Barwood, Inc.

BARWOOD, INC. Barwood, Inc. and Automotive, Petroleum, Cylinder and Bottled Gas, Chemical Drivers, Helpers and Allied Workers, Local Union No. 922, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of Ameri- ca. Case 5-CA-5948 February 13, 1974 DECISION AND ORDER BY CHAIRMAN MILLER AND MLMBERS FANNING AND KENNEDY On June 21, 1973, Administrative Law Judge Thomas F. Maher issued the attached Decision in this proceeding. Thereafter, General Counsel filed exceptions and a supporting brief, and Respondent filed an answering brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and briefs and has decided to affirm, with the exception noted in footnote 1 below, the rulings, findings, and conclusions i of the Administrative Law Judge and to adopt his recommended Order. 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 Administrative Law Judge and hereby orders that the complaint be dismissed in its entirety. MEMBER FANNING, dissenting: I cannot agree with my colleagues to dismiss this alleged refusal to bargain with a certified representa- tive for the reasons they give. The circumstances are unusual and, in my view, the record in the underlying representation proceeding should be reopened before dismissal is considered. The Union was certified in September 1971 after i While adopting the Administrative Law Judge 's conclusion , we do not adopt his finding of a violation of Sec 8(a)(5) We agree with the Administrative Law Judge that, where a respondent is charged with refusal to bargain with a union certified after a stipulated election, the complaint proceeding is sufficiently related to the representation proceeding to preclude relitigation of the scope of the appropriate unit and employees therein However, in the present case, Respondent was permitted by the Administrative Law Judge, without objection from the General Counsel, to introduce evidence which clearly establishes that the cab drivers, who constitute a majority of the persons included in the unit, are in fact independent contractors inasmuch as the General Counsel has not excepted to the admission of such evidence. we are presently constrained to consider it in reaching our decision In these circumstances , we can only 19 the parties stipulated to a consent election in a unit of all garage employees and all cabdrivers driving vehicles rented on a daily basis from the Employer, here the Respondent. The parties apparently were satisfied with the conduct of the election and bargaining ensued. Bargaining later came to a halt over cab rentals and a charge was filed by the Union in August 1972. The next month a settlement agreement was reached which extended the certifica- tion year for 5 months. Bargaining began again. Later Respondent employed a new attorney. Bar- gaining broke down. As the Administrative Law Judge found, the Respondent has at all times failed to bargain about cab rental rates. In the course of the present 8(a)(5) proceeding Respondent has taken the position that it will not bargain about cab rental rates because the drivers are independent contractors. Although the Union filed the charge, it did not appear at the hearing, held in May 1973. Its president testified for the General Counsel concerning the certification and the bargain- ing thereafter, thus developing the refusal-to-bargain aspect of the case. Respondent's sole witness was its general manager who testified concerning the duties of drivers, thus attacking the unit on which certifica- tion was based. The General Counsel did not object to the introduction of such testimony though it had the effect of relitigating a matter disposed of some 16 months earlier in the related representation proceed- ing. Based on this testimony the Administrative Law Judge found the unit drivers to be independent contractors, seeing no alternative to such a ruling in view of the thrust of the evidence before him. It appears that the Charging Party may have failed to participate in the hearing in view of the Board's well-known rule against relitigating at the complaint stage issues passed upon at the representation stage. Accordingly, I would give it an opportunity to adduce testimony concerning the independent con- tractor contentions. To this end I would issue an order to show cause in the representation proceeding why the outstanding certification should not be revoked inasmuch as the unit now appears to include a majority of persons not defined as employees in the Act. To conclude on this record that the drivers are not conclude that the cab drivers are not employees within the meaning of Sec 2(3) of the Act, that therefore a refusal to negotiate concerning cab rental rates was not a violation of Sec 8(a)(5). and that, for this reason , we adopt his conclusion that the complaint herein should be dismissed Pittsburgh Plate Glass Companp, Chemical Division. 404 U S 157 (1971) Our dissenting colleague would give the Charging Party an opportunity to present further evidence on the independent contractor issue , holding, in effect, the Charging Party not bound by the General Counsel's failure either to object or except to the admission of evidence on this issue Whatever force Member Fanning's argument might otherwise have had seems to us destroyed by the fact the Charging Party has not seen fit to file exceptions to the Administrative Law Judge's dismissal of the complaint in its entirety 209 NLRB No. 8 20 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees and thus dismiss the 8(a)(5) allegation seems not only unfair to unit employees as a whole, but premature. The decision to do so should not hinge on the General Counsel's failure to object to the introduction of the evidence during the hearing followed by exceptions ignoring that facet of the problem.2 In the circumstances I would give all parties the opportunity to defend-or attack-the certification in the proper proceeding by reopening the represent- ation case record. 2 It appears that my colleagues-simply because the Union now may have lost interest in representing the drivers - -would leave the garage employees who make up the balance of the unit in representational limbo Were the Board , on its own motion, to issue a motion to show cause why its outstanding certification should not be revoked , this would be an orderly way of resolving the unit issue that should not have arisen in this complaint case. That approach would reflect a proper concern for the rights of employees who through Board processes, elected a union to represent them If the Union does not participate , the certification will be revoked , leaving at least the garage employees unquestionably free to seek a new bargaining representative if they so desire. DECISION STATEMENT OF TILE CASE THOMAS F. MAHER, Administrative Law Judge: Upon a charge filed on January 30, 1973, by Automotive, Petrole- um, Cylinder and Bottled Gas, Chemical Drivers, Helpers And Allied Workers, Local Union No. 922, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, herein called the Union, against Barwood, Inc., Respondent herein, the Regional Director for Region 5 of the National Labor Relations Board, herein called the Board, issued a complaint on behalf of the General Counsel of the Board on March 20, 1973, against the Respondent, alleging violations of Section 8(a)(5) and (1) of the National Labor Relations Act, as amended (29 U.S.C., § 151, et seq ), herein called the Act. In its duly filed answer the Respondent, while admitting certain allegations of the complaint, denied that it was an employer within the meaning of the Act or that it had committed any unfair labor practice. Pursuant to notice a trial was held before me in Washington, D.C., on May 14, 1973, whereat all parties were present, represented and provided full opportunity to call and to cross-examine witnesses , and to file briefs Briefs were filed with me by both the General Counsel and Respondent on June 1, 1973. Upon consideration of the entire record and including the briefs filed with me, and upon my observation of the witnesses appearing before me, all of whom I credit, I make the following: FINDINGS OF FACT AND CONCLUSIONS OF LAW 1. THE NATURE OF THE RESPONDENT'S BUSINESS Barwood Inc.. Respondent herein, by its own admission, is a Maryland corporation with its principal office and place of business in Bethesda, Maryland, where it is engaged in the operation of taxicab services. In the course and conduct of its business it admits to receiving annual gross revenues in excess of $500,000 and annually purchasing from points outside the State of Maryland goods and materials valued in excess of $25,000. Respon- dent denies, however, that it is an employer engaged in commerce within the meaning of the Act. In support of its contention that it is not an employer Respondent sets forth in detail, upon the credible testimo- ny of its general manager, Charles Steets, the duties and responsibilities of its cabdrivers and their organizational relationship to Respondent. Upon this it has been established to my satisfaction that these individuals are, in fact, independent contractors, as will be explicated in detail hereafter. But it is to be noted, however, that in a previous matter involving the same Respondent (Case 5-RC-7762) the Regional Director, on behalf of the Board, has already found on the basis of a consent stipulation agreement between the Respondent and the Union that it is an employer within the meaning of Section 2(6) of the Act. Quite apart from this official determination of Respon- dent's employer status the unit certified as appropriate for the purposes of collective bargaining was stated to be: All garage employees and all cab drivers of the Employer at its Bethesda, Md. location who drive vehicles on a daily rental basis but excluding owner- drivers, office clerical employees, dispatchers, guards and supervisors as defined in the Act. Thus, in addition to the disputed category of "cab driver" which forms the issue in this proceeding (infra ) there are also "garage employees." As to these Respondent raises no issue, its attorney stating at the trial, "We are not challenging the mechanics who are included. We are only challenging the drivers who lease cabs on the basis that they are not employees and therefore were erroneously included in the unit which they never should have been." Thus, Respondent's argument with respect to drivers to the contrary notwithstanding, it clearly admits that it is an employer of the mechanics. Upon the Regional Director's finding and Respondent's own admission, therefore, I conclude and find that it is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. In the pleadings, throughout the trial, and in its brief Respondent misconceives the term "jurisdiction" by equating it with the Board's function of interpreting the BARWOOD. INC. Act in the determination of a unit of employees appropri- ate for collective bargaining. The term "jurisdiction," as traditionally understood by the Board and the courts ' refers to the power vested in the Board by the Congress to determine labor relations matters affecting interstate commerce . I reject as unsupported any suggestion that it likewise refers to the Board's function in interpreting, as it will here, specific provisions of the statute. 11. THE LABOR ORGANIZATION INVOLVED It is admitted and I accordingly conclude and find that Automotive, Petroleum, Cylinder and Bottled Gas, Chemi- cal Drivers, Helpers and Allied Workers, Local Union No. 922, affiliated with International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of America, is a labor organization within the meaning of Section 2(5) of the Act. 111. TILE UNFAIR LABOR PRACTICES A. Procedural Background On August 6, 1971 the Union filed with the Regional Director its petition for an election in support of its claim to represent a majority of Respondent's employees2 in a bargaining unit of drivers and mechanics and excluding dispatchers, office clerical and professional employees, and supervisors. Thereafter on August 31, 1971, following consultation between the parties, a Stipulation For Certification Upon Consent Election was executed by them and approved by the Regional Director. The following was agreed upon as the appropriate bargaining unit: All garage employees and all cab drivers of the Employer at its Bethesda. Md. location who drive vehicles on a daily rental basis but excluding owner- drivers, office clerical employees, dispatchers, guards and supervisors as defined in the Act. On September 16, 1973, an election was held in which 56 of Respondent's 110 employees voted. The Union was selected by a vote 38 to 17. Thereafter, on September 24, 1971, the Regional Director, on behalf of the Board. certified the Union as the exclusive bargaining representa- tive of the employees in the bargaining unit set forth above. After some bargaining between the parties negotiations broke down over cab rentals, the Respondent insisting that it could not afford the rental rates being proposed by the Union. A charge was filed on August 24, 1972. in Case 5-CA-5754. Thereafter on September 29 the Respondent and the Union, with the Regional Director's approval, executed a settlement agreement, the Respondent agreeing to bargain with the Union upon request, and to post an appropriate notice. The agreement by its terms extended the certification year for an additional 5 months. After some bargaining in September and October 1972 Respondent retained new counsel who immediately noti- ' See Guss v Utah Labor Retauon, Board. 353 U S. 1. I Case 5-RC 7762 21 fied the Union of his appointment and suggested an early meeting. Thereafter, not having heard from the Union, he sent them a "suggested contract." Bargaining ensued during the month of January 1973. General matters were discussed at the early meetings and it was not until the January 25, 1973, meeting that the subject of cab rentals came up for discussion with Attorney Lambeth present and representing Respondent. Respondent expressed a willingness to bargain about hourly rated employees, presumably the mechanics, but took the position that the daily cab rental rate was a nonnegotiable item and outside the area of bargaining. Accordingly it has at all times refused to bargain concerning rental rates. In the pleadings and in its brief, as well as throughout the trial , Respondent has taken the position that cabdrivers are independent contractors and not employees and that accordingly the Board has no "jurisdiction" in the matter. In justification of the long delay in raising this legal issue the Respondent's counsel cites the apparent naivete of Respondent's previously retained counsel in matters relating to labor relations law and the procedures followed before the Board in the matters relating to the certification of employee representatives. B. The Respondent 's Defense it is Respondent's contention that it was not obligated to bargain with the Union for the reason that the Board had no authority to assume jurisdiction over the cabdnvers,3 for the reason that they are not employees but independent contractors. In support of this contention Respondent adduced unrefuted testimony, which I credited, which demonstrates the following : The cabs driven by the drivers (other than the owner-drivers) are the property of Respon- dent, insured by it, and rented to the individual drier on a daily rental basis, identical in procedure to the usual hiring of rental cars. Included in the daily cost of the vehicle to the driver is the rental fee itself, plus $2 .50 liability insurance fee on Respondent's vehicle, and a $3 "lot fee" which goes to defray radio dispatch services provided by an independent organization, and a State sales tax. Respondent itself defrays the cost of its maintenance of rental vehicles. The only qualifications required of a driver is that he possess a valid Maryland operator's license and a current public vehicle license issued by Montgomery County upon application filed with it by the individual driver. The Respondent is required by the county to keep a supply of applications on hand as a convenience to perspective applicants. The driver purchases his own gasoline from whatever source and of whatever brand he chooses. Gasoline is not dispensed by Respondent. It does not withhold any monies for social security , federal, State or county income tax, or any other purpose, and it files no reports whatever to any agency concerning the earnings of the individual driver. In fact, it keeps no record of the individual earnings of the drivers. Drivers are not required to post bond nor to maintain any type of record either for tax or social security purposes { At no time had Respondent contested the employee status of the garage employees 22 DECISIONS OF NATIONAL LABOR RELATIONS BOARD nor for Respondent's own operations. Accordingly Res- pondent provides no accounting or bookkeeping service for the drivers. Drivers set their own time and select their own areas of operation and, in their own discretion, use the cab stands established and maintained by the county for the use of all cabdrivers. No cabstands are provided by Respondent. There are instances, however, where cabdriv- ers using the contracted radio dispatched system misre- present their location as being nearer to the dispatched address than they actually are (called "stretching a fender"). In such cases the dispatcher, an employee of an independent company whose services are engaged by Respondent, will take the dnver "off the air," for 24 hours. He will do this however, only on the word of two or more complaining drivers, but never at the request of the Respondent alone. Upon consideration of all of the foregoing characteristics of the cab rental system operated by the Respondent it is obvious that it has no more control over the renter of a cab than a commercial car rental agency has over a casual renter of a passenger car .4 The quantum of control required by the Board to establish the employee status of taxicab drivers in rental situations is fully explicated in Central Taxi Service, 173 NLRB 826, and Transporation Promotions, Inc., 173 NLRB 828, where, in each case, there are elements of central control and discipline not evident here. Furthermore, General Counsel misreads Local 24, Teamsters v. Oliver, 358 U.S. 283, cited to me in his brief, in support of the proposition that the rental fee is a mandatory subject of bargaining. In that case, contrary to the instant one, it was the employer who paid the rental fee for the services of the individual driver and the use of his own property. Here the individual driver has been found to have rented the property from the alleged employer. Given this complete lack of control by Respondent over the driver or over the cab which he hires I have no alternative but to conclude that he is an independent contractor and not an employer as defined in the Act .5 C. Analysis and Conclusions "Where a company is charged with refusal to bargain with a union certified after election, the proceeding is sufficiently `related' to the representation proceeding to preclude relitigation of such common issues as the scope of the appropriate unit and employees therein."6 Thus the United States circuit court of appeals gives substance to Section 102.67(f) of the Board's Rules and Regulations relating to a Regional Director's determination of a representation proceeding which provides, as follows: The parties may, at any time, waive their right to request review. Failure to request review shall preclude such parties from relitigating, in any related subsequent unfair labor practice proceeding, any issue which was. ' As an element of disuplme indicative of control General Counsel cites the penalty for micreprecentation of cab location, 24 hours "off the air." and also a $1 penalty for late payment of the daily rental charge As to the former I have already found this to be a matter between drivers and the dispatching Company A, to the latter I see no more discipline or control in the late penalty than there would be in any other late or overdue charge at such establishments as a public library or local department store. or could have been, raised in the representation proceeding. Denial of a request for review shall constitute an affirmance of the Regional Director's action which shall also preclude relitigating any such issues in any related subsequent unfair labor practice proceedings. Because the Regional Director's determination in Case 5-RC-7762 relates directly to the substance of the unfair labor practice set forth in the complaint in this case the conclusion is obvious. I am precluded from further litigation of the issues involved. It might, of course, be argued that the question of relitigation of an issue is not before me, the issue never having been raised to this point. Thus, it could be suggested, that the failure to litigate the matter of the drivers' employee status in the representation case consti- tutes implicit permission for me to litigate them for the first time here . As I conceive of my function in the administra- tive scheme, however, I find no authority vested in me to overrule action taken by the Board, or by the Regional Director in its behalf . Indeed, to conclude otherwise would serve only to provide a convenient vehicle for continuing procedural delay and confusion. Apart from the legal aspects of relitigation concerned above it is of no consequence that the subject matter sought to be raised here was not, in fact, raised previously. Actually, it could have been raised then and it was not. Respondent did not offer at the hearing any newly discovered or previously unavailable evidence. Neither has it shown to my satisfaction the existence of special circumstances. And these are the only exceptions which would require the Board to reexamine the decision made in the representation proceedings.7 Respondent, of course, alleges that special circumstances do exist which require that I depart from the Board 's well- established policy by reconsidering the presence in the bargaining unit of those individuals whom I have deter- mined to be nonemployees. A determination, I might add, which could have been made in the representation case had the issue been raised there. Thus Respondent urges that the ineptness of the previously retained counsel prevented the full exploration of all the issues in the case and directly resulted in the anomalous inclusion of the cabdrivers in the unit. I have been referred to no precedent suggesting that the representation by inept counsel constitutes such a "special circumstance," and I know of none. On the contrary, reason suggests that such a situation should not merit special consideration . For, if it is to be permitted a respondent to indulge himself in the do-it-yourself ap- proach to labor relations or that it be excused for any ineptness of legal counsel whom he retains the net result would be interminable delay, necessary relitigation of issues, and, for the employees involved, an interval of 5 N I R B v United Insurance Co, 390 U.S 254 (1968), N L R B V Steinberg, 182 F 2d 854 (C.A. 5). 6 N L R B v Sagamore Shirt Company. d/b/a Spruce Pine Manufacturing Co, 365 F.2d 898, 904 (C A D.C, 1966) See also Pittsburg Plate Glass Company v NLRB , 313 U S. 146, 158. 7 Farah Manufacturing Compam•, Inc. 203 NLRB No. 78 BARWOOD, INC. isolation from the protections of the Act. I accordingly reject any suggestion that any inadequacies of Respon- dent's initial legal counsel which may appear in the handling of Case 5-RC-7762 constitutes a special circum- stance that wouldjustify the relitigation of that representa- tion case by me. Nor am I persuaded that the composition of the bargaining unit is such as to justify a dismissal of the complaint by me. It is Respondent's position that because the cabdrivers in the unit are in fact independent contractors the Board had no "jurisdiction"; i.e., that Respondent is not an employer. Quite apart from my previous holding in which I find the Board's jurisdiction to be based upon more basic grounds, Respondent loses sight of the fact that the bargaining unit is composed, at least in part, of admitted employees-the mechanics. The problem reduces itself, then, to my willingness to adjudge this case in the light of what appears to be actual fact, and in so doing overrule what has already been done in the name of the Board. As previously noted, administra- tive regularity and common sense dictates that this I cannot do. If there is repair work to be done in this proceeding it should not be of my doing. Indeed, the Board's Rules and Regulations and orderly procedure have always been available to Respondent, even now by its astute counsel, to correct what appears to have been an inadequate presentation of evidence in its behalf. For myself I am presented an admitted refusal to bargain with a certified representative of Respondent's employees. Technical though this refusal is, nonetheless it is a violation of Section 8(a)(5) of the Act. IV. THE REMEDY I have concluded and found that Respondent has unlawfully refused to bargain with the certified representa- tive of its employees. Normally I would recommend to the Board that an order issue requiring Respondent to cease 8 In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec 23 and desist in its refusal, to bargain upon request, and to post appropriate notices of compliance. Here, however, the matter has been complicated by the inclusion in the certified bargaining unit of a substantial group of individu- als whom I find to be independent contractors, and not employees as defined in Section 2(3) of the Act. Finding as I have that these individuals are not employees I certainly cannot now recommend to the Board that it contravene the Act by nonetheless ordering Respondent to bargain in their behalf. In American Federation of Musicians, Local 76, AFL-CI- O, 202 NLRB 620, the Board took occasion to discuss in detail what effect the processing cases of trivial or moot consequence had upon the enforcement of the Act. I respectfully suggest that the subject matter here presents an analogous situation. For if it is a strain upon the Board's limited resources to prosecute matters which have little or no meaning in effectuating the policies of the Act, as the Board has found, a fortiori would appear to be an even great travesty for me to recommend a remedy that would be, on the facts before me, in contravention of the Act. I therefore recommend that no order be issued herein, and I respectfully suggest to the Board that it reconsider the unit determination made in its behalf. Because, therefore, it is the sum and substance of my recommendation that however technical the violation of the Act may be here an appropriate remedy is not feasible in the present state of this proceeding. I shall recommend that the complaint be dismissed in its entirety. Upon the basis of the foregoing findings of fact and conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER8 The complaint shall be dismissed in its entirety. 102 48 of the Rules and Regulations , be adopted by the Board and become its findings, conclusions, and order, and all objections thereto shall be deemed waived for all purposes