S. S. Kresge Co.

K-MART DIV. OF S. S. KRESGE CO. 1127 K-Mart Division of S. S. Kresge Company i and Retail Store Em- ployees Union, Local 36, Retail Clerks International Associa- tion, AFL-CIO, Petitioner. Case 7-RC-67144. November 16, 1966 DECISION ON REVIEW AND DIRECTION OF ELECTION On June 15, 1965, the Regional Director for Region 7 issued a Deci- sion, Order, and Direction of Election in a consolidated proceeding, including this case, in which he found inappropriate the requested storewide unit of all employees of K-Mart, including its seven unrep- resented licensed department employees ,2 within the "Jackson K-Mart Plaza" at Jackson, Michigan, on the ground that K-Mart and its several licenses do not constitute joint employers of licensed department employees. In agreement with the Employer and another petitioner,' he found appropriate two units; one restricted to K-Mart employees, sought in Case 7-RC-6708,4 and a second limited to employees of one license, F & G Merchandising, Inc., sought in Case 7-RC-6707.5 Thereafter, the Petitioner filed a timely request for review, contending, inter alia, that the Regional Director erred in finding that K-Mart was not a joint employer of the employees in each of the licensed departments involved. The Employer filed a statement in opposition, contending that the Regional Director's decision was consistent with the precedent upon which he relied and which had not been considered in prior cases involving K-Mart. On January 26, 1966, the National Labor Relations Board granted review. Thereafter, both parties filed briefs on reviews i The name of the Employer appears as amended at the hearing Notice of hearing was duly served on the following seven operators of licensed departments within the Jackson K-Mart Plaza: F & G Merchandising, Inc ; Cunningham Drug Stores, Inc. ; Joy Stores, Inc ; Miles Shoes ; Dunham's Garden City, Inc. , Schiller Co. ; and Levitt Co. The first two were represented at the hearing The latter two were unrepresented The remaining three were represented by observers who did not appear formally or take positions at the hearing. On the basis of the findings made herein, we hereby amend the caption to include these companies as Joint Employers 2 The Petitioner ' did not seek to iiiclude Wrigley's Supermarkets , Inc a division of Allied Supermarkets, Inc , which operates a grocery department in the Jackson K-Mart Plaza. All parties agreed that its relationship with K-Mart differed from that of the other licensees and that it operated under a different license agreement. The record indicates that Wrigleys has a current collective-bargaining agreement with the Petitioner, Retail Clerks. 3 Truck Drivers Local 164, International Brotherhood of Teamsters, Chauffeurs, Ware- housemen and Helpers of America, Inc , herein called the Teamsters. 4 This petition was dismissed by the Regional Director in his Decision, Order, and Direc- tion of Election because the Teamsters made an insufficient showing of interest . However, the Regional Director treated that petition as a motion to intervene in the instant case based upon an adequate showing of interest 5 This petition was withdrawn by the Teamsters with the Regional Director 's approval on July 15, 1965. Accordingly, there is no extant unit determination involving this licensee. 9 In its brief on review, filed February 4, 1966, the Employer sought to enlarge the issues under review by raising , for the first time since its brief to the Regional Director, ques- tions concerning the Regional Director 's exclusion of buyers , assistant buyers, and man- ager trainees and inclusion of regular part-time employees. Under the Rules and Regula- tions of the Board, such request for review is untimely and is not considered herein. 161 NLRB No. 92. 1128 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Board has considered the entire record with respect to the issue under review, including the briefs,7 and makes the following findings : S. S. Kresge Company, a Michigan corporation, operates certain retail stores on a national. basis under its service trade name of K-Mart. Most of K-Mart stores contain various sales departments operated either by K-Mart with its own employees or by various licensees. K-Mart's relationships with most of its licensees are gov- erned by a standard license agreement and by K-Mart rules and regulations which have been used nationally by K-Mart in all of its stores since 1962. This case involves only the discount department store in Jackson, Michigan, known as "Jackson K-Mart Plaza." Pursuant to the same standard license agreement which is used nationally, various firms operate departments for the sale of merchandise within the K-Mart Plaza, with the overall appearance being that of a single department store. In the sales departments operated by K-Mart there are approx- imately 100 employees, whereas the licensees together employ approx- imately 63. Analyzing the license agreement, the Regional Director concluded that K-Mart exercised general control over the operational policies of the licensees but that there was "no common control over the labor policies of the latter," as required by his interpretation of certain Board decisions 8 for finding that K-Mart was a joint-employer with the various licensees involved. In support of his finding that there was "no common control of labor relations," the Regional Director relied on negative factors : the absence of evidence that K-Mart has ever had any part in settling grievances of employees of any licensee; the lack of any prohibition against the licensee and licensor entering into separate collective-bargaining negotiations with any labor orga- nization without the approval of the other and the absence of any pro- vision that either must participate in such negotiations by the other; and the provision that "The parties do not intend this Agreement to constitute a joint venture, partnership, or lease, and nothing herein shall be construed to create such a relationship." The Petitioner contends, on the other hand, that the cases cited by the Regional Director stand for the principle that a storewide unit, including licensed department employees, is appropriate for bargain- ing where the licensor reserves labor relations control over the licen- 'The Petitioner's request for oral argument before the Board is hereby denied as the record, including the briefs, adequately presents the Issues and positions of the parties. 8 Le. New Fashion Cleaners, Inc., 152 NLRB 284 ; Esgro Anaheim, Inc., 150 NLRB 401 ; Bab-Rand Company, 147 NLRB 247; and S.A.G.E. of Houston and Its Licensees, 146 NLRB 325. K-MART DIV. OF S. S. KRESGE CO . 1129 Bee's employees. The Petitioner further contends that the licensee agreements herein confer such authority upon K-Mart expressly in section 10 1 and in various provisions of the K-Mart rules and regula- tions, neither of which the Regional Director considered in his decision. The license agreements and the K-Mart rules and regulations involved are identical in material respects with those described in detail by the Board in K-Mart, A Division of S. S. Kresge Com- pany, et al., 159 NLRB 256, wherein K-Mart was found to be a joint employer of the employees in each of the licensed departments therein. It is clear in this case, as in the cited case, that the license agreement expressly reserves to the licensor the power substantially to affect the employment conditions of employees in licensed depart- ments. Moreover, here as in the cited case, there is independent evi- dence that confirms the parties intent to vest such reserved power in the licensor. Thus, the record here shows that the F & G depart- ment manager had been instructed by K-Mart to start his full-time employees, as a minimum, "at no less than the rate paid by K-Mart to certain categories of its employees. The foregoing evidence, in our view, is sufficient to support a finding that K-Mart is a joint- employer, of the employees in each of the licensed departments. Having found that K-Mart and its licensees are joint employers, we find that the requested storewide unit is appropriate,10 and that the following employees constitute a unit appropriate for the pur- poses of bargaining within the meaning of Section 9(b) of the National Labor Relations Act : All full-time and regular part-time selling and nonselling employ- ees of K-Mart Division of S. S. Kresge Co., at its store at 3001 East Michigan Avenue, Jackson, Michigan, including employees of licensed departments other than Wrigley's Supermarkets, but exclud- ing managers, assistant managers, manager trainees, department heads, guards, and all other supervisors as defined in the Act. [Text of Direction of Election omitted from publication.] 9 "10. Rules and Regulations . The licensor shall from time to time, for the benefit of the common enterprise, establish, amend, modify or revise uniform Rules and Regulations con- sistent with this license agreement which shall govern but not be limited to the following subjects : orders and appearance of the store , methods for handling cash registers , credit, will-call and lay-away sales , payments made by licensor for account of licensee , refunds, pricing policies , inventory requirements , disposal of old merchandise , overlap in mer- chandise carried by various licensees, products liability insurance , employment practices, personnel and store policies, receiving of merchandise and store security . . . [Emphasis supplied.] io Frostco Super Save Stores, Inc., 138 NLRB 125, 129. Wrigley' s Supermarkets is excluded for reasons stated in footnote 2, supra.