Columbia Transit Corp.

812 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Columbia Transit Corporation , Employer-Petitioner and Amalgamated Transit Union, AFL-CIO-CLC. Case 18-RM-956 November 8, 1976 DECISION AND DIRECTION OF ELECTION BY MEMBERS FANNING, PENELLO, AND WALTHER Upon a petition duly filed under Section 9(c) of the National Labor Relations Act, as amended, a hearing was held before Hearing Officer Floyd M. Child II of the National Labor Relations Board. Fol- lowing the close of hearing the Acting Regional Di- rector for Region 18 transferred this case to the Board for decision. Thereafter the Employer filed a brief. 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 reviewed the Hearing Officer's rul- ings made at the hearing and finds that they are free from prejudicial error. They are hereby affirmed. Upon the entire record in this proceeding, the Board finds: 1. The Employer, a wholly owned subsidiary of ARA Services, Inc., a Delaware corporation, oper- ates schoolbuses under contract with five school dis- tricts in and around the cities of Minneapolis and St. Paul, Minnesota. Under Minnesota state laws, school districts are required to provide transportation for all public, private, and parochial students up to and in- cluding the eighth grade. During the past 12 months the Employer had gross revenues of approximately $7 million. Of this amount, approximately 96 percent is derived from its contracts with the five school dis- tricts.' There are approximately 500 drivers in the unit.' Of these, approximately 475 drivers spend a typical day working for one of the five public school dis- tricts. When the regular school year ends, the unit drops to 75 employees until school begins in the fall. The individual school districts are governed by school boards, which operate under the direction of the state board of education. Each school district is a political subdivision with the power to tax and enter 1 The remaining 4 percent is derived from other nonschool district related sources 2 The parties stipulated that the appropriate unit would include All school bus drivers and yard workers employed at the Arden Hills and St Paul school bus terminals, but excluding all other employees, professional employees, managerial employees, guards and supervisors as defined in the Act, as amended into contracts. Pursuant to Minnesota statutes, whenever transportation is provided, the scheduling of routes, manner and method of transportation, control and discipline of school children, and any other matter relating thereto is within the sole discre- tion, control, and management of the school board. The state board of education has established rules concerning the execution and implementation of school transportation contracts, drivers' qualifica- tions, operation, design, safety of schoolbuses, and pupils' eligibility to ride the buses. All contracts for the transportation of school children entered into by the individual school districts must be approved by the state commissioner of education within 10 days after the written contract is negotiated. Each con- tract must indicate the kind of equipment to be used, the per-pupil rate paid, the number of pupils to be transported, holidays, vacations, provisions for changes in bus routes and special trips, method of adjustments and refunds, types and amount of insur- ance coverage, how contracts are to be terminated, and a provision that the local school board must ap- prove all schoolbus routes, drivers, and alternate drivers. The Employer entered into contracts with the five school districts after approval by the state board of education. All schoolbus drivers must be satisfactory to the school districts. The Employer provides each school district with its own manager and dispatcher. These individuals are responsible to school district person- nel for proper scheduling of bus routes, and resolving problems involving student discipline, accidents, breakdowns, or shortage of drivers. Payments to the Employer are made from the public school districts which receive the money to pay for schoolbus service from the state treasury. The Employer is prohibited from charging pupils for its services or carrying ineli- gible riders on bus trips pursuant to the public schoolbus contracts. Under the contracts, only gaso- line prices may fluctuate. School officials may reduce the Employer's revenues by canceling or reducing regular routes and field or athletic trips. School dis- tricts may exercise their prerogative to change routes or schedules. Busdrivers are required to honor the requests of principals and teachers who seek to delay the departure of buses. In addition to the drivers and buses provided by the Employer, Minneapolis and St. Paul school dis- tricts operate schoolbuses with drivers on their direct payroll. The publicly owned buses travel nearly iden- tical routes and schedules as those serviced by the Employer. On occasion, when the Twin Cities are short of drivers or buses, the Employer may be called upon to service such routes with its own drivers and buses. Also, when the Employer is short on its bus 226 NLRB No. 115 COLUMBIA TRANSIT CORPORATION routes, drivers and buses are furnished by the Twin Cities. All schoolbus drivers must participate in a state- required and -conducted 20-hour schoolbus driver education program. The Minnesota department of education publishes and distributes to the Employ- er's drivers a pamphlet entitled "Minnesota Bus Driver Safe Driving Curriculum." The pamphlet sets forth the role of the driver as a teacher and instructs the driver in human relations and the methods of dealing with students. Individual school districts have issued their own guidelines to drivers and pro- vide for a uniform drivers' discipline-vandalism re- port. Busdrivers' names may be stricken from the list of eligible drivers or they may be dismissed by the individual school districts. Moreover, the State has the right to conduct compliance audits at any time. Both Minneapolis and St. Paul have ordered the dismissal of drivers because of parents' or school of- ficials' complaints. The Twin Cities require affirma- tive action programs and set forth mandatory proce- dures that the Employer must follow before terminating employees. The Employer must accede to the wishes of the five school districts as to matters involving the deployment of schoolbuses, routes, schedules, hours drivers must work, and whom to hire or fire. Transportation contracts with the school districts may be terminated on 30 days' notice or not renewed for the next year. As to the remaining 4 percent of the Employer's gross annual business which was derived from non- school district related business during the past year, the record shows the following: St. Paul Talmud Torah $22,500 Minneapolis Torah Academy 6,300 United States Military 22,100 St. Paul Academy 19,485 Breck School 26,730 Regina High School 18,050 Sunday Schools 16,646 Summer Camps 17,600 Colleges 58,200 Orvilla Home (for retarded adults) 9,000 St. Paul Home (for retarded adults) Twenty-five trips for public school children at a location bordering Minnesota .................................. 5.000 Total $222,011 The Employer also receives $36,000 per year from property rentals and $24,000 from a parts supply business. Thus, the Employer does a total of $282,011 yearly business from services which are sep- 813 arate and apart from its contract work with the five public school districts. The Employer contends that if the transportation services to exempt institutions, which are ancillary to the exempt purposes of the respective institutions, are subtracted from the $282,011, the remainder is less than $250,000. St. Paul Talmud Torah $22,500 Minneapolis Torah Academy 6,300 United States Military 22,100 Sunday Schools 16.646 Total $67,546 Thus, in the Employer's view, subtracting the $67,546 from the $282,011 reduces the revenue from ancillary services to $214,465 and therefore the Em- ployer is really not engaged in commerce in the tradi- tional industrial sense and does not meet the $250,000 standard applied to local transit compa- nies.3 Additionally, the Employer contends that the peti- tion should be dismissed because (a) it operates schoolbus services under conditions incidental to and intimately connected with the State's educational functions, and (b) the State exercises such control over its daily operations that meaningful collective bargaining would be precluded. With respect to its first contention, the Employer argues that it provides the only schoolbus service along the routes awarded it under the contract and the drivers perform virtual- ly no work for the Employer that is not related to the bus service it provides for the five public school dis- tricts. Under the contracts and the board of education's rules and regulations, the children on the buses are within the actual responsible and discipli- nary authority of the schoolbus drivers who by regu- lation act as agents of the State to assert sufficient control to protect the health and welfare of their tem- porary wards. Minnesota's public authorities have the last word as to the deployment of buses, equipment markings, and as to eligibility of drivers, placement, discipline, and termination of drivers. Minnesota's school dis- trict personnel have the responsibility of checking the Employer's and the busdnvers' compliance with the contracts, and have the right to, and do, make un- scheduled audits of the Employer's schoolbus opera- tions. Finally, the Employer contends that the record is replete with evidence establishing enough control by Minnesota agencies and public authorities over both the Employer's buses and busdrivers to prevent the Employer from bargaining effectively under the Act. 400 3 Charleston Transit Company. 123 NLRB 1296 (1959) 814 DECISIONS OF NATIONAL LABOR RELATIONS BOARD There is no dispute that the cities of Minneapolis and St. Paul and the five local school districts are not employers under Section 2(2) of the Act. Thus, the issue is whether jurisdiction should be asserted over an employer who provides schoolbus services to such municipalities . For the reasons given below, we be- lieve that the assertion of jurisdiction is not warrant- ed. The Board has declined to assert jurisdiction where the degree of control exercised by the exempt institution over the operations of the nonexempt em- ployer which provides services includes effective con- trol over the labor relations of the nonexempt con- tractor.4 Although the record discloses considerable control by the five public school districts over the Employer's labor relations, including the authority to approve the hiring of drivers and the right to demand dismissal of drivers, the setting of qualifications for drivers, etc., we do not believe the degree of control present is sufficient to preclude the Employer from effectively bargaining with a union. We note in par- ticular that the Employer retains complete freedom in setting wages and fringe benefits for its employees. Thus, where insufficient outside control of an em- ployer's labor relations exists, the focus of necessity is on the nature of the relationship between the pur- pose of the exempt institution and the services pro- vided by the nonexempt employer.5 The record shows that although Minneapolis and St. Paul do perform school busing services with their own equip- ment and their own employees on a very limited ba- sis, these two municipalities have contracted, through their five school districts, with the Employer to per- form those services which they would ordinarily per- form pursuant to Minnesota statutes, and that the Employer, through its employees, is performing the same services that these two municipalities would perform had they not chosen to contract out such services .6 Such relationship necessarily results in near total control of the manner and method of dispens- ing such services by the two municipalities involved. Thus, it follows that the Employer, which is perform- ing state-required services, shares the municipalities' exemption from the Board's assertion of jurisdiction.' This finding that the Employer shares the munici- palities' exemption from the coverage of the Act, however, is limited to the 96 percent of its operations 4 Servomation Mathias Pa, Inc, 200 NLRB 1063 (1972) 5 Herbert Harvey, Inc, 171 NLRB 238 (1968 ), Rural Fire Protection Com- pany, 216 NLRB 584 (1975) In Rural Fire Protection, the Board declined to assert jurisdiction over the employer on grounds that the firefighting ser- vices it provided were intimately related to municipal purposes which the municipality, instead of performing directly with its own employees, dele- gated to the employer to perform in its behalf 6 Transit Systems, Inc, 221 NLRB 299 (1975) r Roesch Lines, Inc, 224 NLRB 203 (1976) devoted to providing bus transportation pursuant to contract by one of the five school districts; i.e., school district related bus services. The Employer also derives $282,011 from nonschool district related bus services, thus exceeding the $250,000 jurisdic- tional standard for local transit systems erected in Charleston Transit Company, 123 NLRB 1296 (1959). The Employer's contention that certain revenue, de- rived from nonschool district related bus services (apparently for religious schools and the United States military) should be subtracted from the $282,011 figure referred to above, thus lowering the remaining revenues beneath the $250,000 minimum needed to assert jurisdiction over its nonschool dis- trict-related bus services, lacks merit. Merely sup- plying services to an institution that may, or may not, be exempt from our jurisdiction has never been suffi- cient to make the supplier of services exempt.' Ac- cordingly, we find that it would effectuate the pur- poses of the Act to assert jurisdiction over the Em- ployer's operations only insofar as they involve non- school district related bus services.' 2. The labor organization involved claims to rep- resent certain employees of the Employer. 3. A question affecting commerce exists concern- ing the representation of employees of the Employer within the meaning of Sections 9(c)(1) and 2(6) and (7) of the Act. 4. Having decided to assert jurisdiction based only on the Employer's nonschool district related bus ser- vices, the nonexempt aspect of the Employer's opera- tions, the issue remains as to what constitutes the appropriate unit for purposes of collective bargain- s We reject Member Fanning's statement that a "patent inconsistency" exists in our assertion ofjurisdiction over the nonschool district related part of the Employer's operations but not over the school district related portion Member Fanning is incorrect in saying that we are refusing to assert juris- diction over school district-related services provided by the Employer mere- ly because these services are being provided under contract with exempt institutions , i e , the five school districts The reason jurisdiction is not being asserted over part of the Employer's operation is that the particular service being provided is a statutorily required service which the school districts would be obligated to perform had they not contracted with the Employer to do the job instead This does not mean, as Member Fanning seems to suggest, that any part of any employer's operation devoted to providing a service to a governmen- tal body is ipso facto exempt from our jurisdic tion The Board addressed precisely this issue in Transit Systems, Inc, supra, in which we refused to assert jurisdiction over a bus company which , pursuant to a contract with a transit commission created by Minnesota state law, provided bus service to three cities The Board distinguished the situation in Transit Systems from that in BDM Services Company, 218 NLRB 1191 (1975), saying there the employer merely provided advice to the U S Army, but did not itself perform the exempt function of the U S Army , national defense In this case, the Employer is performing the exempt function of the MTC [transit commission ] as mandated by the Minnesota legis- lature, i e , public transportation by bus Therefore, the Employer with the MTC is exempt by the Act from the Board's jurisdiction Here, as in Transit Systems, the Employer is providing a service required by statute to a governmental subdivision , and is thus likewise exempt from our jurisdiction v See Roesch Lines, Inc, supra COLUMBIA TRANSIT CORPORATION 815 mg. In light of our jurisdictional finding herein, we further conclude that the unit found apppropriate should be limited to employees of the Employer who are engaged in providing nonschool district related bus services for the Employer. The record fails to disclose, however, whether and to what extent, some or all of the drivers and yard workers engaged in nonschool district related bus services also perform school district-related bus services for the Employer. Therefore, in accordance with principles enunciated in Berea Publishing Company," drivers and yard workers performing both nonschool district related and school district related bus services should be in- cluded in the unit if they perform nonschool district related bus services for sufficient periods of time to demonstrate that they have a substantial interest in the unit's working conditions. Upon the entire record and for the aforementioned reasons, we shall direct an election among employees in the following unit, which we have found to be appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. All school bus drivers and yard workers em- ployed by the Employer at the Arden Hills and St. Paul school bus terminals who are engaged in providing nonschool district-related bus ser- vices; but excluding all other employees, profes- sional employees, guards and supervisors as de- fined in the Act. [Direction of Election omitted from publication.] MEMBER FANNING, dissenting: Contrary to my colleagues and for the reasons set forth in my dissent in Rural Fire Protection Co.,12 I would assert jurisdiction over this Employer, includ- ing that portion of the Employer's operations which the majority finds shares the municipalities' exemp- tion because of the Employer's school busing con- tracts with the five school districts. In my view, the record does not show that the state, cities, or school districts which contract for the Employer's services exercise control over the wages and fringe benefits of the employees of the Employer. Rather, it appears that, except for the maintenance of the proper equip- ment, schedules, and the furnishing of drivers who are competent, the Employer exercises unlimited and full control over his employees, determines his own labor relations policies, and is free to engage in col- lective bargaining. The Employer is not required by the school districts to deal with or refrain from deal- 10 140 NLRB 516 (1963) See also Raymond A Gartman, d/b/a WGK Radio, 201 NLRB 763, 776 (1973) (dual-function employee performing unit work approximately 25 percent of the time included in unit), Kraft Foods Division of Kraftco Corporation, 198 NLRB 632 (1972), Florida Southern College, 196 NLRB 888, 890 (1972) 11 [Excelsior footnote omitted from publication ] ii Supra mg with unions or to submit copies of labor agree- ments for approval by the cities. The Employer owns all of his equipment. The record does not permit a finding that the cities exercise significant managerial control and that the Employer is, in fact, an instru- mentality of the cities. The Board has declined to assert jurisdiction where the exempt employer exercises substantial control over the employment conditions of the em- ployees of the nonexempt employer. However, where such control is lacking, the Board has asserted juris- diction. The record shows, and the majority finds, that the Employer retains complete freedom in set- ting wages and fringe benefits for its employees and that the degree of control by the five school districts over the Employer's labor relations is not sufficient to preclude the Employer from effectively bargaining with a union. Although there is some evidence that the cities in a limited way review and approve certain of the Em- ployer's conditions of employment, it is also clear that the Employer retains the capability of bargain- ing effectively over labor relations matters. The Em- ployer, for the most part, controls hiring, firing, and discipline of its employees, and they do not receive fringe benefits available to city employees. My col- leagues unnecessarily fragmentize the unit by limit- ing it to that 4 percent of the Employer's operations which is devoted to nonschool district-related bus services on grounds that merely supplying services to an exempt institution has never been sufficient to make the supplier of services exempt. However, it is clear that the majority has done just that by granting the Employer an exemption for its school district re- lated bus services to the municipalities. My col- leagues have not given an adequate justification for this patent inconsistency. Any municipality which contracts for goods or services must, of necessity, ex- ercise some control over performance of such con- tracts. My colleagues are placing form over sub- stance when they find that it is the nature of services performed for the exempt institution rather than con- trol of an employer's labor relations which de- termines if an employer shares that exemption. Additionally, it is apparent that the Employer per- forms services which are separate and apart from those performed for the exempt employers and pro- vides transportation, and that such operations pro- duce annual revenues of $250,000 and are sufficient to make applicable the local transit company stan- dard set forth in Charleston Transit Co 13 Therefore, I find here, as the Board did in We Transport, Inc., and Town Bus Corp.,14 that the Employer is engaged in transit operations other than schoolbus operations 3 Supra 14215 NLRB 497 (1974) 816 DECISIONS OF NATIONAL LABOR RELATIONS BOARD which directly and indirectly affect commerce, it is Accordingly, I would assert jurisdiction over this not an essentially local enterprise, and it would effec- Employer. tuate the policies of the Act to assert jurisdiction herein." 15 See my dissenting opinion in Rural Fire Protection Co, supra, and cases cited therein