The Greenwich Gas Co. and Fuels, Inc.

564 DECISIONS OF NATIONAL LABOR RELATIONS BOARD fore, I find that the Employer is engaged in commerce as defined in the Act and that it would effectuate the policies of the Act to assert juris- diction herein. THE GREENWICH GAS COMPANY AND FUELS, INCORPORATED and NORMA SCOTT, PETITIONER and LOCAL 380, UTILITY WORKERS UNION OF AMERICA, CIO. Case No. 2-RD-206. October 26,1954 Decision and Order Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before M. Geller, hearing officer.' The hearing officer's rulings made at the hearing are free from prej- udicial error and are hereby affirmed. Upon the entire record in this case, the Board finds : The Greenwich Gas Company, a local public utility, is engaged in the distribution of natural gas and the sale of gas appliances and of services in Greenwich, Connecticut. During the past year, the Em- ployer's direct and indirect purchases outside the State consisted of appliances valued at $105,000 and natural gas valued at $128,000, a total of $233,000. During this same time, the total dollar volume of the Employer's business was approximately $952,000, of which less than 1 percent reflects sales to customers located outside the State. Within the State, the Employer made sales amounting to $67,000 to The Conde Nast Publications, Inc.; $2,800 to Arnold Bakers; $8,000 to Homelite Corp. ; $3,900 to Electrolux Corp. ; and $515 to New Haven Railroad. Fuels, Incorporated, a wholly owned subsidiary of The Greenwich Gas Company, is engaged in the distribution of bottled gas and the sale of gas appliances in Connecticut. Its total purchases for the past year amounted to $12,000. Its sales for the period exceeded $30,000, of which less than 5 percent was, made out of the State. It has been the consistent position of the Board that it better effec- tuates the purposes of the Act, and promotes the prompt handling of major cases, not to exercise its jurisdiction to the fullest extent pos- sible under the authority delegated to it by Congress, but to limit that exercise to enterprises whose operations have, or at which labor dis- putes would have a pronounced impact upon the flow of interstate commerce. In furtherance of that policy, the Board in October 1950 adopted certain standards to govern its assertion of jurisdiction. Those standards resulted from a study of the Board's experience up to that time. i Fuels, Incorporated, waived notice of hearing The petition and other formal papers were amended to show Fuels, Incorporated, as an Employer involved. 110 NLRB No. 91. THE GREENWICH GAS COMPANY AND FUELS, INC. 565 Among the standards adopted in 1950 was the so-called "public utility and transit systems" yardstick.2 Pursuant to this standard, the Board asserted jurisdiction over local public utility and transit systems irrespective of their size or the possible effect upon interstate commerce. Early this year the Board undertook to study and reappraise the 1950 jurisdictional standards in the light of the Board's experience since their adoption and also in the light of changing economic condi- tions. Based upon that study and reappraisal, it is our considered judgment that the jurisdictional standard established by the Local Transit Lines decision should be revised in order to better attain the Board's long-established policy of limiting the exercise of its juris- diction to enterprises whose operations have, or at which labor dis- putes would have, a pronounced impact upon the flow of interstate commerce. We have determined that in future cases the Board will assert juris- diction over local public utility and transit systems affecting com- merce whose gross value of business is $3,000,000 or more per annum .1 Since the Employer's operations do not meet the Board's newly adopted jurisdictional standard as announced herein, we find that it will not effectuate the purposes of the Act to assert jurisdiction over the Employer in this case, and shall dismiss the instant petition. By juxtaposing an allegation, that data compiled by the Board es- tablishes that the new jurisdictional standard being adopted today will eliminate from 50 to 60 percent of the public utility cases previ- ously entertained by the Board, with a fact, that over 560,000 em- ployees work for public utilities and an additional 134,000 employees are employed by local transit systems, our dissenting colleagues seek to create the impression that our jurisdictional change will cause a mass exclusion of utility and transit employees from the protection of the Act. Even if one were to assume arguendo the validity of the allegation, and it is substantially in doubt because, as explained more fully in our opinion in the Breeding Transfer case,4 our dissenting colleagues have misinterpreted and improperly applied the data re- ferred to above, the impression sought to be created is a distortion of the facts. The Bureau of Old Age and Survivors' Insurance (OASI) reports, from a study covering the year 1947, that in the categories "utilities : electric and gas" and "local utilities and local public serv- ices, not elsewhere classified," that elimination of the 50 percent of the units at the lowest end of the size scale would result in elimination of only 4.4 percent of the total employees. As to "local railways and 8 W U. King, d/b/a Local Transit Lines , 91 NLRB 623 3 To the extent that W . C King, d / b/a Local Transit Lines , supra, and cases relying thereon are inconsistent with our decision herein, those cases are overruled. 4 Breeding Transfer Company, 110 NLRB 493 566 DECISIONS OF NATIONAL LABOR RELATIONS BOARD bus lines," elimination of the first 50 percent of the units would cut off but 2.2 percent of the total employees. Thus viewed, our new juris- dictional standard is well calculated to promote the Board's long- established policy of limiting its jurisdiction to enterprises having a pronounced impact upon commerce without making any unwarranted inroad upon the Act's protection of utility and transit employees. [The Board dismissed the petition.] MEMBERS MURDocK and PETERSON, dissenting : We cannot agree with the Board's refusal to assert jurisdiction herein nor can we concur in the establishment of a new standard deny- ing such jurisdiction over public utilities whose gross volume of busi- ness is less than $3,000,000 per annum .1 This severe recision of juris- diction is one of a number of like restrictions announced by a majority of the Board in press releases on July 1 and 15. In our separate opin- ions in Breeding Transfer Company, 110 NLRB 493, we set forth in detail our basic positions and points of difference with these new jurisdictional standards. The force of these objections is illustrated by the instant case. In view of the detailed statement of our views in the Breeding Transfer case, we shall here confine ourselves to an anal- ysis of the special effect of the new standard concerning jurisdiction over public utilities. The majority decision abruptly finds that any public utility, such as the Employer herein, which has less than $3,000,000 in gross annual receipts, is not an enterprise over which it would effectuate the poli- cies of the Act to assert jurisdiction. Here, as in the other decisions explicating the new standards, the majority opinion is strangely silent as to the grounds or preliminary findings which support this novel conclusion; a conclusion, as we shall see, in flat conflict with 19 years of Board experience. We are informed only that the majority deter- mination as to these utility firms with less than $3,000,000 gross an- nual receipts is based upon "a study and reappraisal" of the jurisdic- tional standards announced in 1950. The majority leaves their dis- senting colleagues, employers, labor organizations, the courts, and the public in general completely in the dark as to what the results of that "study and reappraisal" were, and what considerations dictate and require this new and highly restrictive standard. As it is clear, from data compiled by the Board prior to announcement of the $3,000,- 000 standard, that such a standard would eliminate from 50 to 60 per- cent of the public utility cases previously entertained by the Board, we believe that the establishment of such a restrictive standard merits 5 We shall reserve for a public transit case a discussion of our disagreement with the same standard for public transit systems which is also announced in the majority decision THE GREENWICH GAS CODIPANY AND FUELS, INC. 567 detailed examination. Such an examination, we submit, shows con- clusively that the $3,000,000 formula is without support in either fact or law. It is first pertinent to examine whether or not the refusal to assert jurisdiction over the public utilities eliminated by the new rule is an implementation, in any manner, of the congressional intent found in the statute we administer. While we have dealt with this question on a broader scale in our opinions in the Breeding Transfer case, the in- stant decision is worth some additional attention in that it clearly highlights the issue. It is presumed that our colleagues are familiar with the fact that the record of the enactment of the 1935 Act and its amendments in 1947 does not disclose any intent on the part of Con- gress to exclude any public utilities from the jurisdiction of the Board no matter what their gross receipts happen to be. On the contrary, in 1947, the Congress specifically defeated an attempt to exclude public utilities from the coverage of the Act; the same action which, in sub- stantial part, is being accomplished today in derogation of the con- gressional intent and the mandate of the Act.6 Moreover, the words of the Supreme Court used in striking down a State statute in a case involving a Milwaukee local transit company on the grounds that Congress preempted the field with the National Labor Relations Act, reveal in sharp relief the untenable position of our colleagues : The utility companies, the State of Wisconsin and other states as amici stress the importance of gas and transit service to the local community and urge that predominantly local problems are best left to local governmental authority for solution. . . In our view these questions are for legislative determination and have been resolved by Congress adversely to respondents. When it amended the Federal Act in 1947, Congress was not only cognizant of the policy questions that have been argued be- fore us in these cases, but, it was also well aware of the problems in balancing state-federal relationships which its 1935 legisla- tion had raised. The legislative history of the 1947 Act refers to the decision of this Court in Bethlehem Steel Co. v. New York Labor Board, 330 U. S. 767 (1947), and, in its handling of the problems presented by that case, Congress demonstrated that it knew how to cede jurisdiction to the states [citing Section 10 (a) ]. 6 As noted by the Supieme Court, in Amalgamated Association of Street Electric Rail- way Motor Coach Employees of America, Division 998, at at. v. ti vsconsxn Employment Relations Board, 340 U. S 383 at 391, 392 "No distinction between public utilities and national manufacturing organizations has been drawn in the administration of the Fed- -eral Act, and, when separate treatment for public utilities was urged upon Congress in 1947, the suggested differentiation was expressly rejected Creation of a special classi- fication for public utilities is for Congress, not for this Court" (Emphasis supplied ] 568 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Congress knew full well that its labor legislation "preempts the field that the act covers insofar as commerce within the meaning of the act is concerned," and demonstrated its ability to spell out with particularity those areas in which it desired state regulation to be operative. This Court, in the exercise of its judicial func- tion, must take the comprehensive and valid federal legislation as enacted and declare invalid state regulation which impinges on that legislation? Unlike some of the new standards created to restrict the Board's jurisdiction, the $3,000,000 formula has at least the virtue of simplicity. The question, however, is whether or not this dollar cutoff figure bears any reasonable relationship or correlation to the actual impact upon commerce of the public utilities concerned. For this formula is exclu- sive and under no circumstances, apparently, will our colleagues assert jurisdiction over a public utility which does not meet this arbitrary level of gross receipts. So far as appears from the majority opinion the selection of this figure is based upon no other consideration than the fact that it is a large round number which will be effective in this area of industry to divest the Board of much of its jurisdiction in aid of the majority's general objective of reallocating authority between the Federal and State Governments. At best, it would seem to be predicated upon an undocumented assumption that large utilities in terms of gross receipts have an impact upon interstate commerce while smaller utilities do not. The fallacy in any such assumption is readily apparent from a glance at available Government statistics concern- ing the utility industry. Over 66 percent of all electric power pro- duced in this country in 1952 was sold to industrial and commercial consumers. The more than 3 billions of dollars of receipts originat- ing from such sales, moreover, were almost equally shared by small and large light and power companies." This fact plainly invalidates any test of the effect of a utility's operations upon commerce expressed solely in terms of the size of a company's annual gross revenue. Al- most 40 percent of the revenues of the gas utility industry are derived from sales to industrial and commercial consumers despite the wide- spread use of such fuel by residential consumers.' The 1 billion dol- lars in value of gas sales to industry and commerce by the gas utilities strongly indicate the importance to industry of the service thus fur- nished and the impact of labor disputes affecting such service. In turn, the utility industries are heavily dependent upon industrial con- sumption, for, as numerous writers and economists have observed, "the very nature of the industry has dictated that this business be 7Ibsd., pp. 397-398 8 Statistical Abstract of the United States, 1953 , U. S Department of Commerce , Bureau of the Census, p 519. 9 Ibtd , p 523. THE GREENWICH GAS COMPANY AND FUELS, INC. 569 developed" for reasons pertaining to peak load problems and operating economy.l0 It may also be noted that a yardstick which purports to test the ef- fect of a utility's operations on interstate commerce solely in terms of the size of its gross revenue is likewise defective for other reasons. Thus, a $3,000,000 utility may generate all its power and sell all its product within one State or even one large city, and have neither out- of-State inflow or outflow. A $2,000,000 utility, which by majority fiat has no substantial effect on commerce, however, may bring a sub- stantial part of its power across a State line and may sell across State lines, clearly having a far greater impact on commerce in terms of its inflow and outflow. Furthermore, it is obvious that there will be many small industrial cities throughout the land whose manufacturers are dependent for power upon utilities with gross revenues of less than $3,000,000 and whose shipment of goods in commerce could be stopped by a cessation of power. Is the effect upon the commerce of industries which are dependent on power of a cessation of such power any differ- ent because they happen to be located in a community whose utility has only $1,000,000 in gross revenue rather than $3,000,000? More- over, the gross receipts standard will result in taking jurisdiction of some utilities all of whose customers are residential rather than in- dustrial," while denying jurisdiction over many utilities which have substantial number of industrial customers dependent upon power to produce goods for interstate commerce. A standard which is pro- ductive of such paradoxical results is obviously not a proper yardstick by which to measure impact on interstate commerce. It should also be noted that it is not an inconsiderable portion of the Nation's economy that is affected by a slash in jurisdiction which will eliminate 50-60 percent of the Board's utility cases. Over 560,000 employees work for public utilities, excluding telephone, telegraph, and transportation firms. An additional 134,000 employees are em- ployed by local railway and bus lines.12 The relationship between these employees and their public utility employers is not one which is insulated from unfair labor practices and work stoppages. On the contrary, industrial disputes occur in this area and, when they occur, have an immediate impact upon commerce. And unless there has been a radical change in recent years, this would appear to be one of the industries where the need for the protections of the Act and collec- tive bargaining is greatest. It has been pointed out that:" ii Public Utilities Industries , Wilson, Herring and Eutsler, 1st Edition ; Economics of Public Utilities, Troxel 11E. g Bi ooklyn Borough Gab Company, 110 NLRB 18, where the utility met the $3,000 ,000 gross receipts test , but whose customers are residential users 12 Statistical Abstract of the United States , 1953, U . S. Department of Commerce, Bureau of the Census, p 190 13 Encyclopedia of the Social Sciences , Vol XII ( McMillan) p. 683 570 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Utility legislation grants no power to commissions to regulate labor conditions. There is an obligation imposed upon utility managements to render adequate and continuous service, which makes stoppages because of labor disputes of immediate and di- rect concern to the public. Despite this situation the fixing of wages, hours and other conditions of labor has been left entirely to managements, which are uniformly hostile to organized labor. Work in public utilities is highly specialized, whether in produc- tion, where machinery dominates entirely, or in distribution, where there is a union of machine techniques and personal service. This specialization limits the opportunities for employment be- cause of the utilities' monopolistic character and renders compe- tition in the labor market favorable to the employers. From all standpoints, accordingly, the Board's mandate to protect commerce from the impact of labor disputes has particular force and importance in the field of public utilities. The only answer offered by the majority opinion to all of this is that their standard will not result in a "mass exclusion" of employees but only in the exclusion of a small portion of the employees in the public utility field. As in the Breeding Transfer opinion, this conten- tion is based upon a misapplication of OASI statistics based on the employment in an entire industry to a percentage of cases before the Board. As a matter of fact, from data supplied by the Federal Power Commission, for example, it can be ascertained that some 79 percent of the total number of electric utility companies in the Nation will fall outside the $3,000,000 requirement. The defense offered by the majority, however, is interesting because of its clear implication. Apparently our colleagues believe that any cut in jurisdiction is permissible if the firms excluded by their stand- ard in their view employ less than 10 percent of the employees in a given industry. That premise has previously been unknown in either law or policy. It is directly contrary to the precise instruction of Con- gress that "the rights of employees should not be denied because of the size of the plant in which they work." Furthermore, it has no rele- vance whatsoever to the essential question upon which, according to the Act, the assertion of jurisdiction must be decided, i. e., the effect of a work stoppage at a given enterprise upon the free flow of com- merce. The fact that a given utility may have only 50 employees simply cannot be an indication of the importance of that utility's operations to the industries it serves or any fair guage of the impact upon commerce which would ensue from a work stoppage in that utility. As the Board well knows, due to the highly automatic charac- teristics of much of the operations of these utilities, they are frequently able to supply their vital services with limited personnel. Thus, the essential fact remains : even if, as say the majority, only a compara- THE GREENWICH GAS COMPANY AND FUELS, INC. 571 tively small portion of the employment of the utility industry is affected by the exclusion of an admittedly very high portion of the utility firms, this is still no criterion by which to judge the tremendous impact cessation of operation by the excluded firms would have upon commerce. The instant case itself illustrates the inherent fallacy upon which both the $3,000,000 formula and the majority theory is based. The Employer, in this case, is engaged in the distribution and sale of natural gas in Greenwich, Connecticut. It also sells and services gas appliances in that area. The Employer's total receipts for the past year total approximately $952,000, a figure which, according to the theory of the majority, proves that the Employer's operations had an insubstantial impact upon commerce. But-ignoring for the mo- ment this simple and arbitrary approach-what was the actual impact of the Employer's operations upon commerce? The population of Greenwich is slightly more than 40,000 persons according to the 1950 census, and, despite the fact that it is chiefly known as a high-class residential suburb of New York City, a number of manufacturing plants are located there. During the past year, the Employer furnished gas valued at $67,000 to Conde-Nast Publica- tions, Inc., a publishing firm whose executive offices and printing plant are in Greenwich, with some 2,200 employees and over $23,000,000 in yearly receipts derived from the printing, sale, and distribution of na- tional known magazines.14 These magazines, including Vogue, Na- tions Business, and the New Yorker magazine, contain a substantial amount of national advertising and are distributed throughout the country. The Employer likewise furnished gas valued at $3,900 to the Electrolux Corporation, which employs more than 3,600 employees and which produces millions of dollars of nationally distributed ap- pliances as well as small precision electrical equipment for defense work 15 The Employer also makes natural gas sales to the New Haven Railroad as well as a number of other firms engaged in interstate commerce. There is no question, accordingly, that the operations of the Em- ployer are intimately connected with the operations of other enter- prises that do millions of dollars of business a year in interstate com- merce. This is, of course, apart from the unknown but presumably appreciable effect, a cessation of the Employer's operations would have among other industries in the Greenwich area. The Employer, as a public utility, is an enterprise whose operations are, per se, of such public concern and importance that special regulation and controls are required and enforced in our economy. We have looked in vain for any indication in the majority opinion of reasons why such enter- is Moody's Industrial Manual, 1954. 15 ]bid 572 DECISIONS OF NATIONAL LABOR RELATIONS BOARD prises, of admittedly vital importance to the areas which they serve, should be subject to an extreme standard of $3,000,000, whereas enter-, prises of much less importance to commerce are retained under our jurisdiction if they achieve much lower levels of industrial activity. For example, as we understand the somewhat complicated standards the majority has adopted in other areas, they will henceforth assert jurisdiction over a company supplying coal valued at $100,000 to firms engaged in interstate commerce. If the fuel is natural gas of an equal value, rather than coal, however, and is supplied by a public utility such as the Employer here, jurisdiction will not be asserted unless the utility receipts reach the magic figure of $3,000,000. This result will obtain despite the fact that there is demonstrably no difference in the effect upon commerce of the two suppliers regardless of the amount of their gross receipts, and despite the fact that the coal may have been mined in the same State but the natural gas brought in from without the State. How do we effectuate the policies of the Act by creating standards leading to such obvious absurdities? Our colleagues contend that the instant standard is supported by their study and appraisal of the administrative experience under the 1950 plan. We look in vain for evidence of such support in the ad- ministrative experience of this Board as shown by its decisions since 1950 or at anytime in the past 19 years, and here again we must ob- serve no documentation on this point is given by the majority. As a matter of fact the administrative experience of this Agency with re- spect to the impact upon commerce of public utilities has been stated frequently in findings that those enterprises "have such an important impact on commerce as to warrant our taking jurisdiction over all cases involving such enterprises, where they are engaged in commerce or in operations affecting commerce, subject only to the rule of de mini- mis." 16 This conclusion has been uniformly supported by the re- viewing courts.17 In conclusion, it is perhaps appropriate that the Employer con- ceded at the hearing that its operations were within the Board's juris- diction. As we have noted, it has been the uniform experience and finding of this Board from 1935 to this date that public utilities such as the one operated by this Employer have such an intimate relation- ship to commerce that industrial disputes occurring among their em- ployees would have substantial impact upon commerce. The courts have uniformly sustained the existence of that jurisdiction. The Congress, itself, in enacting the legislation the Board administers, 1e W C King d/b/a Local Transit Lines, 91 NLRB 623 ", See Consolidated Edison Co v N. L. R B , 305 U. S 197; Pueblo Gas & Fuel Co. v. N. L. R B, 118 F 2d 304 (C A 10) ; Indianapolis Power it Light Co. v. N L. R B., 122 F. 2d 757 ( C. A 7) ; N. L. R B v Western Massachusetts Electric Co., 120 F. 2d 455 (C. A 1) ; Consumers Power Co v N. L. R B., 113 F. 2d 38 (C A. 6) ; Southern Colo- rado Power Co v N. L R B., 111 F 2d 539 (C A. 10). THE DAILY PRESS, INCORPORATED 573 clearly rejected any intent to exclude those utilities from our juris- diction. The illogical and arbitrary formula now enunciated and applied by the Board majority will remove half or more of those public utilities from the exercise of our jurisdiction in conflict with this precedent and experience and despite the dangers to the free flow of commerce that such a curtailment involves. We have pointed out in our Breeding Transfer opinions, the authority of any State agency, even where one exists, to act in these areas from which our colleagues now withdraw is extremely dubious. That factor when related to the obvious and crucial status of public utilities does not portend in- dustrial peace or the free flow of that commerce. Accordingly, as we would continue to assert jurisdiction over this Employer and over all public utilities subject to the rule of de minimis, we must dissent. THE DAILY PRESS, INCORPORATED and PENINSULA INDEPENDENT EDITORIAL WORKERS ASSOCIATION, PETITIONER. Cases Nos. 5-RU- 1458 and 5-BC-1380. October 26,195.E Decision, Order, and Amendment of Certification Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before Henry L. Segal, hear- ing officer. The hearing officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. Upon the entire record in this case, the Board finds : The Employer is a Virginia corporation engaged in the city of Newport News, Virginia, in the publication of a morning newspaper, The Daily Press, and an afternoon newspaper, The Times Herald. The population area served by the Employer's 2 newspapers is esti- mated at about 185,000. According to the Employer's comptroller, the Employer's policy is to limit its distribution to the area of the three cities of Newport News, Hampton, and Warwick, Virginia, and surrounding counties. Combined daily circulation of the Em- ployer's newspapers is 55,841, of which 205 newspapers are circulated outside the State of Virginia. Sunday circulation in the State is 42,108 and outside the State is 225. The Employer's gross income for the calendar year 1953 was $2,406,564 of which $200,637 was derived from national advertising. Its principal purchases for the calendar year 1953 were $29,412 for Associated Press wire service, $31,793 for feature syndicates, and $469,562 for newsprint. In connection with these purchases, the record discloses that the Employer is a member of the Associated Press and is represented on the membership rolls by two of its executives. Mem- 110 NLRB No. 95.