The News-Journal Co.

National Labor Relations Board - Board Decisions

Jan 21, 1970

180 N.L.R.B. 864 (N.L.R.B. 1970)

864 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The News-Journal Company ' and Newspaper Guild
of Greater Philadelphia, American Newspaper
Guild, AFL-CIO, Petitioner . Case 4-RC-8171
January 21, 1970
DECISION AND DIRECTION OF
ELECTION
BY CHAIRMAN MCCULLOCH AND MEMBERS
FANNING AND JENKINS
Upon a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held before Gordon L. Fine, Hearing
Officer. Following the hearing and pursuant to
Section 102.67 of the National Labor Relations
Board Rules and Regulations and Statements of
Procedure, Series 8, as amended, and by direction of
the Regional Director for Region 4, this case was
transferred to the National Labor Relations Board
for decision. Both the Employer and the Petitioner
filed briefs.
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 case to a
three-member panel.
The Board has reviewed the Hearing Officer's
rulings made at the hearing and finds no prejudicial
error. The rulings are hereby affirmed.
Upon the entire record in this case, the Board
finds:
1. The News-Journal Company is a Delaware
corporation engaged in the business of publishing
and distributing newspapers in and around
Wilmington, Delaware. The dollar volume of sales
from its facilities in Wilmington directly to
customers outside the State of Delaware exceeds
$50,000 annually. The dollar volume of purchases
from outside the State of Delaware exceeds $50,000
annually. The parties stipulated, and we find, that
the Employer is engaged in commerce within the
meaning of the Act, and that it will effectuate the
policies 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 representation of certain employees
of the Employer within the meaning of Sections
9(c)(I) and 2(6) and (7) of the Act.
4. The Petitioner seeks a unit of 21 newspaper
deliverers who are engaged in the bulk distribution
of the Employer's newspapers. The Employer
contends that the petition should be dismissed
because the deliverers are not, within the meaning of
Section 2(3) of the Act, employees, but rather are
independent contractors.'
The name of the Employer appears as amended at the hearing.
180 NLRB No. 137
The News-Journal Company, hereinafter called
the _ Company or the Employer, publishes two
newspapers, the Morning News, hereinafter called
the News, and the Evening Journal, hereinafter
called the Journal. The distribution and sale of the
newspapers is performed under the direction of the
circulation department, which also includes the
mailroom. It is here that the papers are counted,
sorted into bundles, and labeled according to a
prearranged order for delivery by the 21 deliverers
to the Company's carrier boys and motor route
operators, who deliver the papers to the ultimate
purchaser.
In the early 1960's, the Company began to phase
out the independent trucking companies which,
under contract, were supplying their own trucks and
drivers and delivering the paper bundles from the
plant. At about this time, the Company also
automated its mailroom, thus necessitating the
layoff of a substantial number of mailroom
employees. To nine of these employees, the
Company offered contracts which constitute
agreements under which these men supply their own
trucks and deliver the paper bundles from the
Company plant to such addresses as may from time
to time be designated by the Company along routes
in specified territories. In return for this service, the
contracts provide for weekly payment by the
Company of a fixed sum of money for such delivery
of each edition of the paper. These individuals
purchased their own trucks and now perform the
same delivery function formerly performed by the
truckdrivers of the independent trucking companies.
New drivers have also been taken on, and now there
are 21 deliverers. However, only 18 written
contracts were submitted in evidence. The testimony
indicates that the three missing contracts were not
found in a search of the Company files. It is not
clear whether the contracts were simply lost or were
never executed in the first place. The three deliverers
without contracts allegedly operate under
understandings generally similar in terms to the
written contracts. One such driver, however,
additionally services honor vending boxes owned by
the Company.
In addition to the provisions as to route territories
to be serviced, the remuneration therefor, and the
furnishing of operating equipment at the deliverer's
expense, the contracts expressly provide that the
deliverer shall transport and deliver the papers daily,
regularly, and promptly, and shall exercise due
diligence to protect the papers from damage from
handling or the elements; that the deliverer shall
make such transportation and delivery of papers at
his own risk and expense and according to his own
discretion, means , and methods of control, which
shall not be subject to the control or supervision of
the Company; that the contractor-driver shall not be
"'Sec. 2 When used in this Act - (3) the term 'employee' . . shall
not include any individual having the status of an independent
contractor . "
THE NEWS-JOURNAL CO.
considered an agent, servant, or employee of the
Company, it being expressly agreed that the driver
shall have the status of an independent contractor
and shall control the ways and means of performing
his several obligations under the contract; that the
driver shall hold the Employer harmless for any
damage arising out of his performance; that the
contract shall continue in effect until terminated
upon proper notice by either party, as provided
therein; that the contract may also be terminated
without notice by the Company at any time upon
breach by the driver of any of the provisions; and
that the contract contains the entire agreement
between the parties and its terms shall not be
changed, modified, altered, or supplemented except
in writing signed by the parties.
The distribution function of the Employer is
organized in the following manner . Each deliverer is
assigned a route or routes for the delivery of one or
more editions of either the News or the Journal or
both. When a route-territory becomes available
because a deliverer has quit or the distribution
territories are reorganized, the distribution manager,
who organizes the routes, may either put up the the
route for bids or may ask a driver whether he would
like to take over another route. In the former case,
the route is posted for bids on the bulletin board of
the mailroom and the drivers and their
acquaintances then bid on it. The available route is
not publicly advertised. The distribution manager
and his superiors then determine which bid to
accept, having considered the bidders' equipment
and their employment histories. The lowest bid is
not always accepted. A contract is signed describing
the route to be serviced and stating the agreed-upon
price. When a route is not put up for bids, the price
will be fixed by agreement between the Employer
and a selected deliverer. Thereafter, however, the
route-territory may be added to, split up, or
consolidated with another route, and with most
routes this has been done . In these cases, the
driver' s oral agreement to the reorganized route and
to any adjustment in compensation is secured, but
no new contract , as such, is drawn up and signed.
Rather, the route changes are noted on the driver's
route description record in the mailroom and his
rate of compensation is adjusted on the financial
records of the Company. When such route-territory
changes are necessary because of changed
conditions, they are initiated by the distribution
manager , but such changes have also been made at
the request of drivers for their own accommodation.
Having his route assignment , the deliverer is
required to report to the loading dock at least 15
minutes before his edition is due; if the edition is
late, he may wait another half hour before he can
start loading. The mailroom bundles his papers and
sends them down a chute in a prearranged and
labeled drop-spot sequence according to the driver's
route description. The deliverer loads his paper
bundles and proceeds to drop them off at the
865
prearranged spots for the carrier boys and motor
route operators to pick them up. The deliverer is
free to drop them off out of sequence, if he so
desires, but time limitations must be met. The driver
must be careful not to damage the bundles in
dropping them off and, to make them salable, must
deliver them promptly. These delivery services are
performed without on-the-spot Employer supervision
of the driver. However, if bundles are improperly
dropped off, damaged, in the wrong spot, or out of
order, the district managers who supervise the
carrier boys and motor route operators talk to the
deliverers about it, if necessary report them to the
distribution manager, and may even effectively
recommend the termination of the deliverers, if the
latter do not cooperate. The record shows that a
district manager effectively recommended the
termination of an uncooperative driver.
Drop spots are frequently changed and bundles
are split or consolidated depending on the needs of
the carrier boys and motor route operators. Such
drop-spot changes are initiated by the district
managers, who issue change orders which are
approved by their supervisors and are relayed via
the mailroom to the deliverers, who effectuate the
drop-spot changes. Such drop changes and the split
or consolidation of deliverers' routes may, and
frequently do, increase or decrease a deliverer's
route mileage, number of papers, bundles, drop
spots, and route service time. Since a deliverer's
compensation is based on these factors, they may
and have resulted in additional compensation, if
such increases are substantial. However, as noted
below, this does not always follow.
Because of this procedure, the contract provisions
relating to compensation and the delivery routes are,
in most cases, not current and are incorrectly stated
in the contracts. For instance, driver Bayne's
contract provides for compensation of $75 per week
and delivery of 1 route in a certain area, whereas he
actually receives $210 per week and delivers 2 routes
in an entirely different area. This situation and
practice is contrary to the contract provision
requiring all contract changes to be in writing signed
by the parties. Moreover, the Employer has
occasionally made substantial increases in the loads
and route coverage of some of the deliverers without
effecting corresponding changes in their rates of
compensation. For instance, in one case a net total
of 800 papers was added to a deliverer's load, and in
another, three drop spots and accompanying paper
loads were added on, increasing the route mileage
by about 5 miles; in both instances , the deliverers
were not paid any additional compensation.
Normally, the Employer does not reimburse the
drivers for their expenses; however, the Employer
does pay an annual license fee of $22 for four
drivers in the town of Elsmere, apparently without
reimbursement by the drivers. The Employer
maintains no personnel records, as such, on the
drivers. For some special tasks, such as delivery of
866 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
mailbags to post offices, the drivers receive special
compensation; for others, such as delivery of stakes
and tubes, they do not. The total amount of time
spent by each driver in performing Company
deliveries in most cases adds up to a greater portion
of a full work day. However, a number of the
drivers have at one time or another operated sales
or distribution routes for other items, ranging from
trash to bakery products. It appears that a majority
of the drivers have no regular source of income
other than the Employer's delivery routes.
The Petitioner contends that the deliverers are not
independent contractors, as provided by the
contracts, but rather are employees of the Company,
because the Company controls the manner and
means by which they do their work, within the
meaning of the Board's "right of control" test.3
Petitioner points to the fact that the Employer may
reorganize the deliverers' routes at will, as noted
above, has sometimes done so without
commensurate compensation, and exercises
supervision over them through the district managers'
drop spot change orders and instructions as to
proper delivery of the paper bundles. Moreover, the
Petitioner contends, the timing of the delivery of the
various editions to insure their salability necessitates
close integration of function, and supervision is
necessarily required to keep the distribution process
properly operating. The deliverers have no
proprietary interest in their routes and hence cannot
sell or assign them. The fact that the deliverers own
their trucks, hire their own temporary replacements,
and may use their trucks in any manner they see fit
during off hours are, according to the Petitioner, not
controlling factors in the determination as to
whether they are employees within the meaning of
the Act.
The Employer contends, to the contrary, that
preponderance of the record evidence shows that the
deliverers are independent contractors, rather than
employees, because the Company lacks control over
the manner and means by which the deliverers
perform their jobs. The following factors are cited in
support of its position: the present function and
method of operation of the deliverers is the same as
that of their predecessors, the trucking companies;
the contract provisions specifically define the status
of the deliverers as that of independent contractors,
exclude the Company from control of the ways and
means of performance, impose costs and expenses of
operation exclusively on the deliverers, and indicate
that the Company's sole interest is in the result of
performance; the deliverer is free to make changes
in the prearranged sequence of delivery of the
drop-spot bundles and, to that extent, in his route;
there is no direct supervision of the deliverers by the
Company; deliverers may take on other business
provided it does not interfere with their servicing of
their routes; special tasks, such as the delivery of
'San Antonio Light Division . 174 NLRB No. 97
mail bags to the post office, are specially
compensated by prior agreement; a deliverer's net
compensation is the difference between the fixed
contract compensation for services paid by the
Company and the costs of doing business, almost
none of which are subject to reimbursement by the
Company; deliverers determine for themselves
whether to hire helpers or substitutes, and when
their holidays and vacations shall be; the Company,
with a minor exception, as noted above, does not
maintain personnel records of the deliverers for fee
or tax purposes or cover such expenses; and
deliverers are not required to display Company signs
or identification on their vehicles unless they want
to, and in such cases are specially compensated for
advertising by a supplemental contract.
As to the variations in the terms of the contracts,
the Employer contends, the parties have a right
mutually to accomplish any change they wish,
despite the express provisions requiring that all
amendments be in writing, and the orally agreed
changes in routes and compensation are effective
modifications and cannot be' taken to abrogate the
basic contracts themselves. As to the practice of
frequently ordering changes in the drop spots and
contents of the drop bundles, this is a condition of
the newspaper distributing business, and, as such, is
provided for by the terms of the deliverers'
contracts, which obligate them to deliver to such
places as may from time to time be designated by
the Employer. And the fact that changes are not
accomplished directly by the district managers, but
through written orders of the managers approved by
the distribution manager and transmitted by the
mailroom at pickup time to the deliverers, shows,
according to the Employer, that there is no direct
supervision of the drivers. The Employer also
contends that such changes do not in any manner
constitute control of the ways and means of
performing the job, but affect merely the result. The
evidence further establishes, the Employer notes,
that the contracts provide that the deliverers shall
save the Company harmless from liability for any
damage resulting from the deliverers' performance
under the contracts, but they do not require the
deliverers to carry liability insurance. Lastly, the
evidence shows that the actual route time of the
deliverers, in practically every instance, does not add
up to a full workday, so that there remains
opportunity for the deliverers to perform outside
jobs, and many of them do.
Thus, the question arises whether the deliverer has
stepped into the shoes of the predecessor trucking
company as entrepreneur, or whether the
entrepreneur has been eliminated. The answer to this
question depends on whether it may be said that the
deliverers work for wages with the right of control
over performance of their jobs reserved to the
Employer, or whether, like independent contractors,
they undertake the job for a price, decide how the
work will be done, exercise their own discretion in
THE NEWS-JOURNAL CO. 867
performing the work, and depend for their income
not upon wages, but upon profits. We believe that
the relationship between the Company and the
drivers is properly characterized as one of employer
and employee, as that relationship is described in
Pure Seal Dairv Co., 135 NLRB 76, 79:
Where the person for whom the services are
performed retains the right to control the manner
and means by which the result is to be
accomplished, the relationship is one of
employment. On the other hand, where control is
reserved only as to the result sought, the
relationship is that of independent contractor. The
resolution of this question depends upon the facts
of each case and no one factor is determinative.
The services rendered almost exclusively consist of
the routine manual work of loading and driving
trucks over agreed-upon routes and dropping off
bundles of newspapers properly and in a
prearranged sequence or order at designated drop
spots. The possibility of realizing any meaningful
added profit by changing the established method of
operation appears to be very limited. While the
deliverers own their trucks and have the added
responsibility of maintaining them in good
operational condition, the ownership and
maintenance of the vehicle alone is not a controlling
factor in a determination of this type.4 The
deliverers retain practically no independence in their
operations; they cannot decide when or whether they
will go out on an assigned route; they cannot fix the
time of delivery; and they cannot determine that
others should drive their vehicles, except in cases of
illness, vacation, or excusable absence, when they
provide and pay for their own substitutes. Although
they may hire and pay for additional helpers, the
record does not show that such helpers are hired on
any regular basis.'
Thus, the express provisions of the contracts
purporting to create independent contractor
relationship notwithstanding (and we note that there
do not even appear to be any written contracts for
three of the drivers), the practice of the parties
'San Antonio Light Division, The Hearst Corporation. 174 NLRB No.
97, San Antonio Light Division, The Hearst Corporation, 167 NLRB No.
99, and Frito Lay inc., 167 NLRB No. 11.
'One of the deliverers , Wilson, also services paper vending machines, for
which purpose he hires a helper . This service is specially compensated
shows that the deliverers do not act as independent
contractors. The territories and drop spots are
predetermined by the distribution and district
managers. All that remains to be done is the
physical work of loading, truckdriving, and dropping
off the paper bundles. There is no room for the
exercise of true discretion in the performance of the
work. The drop spots are changed, without
consultation, by written orders of the district
manager which are relayed to the deliverers by the
mailroom at pickup time. The deliverers may not
receive added compensation for some of these
changes. The district managers tell the deliverers
how to properly drop off their bundles and rely on
the distribution manager for further corrective and
disciplinary measures. There is necessarily close
supervision of the deliverers to insure proper and
timely delivery of the paper to the ultimate
subscriber.
Upon the entire record, we find that the News
Journal Company has in practice reserved to itself
the right to control the basic manner and means, as
well as the result, of the deliverers' work. We thus
find that the deliverers are not independent
contractors, but employees of the Company within
the meaning of the Act.
Accordingly, we find that a unit of the following
employees is appropriate for purposes of collective
bargaining within the meaning of Section 9(b) of the
Act:
All newspaper deliverers employed in the
circulation department of the Employer's
Wilmington, Delaware, newspaper business,
excluding all other employees, and all supervisors
as defined in the Act.
[Direction of Election6 omitted from publication.]
'in order to assure that all eligible voters may have the opportunity to
be informed of the issues in the exercise of their statutory right to vote, all
parties to the election should have access to a list of voters and their
addresses which may be used to communicate with them Excelsior
Underwear Inc 156 NLRB 1236; N L R. B. v. Wyman-Gordon Company,
394 U.S. 759. Accordingly , it is hereby directed that an election eligibility
list, containing the names and addresses of all the eligible voters, must be
filed by the Employer with the Regional Director for Region 4 within 7
days of the date of this Decision and Direction of Election The Regional
Director shall make the list available to all parties to the election No
extension of time to file this list shall be granted by the Regional Director
except in extraordinary circumstances Failure to comply with this
requirement shall be grounds for setting aside the election whenever proper
objections are filed