Creative Country Day School at Westchester, Inc.

586 DECISIONS OF NATIONAL LABOR ,RELATIONS, BOARD Creative Country Day School at Westchester, Inc. and Hotel,, Restaurant Employees . and Bartenders Union, Local 178, AFL-CIO. Case 2-CA-12010 August 11, 1971 DECISION AND ORDER CHAIRMAN- MILLER, AND MEMBERS BROWN AND KENNEDY On February, 11, 1971, Trial Examiner Samuel M. Singer , issued a Decision in the above-entitled pro- ceeding, finding that Respondent is: not engaged in commerce within the meaning, of ,the Act, and recommending, that the complaint be dismissed in its entirety, as set forth in the `attached Trial Examiner's Decision. Thereafter the General Counsel filed exceptions to the Decision and a brief in support thereof. Pursuant to ' the' provisions of Section 3(b) of the National Labor. Relations 'Act,, as amended, the National Labor ,Relations,, Board had delegated its powers in connection with this case to a three-member panel. The Board has reviewed the rulings of the Trial Examiner made ' at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed.'The Board has considered the Trial Examiner's Decision, the exceptions, the brief, and the entire record in the case, and hereby adopts the findings,; conclusions;- and 'recommendations Of the Trial Examiner. -ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, ,the National Labor Relations Board adopts as-its Order the recommend- ed Order of the Trial Examiner and orders that the complaint herein be, and it hereby is, dismissed in its entirety. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE SAMUEL M. SINGER, Trial Examiner: The complaint in this proceeding (issued on November 6, based on a charge filed on March 12, 1970) alleges that Respondent, a profitmaking nursery school, violated Section 8(aXl) and (3) of the Act by unlawfully refusing to reinstate four strikers because they had engaged in a protected strike. Respondent in its answer and at the hearing denied that the Board has jurisdiction, asserting that it is not an employer 1 Transcript corrected by my order on notice dated February 4, 1971. 2 The other schools are: Creative Country Day School, Inc. ("Valley Stream"), Creative Nursery School at Fresh Meadows, Inc. ("Fresh engaged in.commerce within the meaning of the Act. It also denies commission of the alleged unfair labor practices. Pursuant, to notice, a hearing was held before me in New York, New York, on December 16-18, 1970, ^ All` parties appeared and were afforded full opportunity to be heard, to examine and cross-examine witnesses; and o introduce relevant evid'e`nce. Briefs were'filedby"General Counsel and Respondent. The threshold= question is' whether the Board has or should' entertain jurisdiction ',in this case. For reasons to be stated, I- conclude ' that it should not. Accordingly, ',it: is unnecessary, to ,reach the issue on the merits, i.e. whether Respondent unlawfully refused to reinstatefour strikers. Based upon the entire relevantrecordin this proceeding) and, my observation of the witnesses, I make the following findings of "fact, conclusions of law, 'and recommended order: 1. JURISDICTIONAL FINDINGS A.; , Introduction Respondent ("Westchester" school) is one of four nursery schools in the New York City area operated and controlled by Edward L. Silver.2 Each school, organized under the New York-State Educational Law, is separately incorporat- ed as a profitmaking commercial enterprise and provides nursery school, kindergarten; and' daycanip services. Silver also operates and controls Creative Country Day School at Puerto Rico, Inc. ("Puerto Rico" school), organized and incorporated under Puerto Rico law, which, conducts a summer camp for 2 months a year, leases its facilities to an unaffiliated school (Baldwin) for the balance, of the year, and operates a "country club" on weekends. Although apparently conceding that the New York schools, including Westchester (situs of the labor dispute),"are not engaged in commerce or in operations affecting commerce within, the meaning of the Act, General Counsel urges that the Board should assert jurisdiction on the theory that the New York schools together with the Puerto Rico school constitute a single multistate enterprise. B. The New York Nursery Schools The record establishes that Silver is president and sole stockholder, and his, wife secretary-treasurer,, of each of the corporations here involved. Each New York' schoolhas-its own administrative director in charge of business policies, transportation, and general purchases; and also `its own educational director in charge of educational matters and dealings with teachers and parents. Lionel S. Dimin is the "managing director" overseeing the administrative direc- tors; and Mrs. Frankman is the supervising educational director overseeing other educational directors. Each school has its separate teachers and staff and establishes its own salary schedules and tuition fees. While each school pays its own staff, the salaries of the three top executives (Silver, Dimin, and Frankman) are paid by another Silver- owned New York corporation known as Creative Supervi- Meadows"), and Creative Nursery School and Kindergarten at Plainview, Inc. ("Plainview"). 192 NLRB No. 95 CREATIVE COUNTRY DAY SCHOOL 587 sory Corp., which exists for no purpose other than to collect fees from all of the Silver-owned corporations (including the 'Puerto Rico' School) to 'pay the three executives' salaries.3 As already noted, the New York schools operate on the nursery level, servicing children 3' to 5 years old residing in the school area. The teachers and assistant teachers similarly reside in the New York area, the latter (assistant teachers) consisting mostly of neighborhood housewives whose children attend the school in which they work-.4 Most of the children attend part-time, 3 hours a day. Two of the four schools (Westchester and Valley Stream), where children may attend all day; serve hot lunches. All school supplies-i.e. toys, crayons, papers, paints, books, and records-are obtained locally. Programs, set up by each Educational Director for her own school, include arts and crafts projects, music, dancing, and use of numbers, colors, and (in the case _ of the 5-year-old's) letter printing. However, it is the three'top Company executives (Company President Silver, Managing Director Dinh,, 'and the supervising, educational director) who set the "philosophy of education basically" followed. Once each year an "in- service training meeting" is run for all the nursery schools at which outside speakers are invited to help formulate the curriculum. As also noted, all four New York schools operate day camps during the. two summer months (July-August). While the children in two (Fresh Meadows and Plainview) are restricted to the 3-to -5-year age group, those in the other two (Westchester and Valley Stream) service children up to age 12. The camp operation "is completely separate from the nursery - school" and is conducted by "an entirely different staff-of people," including teachers and directors who work the rest'of the year in the, public school system. The program- is- of the- "athletic type," concentrating on baseball and swimming, although such activities as music, dancing, and dramatics areincluded. - _ Although "minor" labor relation matters are handled by individual school directors: (administrative and education- al), "major" policy on matters such as salary range, school budget, and. capital expenditures are formulated by Company President-. Silver in conjunction with,, Managing Director _ Dimin - and Supervisory Education Director Frankman.s The school's administrators are consulted in formulating the basic programs for the school, since matters such as tuition and, budget vary-from school to school. In case 'of differences of opinion, Company President Silver makes the "final decision. " `It is conceded"' that gross annual'revenues of all schools combined exceeds $1 million, divided as'follows: Respon- dent Westchester (where about 150 full- and'part-time children attend nursery school and, 200 are enrolled in summer camp=$300,000; Valley- Stream (220 school .and 500 camp attendants)-4750,000; Fresh Meadows' (150 3 According to Silver, Creative Supervisory Corp. has no employees (other than the three executives whose salaries it pays ) and collects just enough fees from the other schools (in amounts determined by his accountant) to pay the salaries in question. 4 No particular ` fornnal .education" is, required to, qualify, as assistant teacher; her duties generally consist of driving children to and from school, helping clothe and keeping them clean , and assisting the teacher in the school and 108 camp attendants" 160,000 and Plainview s " (100 school and 100 camp attendants)-$l00,000 C. The Puerto Rico `School" Unlike the other (New York) "Creative" schools, the Puerto Rico "school" does not operate a year-round nursery. As previously noted (supra, sec. A),'it operates only a daycamp for 2 summer months (July-August), leases its facilities to another (non-Silver owned) school for",the balance of the year, and operates a "country club":"on weekends. Silver is the sole stockholder of the'corporatioh and is` its president; his wife is secretary-treasurer.' - As in the case of the New York, schools, the' children serviced and the staff recruited are from the local (Puerto Rico) area. Similarly, all supplies are obtained locally. The camp director, appointed by and answerable to Silver, hires and supervises the staff; Dimin, managing director of the New York schools, is in no way "involve[d]" in the Puerto Rico operation. Silver and 'the Puerto Rico director formulate labor relations on matters such as tuition, budget, "and the camp program, final decision resting with Silver. The camp program is of an "athletic type" as in the New York schools, but the Puerto Rico camp provides additional and-ino're varied activities such as horseback riding, waterskiing, and scuba diving. Approximately 200 children, ages 3 to 12, attend the camp. The "country club"' is operated on weekends as an adjunct to the-,day camp. Local Puerto Ricans, including campers' parents, are provided recreational facilities such as swimming and volleyball; no food or beverages are served, `The record establishes that the Puerto Rico operation has a gross annual revenue of approximately $91,000, derived as. follows: $60,000 , from the day camp; $10,000 from the "country -club"; and $21,000 from rental. All of its income is deposited in a local 'Puerto, Rico bank, but another account, is maintained in its name in a New,York bank to which about1$2,000 is transferred monthly to pay bills. The accountant handling the Puerto Rico operation is not the same as the one handling the New York school operations. There, is no evidence of any purchases, and, shipments from outside Puerto Rico other than a single, shipment during the past year (from New York to Puerto Rico) of $500 or $600 worth of camp uniforms. According to President Silver's uncontradicted and credited testimony, all.supplies and equipment, including'uniforms obtained in previous years, were purchased locally. Silver also, testified that he would make seven or eight personal and business trips between Puerto Rico and New York each-year, indicating that he- maintains apartments in both places; the cost of the business,-trips (about '$800), is charged to one of his New York corporations (Creative Supervisory Corp., which` pays his salary) since these trips entail travel from his classroom (to which she is assigned) in other sundry tasks . Not all full- fledged teachers are "certified" or even possess college degrees. Although the ratio of teachers to assistant teachers in all of the "Creative" schools is not shown, the uncontradicted evidence establishes that prior to the labor dispute at Westchester (January 30), that school employed I i 'assistant teachers and 7 teachers. 5 On matter's such as school hours and size of classes, State law controls. 588 DECISIONS OF NATIONAL LABOR RELATIONS BOARD "legal""residence (Puerto, Rico) "to do business- with the New York corporations;' U. CONCLUDING FINDINGS It is clear that "before the Board takes cognizance of a case, it must first be established that it has legal or-,statutory jurisdiction; i.e.,. that the business operations,, involved affect c ommerce within the meaning oftheAct. It must also appear that the business operations meet the Board's applicable jurisdictional standards." NLRB, Thirty-Fourth Annual Report (1969), p. 28. Respondent contends that the Board has no legal jurisdiction , over its operations at the Westchester school, situs of the labor dispute, because that school's activities are, purely "intrastate" and do not "affect" commerce. On the other hand, General Counsel claims . (br.pp. 15-16) that assertion of jurisdiction is appropriate because the Westchester school is part- of _a single, multistate enterprise comprising the Puerto Rico and four New York City area schools which, if viewed in combination, do sufficient business to give 'the Board legal jurisdiction and to satisfy the Board's self-imposed monetarystandards. As to Respondent's contention that the Board lacks jurisdiction because of the purely local-character of the Westchester operation, it is well settled that Board jurisdiction extends to local and intrastate activities which (it may reasonably be said) would have a substantial impact on the free flow of commerce. The basic test is whether interstate transportation or flow of commerce across state lines tend' to be impeded if the business immediately involved 'were 'disrupted as a result of a labor dispute caused by unfair labor practices. If so, the Act applies, regardless of the "volume of interstate commerce affected, provided it is more than de minimis. See NLRB. v. Fainblatt, 306 U.S. 601; 604-605; 'N.LKB. v. Shawnee Milling Co. 184 F.2d 57, '58-59 `(C.A. 10). Furthermore; if the business immediately involved is part of a "single integrated enterprise and employer" (A.K Allen Co. Inc., 117 NLRB 568, enf'd ,252 F.2d 37 (C.A. 2)), the'impact of the entire enterprise must be considered.6 If the impact on commerce is slight, negligible, or remote, the Board will not assert jurisdiction. International Longshoremen &' Ware- housemen's ' Union, Local No. 13, etc. (Catalina Island Sightseeing Lines, Inc:), 124 NLRB 813, 815, fn. 5. To 'begin ` with, ibis apparent that the operations of Westchester, the- business here immediately involved, are purely local and intrastate and do ^ not affect commerce within the meaning of 'the Act-whether or not these operations °are considered by, themselves or as part of all Silver-owned .schools in the New-York area. All the New York schools operate at a purely local level, servicing 3- to 12-year olds- in daycamps during~, summer. There. is no showing of purchases and sales across State lines, direct or indirect; nor even movement of students, teachers, and revenues out of State. Nothing in the record warrants a finding that a labor disturbance at Westchester and other 6See N.L.RB. v. National Shoe; Inc., 208 F.2d 688, 691 (C.A. 2); International Union of Operating Engineer; Local 428, AFL-CIO (See Bee Shiny Matic, Inc.), 169 NLRB 184. 7 It would appear that the New York State Labor Relations Board may New York schools would have a -sufficient impact on commerce to bring their operations under the Act. Nor, does this record support a finding that Respondent Westchester is an integral part of a multistate operation merely , because it is owned and.controlled by Silver, who also, ownstand controls the Puerto Rico "school:" Insofar as appears, the Puerto Rico operation , geographically separat- ed , thousands of miles, is managed Independently., and operates as a separate -and distinct entity. There, is no evidence of interchange of operations, employees, or equipment. There is no common workforce, payroll, and source of income. Cf. Piedmont Wood Products Co., Inc., 156 NLRB 151; Electronic Circuits, Inc., 115 NLRB 940. Unlike the Westchester and other New York schools, the Puerto Rico "school" operates only, a daycamp for` 2 months and a "country club" on weekends . It has, its own local manager or director. The children serviced in the camp and the parents in'the country club reside in the immediate area. Nor are the . Puerto Rico and New York operations held out to the public as a single integrated enterprise. Cf.. See Bee Slurry Matic, Inc., supra, 169 NLRB 184. The fact that a single `individual (Silver) has final authority over the labor relations of both essentially local enterprises does not mean that he cannot- and does not exercise policy with respect to each one separately and apart from one another. CF. N.LRB. v. Shawnee Milling Co., 184 F.2d 57, 59 (C.A. 10). The point is that the labor relations of the two autonomous entities is exercised separately and not as if they were entwined and centralized. Manifestly, "a shutdown at either [school] would not affect the other .... " ' Piedmont Wood Products, supra, 156 NLRB at 152.7 Under the circumstances, I do- not find significant the fact that , in the past year the Puerto Rico "school" purchased and received from New York $500 or $600 worth of camp uniforms, that it transferred -$2,000 per month from its, Puerto Rico to its New York bank, and that Silver made about $800 worth of -business trips from Puerto Rico to New ^ York. While those factors could be relevant' in determining the question whether the Puerto Rico opera- tion was in commerce, they are=notrelevant in determining the critical question here-whether that operation is so integrated with the New York operations as to constitute all a single integrated enterprise. In any event, insofar as the expenditure on uniforms is.concerned ,-it appears that this was of a nonrecurring nature and, therefore, not available as a basis for.asserting -jurisdiction even over the Puerto Rico operation.8 As to the trips from Puerto Rico (Silver's legal residence) to New ,York, it appears that - these were made exclusively on behalf of 'the New York schools and were charged to one of the New York corporations., As, to the $2,000monthly transfers, of funds from Puerto Rico to New York, it is doubtful that this circumstance is in itself sufficient , to warrant assertion of jurisdiction over the Puerto- Rico operation, even, assuming that this question were properly before me. In my view of the foregoing, it is also unnecessary to pass assert jurisdiction over a profitmaking private school (such as the one here involved) where the National Labor Relations Board declines jurisdiction. See The Brunswick Home 18 N.Y. L.R. 458,462. 8 See Magic Mountain, Inc, 123 NLRB'1170. CREATIVE ' COUNTRY DAY SCHOOL on General Counsel's contention (br. -pp. 15-16) that the operations here involved (the New York and Puerto Rico schools) satisfy -",all the Board's standards" on annual gross revenues--i.e., the $1 million monetary standard for asserting jurisdiction over private nonprofit colleges (which General 'Counsel would also apply to commercial profit- making educational institutions such as here involved); or , &eBoard's jvrisdictioiial standards for retail or nonretail enterprises :formerly ` applied by the Board- to such profitmakinginstitutions. As the Board has said,-"Implicit in the Board's promulgation of its jurisdictional standards if the recognition that in ordinary circumstances the meeting of a gross dollar volume test will necessarily entail activities `affecting commerce' within the purview of Section 2(7) of the Act. Nevertheless, the Board recognized that the Federal Government is a government of limited jurisdiction and that some showing oflegaljurisdiction must be made in every case brought before its tribunals. ...[T']he gross dollar volume-test, standing alone, is insufficent to confer upon the Board the jurisdiction contemplated by the Act. Some proof must be made of legal jurisdiction" Catalina Island Sightseeing Lines, supra,, 124 NLRB at 814-815. I have already found that proof of legal jurisdiction here is lacking, whether or not, Respondent Westchester- be regarded (for jurisdictional purposes) as an entity by itself, or as part of -a single integrated enterpriswcomprising all of the Silver-owned New York schools, or as part of a single integrated enterprise comprising ` the Silver-owned Puerto Rico and New York schools It-is to be noted that statutory 589 jurisdiction, was expressly found •in the cases relied on by General Counsel-on, the , basis of direct and indirect interstate purchases of goods and services.. See Boston College, 187 NLRB No. 16 (private `nonprofit-educational institution), National College of Business, 186 NLRB No. 76 (priviate profitmaking educational institution). Further- more, unlike the strictly local character of the student body involved in this case, one of the cited , cases' (National College of Business) involved an institution servicing "a substantial number [of students ] coming from out,of-State" and one in which, the Federal Government interest was evidenced by Federal sponsorships, grants, and subsidies. III. CONCLUSIONS OF LAW Upon the basis of the foregoing findings and the entire record in this proceeding, I conclude that assertion of jurisdiction- in this case will not effectuate the policies of the Act. I find - that, the evidence - does not establish - that Respondent's operations , are in commerce, or. that they substantially "affect" commerce within the meaning of the Act. RECOMMENDED ORDER Upon the basis of the foregoing findings of fact and conclusions of law it is recommended that the complaint be dismissed in its entirety.