Greenlawn Funeral Home

GREENLAWN FUNERAL HOME Greenlawn Funeral Home, Inc. and General Drivers, Salesdrivers, Warehousemen & Helpers, Local 245, affiliated with International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of America, Petitioner. Case 17-RC-8650 July 24. 1979 DECISION ON REVIEW BY MEFMBI-RS PNE I.(). MTRPHY. ANI) TRI SI)AI.E On December 14, 1978, the Regional Director for Region 17 of the National Labor Relations Board is- sued a Decision and Direction of Election in this pro- ceeding in which he found that the Employer's gross volume of business in the computation year exceeded the Board's jurisdictional standard governing retail establishments, and therefore that the Employer was engaged in a business affecting commerce within the meaning of Section 2(6) and (7) of the National La- bor Relations Act, as amended. Accordingly. the Re- gional Director directed an election in a unit of li- censed embalmers at the Employer's two locations in Springfield, Missouri. Thereafter, in accordance with Section 102.67 of the Board's Rules and Regulations, Series 8, as amended, the Employer filed a request for review, contending that the Regional Director's com- putation of the Employer's gross income was clearly erroneous and a departure from Board precedent. The Petitioner filed a brief in opposition. On January 12, 1979, the Board, by telegraphic order, granted the Employer's request for review and declined to stay the directed election, but ordered that the ballots be impounded pending this Decision on Review. There- after, the election was held, and the ballots were im- pounded. 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. The Board has considered the entire record in this case with respect to the issues under review and makes the following findings. The Employer, a Missouri corporation, is engaged in providing undertaking, crematory, and general fu- neral services at two locations in Springfield, Mis- souri. The Employer derives its income from furnish- ing the above services on an immediate need basis and from the sale of contracts for future funeral ser- vices, otherwise known as preneed contracts. Mis- souri state law requires that 80 percent of the rev- enues derived from the sale of preneed contracts must be maintained in a trust account; the remaining 20 percent immediately vests in the seller, here the Em- ployer. The 80 percent maintained in a trust account is paid over to the Employer when it furnishes the service contracted or unless the customer has exer- cised his rights to withdraw the monies placed in trust any time before his death. The Regional Director found that during the Em- ployer's last fiscal year, after various subtractions to income, the Employer had gross revenues of approxi- mately $546,900, of which $122,230 was attributable to preneed contracts. The Regional Director then concluded that the Employer's gross volume of busi- ness exceeded the Board's $500.000 jurisdictional amount for retail enterprises, and that the Employer was engaged in commerce and in a business affecting commerce within the meaning of Section 2(6) and (7) of the Act. On review, the Employer contends that the Re- gional Director, in computing the Employer's gross volume of business, erroneously included as income that 80 percent of the revenues derived from the sale of the preneed funeral contracts. Citing Viewer Spoin- sored Television Foundation, Inc.. d/b/a K'ST-TIV, 217 NLRB 419 (1975). the Employer contends that only those funds that are presently available to it for operating expenses are properly includable in gross income. Since the Employer is prohibited from utiliz- ing 80 percent of the preneed funds as operating in- come, the Employer argues that the Board should de- duct that amount from the gross volume figure of $546,900, thereby reducing the amount of the Em- ployer's revenue below the Board's retail jurisdic- tional standard. The Employer further argues that to do otherwise would lead to an inequitable result. Spe- cifically. the Employer argues that, if the Board con- siders preneed income in the year of receipt and not in the year of vesting, then the same revenues could appear twice in a computation, i.e., the year of receipt in the trust account, and in the year of vesting in its general cash account, thereby presenting an inflated picture of the Employer's cash inflow and gross vol- ume of business. The Petitioner contends that the Employer's argu- ment is without merit as the Board considered an analogous assertion in Samuel A. Ellsburo Co.. 95 NLRB 276 (1951), and rejected it there. In that pro- ceeding, the Board included in the employer's gross outflow sales consummated in the computation year even though delivery of the materials sold was sched- uled for the following year. For the following reasons. we find that all of the revenue received by the Employer from the sale of preneed contracts is properly includable in the com- putation of its gross income for purposes of comput- ing gross revenue, and, including those funds in gross revenue, we find that the Regional Director correctly asserted jurisdiction here. 243 NLRB No. 110 673 D6C.('ISIONS OF NATIONAL LABOR RELATIONS BOARD According to Missouri state law,' 80 percent of the revenues received from the sale of preneed funeral contracts must, within 30 days from the date of re- ceipt, be deposited in a trust account in a state or national bank which possesses trust administrative authority and which is located in the State of Mis- souri. The monies deposited are to be held there until either of the following occurs: (1) the contracted-for funeral services are provided, and a death certificate is presented: or (2) the customer voids the contract and requests reimbursement.' Despite the above, we conclude that, pursuant to state law, the Employer exercises sufficient present dominion and control over the trust corpus to warrant its inclusion now in the computation involved in determining the Employer's gross volume of business. We note that pursuant to state statute 3 the trust accounts are carried not in the name of the customer. but in the name of the seller, here the Employer. The statute also specifically provides that the seller "shall be entitled to all income ... including interest, capital gains and all other earnings" that may be derived from the principal of said trust accounts.4 In essence. the Employer is entitled by state law to invest these funds in a financial institution of its choosing in such a manner as to reap and enjoy the greatest return on its investment. This factor persuades us that these revenues, which constitute approximately 20 percent of the Employer's gross revenues, represent more than mere deposited sums of money in which the Em- i Mo. Rev. State. ('hap. 436 Contractual Relations. 2 While the Regional Director did not refer to the specific Missouri statute involved herein, we note that the Board is empowered to take administrative notice of state and local statutes and regulations. See. e.g.. Anchor Rome Mills, Inc. 86 NLRB 1120. 1150, n. 47 (1949). Mo. Rev. Stat. Chap. 436.040. 'Mo. Rev Stat. Chap. 436.020. ployer has no interest and over which the Employer has no control.5 We reject the Employer's argument that the inclu- sion of all preneed contract income in gross revenues results in the same revenues being counted twice, i.e.. in the year of receipt and in the year of transfer to the general corporate account. In any given computation year. revenues can only appear in one account unless. of course, the preneed contract is signed and services are provided in the same year. In that case, the amount in question would be deducted from one of' the accounts (either the general account or the pre- need account) comprising gross revenue. For the foregoing reasons, we find that all revenue from preneed funeral contracts is cognizable as in- come, for purpse of determining jurisdiction, in the year it is received, and that the Employer's gross vol- ume thus computed exceeds our standard for retail enterprises.6 We therefore affirm the Regional Direc- tor's Decision and Direction of Election and direct that the ballots which have been impounded be opened and counted by the Regional Director, and that thereafter he take such further appropriate ac- tion as required by Section 102.69 of the Board's Rules and Regulations, Series 8. as amended.? We find that liecr Spuon.sored Televiion. upral, cited by the Employer. involved an issue not currently before us. hat case involved the issue of whether funds donated to a nonprofit, noncommercial television station were properly includable as income for the purpose of asserting jurisdiction. The language used b the Board there arose in that context The mployer here, in contrast, is a Ibr-profit commercial enterprise which bases a substantial part of its business resenues on the sale of preneed funeral contracts. ITo ignore the revenues generated by the sale of these contracts would he to ignore a substantial part iof the Emploer's business and would thus present a distorted picture of the Emploser's true impact on commerce. We note that, while the issue before us was not specifically raised there, the Board in Ol Ifil I ror.mnnr (opurin, 170 NLRB 300 (1968). in- cluded preneed revenues in determining that mortuary and cemetery's gross volume of business. ' In view of our decision herein, we find it unnecessary ito pass on the Petitioner's further contcntion that the Employer and Greenlawn Memorial Gardens and Dlemer Monument (Company constitute a single. integrated enterprise for the purposes of asserting jurisdiction herein. 674