
employees. Discharge, discipline, and other labor relations matters are
primarily the responsibility of the Employer. However, the employ-
ees in the performance of their duties are subject to direction by mem-
bers of the Hospital's supervisory staff and are required to comply
with Hospital sanitation and clothing regulations. Complaints and
resulting disciplinary action which are initiated by Hospital personnel
are channeled through the Employer's manager.
The various hours during which each of the food service facilities
must be in operation each day are specified in the contract. Because of
the needs of the patients, the kitchen used for preparation of their
meals is, as above stated, kept open 24 hours a day, 7 days ,% week. The
cafeteria, also a 7-,lay operation, is for the exclusive use of Hospital
employees and a sign on display there sets forth this restriction. The
Hospital pays the Employer for cafeteria food eaten by resident doc-
tors, senior medical students, and certain technicians, as the Hospital
has agreements with such persons to furnish their meals. The coffee-
shop is maintained for the use of Hospital visitors and, although cus-
tomer restrictions are not enforced, the general public is neither invited
nor solicited, and there was no evidence that they, in fact, give it any
patronage.
The contract provides that the Employer's books and records per-
taining to the entire operation must be subject to inspection and audit
by the Hospital at all reasonable times. In addition, the Employer is
required to maintain, at its own cost, liability and workmen's compen-
sation insurance policies in which the Hospital is named as an assured.
Other contractual terms obligate the Hospital to provide, without cost
to the Employer, all heat, power, gas, garbage removal, and local tele-
phone service used in the operation of the patient feeding kitchen, the
cafeteria, and the coffeeshop.
We conclude, upon the foregoing, that the food service operations
performed by the Employer under its contract with the Hospital are
incidental to and intimately connected with the patient care and medi-
cal education purposes of the Hospital. In view of the close relation-
ship found to exist between the Employer's operations here involved
and the activities of the Hospital, and as the latter is exempt from the
Board's jurisdiction, we find, contrary to the Regional Director, that
it will not effectuate the purposes of the Act to assert jurisdiction in
this case.' Accordingly, we shall dismiss the petition.
[The Board dismissed the petition.]
'Cf. Crotty Brothers , N Y., Inc., 146 NLRB 755; The Prophet Co , 150 NLRB 1559;
University of Miami, Institute of Marine Science Dmisaon , 146 NLRB 1448, 1450.