The Houston Press Co.

In the Matter of THE HOUSTON PRESS COMPANY and CONGRESS OF INDUSTRIAL ORGANIZATIONS Case No. 16-R-1055.-Decided August 26, 1946 Fulbright, Crooker, Freeman cf; Bates, by Mr. W. N. Arnold, of Houston, Tex., for the Company. Mr. J. E. Crossland, of Houston , Tex., for the Union. Miss Katharine Loomis, of counsel to the Board. DECISION AND DIRECTION OF ELECTION STATEMENT OF THE CASE Upon a petition duly filed by Congress of. Industrial Organizations, herein called the Union, alleging that a question affecting commerce had arisen concerning the representation of employees of The Houston Press Company,' Houston, Texas, herein called the Company, the National Labor Relations Board provided for an appropriate hearing upon due notice before Glenn L. Moller, Trial Examiner. The hearing was held at Houston, Texas, on May 11 and 12, 1045. The Company and the Union appeared and participated. All parties were afforded full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing on the issues. At the hearing the Company moved to dismiss the petition on the ground that the news- boys involved in this proceeding are not its employees.2 The Trial Examiner referred the motion to the Board. In its brief, the Company moves for a dismissal of the petition on the further ground that the activities of the newsboys have no susbtantial effect upon commerce. For reasons hereinafter stated the Company's motions are denied. The Trial Examiner's rulings made at the hearing are free from preju- dicial error and are hereby affirmed. All parties wer afforded oppor- tunity to file briefs with the Board. Upon the entire record in the case, the Board makes the following : ' The name of the Company appears as amended at the hearing. The Company cites Matter of Houston Chronicle Publishing Company, 28 N L R B. 1043, in support of its position 70 N L R B, No 48. 660 THE HOUSTON PRESS COMPANY FINDINGS OF FACT 1. THE BUSINESS OF THE COMPANY 661 The Houston Press Company, a Texas corporation, is engaged at Houston, Texas, in the publication of a daily (excluding Sunday), newspaper known as The Houston Press. The average daily circula- tion of the newspaper is approximately 78,500 copies. The Company uses annually in excess of 3,000 tons of newsprint, of which 40 percent, amounting in value to about $75,000, is shipped to its plant from points- outside the State of Texas. Approximately 8 percent of the adver- tising in The Houston Press originates from points outside Texas, In connection with its operations, the Company utilizes the services. of the United Press and the Scripps-Howard News Alliance. The Company does not deny and, indeed, appears to admit that. Its operations affect commerce. However, it contends that the active-- ties of the newsboys are so remotely related to its operations and so• local in character that they do not, in themselves, affect commerce.. In view of our finding hereinafter that the newsboys are employees- and, also, in view of the well-established principle that it is not a prerequisite to the Board's jurisdiction that a specific determination be made that the duties of the particular employees sought to be rep- resented affect interstate commerce,' we see no merit to the Company's, contention. We find, therefore, that the Company is engaged in. commerce within the meaning of the National Labor Relations Act.. II. THE ORGANIZATION INVOLVED Congress of Industrial Organizations is a labor organization ad- mitting to membership employees of the Company. 111. THE QUESTION CONCERNING REPRESENTATION On or about September 7, 1944, the Union requested recob Iition' from the Company as the bargaining agent for all street newsboys selling its papers in downtown Houston. The Company has refused to grant such recognition on the ground that the newsboys are not its employees. We find that a question affecting commerce has arisen concerning the representation of employees of the Company, within the meaning of Section 9 (c) and Section 2 (6) and (7) of the Act. 8 See Virginia Electric ti Power Company v. N. L. R. B., 314 U. S. 469 ; Matter of City' National Bank and Trust Company, 50 N. L. R. B.,516; Matter of The Northern Trust Company, 69 N L R B 652 662 DECISIONS OF NATIONAL LABOR RELATIONS BOARD - IV. THE APPROPRIATE UNIT A. The status of the newsboys The Union seeks a unit of newsboys who sell The Houston Press from fixed locations in downtown Houston. The Company takes the position that the newsboys are not its employees but rather independ- ent contractors and, as such, are not entitled to the Act's protection. Although designated as newsboys, the individuals here concerned are mature men between the ages of 35 and 70 who depend upon the sale of papers as their sole source of livelihood. They have no finan- cial interest in their. sales locations and do not employ helpers to assist them in making sales. While the Company does not carry these individuals on its pay rolls or grant them the benefits of Social Se- curity, Workmen's Compensation, or Unemployment Compensation, it is nevertheless dependent upon them for street sales of its papers to the public. The street sales come under the general supervision of the circulation manager of the Company's circulation department, and under the more immediate supervision of a street circulation manager and of three streetmen who are responsible to the street circulation manager. The street circulation manager and the streetmen 4 are carried on the Company's pay rolls and are admittedly its employees. The newsboys receive their papers from the streetmen at a price determined by the Company, and sell the papers to the public at a .price likewise fixed by the Company and printed on the front page of each paper.5 They settle their accounts with the streetmen at the end of each day, retaining for their earnings the difference between the price at which they receive the papers and the price at which the papers are sold. Before the wartime gasoline shortage the streetmen delivered all four editions of the paper to each newsboy either at his individual selling location or at a nearby "spot" fixed-by the streetmen as the place of delivery. At the time of the hearing the Company had, in con- formity with an order of the Office of Defense Transportation that only two deliveries a day could be made at any one place, rearranged its delivery system so that two of the four editions were obtained by the newsboys from a substation the Company established in the down- town area.' 4 All of whom are at times referred to herein as "streetmen." The Company in its brief points to an instance where newsboys sold papers at a football game for mole than the established price and refers to the receipt, upon occasion, of com- plaints from customers that newsboys have sold papers at more than this price. These, however, appear to be isolated instances Moreover, we are of the opinion that, by printing the price on the front page, the Company has effectively set the price of its product for public consumption. 6 The Company's plant is 12 blocks from the center of the downtown area. The substa- tion is Niwithin 2 to 5 blocks of the spots of the newsboys who were witnesses at the hearing. THE HOUSTON PRESS COMPANY 663 In addition to fixing the place and the manner of delivery the Com- pany has always controlled the quantity of papers made available to the newsboys. The streetmen estimate the number of papers which will be sold in the downtown area before making their deliveries. In arriving at the proper number for distribution, they take into consider- ation both the number of papers usually sold by the particular news- boy and the news value of the particular edition. The record further shows that the amount made available to the newsboys at the time of the hearing had also been affected by wartime rationing of paper. On those frequent occasions when the streetmen could not obtain papers in the desired amount, they had distributed the number available to the, newsboys under instructions from Earl Buell, the circulation manager, to allot the papers equitably among the newsboys. Rationing had also had the effect of. limiting the number of unsold papers returnable for credit.? The acquisition by the newsboy of his location has also been con- trolled by the Company. Thus, each of the seven newsboys who testified at the hearing stated that he originally obtained his selling location by inquiring of one of the streetmen whether a spot was "open." In those instances where a spot was available the newsboy was escorted to it and almost immediately supplied with papers. In other instances the newsboy kept in touch with the streetmen until a spot was found for him. Indeed, the streetmen keep lists of appli- cants for the various corners. Because some of the spots are better selling points than others newsboys have sought and been granted transfers, apparently upon a merit basis. With'respect to the extent of their locations,,newsboys have either been definitely instructed by the streetmen or have understood' from the fact that they had been assigned to particular locations, that their selling activities were restricted to those spots. They have, in practice, so restricted their areas of operation.' Although newsboys, some of whom regularly sell other Houston papers as well as The Houston Press, do leave their spots to sell Sunday, holiday and extra editions of any of the papers they handle, this appears to be an exception to the general practice and to be done with the approval of the streetmen. The newsboys in a Although Emmitt Skains, street circulation manager, denied that he had ever refused to accept returns, newsboys testified that they had been instructed by streetmen to limit returns at one period to 5 percent, and at another period to 10 percent, of the number received. Walter It. Scott, a newsboy testified that on several occasions streetmen had refused to accept returns of 5 percent from him, and Benny Gomez, another newsboy, testified that Skains had on one occasion refused to accept more than 10 percent of his unsold papers. 8 P. L. Pierce, a newsboy, testified that he never sold "off his corner" because "they put site on that corner and I expect that is the only place they except me to sell papers." Lindsay Oklahoma Parks, another newsboy, testified that on being placed on his corner by Skains he was instructed not to "bootjack." In newsboy parlance "bootjacking" means to sell papers "wherever the newsboy wants to" in contrast to selling from a fixed location, and a "bootjacker" Is a newsboy who sells from no fixed location. 664 DECISIONS OF NATIONAL LABOR RELATIONS BOARD such situations return to their established locations in order to sell the regular editions of The Houston Press. In this connection, the record shows that the streetmen have, by restricting their deliveries to the men who sell at the established spots and refusing to deliver to other than newsboys having fixed locations, effectively discouraged "boot- jackers" in the downtown Houston area .9 The working schedule of the newsboys is also regulated by the Com- pany. Newsboys testified without contradiction that they had been instructed by the streetmen to be at their spots when the papers were delivered; to stay on their spots until all papers were sold or until lunchtime; to go to lunch at 2 o'clock; and to "check in" at the sub- station before 8 o'clock. Streetmen have not hesitated to reprimand newsboys who leave their spots during the usual working hours. One such newsboy was reprimanded for taking too long a period for lunch, had his papers taken away from him, and was told by a streetmen that the latter was "through with him." Others, when found by the street- men to be away from their respective spots, have been instructed to return to them. Newsboys who sell both the Press and the Chronicle have been told not to leave their spots to obtain the Chronicle.10 The interest of the Company in the .continuous operation of the spots is further made manifest by the fact that streetmen have selected sub- stitutes for newsboys who were ill or on vacation. `The streetmen. have also given the newsboys some instructions in sales methods. With respect to the manner of operating their sales locations, the newsboys keep their principal stock of papers in racks and often wear aprons containing pockets for change. In the past such equipment was supplied by the Company, although at present the newsboys furnish it themselves. The newsboys remove the papers from the rack in small quantities and hold them under their arms while they call out the names of the papers in order to attract the atten- tion of the public. Streetmen have not hesitated to instruct the news- boys that the Press should be displayed in a prominent manner. Thus, Newsboy Javers, who sells the Chronicle as well as the Press, was told by Streetman Reid, "I want you to hold the Press on the outside. I want the Press exposed and not the Chronicle at no time." In addi- tion, others have been repeatedly instructed to "push the Press." Also, on one occasion, when two streetmen were told by a newsboy that a 0 Streetman Raymond Reid testified that if the newsboys were not restricted to regular selling locations we would have a revolution on our hands in downtown Houston." Reid also testified that he would refuse to deliver papers to a "hootjacker " who appeared at one of the established spots. Skains , in answer to questions by the Trial Examiner , admitted that if bootjackers were prevalent in the downtown area it would have a detrimental effect on the earnings of the men at the fixed spots and that it was to the advantage of the Company to keep experienced men on the spots. 10 Edmond R Javers , Walter R Scott, and Emery Shoup , the newsboy witnesses who sell both papers , all testified that they hired boys to bring their Chronicles to them after receiving instructions that they were not to leave their spots for this purpose. THE HOUSTON PRESS COMPANY 665 complaint was apparently about to be lodged against him because he was "hollering his papers too loud," they responded that he was to "keep hustling the same way" until they "told him different." Refusals by newsboys to comply with instructions have resulted in such disciplinary action as the discontinuance of papers for weeks or months at a time, or removal from the location 11 In the Hearst case 12 the Supreme Court was confronted with a some- what analogous situation to that presented here. In that case the newsboys involved were mature men who worked as news vendors on a regular basis and were dependent on the proceeds of their sales for their livelihoods. They sold their papers from established spots and, although they bought and sold these spots among themselves, the pub- lisher reserved the right to approve each spotholder and to remove him from his spot for reasons of discipline or efficiency. The news- boys, who themselves hired helpers- to assist them in their sales, were not carried on the publisher's pay rolls, nor did they enjoy the benefits of Social Security or Unemployment Insurance. Their earnings con- sisted of the difference between the prices at which they sold the papers to the public and the prices at which they purchased them from the publisher, the publisher controlling the buying and selling prices and also the number of papers allotted to each newsboy. Although the newsboys were given some latitude for the exercise of individual initia- tive in making their sales, the publisher controlled the broad terms and conditions of their work through the supervisory efforts of its district managers. These individuals gave the newsboys explicit in- structions as to their hours of work and, by measures varying in severity from reprimand to dismissal, obtained compliance with their instructions. They also instructed the newsboys in methods of sales technique and sought to enforce standards of good conduct and dili- gence during working hours. In its opinion the Supreme Court laid down some general principles with regard to the meaning of "em- ployee" as used in the Act. The Court said that many service rela- tionships existed in which the individuals who performed services possessed characteristics of both independent contractors and of em- ployees and yet did not clearly fall within either group; that, with respect to such workers, the economic facts surrounding the relation- ship rather than technical or common law concepts, were significant 11 Although Buell testified that he had instructed the streetmen not to "control" the newsboys, Reid 's version of such intructions was that "he didn 't want us to exercise any more control over those boys than we had to " And neither Skains nor Reid, the two streetmen who testified at the bearing, specifically denied any of the instances of instruc- tions , reprimands , or discontinuance of papers described above 12 N. L. R B v. Hearst Publications, Inc, 322 U S 111 This case came before the Court as a result of the Board's decision in Matter of Stockholders Publishing Company, Inc.. 28 N L. R B. 1006, in which newsboys were found to be employees. 666 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in a determination of whether they were employees under the Act; and that "where all the conditions of the relation require protection, protection should be given." The Court then affirmed the Board's finding that the newsboys were employees. We are of the opinion that the Hearst case is controlling here. The facts in both cases are very similar. As in the Hearst case, the Com- pany's newsboys possess some characteristics of independent contrac- tors insofar as they sell papers other than those of the publisher and do not receive some of the benefits incident to the conventional em- ployer-employee relationship. But like the publisher in the Hearst case, the Company exercises a substantial amount of supervision over the newsboys' hours of work and sales methods. By this means and also by its controls of sales areas, the prices of the papers and the num- ber allotted to each newsboy, the Company has in large measure con- trolled their economic existence. The newsboys involved here, like those in the Hearst case, are mature men who depend on the sale of papers for their livelihoods. Moreover, unlike the Hearst case news- boys, they do not have financial interests in their spots or employ helpers. Thus, here, in some aspects, the economic facts surrounding the relationship between the publisher and the newsboys appear to be even more persuasive that there is an employee status within the meaning of the Act than they were in the Hearst case. Applying the principles of that case to the facts in the instant case, we are convinced, in view of all the conditions pertaining to the relationship between the newsboys and the Company, that the newsboys are the type of workers who are entitled to the Act's protection. Accordingly, we find that the newsboys involved in this proceeding are employees with- in the meaning of Section 2 (3) of the Act. In reaching our decision, we have considered, but cannot agree with, the Company's contention that the case of Matter of Houston Chron- icle Publishing Company, supra, in which we held that the newsboys there involved were not employees within the meaning of the Act, is controlling on the issue of employee status for the Company's newsboys here involved. The facts in that case are distinguishable from those presented here. We note especially that,- in the Chronicle case, the newsboys selected their own sales locations, the publisher apparently not expecting that sales would be restricted to particular areas, and that the publisher "exercised no supervision or control over the news- boys' activities on the street with respect to the manner and methods used in news vending." And we also note that there is nothing in that case to show the existence of economic facts surrounding the relation- ship between the newsboys and the publisher similar to those brought out in this record. THE HOUSTON PRESS COMPANY 667 Also, in arriving at our decision in the instant case, we are cognizant of our recent decision in Matter of Philadelphia Record Company 13 in which we held that the publisher's house-to-house newspaper carriers were not employees within the meaning of the Act. The facts of the Record case are also distinguishable from those in this case. In the Record case the carriers themselves bought and sold the sales areas, termed routes, which they operated; they also set the boundaries of their routes, subdivided them, and added to them by the purchase of additional routes. The publisher took little part in these transactions and, moreover, had not in recent years ordered a carrier to dispose of a route, to alter its boundaries, or to subdivide it. The carriers, many of whom employed helpers to assist them in the actual delivery of their papers, operated their routes under virtually no instructions from the publisher regarding the details of their work, and they were free to compete with the publisher in the wholesaling of the publisher's papers, to sell out-of-town papers, and even to sell miscellaneous commodities unconnected with their relationship to the publisher on their routes. Although the publisher set the buying and selling prices of the paper, it was the carriers who determined how many papers would be needed to supply their customers and that number was uniformly furnished them. We concluded that the earnings of the carriers depended in large measure on their own energy and resource- fulness rather than upon controls set by the publisher and that all the economic facts surrounding the status of the carriers indicated that they were more nearly independent contractors rather than employees under the Act. Our decision in the Record case was premised, as is our decision here, on an application of the principles of the Hearst case. B. The unit finding The Union contends that the unit should be comprised of the news- boys who regularly sell The Houston Press from fixed locations in the downtown Houston area, excluding bootjackers and route carriers who deliver the newspaper to residential subscribers. Although the Company takes the position that no unit of newsboys is appropriate, it appears to contend that, in the event the Board does make a unit finding, bootj ackers should be included in the unit. In the Hearst case we excluded bootjackers on the ground that they did not have the same regular and continuing interests in their em- ployment as did the newsboys who sold from established spots. For the same reason, we shall exclude them here. We find, therefore, that all newsboys who regularly sell The Hous- ton Press from fixed locations in the downtown Houston area, exclud- 13 69 N. 1, R B. 1232 668 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ing bootjackers, route carriers who deliver the newspaper to residen- tial subscribers, and all supervisory employees with authority to hire, promote, discharge, discipline, or otherwise effect changes in the status of employees, or effectively recommend such action, constitute a unit appropriate for the purposes of collective bargaining within the mean- ing of Section 9 (b) of the Act. V. THE DETERMINATION OF REPRESENTATIVES We shall direct that the question concerning representation which has arisen be resolved by an election by secret ballot among the employees in the appropriate unit who were employed on the date of the Direction of Election herein, subject to the limitations and addi- tions set forth in the Direction.14 DIRECTION OF ELECTION By virtue of and pursuant to the power vested in the National Labor Relations Board by Section 9 (c) of the National Labor Relations Act, and pursuant to Article III, Section 9, of National Labor Relations Board Rules and Regulations-Series 3; as amended, it is hereby DIRECTED that, as part of the investigation to ascertain representa- tives for the purposes of collective bargaining with The Houston Press Company, Houston, Texas, an election by secret ballot shall be conducted as early as possible, but not later than thirty (30) days from the date of this Direction, under the direction and supervision of the Regional Director for the Sixteenth Region, acting in this matter as agent for the National Labor Relations Board, and subject to Article, III, Sections 10,and 11, of said Rules and Regulations, among the employees in the unit found appropriate in Section IV, above, who were employed on the date of this Direction, including employeeswho did not work on that date because they were ill or on vacation or tem- porarily laid off, and including employees in the armed forces of the United States who present themselves in person at the polls, but excluding those employees who have since quit or been discharged for cause and have not been rehired or reinstated prior to the date of the election, to determine. whether or not they desire to be represented by Congress of Industrial Organizations, for the purposes of collective bargaining. 14 At the hearing Skains designated the 49 locations at which the Press is regularly sold. A list of the locations is attached hereto as Appendix A in order to aid in the conduct of the election. THE HOUSTON PRESS COMPANY 669 APPENDIX A 1. Medical Arts Building 2. Texas Company 3. Capitol and Fannin 4. Texas State Hotel 5. Cotton Hotel 6. Gulf Building 7. Capitol and Travis 8. Sacks 9. Greyhound Bus Terminal 10. Majestic Grill 11. Nellie Esperson Building 12. Neils Esperson Building 13. Houston Trunk Factory 14. Liggett Drug Store at Rusk and Main 15. Second National Bank 16. Forum Cafeteria 17. West Building 18. Scholl's Cafeteria 19. Stowers 20. Commerce Building 21. One's a Meal at Main and Mc- Kinney 22. Lamar Hotel 23. Humble Building 24. Continental Oil 25. Union Station 26. Ben Milani Hotel 27. Petroleum Building 28. Cotton Exchange 29. Prairie and San Jacinto, also, called Bus 30. Keystone Building 31. Shell Building 32. Sterling Building 33. Fannin Pharmacy 34. Rice Hotel 35. Adams Hot Shop 36. Walgreen's Store at Texas and Travis 37. Barnacle Building 38. Columbia Dry Goods Store- 39. Citizens State Bank 40. Owl, at Preston and Fannin. 41. Court House 42. Zindlers 43. First National Bank 44. Union National Bank 45. Merchants and Manufacturers Building 46. Southern Pacific Building 47. Bowen Bus Depot 48. Auditorium Hotel 49. Great Southern Building