Pepsi-Cola Bottling Co. of Michigan

8O DECISIONS OF NATIONAL LABOR RELATIONS BOARD meree standards, it does not fall within the intendment of the Board's Advisory Opinion rules.3 For these reasons, we shall dismiss the peti- tion for Advisory Opinion herein. [The Board dismissed petition for an Advisory Opinion.] 8 Upper Lakes Shipping, Ltd., supra; Interlak e Steamship Company and Pickand8 Mather & Co., 138 NLRB 576; Broward County Po? t Authority, 144 NLRB 1539 Pepsi-Cola Bottling Company of Michigan, Grand Rapids Divi- sion 1 and International Union of United Brewery, Flour, Cereal, Soft Drink and Distillery Workers of America, AFL- CIO, Petitioner. Case No. 7-RC-69!8. December 16, 1965 DECISION AND DIRECTION OF ELECTION Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, as amended, a, hearing was held before Hearing Officer l Tilton Fischer of the National Labor Relations Board. The Hearing Officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. The Employer and the Petitioner filed briefs which have been considered by the Board in making its decision in this case. Pursuant to the provisions of Section 3(b) of the Act, the Board has delegated its powers in connection with this case to a, three-member panel [Chairman McCulloch and Members Brown and Zagoria]. Upon the entire record in this case, 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 labor organization involved claims to represent certain employees of the Employer. 3. A question affecting commerce exists concerning the represen- tation of certain employees of the Employer within the meaning of Section 9(c) (1) and Section 2(6) and (7) of the Act. 4. The Petitioner seeks a unit of single truck distributors who are engaged in the sale and distribution of the Employer's products. The Employer contends that these distributors are independent contractors.1 The Employer in Marcll 1965 acquired the assets of its distributor in Grand Rapids, Michigan, the Michigan Beverage Company, herein called Michigan, and entered into individual "Distributor's Agree- ' The name of the Employer appears as amended at the hearing. 8 An alternative contention of the Employer that these distributors are supervisors was withdrawn by the Employer. 156 NLRB No. 9. PEPSI-COLA BOTTLING COMPANY OF MICHIGAN 81 ments" with seven of Michigan's former driver-salesmen. Pursuant to this agreement, each driver, described therein as "an individual prin- cipal," derives his income from the "profits" received as the result of the sale of the Employer's products. Each of the drivers purchased his truck from the Employer-the same truck in some instances that he had driven previously for Michigan-with no down payment and a security interest remaining in the Employer. The trucks were to be paid for by the return to the Employer of 5 cents on every case of merchandise purchased by the drivers for resale, which covered with- out interest not only payments for the truck but also the insurance, license, and tax for the truck as well as uniforms, the first load of merchandise, and receipt books. The drivers were no longer covered by workmen's compensation or other company insurance, and no social security or income tax was withheld by the Employer. By the terms of the contract, the drivers had to pay for their own gas, oil, mainte- nance, repairs, and insurance, although the minimum limits of insur- ance were set by the Employer and purchased through it. The distributors receive no vacation or sick leave benefits. Although each driver was. granted the right to be the exclusive distributor for the Employer in his area, the Employer reserved the right to sell and distribute in each distributor's territory, and unilater- ally to control the size of the territory. There is evidence that the territories allocated by the Employer were established with reference to a 40,000-case guideline, and that the routes would be unilaterally adjusted up or down according to the demands of the Employer. The Employer eventually reduced the routes of all four of the distributors who appeared as witnesses. In addition, there is evidence that the Employer, upon a complaint from a dissatisfied customer, could trans- fer the acount to a different distributor without compensation to the original distributor. The distributors were obligated by the contract to "diligently pro- mote the sale and the distribution of such products to every retail outlet therein [the territory], . . . make every endeavor to sell new accounts," and engage in advertising and promotion techniques "with the objective of achieving display dominance over competing prod- ucts." Each distributor was also required to solicit locations for vend- ing machines and to provide service and minor repairs to such installa- tions in his territory, although this did not usually result in any income to the distributor. The contract did not prohibit distributors from selling any other products, but the Employer did expressly proscribe the sale of products competitive with those of the Employer; there is testimony that the distributors were told to "push" the Company's products; and the record shows that their day-to-day duties and their obligations under the contract made it impractical for them to try to sell any other products. 82 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The contract also required the distributors to maintain records in a form approved by the Employer subject to its inspection and right to make copies thereof, to adhere to certain practices with respect to the trademark and franchise requirements, and to comply with the instructions from the Employer to minimize loss or waste. A distributor cannot transfer or otherwise convey his distributor- ship. While either party has the right to terminate the contract upon a 90-day written notice, the Employer has in addition the right to terminate if the distributor should fail to comply with any of the terms of the contract or "becomes involved in financial difficulties of any nature." The contract calls for the distributor to maintain warehouse space, but in practice the Employer provides such space without change; most of the distributors leave their empty trucks at the ware- house at night, to be loaded by the warehouse employees. Also at the warehouse is a designated place for each distributor to keep his route book, which is the only list of customers within the territory and which specifies the dates upon which customers are to be called. The Employer provides these route books and, when routes are altered, it provides new route books. The distributors are free to determine 'their hours of work, are free to refuse to service customers, are not trained or supervised while on the route, may deviate from the established routes and from the suggested list prepared by the Employer, may use their trucks for personal purposes, and are free to hire helpers. Although the freedom of the distributors to make such determina- tions indicates some degree of independence, the evidence as a whole establishes that the Employer maintains close control over their opera- tions. The Employer sent its representatives to accompany the dis- tributors on their initial days on the route even when it was the same route they had covered for the predecessor company, and thereafter, without request or consent from the distributors, supervisory person- nel on occasion were sent to accompany them on their routes. The Employer provided the distributors with a "suggested" price list for products to be sold to the retailers and expected the list to be furnished by the distributors to the retailers. Moreover, the evidence clearly shows a close adherence to the price list "suggested" by the Employer while the Employer, in contract, at times sold its products at a dis- count directly to customers within the distributors' territories. In addition, the evidence reveals attempts of the Employer to supervise the distributors with respect to their clothing and work habits. Thus, although there are no formal requirements that the distributors wear uniforms, call the plant while out on the route, or attend the weekly sales meetings, the Employer has sought compliance with such practices. PEPSI-COLA BOTTLING COMPANY OF MICHIGAN 83 The Board has frequently held that, in determining the status of persons alleged to be independent contractors, the Act requires applica- tion of the "right of control"test. Where the person for whom the services are performed retains the right to control the manner and means by which the result is to be accomplished, the relationship is one of employment; while, on the other hand, where control is reserved only as to the result sought, the relationship is that of an independent contractor. The resolution of this question depends on the facts of each case, and no one factor is determinative. On the basis of the foregoing and the entire record, we are satisfied that the distributors are not independent contractors. We are aware that the evidence discloses several factors which are usually considered to indicate an independent contractor status, but the presence of these factors does not alone establish such status. Thus, we are not per- suaded and do not regard as controlling the fact that a written agree- ment defines the relationship as one of "independent principal"; that the distributors provide their own equipment; that the Employer does not make the usual payroll deductions for the distributors; or that the distributors may on occasion hire helpers.3 The potential ownership of the trucks by the distributors does not negate the Employer's con- trol of the manner and means by which the result they seek is to be accomplished .4 Aside from the question as to the ownership of the truck, which is subject to the lien of the Employer until the purchase price is paid in full, the evidence shows that the Employer effectively controls the operations of the distributors. The routes are controlled by the Employer in terms of location, size, and sales practices, and the distributors are in practice effectively limited to sales of the Employ- er's products. Furthermore, the fact that the dstributors may work for "profit" rather than wages does not in and of itself establish that they possess the opportunity to make decisions resulting in profit or loss which resemble those decisions made by independent businessmen.5 There is evidence that the allocated territory, established with reference to a 40,000-case guideline and unilaterally adjusted by the Employer in accordance with that guideline, confines and limits the distributor's potential range of income. Moreover, the Employer may go into the distributor's territory and sell directly to his customers or transfer his accounts to another distributor. The distributor retains no proprie- tary rights in the territory which he can sell. The Employer deter- 8 Eureka Newspaper8, Inc., 154 NLRB 1181. 4 Samuel H. Burton, et al., d/b/a Burton Beverage Company, 116 NLRB 634. 5 See The Seven-Up Bottling Company of Detroit, Inc., 120 NLRB 1032, 1034. 217-919-66-vol. 156-7 84 DECISIONS OF NATIONAL LABOR RELATIONS BOARD mines the prices at which products will be sold to the distributor and, by its practice of providing for distribution to the retailers the "sug- gested" price list at which the products should be purchased from the distributors, effectively circumscribes resale prices. In view of the facts that the distributors have minimal control of the manner and means by which their work is to be accomplished and meager opportunity to make decisions which would affect their profit and loss and upon the entire record, we find that they are employees within the meaning of the Act. Accordingly, we find that a unit of the following employees is appropriate for the purposes of collective bar- gaining within the meaning of Section 9 (b) of the Act : All single truck distributors employed by the Employer at Grand Rapids, Michigan, excluding warehousemen, semitruck drivers, office clerical employees, salesmen, guards, and supervisors as defined in the Act. [Text of Direction of Election omitted from publication.] John C. Stalfort & Sons, Inc. and Printing Specialties and Paper Products Union of the International Printing Pressmen and Assistants' Union of North America, AFL-CIO, Petitioner. Case No. 5-IBC-5208. December 16, 1965 DECISION AND DIRECTION OF ELECTION Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, as amended, a hearing was held before Hearing Officer Hubert E. Lott of the National Labor Relations Board.' The Hearing Officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. Pursuant to the provisions of Section 3 (b) of the Act, the Board has delegated its powers in connection with this case to a three-member panel [Chairman McCulloch and Members Brown and Zagoria]. Upon the entire record 2 in this case, 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. ' The Employer's name appears herein as amended at the hearing. 2 The Hearing Officer granted the Employer 's motion to incorporate into the record in the instant case, insofar as relevant and material hereto, the record in Case . No. 5-RC- 2018, a prior representation proceeding involving one of the.two issues presented here, but not the same Union. 156 NLRB No. 7.