Mitchell Bros. Truck Lines

476 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Mitchell Bros. Truck Lines and John D. Buchanan, Petitioner and Joint Council of Teamsters Local Union No. 37, Teamsters Local Union Nos. 162 and 962, International Brotherhood of Team- sters, Chauffeurs, Warehousemen & Helpers of America, Union. Cases 36-RD-624 and 36- RD-700 May 14, 1980 DECISION AND DIRECTION OF ELECTION BY CHAIRMAN FANNING AND MEMBERS JENKINS AND TRUESDALE On August 24, 1978, pursuant to Section 9(c) of the National Labor Relations Act, as amended, a petition was filed in Case 36-CD-624. On Septem- ber 14, 1978, the Regional Director for Region 19 dismissed this petition without a hearing because he found that the petitioned-for bargaining unit was currently covered by a "valid, collective bargain- ing agreement containing substantial terms and conditions of employment, and as the effective dates of said collective bargaining agreement are from November 1, 1976 to October 31, 1979, a question concerning representation cannot be raised at this time." On September 22, 1978, in accordance with the Board's Rules and Regulations, the Petitioner filed a request for review of the Regional Director's de- cision. By order of December 27, 1978, the Deputy Executive Secretary of the Board notified the par- ties that the Board had concluded that the petition raised issues which could best be resolved at a hearing. Accordingly, the petition was reinstated, and the case was remanded to the Regional Direc- tor for hearing, thereafter to be transferred to the Board for decision. Commencing March 5, 1979, a hearing was held for 4 days in Portland, Oregon, before Hearing Of- ficer B. Allan Benson. Following the issuance of the Hearing Officer's report on March 9, 1979, the case was transferred to the Board. Thereafter, the Petitioner, the Employer, and the Intervenor Union filed briefs. On August 24, 1979, the Petitioner herein filed another petition in Case 36-RD-700 for the same unit. By order of September 13, 1979, the Regional Director for Region 19 transferred this case to the Board because of the similarity of issues in the two cases. The Petitioner thereafter filed a brief with respect to the transfer. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its au- thority in this proceeding to a three-member panel. 249 NLRB No. 51 The Board has reviewed the Hearing Officer's rulings made at the hearing and finds that they are free from prejudicial error. They are hereby af- firmed. Upon the entire record in this proceeding, the Board finds: 1. The Employer is engaged in commerce within the meaning of the Act, and it will effectuate the purposes of the Act to assert jurisdiction herein. 2. The Intervenor, Joint Council of Teamsters Local Union No. 37, Teamsters Local Union Nos. 162 and 962, International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of America, herein called IBT or Union, is a labor or- ganization within the meaning of the Act. 3. As stated earlier, the Regional Director found in Case 36-RD-624 that the petition was barred by a collective-bargaining agreement which became effective November 1, 1976, and expired on Octo- ber 31, 1979. The Board ordered a hearing on that issue, and on the status of the truckdrivers and the appropriate unit. Following the hearing, this case was transferred to the Board in Washington, D.C. While this case was pending before the Board, the Petitioner's second petition was filed on August 24, 1979. This petition was filed within the 90-60-day open period, since the contract which has been claimed as a bar expired on October 31, 1979. As this petition is timely, the issue as to whether the collective-bargaining agreement was a bar to the earlier petition is now moot. Contentions of the Parties The Petitioner and the Employer contend that the owner-operator drivers who lease their equip- ment to the Employer are independent contractors, not employees as defined in Section 2(3) of the Act, and for that reason should be excluded from any unit found appropriate. The Intervenor Union contends that the owner-operators are employees within the meaning of the Act. It further claims that the Board should defer to an arbitration award of May 31, 1978, in which an arbitrator upheld the Union's position and found that the owner-opera- tors were employees within the meaning of the Act. On the issue of an appropriate unit, the Petition- er and the Intervenor Union contend that any unit should include both the admitted employees and the owner-operators, if they are found to be em- ployees. The Employer, on the other hand, con- tends that the employee drivers and owner-opera- tors each have a separate community of interest, and that therefore each grouping should be found to constitute a separate appropriate bargaining unit. MITCHELL ROS. TRUCK IINES 477 FINDINGS OF FACT The record in the instant case reveals that the nature of the employment relationship between the Employer and the owner-operators as well as the admitted employees' is one largely dictated by a complex matrix of state and Federal regulations, promulgated by the States in which Mitchell Bros. has its primary transport operations 2 and by var- ious agencies of the Federal government, including the Federal Highway Administration (FHA), the Interstate Commerce Commission (ICC), and the Department of Transportation (DOT). The detailed and comprehensive regulations apply to every aspect of the employment relationship, including qualifications for drivers (both at the hiring stage and during the employment relationship), leasing agreements, safety and operational standards for motor vehicles, and restrictions on how and where the vehicles may be operated. The most important regulations, 49 CFR sections 390-397, are con- tained in the Federal Motor Carrier Safety Regula- tions Pocketbook which is published by DOT and FHA. The pocketbook is approximately 280 pages, single spaced, and, as its name suggests, is a small book approximately 5-1/2 inches long and 4 inches wide. Each driver has, until recently, received a copy at the time of hiring.3 Also, Mitchell Bros. in- dependently has established some conditions of em- ployment for the drivers. An individual who wishes to drive for Mitchell Bros., either by leasing equipment to Mitchell or by operating the Employer's equipment, must meet the Federal standards enumerated in 49 CFR sec- tion 391, Qualifications of Drivers. Under 49 CFR section 391.11, an applicant must, among other things, be at least 21 years old, speak conversation- al English, know how to drive a truck and secure the freight, have a valid operator's license, and file an application with the carrier. The application shows the applicant's employment history for the past 3 years, the applicant's accident record for the past 3 years, and traffic citations received in the past 3 years. Mitchell Bros. also administers a road test and a written examination for each driver ap- plicant. It will then certify to the DOT that each driver applicant has successfully completed the written test or its equivalent. Finally, each driver I Mitchell Bros. employs 21 drivers who it admits are employees within the meaning of the Act There are approximately 200 owner-oper- ators, of whom approximately 5 own more than I truck Where Mitchell Bros. treats admitted employees differently from owner-operators, the procedures applied to employees will be set out in a footnote. 2 Under authority granted by the Interstate Commerce Commission. Mitchell Bros has established its primary transport operations in 11 west- ern States and British Columbia The boundaries of this area stretch from British Columbia through southern California. east to the eastern border of Colorado I See fn. 4, infra. must undergo a medical examination, and obtain a medical examiner's certificate which must be re- newed every 2 years. In addition to the regulatory prerequisites, Mitchell Bros. has required all drivers to attend an orientation program before Mitchell Bros. will sign a lease agreement with the owner-operator. 4 The orientation program educates the driver with re- spect to the safety and personnel requirements of the pocketbook, as well as internal business proce- dures of Mitchell Bros. For example, the program deals with procedures for trip leasing and interlin- ing, telephone usage in order to obtain shipment and to report in on a daily basis, accident reports, vehicle safety inspection, securing loads, prepara- tion of trip cards, shipping orders, various bills of lading, the DOT-required monthly p.m. report, and daily vehicle condition report and driver's daily log. While many of the subjects deal with pocket- book regulations, items like telephone usage and preparation of trip cards and shipping forms are on the agenda in order to inform the prospective driver of company procedure. Each driver-partici- pant signs an acknowledgment that he has received information about the various subjects "as part of drivers pre-lease fitness and qualification require- ments." The acknowledgment is also signed by the instructor. Assuming that the driver and his equipment meet the requirements set forth in the pocketbook, and that the driver has satisfactorily completed the ori- entation program, the parties may then execute the Equipment Lease Agreement. 5 While Government regulations specify certain subjects which the lease agreement must cover, the specifics of the agree- ment are unilaterally set by Mitchell Bros., the drafter of the agreement. The lease agreement is in writing and for a term of 30 days, to be continued "thereafter until can- celled by either party giving ten days' written notice to the other." Under the agreement, Mitch- ell Bros. compensates its owner-operators on the basis of a percentage of the revenues from the haul.6 That percentage is 65, 70, 75, or 90, depend- ing on the geographic location of the trip, and the kind and amount of equipment furnished by the 4 The program was made nonmandatory the week before the hearing, and the Company no longer gives out the same orientation packet. It ap- pears that most of the drivers under lease agreement at the time of the hearing had attended the program. ' No such agreement is required of the employee drivers, since their equipment is furnished by Mitchell Bros. 0 Employee drivers are compensated in a different manner If the trip is longer than (X) miles, a driver is paid on a mileage basis plus an hourly rate. If the trip is less than 100 miles he is paid by the hour An employee driver also receives overtime, holiday, and vacation pay, and cost-of- living increases MITCHELL BROS. TRUCK LINES 477 478 DECISIONS OF NATIONAL LABOR RELATIONS BOARD owner-operator. 7 Mitchell Bros. determines what percentage will be appropriate, based on the partic- ular location in which the driver hauls and the kind and amount of equipment offered by the owner-op- erator. Under the agreement, the owner-operator may not trip lease or provide interline service unless he has Mitchell Bros.' express approval. 8 Mitchell Bros. also requires the owner-operator to carry public liability, property damage, and cargo insur- ance on each leased vehicle, whether the vehicle is being operated under Mitchell Bros.' control or not. Fire, theft, collision, and comprehensive insur- ance is also required, and Mitchell Bros. is named on the policies as an "additional insured." The lease agreement gives the owner-operator the first right to select a driver. Mitchell Bros. re- serves the right, however, to reject any driver if he does not meet the qualifications of the various reg- ulatory agencies. In all matters concerning condi- tions and maintenance of equipment, and perform- ance of the hauling, the agreement requires compli- ance with the regulations. Thus, for example, the owner-operator agrees that Mitchell Bros. has the right to inspect his equipment "before the start of any trip and at any place necessary enroute." The owner-operator must also display identification which shows that the truck is being operated by Mitchell Bros. Finally, the agreement provides that if Mitchell Bros. makes any payments for which the owner- operator is responsible, and incurs expense in so doing, Mitchell Bros. may deduct the payments and any expenses from the owner-operator's com- pensation. The drivers at issue here own their own trucks, and were solely responsible for the purchase of them. Mitchell Bros. requires a flatbed truck which meets Federal specifications and standards. The Federal standards are both comprehensive and ex- tremely specific. The drivers are responsible for I It appears that while the lease agreement contains only one fixed per- centage arrangement for the contract term, Mitchell Bros. will adjust the percentage arrangement if the owner-operator accepts hauls in other lo- cations. A "trip lease" is an agreement between two certificated motor carri- ers under which a motor carrier with empty equipment and no ICC au- thority for a given geographical area ("lessor") places its equipment in the possession of another motor carrier with ICC authority in the same geographical area ("lessee"). An "interchange" or "interline" agreement is a contract between two certificated motor carriers to cover transporta- tion requiring the joiner of operating authorities of the two nonrelated carriers because neither carrier's authority in and of itself is extensive enough to complete the haul. While the Federal regulations require that these agreements be between carriers, it does not require a carrier to have the absolute right, as Mitchell Bros. does, to refuse permission for these kinds of subleasing arrangements. This provision seems therefore to go beyond the regulations. To the extent it imbues Mitchell Bros. with additional authority, it conflicts with sec. 5 of the lease which states that Mitchell Bros, will not exercise any control over the vehicles which is not required by law. maintenance and repair of their trucks.9 Mitchell Bros. does not schedule the drivers; the drivers set their own schedule. 0 Once the lease is signed, the drivers begin haul- ing freight for Mitchell Bros. They haul exclusive- ly for Mitchell Bros., except when Mitchell Bros. contracts with another carrier for a trip lease or in- terline. Neither activity occurs frequently. The drivers call the Mitchell Bros. dispatcher who offers them assignments. An owner-operator is free to reject assignments, but if he does his name moves to the bottom of the assignment list." In the past, Mitchell Bros. has also kept a weekly record of how many times a driver has refused as- signments, and his reason. That practice was dis- continued in September 1978. Drivers receive com- pany credit cards for gas purchase, and they may purchase gas at a Mitchell Bros. terminal. They re- ceive a fuel discount at the terminal when they are hauling for Mitchell Bros. and they may park at the terminal without paying a fee. Drivers must abide by the rules and regulations in the pocketbook. The pocketbook requires that the drivers secure loads properly, and abide by a series of safety regulations, including speed limits and absolute restrictions on the number of hours they may drive in a 24-hour period. Under these rules, drivers file trip reports so that Mitchell Bros. can keep track of their mileage and time. In addi- tion, their trucks are regularly inspected by Mitch- ell Bros. 12 If a truck does not comply with pocket- book safety regulation, it may not be driven. The pocketbook provides that a driver may not drive for Mitchell Bros. if he is ill, fatigued, or under the influence of drugs or alcohol such that his ability to operate a truck is affected. Drivers are also required to wear corrective lenses' 3 and hearing aids if necessary to comply with the Feder- al Government's physical fitness requirements. There are also prohibitions against carrying unau- thorized passengers or allowing unauthorized per- sons to drive the truck. 9 Mitchell Bros. owns and maintains the trucks driven by its employ- ees. 0'° By contrast, the admitted employees must work a set schedule. 1 Employee drivers may not reject assignments. 12 In April 1977, Mitchell Bros. signed a settlement agreement with the FHA in which it agreed that, in addition to complying with the Fed- eral regulations, it would inspect the trucks every 30 days, keep better records, and make sure that drivers were physically qualified under the regulations. In particular, Mitchell Bros, agreed to maintain the position of safety director. The director's job is to insure compliance with the reg- ulations and to report to the president on such matters as "Driver's ac- tions while in control of a motor vehicle owned or operated by or on behalf of the CARRIER," and "Maintenance and condition of vehicles owned or operated by the carrier." (Emphasis in original.) This agree- ment was in effect until December 1977. In January 1978 Mitchell Bros. was audited again and found in compliance with Federal regulations. It still retains a safety director. 13 If a driver wears contact lenses he must carry a spare set of lenses. MITCHELL BROS. TRUCK LINES 479 Mitchell Bros. solicits customers and takes care of most of the attendant paperwork for the owner- operators. Mitchell Bros. bears the risk of nonpay- ment by the customer. It signs the contract for shipment of the freight, bills the customer, receives customer payments, and handles complaints. It also arranges both for insurance coverage under an um- brella policy which it holds for itself and the driv- ers, and for all permits, licenses or franchises neces- sary for hauling. It does not charge the owner-op- erators for these services. Mitchell Bros. pays the drivers twice a month. At that time it presents them with a settlement sheet which is a statement of the gross revenues from the drivers' hauls minus any expenses incurred. In addition, it sometimes ad- vances a driver cash prior to settlement. Mitchell Bros. deducts the cost of fuel purchased either at Mitchell Bros.' terminals or with credit cards fur- nished by the Company and billed to the Compa- ny, and any cash advances. It deducts any permit and licensing fees, certain taxes which Mitchell Bros. pays on a fleetwide basis, insurance premi- ums, and workmen's compensation premiums, where authorized by the driver. It does not deduct any Federal taxes or social security payments. 4 It appears from the record that Mitchell Bros. does not give warnings or suspensions to owner- operators. It does, however, terminate their serv- ices for violations of certain rules. Operations Vice President Frank Pellisier testified that Mitchell Bros. had disqualified drivers in the past for carry- ing unauthorized passengers, and for moving a ve- hicle when the driver had already driven the number of hours permitted by law. He further stated that if any owner-operator "continues to vio- late the rules and regulations in this [the Federal Motor Carrier Safety Regulations Pocketbook], we would disqualify him as a driver at Mitchell Bros. Truck lines." In addition, under 47 CFR section 391.15, a driver must be disqualified if he has lost his privilege to drive his vehicle by virtue of the revocation, suspension, withdrawal, or denial of his operator's license, if he uses unlawful drugs, if he leaves the scene of an accident which resulted in personal injury or death, or if he commits a felony involving the use of a motor vehicle. Discussion As a threshold matter the Union argues that the Board should, under Spielberg Manufacturing Com- pany,15 defer to an arbitration award of May 31, 1978. In the award the arbitrator concluded that the owner-operators were employees, and that Mitchell Bros. had violated an existing collective- '4 These deductions are made for employee drivers '5 112 NLRB IO80(1955) bargaining agreement by failing to require owner- operators to maintain union membership, by refus- ing to withhold contributions, and by failing to make payments to the union health and welfare and pension trust accounts. In so holding, the arbitrator engaged in an extensive review of prior Board De- cisions. His decision was subsequently enforced by a Federal district counrt on the ground that the ar- bitrator had the authority to decide the issue of the owner-operators' status as a necessary predicate to resolving the issues raised by the collective-bar- gaining agreement.", The considerations for defer- ral by the Board, however, are somewhat different from those weighed by the court in enforcing an arbitration award. The Board has a longstanding policy that it does not normally defer to an arbitration award where questions of representation are involved. Here the collective-bargaining agreement has expired, and the only outstanding issues are whether the owner- operators are employees or independent contrac- tors, and what constitutes an appropriate unit if the owner-operators are found to be employees. These issues are exclusively ones involving representation, and the Board's expertise is particularly suited to the resolution of this kind of issue. On the other hand, the arbitrator's mandate is to interpret the collective-bargaining agreement, which, in the in- stant case, has expired. Accordingly, we will not defer to the arbitration award.1 7 We therefore turn to the status of the owner-operators and the appro- priate unit, if any. In N.L.R.B. v. United Insurance Company, supra, the Supreme Court, in affirming the Board's con- clusion that the insurance agents were employees, stated that "We should apply the common law agency test . . . in distinguishing an employee from an independent contractor.""' This test has subse- quently been applied by the Board and numerous courts.19 Under this test, it is the right to control, '^ General Teamsters. Auto Truck Drivers and Helpers Local 162 v. Mitchell Bras Truck Lines, 87 LC 11,681 (D.C. Ore. 1979). " Combustion Engineering. Inc., 195 NLRB 909. 910-911 (1972), and Hershey Foods Corporation, 208 NLRB 452. 456-457 (1974). We also note that. in finding the owner-operators to be employees, the arbitrator relied on NL.R.B. v. Hearst Publications, 322 U.S. 11 (1944). This case was ef- fectively overruled in N.L.R.B. v. United Insurance Company, 390 U.S. 254, 256 (1968), where the Supreme Court recognized the congressional mandate to apply the common-law tests of agency without regard to "economic and policy considerations within the labor field." '" 390 U.S. at 256. ', See, e.g., Ace Doran Hauling & Rigging Company, 191 NLRB 428 (1971), enforcement granted in part and denied in part, 462 F.2d 190 (1972); Pony Trucking. Inc., 198 NLRB 686 (1972), enfd. 486 F.2d 1039 (6th Cir. 1973). Deaton, Inc., 203 NLRB 1099 (1973), enfd. 502 F.2d 1221 (5th Cir. 1974); The Aetna Freight Lines. Incorporated, 209 NLRB 850 (1974), enfd. 520 F 2d 928 (6th Cir. 1975). Am-Del-Co, et al., 234 NLRB 1040 (1977), enforcement denied sub nom. Merchants Home Delivery Serv- ice, Inc.. 580 F.2d 966 (9th Cir 1978); Yellow Cab Company.., Inc, 229 NLRB 1329 (1977), enfd sub nom. Local 777, Democratic Union Organiz- Continued MITCHELL BROS. TRUCK LINES 479 480 DECISIONS OF NAIIONAL LABOR RELATIONS BOARD and not actual control or supervision, which is im- portant. The Board seeks to determine if the al- leged employing entity-here a common carrier- reserves the right to control the manner and means by which the result is accomplished, or whether it concerns itself with results only, leaving the manner and means to the driver. In making this de- termination there is "no shorthand formula or magic phrase"-the question is one of degree-and, "to find the answer" to whether employee status is negated because there is substantial independence from an employer's right to control, consideration must be given to "all of the incidents of the [work] relationship .... with no one factor being deci- sive." 2 0 Restatement of Agency 2d the Law has also listed a number of factors which should be considered. 21 In reviewing the evidence in the in- stant case, we have examined the entire working relationship, with the indicia of Restatement in mind. On the basis of this review, we have con- cluded that the drivers at issue here are employees. This conclusion rests in part on the intricate maze of Federal and state regulations which, in essence, dictate the terms of the employment relationship, and in part on additional factors, as discussed infra. Extensive Federal and state regulation has effec- tively obviated the need for common carriers to es- tablish their own personnel policies or operational ing Committee, Seafarers International Union of North America, AFL-CIO v. N.LR.., 603 F.2d 862 (D.C. Cir. 1978); A. Duie Pvle, Inc., 236 NLRB 1220 (1978), enforcement denied 606 F 2d 379 (3d Cir 1979). 20 390 U.S. at 258. 21 Restatement of Agency 2d, §220 (1958) provides: § 220. Definition of Servant (1) A servant is a person employed to perform services in the af- fairs of another and who with respect to the physical conduct in the performance of the services is subject to the other's control or right to control. (2) In determining whether one acting for another is a servant or an independent contractor, the following matters of fact, among others, are considered: (a) the extent of control which, by the agreement, the master may exercise over the details of the work; (b) whether or not the one employed is engaged in a distinct occu- pation or business; (c) the kind of occupation, with reference to whether, in the local- ity, the work is usually done under the direction of the employer or by a specialist without supervision; (d) the skill required in the particular occupation; (e) whether the employer or the workman supplies the instrumen- talities, tools, and the place of work for the person doing the work; (f) the length of time for which the person is employed; (g) the method of payment, whether by the time or by the job; (h) whether or not the work is a part of the regular business of the employer; (i) whether or not the parties believe they are creating the relation of master and servant; and (j) whether the principal is or is not in business. standards. 2 2 The most important regulations are contained in the "pocketbook," discussed supra. Mitchell Bros., as a common carrier, makes sure that every driver-whether an admitted employee or an owner-operator-complies with the pocket- book. To this end, Mitchell Bros. holds an orienta- tion program to train the drivers. If a driver re- peatedly violates the pocketbook provisions, he will be "disqualified" or terminated. In fact, if the rule is important, one infraction will result in termi- nation. Thus, drivers have been terminated for car- rying an unauthorized passenger or driving more hours than permitted by law. By enforcing these rules, Mitchell Bros. necessarily exercises extensive control over the drivers' daily operation. Not only does it dictate substantive requirements for new hires, it also enforces report requirements, permit requirements, securement of load requirements, speed limits, hours of driving, and mechanical specifications which severely limit the owner-oper- ator's freedom to control his financial investment, his hours of employment, and the manner in which he operates his truck. In fact, Mitchell Bros. acts as an employer of the owner-operators. Does it then matter that Mitchell Bros. is re- quired by law to act in this capacity? The Board has, in the past, sometimes answered this question affirmatively.2 3 Recently, however, in Robbins Motor Transportation, Inc.,2 4 we recognized the overriding nature of the regulations, and that what is important is the actual relationship between the carrier and the drivers, and not the reason for it. In this respect, the Board adopted the views of then- Member Fanning and Member Jenkins which they had expressed in dissent in earlier Decisions such as Portage Transfer Company, Inc., 25 and George Transfer & Rigging Co., Inc. 26 Robbins also implic- itly disavowed earlier Board Decisions which stated that because Federal regulations are imposed on the parties by governmental fiat they are not by themselves sufficient to establish employee status. 2 7 We adhere to our decision in Robbins. Indeed, we conclude on this record that it matters not whether the controls placed on the driver emanate 22 Indeed, the only significant area where the carrier appears to have any authority to make independent decisions is in its bookkeeping poli- cies. 23 See Portage Transfer Company, Inc., 204 NLRB 787 (1973), and George Transfer & Rigging Co., Inc., 208 NLRB 494 (1974), discussed infra; Fleet Transport Company, Inc., 196 NLRB 436 (1972); Daily Express. Inc., 211 NLRB 92 (1974), and Reisch Trucking ad Transportation Co.. Inc., 143 NLRB 953 (1963). But, for a different result see Pony Trucking Inc., 198 NLRB 686 (1972), enfd. 486 F.2d 1039 (6th Cir. 1973). 24 225 NLRB 761 (1975), See, for the same result, John Ilimmer Trans- Ier, Inc., 221 NLRB 284 (1975). 2` 204 NLRB 787, 791 (1973) (then-Member Fanning dissenting) 2 208 NLRB 494. 498 (1974) (then-Member Fanning and Member Jen- kins dissenting). 27 These decisions are set out in fn 23, supra. MITCHELL BROS. TRUCK LINES 481 from Mitchell Bros. independently, or whether these controls are imposed on Mitchell Bros., which in turn, imposes them on the drivers. Either way, these controls define the carrier's employment relationship with its drivers. As Chairman Fanning observed in his dissent in Portage Transfer, "Simply by being certified as a carrier, Portage undertakes to exercise such controls." And, in George Transfer & Rigging Co., Chairman Fanning and Member Jenkins stated: It is irrelevant, in our view, that some of the rules enforced by George emanate from the Interstate Commerce Commission, the Depart- ment of Transportation, or other government agencies. For, surely, as this record shows, the drivers controlled by George are not under the aegis of those agencies, but under the com- plete and operative authority of George, sub- ject to losing their employment at the will of George. [208 NLRB at 498.] In deciding that the drivers are employees, we have also considered and relied on factors apart from the pervasive scheme of governmental regula- tion. First, the drivers are not involved in an occu- pation distinct from Mitchell Bros. Indeed, their work is not merely "part of the regular business of the employer," it is the business of the employer. Second, while the lease is for a period of 30 days, it is automatically renewed unless cancelled. Thus, in effect, the duration of employment is indefinite, since, because of the restriction on trip leasing and interlining, the driver works virtually exclusively for Mitchell Bros.2 8 Third, trip leasing and inter- lining are infrequent, and, in any event, these agreements are between carriers and at the option of the employing carrier. In this regard, it is signifi- cant that Mitchell Bros. requires that the owner- operators obtain permission to trip lease or inter- change, even though permission is not specifically required by the regulations. 2 9 Finally, in evaluating the extent of daily supervision we naturally have considered the nature of the occupation. Because the drivers are constantly on the road, Mitchell Bros. cannot supervise them on the basis of person- al observation. Indeed, in this respect, the drivers '2 The drivers who testified had worked for Mitchell Bros. for periods considerably longer than 30 days, e.g., 2 ears in one case, and 4 years in another. 29 Indeed, in NL.R.B. . Pony Trucking. Inc., 46 F 2d 1039, 1040, the Sixth Circuit enforced our finding that truckdrivers were employees on the basis of the ICC regulations and the employer's restriction that sub- leasing of equipment could not occur without prior consent. These same controls are present here. This factor also distinguishes this case from A. Duie Pye. inc., supra, where the drivers regularly arranged their own trip leasing without in volving Pyle. Here, trip leases must be arranged through Mitchell Bros Moreover, while drivers have occasionally trip leased without informing Mitchell Bros., these instances are the exception and not the rule are similar to the insurance agents in United Insur- ance,3 0 who were out of the office making business calls. And, the Eighth Circuit observed, in finding that nonowner cab drivers were "employees" under the Federal Insurance Contribution Act, "where the nature of a person's work requires little supervision, there is no need for actual control. 31 Accordingly, the drivers' freedom here from daily observance does not necessarily free them from real supervision. Mitchell Bros. supervises the em- ployees through preventive measures, which in- clude periodic physical exams for the drivers, regu- lar inspection of their vehicles, and inspection of their trip reports and settlement statements. Most of the other factors noted by Restatement of Agency 2d go to the question of entrepreneurial control or risk. This factor is also considered in earlier Board Decisions, and, most recently, in Robbins. With respect to entrepreneurial control or risk, the record shows that the drivers own their trucks, select them for purchase, and finance the purchase privately. The drivers pay for repair, maintenance, and insurance. The drivers also have the right to schedule their own hours, to refuse a load, and to hire a driver in their place. They are paid a percentage of the revenues and do not re- ceive employee benefits. Mitchell Bros. does not deduct either Federal income tax or social security from the driver's settlement. On the surface, these facts suggest that the driv- ers operate as independent businessmen. In fact, however, there are a number of ways in which both entrepreneurial freedom and risk are substan- tially minimized. For example, it is true that a driver may limit his hours of work. Whenever he does work, however, he works for Mitchell Bros. Under this exclusive arrangement, Mitchell Bros. is insured that the driver is regularly available during the workweek. Similarly, while a driver may theo- retically purchase any flatbed truck, in fact, in order to drive for Mitchell Bros., the owner-opera- tor must purchase a truck which complies with Federal regulations. These regulations insure sub- stantial uniformity of equipment, so that any entre- preneurial judgment by the owner-operator is mini- mal. The same is true for his earnings. Mitchell Bros. has unilaterally established a percentage for earnings which the driver must accept. At the same time, Mitchell Bros. enforces a limit on the number of hours a driver may haul, and the speed at which he may travel. These terms severely restrict the driver's ability to maximize his earnings through either skilled negotiation or hard work and superi- :m 390 UrS at 258 3a Air lirminul Cab. Inc v (IS, 478 F 2d 575, 58( (1973), cert denied, 414 U S 404 MITCHELL BROS. TRUCK LINES 451 482 DECISIONS OF NATIONAL LABOR RELATIONS BOARD or know-how. Similarly, while the driver may refuse a haul, if he does, he moves to the end of thz list of approximately 200 drivers. Yet, since he drives exclusively for Mitchell Bros., he cannot offer his services to someone else. Moreover, until recently, Mitchell Bros. kept a record of drivers who refused loads. While Mitchell Bros. contends that its reason for the list had nothing to do with disciplining its drivers, the existence of the list sug- gests otherwise. In any event, under all the circum- stances, it would appear that there is a real incen- tive to accept the loads offered by Mitchell Bros.' dispatcher. The owners may also hire a driver, but the driver must comply with the Federal regula- tions, or he, like the owner-operator, will be termi- nated by Mitchell Bros. Finally, and most importantly, like the employer in Robbins, Mitchell Bros. assumes many responsi- bilities for the owner-operators which minimize the driver's entrepreneurial risk.3 2 Mitchell Bros. as- sumes the risk of nonpayment by customers and provides fleetwide insurance policies on which it is also an insured for cargo and liability insurance. It gives the drivers Mitchell Bros. credit cards, and permits them to purchase gas at a price lower than that paid by outside parties. It processes permit ap- plications, and handles the bookkeeping for all hauls without any overhead charge to the drivers. The drivers are given free parking spaces and cash advances on their settlements. Unlike independent businessmen, the drivers depend on Mitchell Bros. for these services, without which they could not operate. Similarly, Mitchell Bros. depends totally on the drivers to perform Mitchell Bros.' business as a carrier. This interdependence belies an inde- pendent contractor relationship and supports our finding that the drivers are employees within the meaning of Section 3(2) of the Act.33 In so concluding, we are aware that some circuit courts have in the past disagreed with our findings that truckdrivers and some cab drivers are employ- ees within the meaning of the Act.3 4 To our knowledge, however, all but one of the circuits which have considered the issue have agreed that Federal and state regulations are a factor to be weighed in determining right to control.3 5 More- over, in several decisions, the courts have agreed :z 225 NLRB at 764. :' For the same result, see John iner and Pony IrucAitg. cited supra, and see Dixie Transport, 218 NL.RB 1243 (1975). a' See. e.g . Am-Del-Co. .4 Duie Pyle, and Yellow Cab. upra :" See, e.g.. N.L.R.B. v. Deaton, Inc.. 502 F2d 1221, 1224-25.4 Ace Doran Iauling v. N.L.R.B., 462 F.2d 190, 194 In Yellow Cab the D.C Circuit has taken the view that regulations do not support a finding of control 63 F.2d at 875-876. that the ICC regulations for truckers are an ex- tremely important, if not determinative, factor in finding employee status. As the 5th Circuit stated in N.L.R.B. v. Deaton, Inc.: The regulations . . . have the effect of requir- ing the holder of a certificate of public con- venience and necessity to possess and exercise considerable control over all trucks operated under the certificate, without regard to wheth- er the holder owns the trucks. Control over trucks involves control over drivers. [502 F.2d at 1224-25.] In Deaton, the circuit affirmed our finding of em- ployee status on the basis of Federal regulations and limited "additional controls' voluntarily re- served by Deaton."3 6 Here the record shows that the regulations require Mitchell Bros. to involve itself in the daily details of the owner-operators' performance, and that Mitchell Bros. will terminate drivers for failure to abide by the regulations. In addition, Mitchell Bros. has restricted trip leasing and interlining, in order to assure that the driver works exclusively for it. Thus, the owner-operators meet the common-law agency test for employee. Finally, we address the question of the appropri- ate unit. Petitioner and the Union have asked for a unit of all truckdrivers, while the Employer argues that there should be separate units for the admitted employees and the owner-operators. Based on our review of the evidence we conclude that the peti- tioned-for unit is appropriate. This is so since all employees perform the same functions with the same supervision. Moreover, although the form of payment and benefits may differ, all personnel poli- cies are centrally administered by the staff. Ac- cordingly, we find the following unit to be appro- priate: All truckdrivers employed by the Employer at its terminals in Portland, Oregon and Medford, Oregon, including owner-operators,3 7 and non-owner drivers o equipment leased by the owners to the employer; excluding all mechan- ics, office clericals, guards and supervisors as defined in the Act. [Direction of Election and Excelsior footnote omitted from publication.] "' 502 at 1225 See also, for the same result, 4ce Doran. cited above, and N.L.R.B. v Pony lrucAing. upru. :'` Since it is uclear hoA many owner-operators ha'e lease agree- ments covering more than one tractr. the factual basis for determining whether or not such individuals are supervisors with respect to drivers they select as defined in the Act is inadequate Accordingly, if there are such "multiple" w ner-operators, they shall e permitted to vote under challenge