Borden Co.

National Labor Relations Board - Board Decisions

Jan 19, 1966

156 N.L.R.B. 1075 (N.L.R.B. 1966)

F. H. SNOW CANNING COMPANY 1075
by the Chemical Workers, but not to that Union or its members. Our
determination is limited to the particular controversy that gave rise
to this proceeding.
DETERMINATION OF DISPUTE
Upon the basis of the foregoing findings and the entire record in this
proceeding, the Board makes the following Determination of Dispute
pursuant to Section 10 (k) of the Act :
1. Employees of Northwest Natural Gas Company, who are repre-
sented by International Chemical Workers Union, Local 133, are enti-
tled to perform the work of new construction of gas mains and lines in
Astoria, Oregon, including service lines to customers.
2. United Association of Journeymen and Apprentices of the Plumb-
ing and Pipe Fitting Industry of the United States and Canada, Local
No. 573, AFL-CIO, and Clatsop and Tillamook Counties Building and
Construction Trades Council, AFL-CIO, are not entitled, by means
proscribed by Section 8(b) (4) (D) of the Act, to force or require the
Company to assign the above work to employees who are represented
by them.
3. Within 10 days from the date of this Decision and Determination,
the Plumbers and the Council shall notify the Regional Director for
Region 36, in writing, whether they will refrain from forcing or requir-
ing the Company, by means proscribed by Section 8(b) (4) (D) of the
Act, to assign the work in dispute in a manner inconsistent with the
above determination.
F. H. Snow Canning Company, a Division of the Borden Company
and National Maritime Union of America , AFL-CIO, Petitioner.
Case No. 4-RC-6489. January 19,1966
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
Alexander T. Graham, Jr. The Hearing Officer's rulings made at the
hearing are free from prejudicial error and are hereby affirmed. Fol-
lowing the hearing and, pursuant to Section 102.67 of the National
Labor Relations Board Rules and Regulations and Statements of Pro-
cedure, Series 8, as amended, by direction of the Regional Director
for Region 4, this case was transferred to the National Labor Relations
Board for decision. Briefs have been filed by the Employer and the
Petitioner.
156 NLRB No. 95.
217-919-66-vol. 156-69
1076 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Pursuant to the provisions of Section 3(b) of the National Labor
Relations Act, as amended, the National Labor Relations Board has
delegated its powers in connection with this case to a three-member
panel [Members Fanning, Brown, and Zagoria].
Upon the entire record in this case, including the briefs filed by the
parties, 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 jurisdic-
tion herein.
2. The labor organization involved claims to represent certain
employees of the Employer.
3. The Petitioner seeks to represent a unit of all crew members
employed aboard clamming vessels owned by the Employer, excluding,
however, the captains as supervisors. The Employer contends that the
captains are independent contractors, who lease their boats from the
Employer and then engage a crew to perform the work and that, there-
fore, the crewmen are employees of the captains and not of the
Employer.
The Company is engaged in the business of processing and canning
sea clams at plants located in Point Pleasant Beach, Cape May, and
Wildwood, New Jersey, and Pine Point, Maine. Its principal raw
material is sea clams which are caught offshore by clam dredging ves-
sels. The Company owns 14 vessels, l of which is used for experimental
purposes. The other 13 are equipped for clam dredging and are oper-
ated for that purpose by individuals who captain the ships.
The relationship between the captains and the Company was out-
lined by a series of agreements which were entered into between the
captains and the Company. From January 14, 1957, through June
1964, both under written and oral agreements, the captains and their
crews were paid pursuant to what was known as the "broken-forty
system." 1 The gross price per bushel of clams was established and the
captains received a weekly check from the Company for the gross
amount based on the amount of clams caught. The captains would
then deduct expenses for fuel, oil, chart paper, propane gas, and book-
keeping and remit to the Company 40 percent of the net amount as
rental for the boat. The remainder would be divided by the captains
between themselves and their crews. From January 14, 1957, when
the captains received 1.75 gross per bushel, the rate decreased until it
reached 1.15 per bushel sometime prior to June 1964. During this
period the captains were also paid an additional 10 cents per bushel
by the Company.
'There were written concurrent charters and clam purchase agreements in effect only
from January 14 to June 14, 1957, covering the authority , obligations, rights, and
financial arrangements of the Company and the captain for each boat . Thereafter, the
captains and the Company operated on a verbal basis.
F. H. SNOW CANNING COMPANY 1077
In June 1964 the Company changed the method by which the cap-
tain's share was computed. Under this method the captains received
a straight 57 cents per bushel which was then later raised to 62 cents
per bushel. The captains then paid a portion of that amount to their
crew members. As these sums were net amount, no bookkeeping
deductions such as the vessel's rental and costs for fuel, oil, and pro-
pane were made by the Company. On September 8, 1965, after the
petition herein was filed, the Company introduced another arrange-
ment which presently governs the compensation of captains and crew.
Under what is called a clam boat lease agreement, the captains are
designated as the lessees of the vessels for which they pay the Company
$1,500 per month. The Company retains 60 cents out of a $1.40 price
per bushel of clams bought in by the boat until the $1,500 per month
rental is satisfied. The term of this agreement is 1 year except that
either party may terminate after 2 days under certain circumstances.
Under all these agreements, the Company carried insurance, main-
tained the boats in good repair, and supplied the special equipment
for clam dredging, including suitable replacement parts when neces-
sary. The Company determined when such repairs were required and
when they would be made. The captains were permitted to use the
boats for the sole purpose of clamming. When so operating they had
complete management and navigational control of their vessels as well
as the right to choose the location for dredging. They also determine
under what weather and sea conditions to sail. Management of the
boat includes hiring, terminating, and disciplining the crew members
as well as determining their hours of work and rates of pay.
The Company contends that its captains are independent contrac-
tors and, therefore, not employees within the meaning of the Act. It
relies upon a previous Board decision to that effect,2 asserting that the
relationship between the captains and the Company has remained
substantially the same.
When the Board previously considered this issue, the 1957 written
agreements as described above had just been placed into effect. In
concluding that the captains were independent contractors in that deci-
sion, the Board examined the existing contractual arrangement and
although it viewed many elements in the then-existing practice as
tending to establish an employment relationship, it regarded certain
factors encompassed by the agreements,3 including the fixed term
thereof, as rebutting the inference that the Company retained control
and that the captains were supervisors. Thus, despite a past practice
supporting a contrary conclusion, the Board accorded controlling
2 F. H. Snow Canning Company, Inc., 118 NLRB 284.
8 The Board relied upon the fact that the captains thereby received an agreed-upon
price for the clams they sold to the Company , that they were free to hire, terminate,
and determine the working conditions of the crew , and that they kept records of their
boats' operations including the withholding of taxes and the payment of social security.
1078 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
weight to the apparent intent of the new agreements. While the pres-
ent agreement like the 1957 predecessor indicates that similar incidents
of control reside in the captains , there is ample evidence in the record
of the experience that has evolved under the previous agreements and
the subsequent arrangements which sheds additional light on the nature
of the relationship between the Company and its captains. In view
of the record herein, we find that the previous decision warrants recon-
sideration.
The determination of whether an individual is an independent con-
tractor or an employee under the Act is dependent upon the nature and
the amount of control reserved by the person for whom the work is
performed. When such person reserves the right to control the result
and direct the manner and means of accomplishing the work, an
employer-employee relation exists. This nature of the relationship
must be resolved upon consideration of all the facts of each case, and
no one factor is determinative 4
The record shows that under all of the agreements and arrange-
ments, the methods of payment as well as the fluctuating amount per
bushel paid the captains were unilaterally established by the Company.
Instead of contract negotiations occurring between the Company and
the captain involved and culminating in a mutual understanding and
agreement , a company official would call the captains together , advise
them of the terms of the agreements, and then ask them for their
approval on a take-it -or-leave-it basis. In this regard , there was evi-
dence that when one of the captains refused to agree to the different
method of payment unilaterally established by the Company in June
1964, his employment was terminated. Thus, the Company, in formu-
lating the agreements that purported to define the basic relationship
between itself and the captains, exercised the type of control that is
generally found to exist between an employer and his employees rather
than between a principal and an independent contractor.
The Company, however, urges that the captains are independent
contractors because, like entrepreneurs, they can by exercise of their
own judgment increase their profits from operation of the boats. While
the incentive arrangements contained within the above-mentioned
agreements seem to allow the captains an opportunity to increase their
profits through the sound operation of their boats, the record shows that
as a practical matter the captains have little opportunity to make deci-
sions which will affect their profit and loss. Thus, there is evidence
that the Company did not change the methods of payment and the
amounts paid per bushel of clams on a haphazard basis. These changes
were the result of mathematical calculations based upon the Company's
records as to the average number of bushels of clams a captain can catch
in a day, the average number of days the captains could generally work
4 Farmers Insurance Group, et al., 143 NLRB 240.
F. H. SNOW CANNING COMPANY 1079
in a year, and the average cost of operating a boat over the year. By
altering the methods of payment as well as amounts paid per bushel
the Company was thereby able to establish within narrow limits a ceil-
ing on the maximum earnings the captains could receive in a year. At
the same time, because the captains were paid a flat sum per bushel of
clams, and the Company absorbed the major expenses (those attributed
to owning, maintaining, and equipping the vessels) the captains did
not risk any capital loss which might have come from inefficient man-
agement on their part. The record indicates that the risk of loss is
further minimized under the present agreement since the Company
will "carry" the captains in the event they cannot meet their rent
because of poor weather or the faulty operation of their boats.
Although it might appear that under the written agreements the
captains were able to increase their income by the efficient and economi-
cal management of their boats on a day-by-day basis, this in fact did
not occur. Thus, while the 1957 and the present agreement required
that the captains furnish supplies for the boats, and theoretically pre-
sented the opportunity to profit by selective purchasing, the record
shows that they made all such purchases from the Company at the lat-
ter's facilities with the charges therefor offset against the payments
due the captains and the crew. And, under the arrangement in exist-
ence between June 1964 and September 1965, there was not even the
appearance of an opportunity to profit through purchases of supplies
since the Company at that time assumed the responsibility for such
cost. In addition, the Company has at times limited the number of
clams it will buy and while the captains do have the right to sell clams
in excess of this quota to other buyers, there was evidence that such a
market was not readily available in the area. Further, the Company
has the right to inspect the clams for size and conditions and make a
final determination on whether or not to purchase clams.
Nor does the record otherwise establish that the captains are inde-
pendent contractors. Although the captain is the complete master
aboard his boat, such control is in accord with maritime tradition and
would obtain regardless of whether he is an independent contractor or
an employee. Furthermore, the Board has held in similar circum-
stances that "[t]he existence of an area in which judgment may be
exercised by a skilled worker is not inconsistent, or incompatible, with
the existence of an employment relationship." 5 In any event, the Com-
pany here has retained substantial control over the overall business
operation. Thus, the boats are owned by the Company; the contracts
while providing for a fixed term may be terminated on short notice
upon numerous grounds, thereby ending the entire arrangement
between the Company and the captain; the captain must turn over the
entire catch to the Company at a predetermined fixed price if the Com-
a Southern Shellfish Co., Inc, 95 NLRB 957, 962.
1080 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
pany wants it; the Company pays all costs of keeping the boat in repair
and makes all decisions concerning when and where major repairs are
to be made; the Company carries indemnity insurance which protects
the captain as well as his crew ; and the captain is prohibited from using
the boats for any purpose other than clamming.
In view of the foregoing and the record as a whole, we find that the
captains are not independent contractors but are supervisors and the
crew members are employees of the Employer.(' We therefore find that
a question affecting commerce exists concerning the representation of
certain employees of the Employer within the meaning of Section
9(c) (1) and Section 2(6) and (7) of the Act.
4. We find that the following employees of the Employer constitute
a unit appropriate for the purposes of collective bargaining within the
meaning of Section 9(c) of the Act:
All crew members employed aboard clamming vessels owned by the
Employer, excluding captains.
[Text of Direction of Election omitted from publication.]
e East Coast Trawling 4 Dock Company, Inc., 153 NLRB 1354; William P. Riggin
Son, Inc., 153 NLRB 135 '8. To the extent that the Snow case, footnote 2, supra, is in-
consistent with this finding, it is hereby overruled.
Westinghouse Electric Corporation and Salaried Employees As-
sociation of the Baltimore Division , Federation of Westing-
house Independent Salaried Unions. Case No. 5-CA-3033.
January 21, 1966
DECISION AND ORDER
On August 11, 1965, Trial Examiner Harry H. Kuskin issued his
Decision in the above-entitled proceeding, finding that Respondent had
engaged in and was engaging in certain unfair labor practices and rec-
ommending that it cease and desist therefrom and take certain affirma-
tive action, as set forth in the attached Trial Examiner's Decision.
Thereafter, Respondent filed exceptions to the Decision and a support-
ing brief.
The National Labor Relations 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 con-
sidered the Trial Examiner's Decision, the exceptions, the brief, and
the entire record in this case, and hereby adopts the findings, conclu-
sions, and recommendations of the Trial Examiner, with the following
modifications.
156 NLRB No. 96.