Butte Water Co.

National Labor Relations Board - Board Decisions

Feb 28, 1957

117 N.L.R.B. 484 (N.L.R.B. 1957)

484 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ployees, stockroom employees, experimental modelmakers, toolroom and
tool crib attendants, and floor inspectors, but excluding the shop coordina-
tors, production control clerks, office and clerical employees, engineering
department employees, research department employees other than model-
makers, time-study men, senior group leaders, guards, watchmen, time-
keepers, head inspectors, professional employees, and supervisors within
the meaning of the Act.
WE WILL NOT in any manner interfere with the efforts of the above-named.
Union to bargain collectively with us, or refuse to bargain with said Union, as.
the exclusive representative of all our employees in the bargaining unit set forth
above.
PRECISION SCIENTIFIC COMPANY,
Employer.
Dated------------------- By-------------------------------------------
(Representative) (Title)
This notice must remain posted for 60 days from the date hereof, and must not be
altered, defaced, or covered by any other material.
Butte Water Company and International Union of Operating
Engineers , Local Union 375 , AFL-CIO. Case No. 19-RC-1869.
February 28,1957
DECISION AND ORDER
Upon a petition duly filed under Section 9 (c) of the National
Labor Relations Act, a hearing was held before Dan E. Boyd, hearing
officer. The hearing officer's rulings made at the hearing are free
from prejudicial error and are hereby affirmed.'
Upon the entire record in this case, the Board finds :
The Employer, a New Jersey corporation, is engaged in providing
water to the general public and to various business enterprises in
Butte, Montana, and the surrounding vicinity. The Employer took
no position in regard to whether or not it was engaged in interstate
commerce.
The record reveals that during the last year the Employer's sales
totaled $685,667. In that same period its sales to organizations engaged
in interstate commerce amounted to $237,533, of which $198,298 were
to the Anaconda Company.
The Employer is a wholly owned subsidiary of the Anaconda Com-
pany and shares interlocking officers and directors with that corpora-
tion. However, the record indicates that the Employer is operated as
a separate enterprise under its own general manager who directs the
Employer's labor relations and other policies and exercises independent
1 Butte Stationary Engineers Union No. 83, International Union of Mine, Mill and
Smelter Workers, was allowed to intervene at the hearing on the basis of its contractual
interest.
117 NLRB No. 63.
BUTTE WATER COMPANY 485
judgment in so doing.2 The primarily local character of the Em-
ployer's activities is shown by the fact that in 'the past year approx-
imately two-thirds of its sales were made to private individuals or to
businesses not engaged in interstate commerce.
On the above facts and the entire record, we find that the Employer
is a local public utility. Under the rule established in the Greeniwieh
Gas 3 case a local public utility must gross $3,000,000 annually to
justify the assertion by the Board of jurisdiction over its operations.
As the Employer does not meet this standard, we find that it will not
effectuate the policies of the Act to assert jurisdiction herein. We
shall, therefore, dismiss the petition.
,The Board dismissed the petition.]
MEMBER MURDOCK, dissenting :
I dissent from the dismissal of the petition on the stated grounds
that it will not effectuate the policies of the Act to assert jurisdiction
over the Employer's operations. The majority's conclusion to that
effect can only have been arrived at by the application of criteria other
than the effect of the Employer's operations on commerce. Moreover,
as appears hereafter, this dismissal is not even required by the Board's
present restrictive jurisdictional standards.
The Employer is the only source of water in the Butte, Montana,
area. In addition to supplying water to individuals, it supplies water
to railroads, airline and bus terminals, and to enterprises engaged' in
interstate commerce, including the Anaconda Company's mining oper-
ations. Its total annual sales approximate $685,000. Its sales to
enterprises engaged in interstate commerce totaled $235,533, of which
over $198,000 were to Anaconda Company's mining operations in the
Butte area.
It is readily apparent that the Employer's operations satisfy the
Board's indirect outflow standard, which requires the assertion of juris-
diction over enterprises which annually furnish materials or services in
the amount of $100,000 to instrumentalities of commerce or to enter-
prises which annually ship goods valued in excess of $50,000 directly
in interstate commerce.' Under this standard the Board asserts juris-
diction over enterprises furnishing window washing services,5 painting
2 The Employer 's general manager is in charge of negotiations with the various unions
with which the Employer deals. In their bargaining they have usually followed the area
pattern in regard to wages and other conditions of employment as established by the Silver
Bow Employer's Association The Employer is not, however, a member of this
organization.
3 Greenwich Gas Company and FaeZs , Incorporated, 110 NLRB 564 ; Gary Hobart Water
'Corporation, 115 NLRB 1575.
4Jonesboro Grain Drying Cooperative, 110 NLRB 481 ; Whippany Motor Co., Inc., 115
NLRB 52.
6 City Window Cleaning Company, 114 NLRB 906.
486 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and sandblasting services,' guard services,' or printed materials such
as office forms. ' Furthermore the Board has just recently applied the
indirect outflow standard to assert jurisdiction over a local transit
system 9 whose operations did not satisfy the Greenwich Gas standard,"
and over an intrastate trucking firm," whose operations did not satisfy
the standards previously established for the transportation industry.la
In the latter case the Board applied the indirect outflow standard de-
spite the fact that it had expressly stated in an earlier decision that the
Jonesboro standards would not be applied to enterprises in the trans-
portation industry." The Board justified its departure from the ap-
plicable standard for the transportation industry on the ground that
The local hauling services performed by Petitioner are indis-
tinguishable from such other types of services for interstate busi-
nesses as might, under the Jonesboro rule afford a basis for
asserting judisdiction.
Consistent with the above decisions , the Board should assert jurisdic-
tion over the Employer . For clearly the furnishing of water to inter-
state businesses is indistinguishable from furnishing other services
which under the Jonesboro rule afford a basis for asserting jurisdiction.
Adequate supplies of water play a particularly essential role in the
copper mining industry . Most of the copper ore mined in this country
is treated at or near the minesite by "flotation ." 14 Flotation has been
described as
the most important modern development in regard to mineral
separation . . . . [It] has rendered possible the profitable treat-
ment of ore bodies and even of residues from older and less ef-
ficient methods of treatment . The flotation process consists in
stirring up finely divided ore in water to which certain additions
have been made in order to produce froth when the water is
violently agitated or air is blown through it . This froth carries
with it to the surface of the water the fine particles of mineral leav-
ing the particles of gangue at the bottom. In this way it is
possible to remove and to concentrate the mineral values out of
very poor ore, the operation being both rapid and cheap.15
6 Industrial Painters and Sandblasters , 112 NLRB 437
7 Burns Detective Agency, 110 NLRB 995.
8 Jahn-Tyler Printing and Publishing Company, 112 NLRB 167
8 Potash Mines Transportation Company, Inc, 116 NLRB 1295.
10 This standard is applicable to local transit systems as well as to local public utilities.
u Pazan Motor Freight, Inc., 116 NLRB 1568.
Is Breeding Transfer Company, 110 NLRB 493 , and Edelen Transfer and Storage Com-
pany , Inc, 110 NLRB 1881.
19 Edelen Transfer and Storage Company , Inc., supra.
14 Minerals Yearbook , Metals and Minerals (Except Fuels), volume 1, 1952, page 351.
Published by United States Department of the Interior , Bureau of Mines
15 15 Encyclopedia Britannica , page 311.
BUTTE WATER COMPANY 487
Although this record does not disclose the details of Anaconda Com-
pany's mining operations, Government reports show that the flotation
process is an important factor in its operations. In 1955 Anaconda
Company's Butte Mines were the third largest copper mining opera-
tion in the United States in terms of output.16 In 1952, after a period
of preparation, Anaconda Company started production of low grade
ores from areas adjacent to the normal Butte vein structures. By the
end of 1955 production of low grade ore had reached an annual rate of
90,000,000 pounds of ore.17
Any reduction in the output of Anaconda's Butte mines would have
significant effects on the copper industry and the national defense.
According to the Mineral Industry Survey, the copper industry in 1955
was marked by inadequate supplies to meet increased consumption.
Output in 1955, though 20 percent higher than 1954, did not meet the
high levels anticipated, chiefly because of labor disputes in the in-
dustry. The Government found it necessary to assist an industry
harassed by shortages, by releasing holdings of metal and of metal
under contact for delivery to the Government.18 As a result of such
action a total of 72,000 tons of copper was diverted from delivery to
Government stockpiles and from Defense Production Act inventory."
Though the situation has eased somewhat in 1956, the improvement has
been largely the results of a recent absence of labor strife in the
industry 20
In the face of the obvious critical importance of the water fur-
nished by the Employer to the -continuance of Anaconda's operations,,
which in turn represent such a substantial portion of the Nation's total
copper production, there can be no possible justification for this
Agency to conclude that the policies of an Act designed to promote
the free flow of commerce will be effectuated by the refusal to assert
jurisdiction over the Employer. The fact that the Employer is a local
public utility whose operations do not meet the $3,000,000 gross receipts
test of the Greenwich Gas case is no justification. Rather it demon-
strates once more, the fallacy of the assumption underlying the Green-
wich Gas standard for public utilities (pointed out in the dissenting
opinion therein), that multimillion dollar utilities in terms of gross re-
ceipts have a substantial impact on interstate commerce while smaller
utilities do not. The fallacy of such an assumption was only recently
18 Mineral Industry Surveys, United States Department of the Interior, Bureau of Mines,
Mineral Market Report No 2563.
17 Standard and Poor's Corporation Records, A-B, page 2100
Is Mineral Industry Surveys, United States Department of the Interior, Bureau of Mines,
Mineral Market Report No 2563.
09 Ibid. In 1951 the Government commenced a program to stimulate the production of
copper by entering into long-term purchase agreements with domestic producers. By the
end of 1952 it had entered into 18 such agreements, of which 11 called for deliveries
until after the end of 1956. See Minerals Yearbook for 1952, table 2, page 348.
20 See the Monthly Copper Reports Nos. 49-58, published by the United States Depart-
ment of the Interior, Bureau of Mines.
488 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
demonstrated again, when the majority applied that standard to refuse
to assert jurisdiction over the water utility in Gary, Indiana, supply-
ing industrial concerns in the largest steel producing area in the
world, despite the crucial importance of an ample supply of water
to the production of steel.21 I do not see how one can avoid the
conclusion that any jurisdictional scheme is arbitrary and capricious
which (as the majority holds) does not permit the assertion of juris-
diction over an enterprise furnishing in excess of $100,000 worth of
water necessary to the production of concerns like the Anaconda Com-
pany or the United States Steel Corporation, but which requires the
assertion of jurisdiction over enterprises which furnish them a like
amount of window washing, painting, and sandblasting or guard
services, or just printed forms.22
But even in the absence of the long overdue revision of the jurisdic-
tional standard for public utilities, under existing precedents involv-
ing the single employer "doctrine" jurisdiction should nevertheless
be asserted over the Employer. The record conclusively demonstrates
that the Employer is an integral part of the Anaconda Company's
mining operations. I have already discussed the manner in which the
Employer's operations are functionally integrated with those of the
Anaconda Company by virtue of the fact that it is the sole source of
supply of water which is essential to the operations of the Anaconda
Company. In addition as conceded by the majority, the Employer
is the wholly owned subsidiary of the Anaconda Company and all of
its officers and directors are officers and/or directors of the Anaconda
Company. The majority finds however, that the Employer is oper-
ated as a separate enterprise under its own general manager who
directs its labor relations and other policies, exercising independent
judgment in so doing. The latter finding would be unexceptionable if
the issue before us were whether or not the Employer's general man-
ager was a supervisor within the meaning of the Act. We are con-
cerned, however, with a different question which the majority refuses
to discuss-the question whether the operations of the Employer,
despite the fact that it is a separate enterprise with a separate corpo-
rate identity, are so integrated with those of Anaconda as to warrant
the conclusion that for jurisdictional purposes they are to be regarded
as a single employer. The functional integration of the operations
of the Employer, described above, together with the common officers
and directors permits of only one conclusion, that the Employer is an
integral part of Anaconda's mining operations and must be treated
as a single employer with Anaconda. This is so even if the majority's
conclusion that the general manager "directs" the Employer's labor
relations policies is intended to suggest that he independently deter-
21 Gary Hobart Water Corporation, 115 NLRB 1575.
21 See cases cited in footnotes 6, 7, 8, 9, 10, 11, and 12.
BUTTE WATER COMPANY 489
mines them. For even in the absence of a centrally controlled labor
relations policy the Board has found two or more corporations to
constitute single employers, where the corporations were commonly
owned, had interlocking directorates, and there was some showing of
integration of operation.23 Indeed in 2 cases the finding of a single
employer was rested solely on the fact that the 2 corporations were
commonly owned and had interlocking directorates.24
However, the majority's finding that the Employer's general man-
ager "direct" the Employer's labor relations does not correctly reflect
the record insofar as it suggests that the general manager independ-
ently determines labor relations policy. The Employer's general man-
ager testified that everything he did is subject to the approval of the
officers of the Company, that naturally he worked under their direc-
tion. In describing the manner in which collective-bargaining nego-
tiations were carried out, he stated that although he did the negotiat-
ing, he first discussed matters with the officers of the Company, and
then with the business agent of the Union. After agreement was
reached, he would write a letter to his superintendent directing him to^
put the new conditions into effect, which "would be approved by officers
of the Butte Water Co." before it could be effective. This testimony
demonstrates that all policies of the Employer including labor rela-
tions policies, are established and controlled by the officers of the Em-
ployer, and that the general manager merely carries out such policies
in accordance with the directions from his superiors. In these circum-
stances the majority's finding that the general manager "directs" the
Employer's labor relations, insofar as it suggests that he determines
these policies, clothes him with authority he refused to claim he had,
and which he specifically placed in the hands of his superior officers.
As these officers are also the responsible officers of the Anaconda Com-
pany, it is plain that labor relations for the two corporations are in
fact centrally controlled by the same group of men. There can be no
doubt but that the Employer and the Anaconda Company constitute a
single Employer for jurisdictional purposes under Board precedents.
In view of the foregoing, I would assert jurisdiction over the Em-
ployer. I would do so on either of the two grounds : First, because the
Employer annually furnishes in excess of $100,000 worth of water to
23 See Youngstown Tent & Awning Company, 110 NLRB 835; and Orkin Exterminating
Company, Inc. (of Kentucky), 115 NLRB 622 In the Orkin case, the Board found that
the separate corporation there involved was an integral part of a multistate enterprise
despite finding that its manager "exercises his own discretion and judgment in hiring and
discharging employees ; he sets the rates of pay of his employees ; and determines holidays,
hours of employment, the need for overtime, and vacation policy. He maintains records
of all transactions, makes up his own payroll, has the power to obligate the Employer's
credit, and shares in the Employer's profits each year "
''4 Hot Shoppes Caterers, Inc., 10-RC-2896 , issued April 13, 1955, not reported in
printed volumes of Board Decisions and Orders , but facts quoted in dissent in Orkin,
"The Rat Man," Inc., 112 NLRB 762, 764; Colonial Sand & Stone Co, 2-RC-8269, issued
October 3, 1956 (not reported in printed volumes of Board Decisions and Orders).
490 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the Anaconda Company, and thus its operations satisfy the Board's
indirect outflow standards; secondly, the Employer constitutes a single
Employer with the Anaconda Company whose gigantic operations
obviously meet several of the Board's jurisdictional standards.25
25 Anaconda Company, 114 NLRB 530; Anaconda Copper Mining Company, 104 NLRB
1064 (corporate name changed between dates of the two cases). Anaconda Company's
Consolidated Income Repoit for 1955, discloses gross sales and revenues of $630,703,000.
Standard and Poor's Corporation Records, A-B, page 2102
Vowell Construction Company and International Hod Carriers
Building and Common Laborers ' Union , Local No. 417, AFL-
CIO, and Truck Drivers, Chauffeurs, Warehousemen & Helpers
Local Union No. 941, AFL-CIO, Joint-Petitioners . Case No.
33-RC-585. February 28,1957
DECISION AND ORDER
Upon a petition duly filed, under Section 9 (c) of the National Labor
Relations Act, a hearing was held before Byron E. Guse, hearing
officer. The hearing officer's rulings made at the hearing are free
from prejudicial error and are hereby affirmed.
Upon the entire record in this case, the Board finds :
1. The Vowell Construction Company, hereinafter referred to as
Vowell, is engaged in the construction of roads, highways, and streets
in the State of Texas. During the last calendar year it performed no
services outside the State of Texas. Its direct out-of-State purchases
amounted to approximately $40,000. During-the same period it per-
formed services valued in excess of $250,000, for businesses engaged in
interstate commerce. These services consisted of the construction and
blacktopping of parking facilities. During the same period Vowell
furnished services and materials valued in excess of $100,000, pursuant
to a contract with the United States Government for the construction
of runways and landing strips at Biggs Air Force Base in El Paso,
Texas. The employees involved herein are engaged in furnishing
maintenance services on roads and grounds of the Standard Oil Com-
pany of Texas under a contract between that company and Vowell.
Vowell contends that the Board should not assert jurisdiction herein
because the services it performs for businesses engaged in interstate
commerce do not enter the stream of commerce, and because the em-
ployees involved were not engaged in the performance of services
under the contract with the United States Government. We find no
merit in these contentions. The Board's indirect outflow standard
does not require that the goods or services furnished to businesses en-
117 NLRB No. 69.