Carpet, Linoleum and Soft Tile Local No. 1247

National Labor Relations Board - Board Decisions

Jan 18, 1966

156 N.L.R.B. 951 (N.L.R.B. 1966)

CARPET, LINOLEUM AND SOFT TILE LOCAL NO. 1247 951
Carpet , Linoleum and Soft Tile Local Union No. 1247 of the
Brotherhood of Painters , Decorators and Paper Hangers of
America, AFL-CIO [Indio Paint and Rug Center] and Eugene
W. Norman . Case No. 21-CB-2451. January 18, 1966
DECISION AND ORDER
On October 21, 1965, Trial Examiner Maurice M. Miller issued his
Decision in the above-entitled proceeding, finding that the Respondent
had not engaged in unfair labor practices as alleged in the complaint
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 1 to the Trial Examiner's Deci-
sion and a supporting 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 considered the Trial Examiner's Decision and the entire record in
this case , including the exceptions and brief, and hereby adopts the
findings, conclusions , and recommendations of the Trial Examiner.
[The Board adopted the Trial Examiner's Recommended Order.]
1 We find merit in the General Counsel's contention that the burden of proof in deter-
mining whether the Employer herein is primarily engaged in the building and construe-
tion .industry lies with the party seeking to avail itself of Section 8(f)'s statutory ex-
ception , in this case the Respondent Union. However , based upon the entire record, we
conclude that the evidence clearly indicates that Respondent has adequately borne such
burden.
DECISION OF THE TRIAL EXAMINER
STATEMENT OF THE CASE
Upon a charge and amended charge duly filed and served-dated December 7
and 11, 1964, respectively-the General Counsel of the National Labor Relations
Board caused a complaint and notice of hearing to be issued and served on
March 24, 1965, upon Carpet, Linoleum and Soft Tile Local Union No. 1247 of
the Brotherhood of Painters, Decorators, and Paper Hangers of America, AFL-CIO,
designated as Respondent Union in this decision . Therein, Respondent Union was
charged with unfair labor practices affecting commerce, within the meaning of
Section 8 (b)(1)(A) and (2) of the National Labor Relations Act, as amended
(61 Stat. 136, 73 Stat. 519). Within its answer duly filed, Respondent Union denied
the complaint 's jurisdictional allegations , conceded certain further factual allegations
therein, but denied the commission of any unfair labor practice.
Pursuant to notice , a hearing with respect to the issues was held in Los Angeles,
California , on June 10, 1965, before Trial Examiner Maurice M. Miller. The
General Counsel and Respondent Union were represented by counsel. Each party
was afforded a full opportunity to be heard, to examine and cross -examine witnesses,
and to introduce evidence pertinent to the issues. Certain stipulations were proffered
which reflected Respondent Union's factual concessions with respect to the com-
plaint's jurisdictional allegations , together with certain other matters . When their
respective testimonial presentations were complete , counsel waived oral argument,
but declared their intention to file briefs. These briefs have been received and have
been fully considered.
156 NLRB No. 97.
952 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
FINDINGS OF FACT
Upon the entire testimonial record, documentary and other evidence received,
and my observation of the witnesses, I make the following findings of fact:
1. JURISDICTION
H. A. Mills and C. M. Mills are, and have been throughout the period with which
this case is concerned, copartners doing business under the trade name and style of
Indio Paint and Rug Center; the firm will be designated as the Company or Employer
within this decision. The Company has its principal place of business at Indio,
California; there it is presently engaged in and has been engaged in, the sale, at
retail and wholesale, and installation of hard and soft flooring and formica. During
the 1964 calendar year-which period may be deemed representative-the Company
had more than $596,000 in gross revenue. Within the same period it purchased, and
caused to be delivered and transferred to its place of business, floor coverings and
other goods and materials valued in excess of $24,000, which goods and materials
were received by it from William Volker Company and J. N. Ceazan Company,
both firms located in Los Angeles, California; these designated firms, so the record
shows, had received the goods and materials in question directly from an out-of-
State source, specifically Armstrong Cork Company's Lancaster, Pennsylvania, plant.
Upon the complaint's jurisdictional allegations, which despite Respondent Union's
formal denial I find substantiated, Respondent is now, and at all material times has
been, an employer within the meaning of Section 2(2) of the Act, engaged in com-
merce and business activitites which affect commerce within the meaning of Section
2(6) and (7) of the Act, as amended. With due regard for those relevant jurisdic-
tional standards which the Board presently applies (Carolina Supplies and Cement
Co, 122 NLRB 88; Man Products, Inc., 128 NLRB 546; Harry Tancredi, 137 NLRB
743, and related cases), I find assertion of the Board's jurisdiction in this case war-
ranted and necessary to effectuate statutory objectives.
it. THE RESPONDENT LABOR ORGANIZATION
Carpet, Linoleum and Soft Tile Local Union No. 1247 of the Brotherhood of
Painters, Decorators and Paper Hangers of America, AFL-CIO, designated as
Respondent Union within this decision, is, and at all times material has been, a
labor organization within the meaning of Section 2(5) of the Act, as amended, which
admits Company employees to membership.
III. THE UNFAIR LABOR PRACTICE CHARGED
A. Facts
1. Background
Since at least 1958, Respondent Union and the Company have been privy to
successive collective-bargaining contracts; these contracts have governed the hire,
job tenure, and terms and conditions of employment for the Company's workers.
Most recently-since August 1, 1964, specifically-the Company and Respondent
Union have maintained and enforced a collective-bargaining contract which, though
separately negotiated, represents a counterpart of Respondent Union's current Master
Labor Agreement with four trade associations within the Southern California floor
covering industry.
(This contract, pursuant to its terms, covers work done within five designated
Southern California counties, and certain limited portions of two or more
contiguous counties.)
Within the geographical area which Respondent Union's master contract covers,
it purports to govern "all work within the [Union's] work jurisdiction" subject to such
changes, however, as may occur from time to time. Therein, Respondent Union is
contractually recognized as bargaining representative for "all workmen, including
maintenance employees [,] who are required to use any of the recognized tools of
the trade" which the contract covers; i e. the floor covering industry. With respect
to such workmen, Respondent Union's master contract contains a union-security
clause which reads as follows:
Article III, Section 1. It is agreed that all workmen covered hereby shall be or
become on the eighth (8th) day after employment, and remain continuously,
members in good standing of the Union signatory hereto and on whose behalf
this Agreement is executed as a condition of employment.
CARPET, LINOLEUM AND SOFT TILE LOCAL NO. 1247 953
Since Respondent Union's contractual privity with Indio Paint and Rug Center
presently derives from that company's conceded acceptance of the union's Master
Labor Agreement, or its counterpart-functioning as a so-called "non-member signa-
tory employer" separately bound-the union security provision noted has been
maintained and enforced with respect to Company workers; General Counsel's con-
tention with respect to its current maintenance and enforcement, has not been
challenged.
2. Discussion
a. The issue
General Counsel, substantially, contends that, through its maintenance and enforce-
ment of a collective-bargaining contract which contains the union-security provision
noted, Respondent Union has caused Indio Paint and Rug Center to discriminate
against its employees in violation of Section 8(a)(3) of the statute; thereby, General
Counsel argues, Respondent Union has engaged in, and continues to engage in, unfair
practices affecting commerce, within the meaning of Section 8(b)(2) and (1) (A) of
the Act, as amended.
Supporting his basic position, General Counsel contends that Indio Paint and Rug
Center should not be considered an employer engaged primarily in the building and
construction industry.
Clearly, this specification within General Counsel's complaint is calculated to
forestall and counter Respondent Union's presumptive contention, by way of defense,
that its contractual arrangement with the Company should-pursuant to Section
8(f) of the statute-be considered privileged. The section in question provides, in
relevant part, as follows:
It shall not be an unfair labor practice under subsections (a) and (b) of this
section for an employer engaged primarily in the building and construction
industry to make an agreement covering employees engaged (or who, upon their
employment, will be engaged) in the building and construction industry with a
labor organization of which building and construction employees are members
(not established, maintained, or assisted by any action defined in section 8(a)
of this Act as an unfair labor practice) because ... (2) such agreement requires
as a condition of employment, membership in such labor organization after the
seventh day following the beginning of such employment or the effective date
of the agreement, whichever is later, .. .
And Respondent Union, herein, does claim privilege for its contract pursuant to this
statutory provision. Specifically, while denying General Counsel's charge, Respond-
ent Union has traversed his complaint's allegation that Indio Paint and Rug Center "is
not" an employer engaged primarily in the building and construction industry. Such a
pleading is calculated, necessarily, to place the burden on General Counsel, with
respect to his contention that Section 8(f) cannot properly be relied upon to save
Respondent Union's contractual union-security provision from statutory proscription.
With matters in this posture, two narrowly defined questions would seem to be pre-
sented for determination: (1) Should the Company's business, particularly that por-
tion which involves the sale and installation of both "hard" and "soft" floor coverings,
be considered a business within the building and construction industry? (2) If so,
should Indio Paint and Rug Center be considered an employer "primarily" engaged
within that industry? General Counsel's testimonial presentation and brief suggest
no contention that floor coveiing installation work specific all y-regard less of the
material installed-should not be considered building and construction industry work
Joinder of issue has been reached, however, regarding the second question noted, since
General Counsel does contend that the Company, for reasons to be seen, should not
be considered "primarily" engaged within the designated industry.
b The business of the Company
Throughout the period with which this case is concerned. Indio Paint and Rug
Center has been engaged in the sale and installation of both "hard" and "soft" floor
coverings, drapes, and prefabricated formica counters. Concurrently, the Company
had done a limited volume of retail "over-the-counter" selling; for the most part, such
sales have been confined to paint and, presumably, some drapes, carpets, and resilient
tile.
With respect to so-called "hard" floor covering, the Company deals in such mate-
rials as linoleum and asphalt tile; the work done by the firm within the so-called soft
floor covering field chiefly involves wall-to-wall carpet installations.
954 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
While a witness, Company partner H A. Mills proffered a knowledgeable guess that
99 percent of his firm's total floor covering sales are not mktlly made pursuant to con-
tracts which require the Company to install whatever materials are sold, according to
Mills, no more than 1 percent of the firm's gross annual revenue has been derived, con-
versely, from compensation received for installation services performed on floor
covering materials which Indio Paint and Rug Center has not, itself, purveyed
Previously, within this decision, reference has been made to the Company's gross
revenue during the 1964 calendar year. Approximately 62 percent of the firm's gross
revenue during the period in question, was derived from so-called special trade con-
tract work for general contractors engaged in residential and commercial construction.
Normally, such work is done pursuant to subcontract awards, made by general con-
tractors, based on competitive bids received; such bids when presented routinely spe-
cify contract prices calculated to cover both the cost of the materials to be furnished
and labor costs for their installation, plus some profit.
Approximately 31 percent of the Company's gross revenue, during the calendar year
1964, was derived from "hard" and "soft" floor covering sales to homeowners The
firm's revenue, thus derived, likewise included compensation for materials furnished
plus installation labor costs. '
(The Company' s homeowner contracts , during the period now under considera-
tion-like its construction project contracts-were calculated to cover the cost of
materials and installation service on linoleum , resilient tile, wall-to-wall carpets, or
some combination of these materials , plus some profit ; combination contracts, pre-
sumably, normally involved linoleum or resilient tile laying for kitchens and bath-
rooms, with wall-to-wall carpet installations elsewhere.)
About 7 percent of the Company's 1964 gross revenue was derived from its retail
"over-the-counter" sales of paint and sundries ; with respect to such sales , clearly, no
portion of the sums received reflected any compensation for installation services.
When requested to state what percentage of the Company's gross yearly revenue
derived from general contractors and homeowners, respectively, covered sales and
'service rendered in connection with "soft " wall-to-wall carpet installations , as dis-
tinguished from "hard" linoleum and resilient -tile installations , Mills could not pro-
vide a meaningful reply: He could only declare that, within the Southern California
area-generally, there is currently a substantial "new trend" for general contractors
engaged in residential tract construction to subcontract for wall-to-wall carpets in
houses built on speculation for subsequent sale.
Summoned as Respondent Union's witness , Business Manager Adam confirmed this
testimony. Within Respondent Union's geographical jurisdiction, he declared, finished
new residential housing, now, will "normally" be sold by builders with some wall-to-
wall carpeting installed. Apartment houses and commercial buildings will, most
likely, have hard surface (resilient tile) floors provided for their public areas, tenants
within such buildings, however, will normally be left free to make their own arrange-
ments with respect to hard surface or carpet installations for rented space
All of the Company's competitors within the Indio area, six or seven in number, do
a substantially similar business; specifically, they regularly solicit and perform "sales
and service" contracts within the floor covering field None of them, so far as the
record shows, limit their contract work to installing floor covering materials provided
by builders, general contractors, materialmen, or homeowners Mills, while a witness,
declared, indeed, that he knew no floor covering contractors who did not sell floor
covering materials
When this case was heard, the Company had 15 employees: 12 of these were instal-
lers During the past calendar year, the firm had, on the average, 15 installers work-
ing. None of these workmen, so far as the record shows, spent any time whatever as
a salesman within the Company's store; normally, I find, they worked at their trade
full-time, 40 hours per week. While so engaged, the firm's installers spent practically
100 percent of their time on jobsites, except for a minimal amount of time spent
"loading up" materials at their employer's premises.
Some slight qualification with respect to this factual determination should be noted.
Mills did testify that some three floor-covering mechanics working for his firm spent a
major portion of their time in shop work, prefabricating formica countertops for sub-
sequent installation at construction sites; I so find.
Though the Company has, upon occasion, requested Respondent Union to dis-
patch needed workmen, and has hired some apprentices pursuant to Respondent
Union's contractually formulated apprenticeship program, the firm does not routinely
engage workmen merely for specific jobs Of the 12 installers working for the firm
when this case was heard, exclusive of one copartner's son, one had 11 years of service;
2 or 3 had been employed for 10 years. The firm's "newest" worker had a total of
11/2 years of prior service.
CARPET, LINOLEUM AND SOFT TILE LOCAL NO. 1247 955
When engaged for so-called contract work, the Company dispatches available work-
men from its regular crew , without distinction , whether such work is to be done for
general contractors , homeowners not yet in residence , or homeowners currently resid-
mg in structures which may still require floor covering work. While so engaged,
whether performing work on construction projects in progress pursuant to some new
homeowner's order the Company 's installers frequently have been called upon to per-
form services while other workmen, specifically building trades craftsmen , have been
sumlarly engaged.
For some 15 years since they purchased the firm, the Company's copartners have
held a state contractor 's license; pursuant to its terms , they are currently licensed to
contract for floor covering , wallboard, and formica work
Previously, within this decision , reference has been made to the Company 's mainte-
nance of a contractual relationship with Respondent Union since 1958; the firm has
also had a contract with the Carpenters ' Union for the same period . ( When this case
was heard , the firm employed one carpenter . Previously , there have been as many as
three. During 1964 , two carpenters comprised the firm's normal complement
Formica counter tops, prefabricated within the Company's shop by three so-called
floor covering mechanics , are installed on jobsites by the firm 's carpenter or carpen-
ters. ) So far as the record shows , all of the firm 's installers currently hold Respond-
ent Union membership , the Company 's sole present carpenter holds Carpenters' Union
membership . Most general contractors who subcontract with the Company for floor
covering work, have been so-called union contractors , privy to labor contracts with
various building and construction trades unions.
When performing services pursuant to contract, on Federal or State construction
projects, the Company, according to Mills' testimony has regularly been required to
pay, pursuant to statute , prevailing area wage rates . So far as the record shows, these
have routinely been the locally determined "union contract" rates. Normally, when
engaged to provide "hard" or "soft" floor covering materials and perform contract
services for construction projects, the Company has not been required to post perform-
ance bonds ; while a witness , Mills testified that his firm's work has normally been
considered covered by the general contractor 's bond.
One further matter, possibly worthy of note because it may be considered relevant
and probative with respect to the firm's recognized status under state law, should be
mentioned ; twice within the past two or three years, the Company has been permitted
to file mechanics ' liens to procure payment for services rendered.
Indio Paint and Rug Center maintains its principal place of business within a struc-
ture compassing 4,000 square feet ( 50 by 80 feet ), this structure is presently divided
into a store 30 feet wide by 50 feet long, (1 , 500 square feet ), with a small office
included, together with separate warehouse and shop areas ( 25 feet wide by 50 feet
long, respectively ) having a combined area of 2,500 square feet.
c. Respondent Union and the floor covering industry
Previously ; reference has been made to Respondent Union's master contract cover-
ing five Southern California counties and portions of two additional counties.
Respondent Union's geographical jurisdiction covers two more counties ; for firms
within the latter counties , however, Respondent Union negotiates a second master
contract , not herein relevant.
Within the territory covered by Respondent Union's Master Labor Agreement pre-
viously noted , some 400 floor covering firms are contractually bound thereby. Most
of these belong to one of the four contractor 's associations , within the floor covering
field, designated as master contract signatories Others, so the record shows, may
hold "associate" membership within the Associated General Contractors of America
(AGC), which admits special trade contractors to such limited membership. Some,
further, may be Building Contractors Association (BCA), and Home Builder's Insti-
tute ( BHI) members.
Testimony proffered ; -without contradiction , by Respondent Union's business man-
ager warrants a determination that , within the field of so-called hard surface flooring
(linoleum and resilient tile) very few Southern California firms contract to provide
installation service exclusively . Within the so-called soft floor covering (carpet) field,
however, the situation is reversed While a witness , Business Manager Adam reported
credibly, that most firms therein function primarily as labor contractors ; through prac-
tically every firm does "some " selling, he characterized their basic business as the
contracting of installation service me,ely . ( With respect to floor covering contractors,
generally, Business Manager Adam testified that so-called labor contractors substan-
tially dominate the field in Los Angeles and Orange Counties, respectively ; within San
Bernadmo, Riverside and Ventura Counties , however, such contractors do not
predominate.)
956 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Regarding "labor" contractors within the carpetlaying field, particularly, Respond-
ent Union's business manager declared, without contradiction, that workers perform
their installation work just as the Company's carpetlayers do, further, some of these
firms, so his testimony shows, likewise have employees of long standing Though
Respondent Union frequently does dispatch men to construction sites, union dis-
patchers have no way of knowing whether such workers have been requested for
service on some particular job, or for long -term hire . With respect to some large
projects, Business Manager Adam conceded , floor covering contractors might con-
ceivably hire "extra " men for a period of service limited to the project's duration;
normally, his testimony suggests , this would not be the case
With respect to Respondent Union's previous contract negotiations , Business
Manager Adam testified generally, without contradiction, that negotiations for the
"floor covering" trade have never taken the position that firms which contract to
provide both labor and materials, within their field of work , should not be considered
part of the building and construction industry
d The Company and the floor covering industry
Previously, within this decision, Indio Paint and Rug Center has been characterized
as a firm which both sells and installs floor coverings . Since it handles , thusly, both
"hard" and "soft" floor covering materials, the firm's method of doing business,
seemingly, conforms with a pattern which preponderates within the floorwork trade
throughout its geographical community. (Reference is made to Business Manager
Adams' previously noted testimony , proffered and received without contradiction,
that, within Riverside County particularly, specialty trade contractors who both
sell and install floor covering materials , regardless of type, from a predominant
group. His testimony confirms that given by Company partner H. A. Mills, who
reported that his firm's competitors do a substantially similar business , specifically
with reference to their performance of sales and installation service contracts.)
During the firm's 1964 calendar year, Indio Paint and Rug Center, so the parties
stipulated , had $596,765. 52 gross revenue . Previously, within this decision , reference
has been made to various percentages of this total sum which the Company derived
from "sales and installation " contracts performed for general building contractors
and homeowners , respectively Most significantly for present purposes , however,
counsel have further stipulated that the firm's gross labor costs totalled $170,324.66
for the calendar year. (Presumably, the figure noted represents both labor costs
related to Indio Paint and Rug Center's retail store business , and labor costs related
to the firm's contract work. Since counsel have provided no breakdown for the
stipulated total, I so find ) Since the Company had 1964 profits of $42,000, approx-
imately, its cost of goods and materials said, both at retail and pursuant to contract,
plus its miscellaneous business expenses , must have totalled $384,440.88 for the year
in question . With due regard for the record, and counsel 's further stipulations, the
firm's 1964 profit and loss position, then , may be summarized for present purposes
as follows:
(Gross Revenue (Rounded to Nearest Dollar)) :
Contract Work ( approx. ) -------------------------- $554, 992
Retail Sales ( approx. )---------------------------- 41, 774
Total Gross Revenue________ ___________________ $596, 766
Less: Cost of doing business-
Gross labor costs ________________________________ 170, 325
Cost of materials and overhead expenses ( approx )____ 384, 441
Total costs ( approx.)------------------------------------ 554, 766
Net Profit ( approx. )------------------------------------------- 42,000
Calculation shows that Indio Paint and Rug Center 's total cost of doing business,
during the calendar year in question , may, therefore , be broken down into gross labor
costs which constituted no more than 31 percent of the firm 's yearly cost total, while
its cost of materials furnished and goods sold, lumped together with various "over-
head" expenses , never specified , accounted for 69 percent of total costs.
No more than 7 percent of the Company 's gross revenue , however, was derived
from retail "paint and sundries" sales. We may reasonably conclude, therefore,
that any labor costs related directly to retail sales were but a minor part of the firm's
total labor costs. Similarly , determination would seem to be warranted that Indio
Paint and Rug Center 's "cost of goods sold" retail ( together with whatever miscel-
CARPET , LINOLEUM AND SOFT TILE LOCAL NO. 1247 957
laneous business expenses may properly have been chargeable against the firm's
retail store operation ) made up but minor parts of the firm 's total yearly costs , within
the two categories noted. I so find. Necessarily , then, whatever proportionate
relationship or ratio the previously noted total figures may reveal, between the firm's
gross labor and material costs, must have been derived , mainly , from the contract
work which it did, during the year, for general building contractors and homeowners.
B. Conclusions
Several years ago, within a Trial Examiner 's report which the Board subsequently
adopted pro forma, with respect to the point, no exceptions having been filed, Section
8(f) of the Act was construed to establish three requirements , which would have to
be satisfied before a 7 -day union -security clause could be considered permissible.
Animated Displays Company , 137 NLRB 999 , 1020-1021. These statutory require-
ments were defined as follows.
(1) the agreement must cover employees who are engaged in the building
and construction industry , ( 2) the agreement must be with a labor organiza-
tion of which building and construction employees are members, and (3) the
agreement must be with an employer engaged primarily in the building and con-
sti uction industry . [Emphasis supplied.]
No questions have been raised, herein , with respect to (1) whether Indio Paint and
Rug Center 's employees are engaged , primarily or to some lesser degree , in the build-
ing and construction industry , or (2) whether Respondent Union admits building
and construction trades workmen to membership . By virtue of their respective
contentions , General Counsel and Respondent Union have joined issue merely with
respect to the third requirement noted; there seems to be consensus , therefore, that
a determination whether the Company should be considered an "employer engaged
primarily in the building and construction industry " will be dispositive of General
Counsel 's challenge regarding the legality of Respondent Union's union -security
clause.
Within his brief, General Counsel has stated his position , in this connection, with
sufficient preciseness to merit quotation . Specifically , by way of argument , the brief
declares that:
The General Counsel is not contending that the Employer is not engaged in the
building and construction industry . The General Counsel does contend that
the Employer is not primarily so engaged . The facts, as shown above , demon-
strate that the majority of the employer 's gross revenue is derived from the sale
of goods, and therefore the employer is primarily engaged in the sale of mer-
chandise , and the installation of said merchandise is merely incidental to the
sale. [Emphasis supplied.]
Despite his disclaimer of any contention that Indio Paint and Rug Center does not
function with the specific industry with which we are concerned , however, due con-
sideration of General Counsel 's final position does call for some definitions of the
statutory "building and construction industry" concept; such a definition would
seem to be needed, certainly , before any sound determination can be made as to
whether the Company should be found primarily engaged within the designated
industry, or retail merchandising.
In his previously mentioned Animated Displays report , Trial Examiner Libbin
noted, correctly , that, despite numerous references to the "building and construction
industry" within the statute's legislative history, the congressional proceedings reflect
no precise definition of building and construction . For present decisional purposes,
therefore , we may presume , indeed, we must presume , that Congress used these
terms "in the traditional sense in which [they are] customarily used in common par-
lance" as well as technical industrial parlance. Animated Displays Company , supra,
1021 I so find.
First, with respect to technical usage: Within the Construction Review , Volume 3,
(1957 Supplement ), published jointly by the U S Department of Commerce and the
U S. Department of Labor , which does not seem to have been revised since Trial
Examiner Libbin noted its pertinent portion, construction work is defined , in rele-
vant part, as follows:
Construction covers the erection maintenance and repair (including replace-
ment of integral parts ), of immobile structures and utilities , together with
service facilities which become integral parts of structures and are essential to
their use for any general purpose. It includes structural additions and altera-
'958 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tions. Structures include buildings ... and all similar work which are built
into or affixed to the land .... Construction covers those types of immobile
equipment which, when installed, become an integeral part of the structure and
are necessary to any general use of the structure. This includes such service
facilities as plumbing, heating, air-conditioning and lighting equipment .
In general , construction does not include the procurement of special purpose
equipment designed to prepare the structure for a specific use. [Emphasis
supplied.]
The Standard Industrial Classification Manual (1957) published by the Bureau of
the Budget classifies the building and construction industry as one type of contract
construction. This major classification division, according to the manual, consists of
three groups: group 15, building and construction-general contractors; group 16,
construction other than building-general contractors; and group 17, construction-
special trade contractors. Within its general definition of contract construction, the
manual declares:
The term "construction" includes new work, additions, alterations, and repairs.
Three broad types of contract construction activity are covered; namely, (1)
building and construction by general contractors ... (3) construction by spe-
cial trade contractors .... General building contractors are primarily engaged
in the construction of dwellings, office buildings, stores, farm buildings, and
other projects of a similar character . . . . Special trade contractors are pri-
marily engaged in specialized construction activities such as plumbing, painting,
electrical work, and carpentry. General contractors in . . . the building field
. usually assume responsibility for an entire construction project, but may
subcontract to others those portions of the project requiring special skills or
equipment. Special.trade contractors may work for general contractors under
subcontracts [performing only part of the work covered by the general contract]
or may work directly for the owner of the property . . . . The installation of
prefabricated building equipment and materials by general contractors and spe-
cial trade contractors is classified in this division . Similar installation work
performed as a service incidental to sale by employees of an established manu-
facturing or selling prefabricated equipment and materials is classified according
to the principal activity of the establishment . [Emphasis supplied.]
Within the manual's special trade contractor group, floor-work contractors are listed.
Specifically, subordinate classification is provided, inter alia, for those special trade
contractors primarily engaged in the installation of asphalt tile, linoleum , and mastic
and resilient flooring; they are grouped with those contractors who lay, scrape, and
finish hardwood floors. The Standard Industrial Classification Manual contains no
subordinate classification, specifically, for contractors primarily engaged in so-called
soft floor covering installation work, though it does provide a classification category
for "special trade contractors primarily engaged in contract work not elsewhere
classified" which conceivably would cover carpetlaying firms. General Counsel,
however, has made no contention , with reference to this case, that wall-to-wall car-
petlaying work, separately considered, should not be comprised within the statutory
"building and construction" concept. Had any such contention been made, my
present disposition would be to consider such work, particularly when performed
within a newly constructed residence or commercial structure pursuant to contract,
for some general building contractor, builder, or homeowner, within the industry
designated. Certainly, such a determination could be justified, since wall-to-wall
carpets are frequently laid directly on subfloors in lieu of hardwood, asphalt tile,
linoleum, or various other resilient floor materials. Within this decision, reference
has previously been made to testimony that Southern California general building
contractors, particularly those concerned with residential construction, now fre-
quently let subcontracts for such carpet work.
With respect to common parlance, the word "build" has been defined as follows:
"To form by ordering and uniting materials by gradual means into a composite
whole " Construction has been defined, comparably, as follows: "The act of put-
ting parts together to form a complete and integrated object." Webster's Third New
International Dictionary. Both concepts have been cited as synonymous with
fabrication.
These definitions , further, have been judicially recognized. Within a variety of
factual and legal contexts, the term "construction" has been defined in court deci-
sions as "the putting together" of materials and constituent parts, in their proper
place and order. Olney v. Hutt, 105 N.W.2d 515, 520, 251 Iowa 1379; Morse v. City
CARPET, LINOLEUM AND SOFT TILE LOCAL NO. 1247 959
of Westport, 19 S.W. 831, 832, 110 Mo. 502; Scharf) v. Southern Illinois Construc-
tion Company, 92 S.W. 126, 130, 113 Mo.App. 157; cf. Paterson N. & RR. Co. v.City of Paterson, 86 A. 68, 69, 81 N.J.Eq. 124. One court has headnoted its view,
in this connection, as follows:
"Construct" as used in Mechanics Lien Law, Gen Code § 8323-9, providing that
the word "subcontractor" shall be construed to include any person, firm or
corporation who undertakes to "construct" alter, [or] erect ... any part of the
structures or improvements mentioned therein, under a contract with any per-
son other than the owner, has reference to the actual combination of materials
on the building site to constitute the structure, and not to the manufacture of
such materials which later may be combined with others to make a building.
Matzinger v. Harvard Lumber Company, 155 N.E. 131, 132, 115 Ohio St. 555.
[Emphasis supplied].
By way of summary: Within these various definitions, whether technical, common,
or legal, substantial consensus seems clear. Each formulation with respect to the
so-called building and construction concept subsumes the provision of labor whereby
materials and constituent parts may be combined on the building site to form, make
or build a structure. These various factors, therefore, define the statutory "build-
ing and construction industry" with which we are concerned. I so find.
With these definitions, determination certainly seems warranted that Indio Paint
and Rug Center's work providing labor and materials in connection with floor cover-
ing installations, both for general building contractors and homeowners , beyond per-
adventure of doubt, constitutes "building and construction" work. Further, since
some 93 percent of the firm's 1964 gross revenue derived from such work, pursuant
to contract, determination would seem to be warranted that Indio Paint and Rug
Center has indeed been, throughout the period with which this case is concerned,
primarily engaged in building and construction industry work. I so find.
General Counsel's contention that the company should be considered primarily
engaged in retail trade , merely because the largest part of its gross revenue was
received as compensation for whatever materials it furnishd in connection with its
contract construction work, must be rejected.
Board and court decisions construing Section 8(f) with respect to the present
question have , thus far, been few . Within one such decision , the Court of Appeals
for the Fifth Circuit did hold that the statutory "building and construction industry"
concept did not include materialmen. N.L.R.B. v. W. L, Rives Company and W-M
Corporation, 328 F. 2d 464, 469 (C.A. 5). Specifically, the court declared that:
We are of the opinion that Congress did not intend to include in the exemption
those employers who manufacture and assemble products which are subsequently
installed by others at the construction site. [Emphasis supplied.]
Substantially, this determination-that "materialmen" should not be considered com-
prised within the building and construction trade-comports with limitations speci-
fied in the Standard Industrial Classification Manual's "contract construction" defi-
nition previously noted; although, consistently with the manual's classification scheme,
installation work done on prefabricated "materials" by general contractors and spe-
cial trade contractors must be considered contract construction, similar installation
work "performed as a service incidental to sale by employees of an establishment ...
selling prefabricated . materials" would be classified, because of the differing
principal activity of the business, within some "trade" division.
Likewise within the sole Board decision General Counsel cites for its relevancy,
Frick Company, 141 NLRB 1204, 1208, specifically, the Trial Examiner noted, with
Board approval, that the respondent company could not be considered primarily
engaged in the building and construction industry within Section 8 ( f)'s meaning,
because-
. [its] major source of revenue is derived from the manufacture and sale of
refrigeration equipment, and only a negligible part of its total gross income
(0.95 percent in 1962) was derived from the actual installation of refrigera-
tion equipment. [Emphasis supplied.]
Consistently, within a Section 10(1) case which dealt, collaterally, with this prob-
lem, the court found a contract, which respondent union therein had negotiated
with a trade association of construction contractors, privileged under Section 8(f)
upon proof that the signatory trade group's membership had been limited to gen-
eral contractors and special trade contractors, particularly those primarily engaged
in electrical work, within the construction industry. Ivan C. McLeod v. Local 3,
960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
International Brotherhood of Electrical Workers, AFL-CIO, (Darby Electric Corp.),
57 LRRM 2052, 2058-2059 (D.C.N.Y.). The court distinguished Frick Company,
supra, precisely because that company had been found "mainly a manufacturer and
seller of refrigeration equipment" which derived nothing more than a negligible part
of its total income from the actual installation of such equipment.
These decisions, however, do not, really, support General Counsel's position that
Indio Paint and Rug Center should be considered primarily engaged in some form
of business other than building and construction work. Specifically, they will not
support a determination that the firm should be considered "primarily engaged in
the sale of merchandise" merely because most of its gross revenue from contract
construction work represented compensation for so-called hard and soft floor cover-
ing materials furnished in connection therewith, with a lesser percentage representing
compensation for services performed in connection with their fixation to a structure.
When we consider the quintessential nature of building and construction work,
whether technically, commonly, or judically defined, determinations with respect to
Section 8(f) questions bottomed, simplistically, upon whatever proportionate rela-
tionship may be found, within any given firm's gross revenue, between the portion of
such revenue received as compensation for the firm's installation service and that
portion received as compensation for materials furnished, must be rejected. Deter-
minations thus reached cannot, with due regard for the realities of industrial life,
promote the statute's purpose.
Rather, the legislative purpose, so far as it can be determined, would seem to be
better served through some more broadly gauged decisional doctrine. When busi-
ness enterprise devote their facilities, time, effort, and funds principally to contract
construction, whether as general building contractors, heavy construction contractors,
or special trade contractors-within the meaning of these terms as previously defined,
they should be considered primarily engaged in "building and construction industry"
work. Further, measurements of degree, with respect to their quantum of participa-
tion in such work, should not be confined to determinations regarding the percent-
age of their gross revenue derived from contract construction within a representative
period; wherever relevant, tries of fact should consider the proportion of their physical
plant and mobile equipment devoted to servicing or performing such work, the per-
centage of their total personnel directly concerned with such work, the relative degree
to which their personnel devote productive time to such work, as well as the pro-
portion of their "total gioss income" derived therefrom. (By such tests, clearly,
Indio Paint and Rug Center would certainly merit classification as "principally,
chiefly or mainly" engaged within the building and construction industry.) When,
however, some firm's gross revenue sources happen to provide the single persuasive
touchstone with respect to Section 8(f) questions, such as those which this case
presents, statutory determinations should be bottomed upon the proportion of that
firm's gross revenue which regularly derives from contract construction, without
regard to whether such revenue was received as compensation for providing labor
merely, or both labor and materials. And, finally should a determination be
required that the business enterprise subject to consideration regularly derives the
major portion of its gross revenue from the performance of contracts within the
building and construction field, calling for both labor and materials to, be furnished,
no distiiiction should be drawn between those firms which derive the major portion
of their total contract revenue from whatever labor services they furnish, and those
firms whose total contract revenue "principally, chiefly or mainly" covers their com-
pensation for mateiials furnished. So long as business establishments, within the
category last designated, devote themselves primarily to contract construction, within
the meaning of that term as previously defined, the mere circumstance that some
principal percentage of their construction contract revenue regularly or normally
represents their compensation for materials furnished should not require their dif-
ferentiation from so-called building and construction firms, or their classification as
retail tradesmen.
General Counsel's contrary contention within the present case's framework, should
it be found persuasive, would create some highly anomalous situations Within
Southern California's floor covering industry, particularly, Respondent Union might
find its master labor contract, with four trade separate groups, legal with respect to
some employer members, specifically, those who provide labor services merely, but
subject to proscription with respect to other firms which, like the firm with which this
case is concerned, provide both labor and materials pursuant to contract. (Con-
ceivably, such determinations might not be necessary; possibly, each trade associa-
tion privy to Respondent Union's master labor contract could be considered the
UNITED NUCLEAR CORPORATION 961
statutory "employer" with respect to which Section 8(f)'s relevancy would have to
be decided . Should such a view with respect to the statute 's meaning prevail, how-
ever, the practical and legal problems which would have to be solved-before any
determination could be made as to whether such a composite "employer" should be
considered primarily engaged in the building and construction industry , would surely
be numerous and difficult . For present purposes , luckily, they need not be dis-
cussed. ) With respect to other types of special trade contract work-plumbing, heat-
ing, and air conditioning ; painting , paperhanging , and decorating ; electrical work;
masonry, stonework , tilesetting , and plastering ; carpentry work; roofing and sheet
metal work ; concrete work; structural steel and ornamental metal work; glass and
glazing work ; and the installation or erection of prefabricated building equipment,
similar situations might conceivably develop which could only be decided on some
case-to-case basis. Congress cannot have conferred statutory privileges , which Sec-
tion 8(f) provides , subject to limitations reasonably calculated to create a double
standard for contractual union security clauses, inter alia, within the building and
construction trade considered as a whole.
CONCLUSIONS OF LAW
In the light of the foregoing findings of fact, and upon the entire record in this
case, I make the following conclusions of law:
1. Indio Paint and Rug Center is an employer within the meaning of Section 2(2)
of the Act, engaged in commerce and business activities which affect commerce
within the meaning of Section 2(6) and (7) of the Act, as amended.
2. Carpet, Linoleum and Soft Tile Local Union No. 1247 of the Brotherhood of
Painters , Decorators and Paper Hangers of America, AFL-CIO, is a labor organiza-
tion within the meaning of Section 2(5) of the Act, as amended , which admits
employees of Indio Paint and Rug Center to membership.
3. Throughout the period with which this case is concerned, Indio Paint and Rug
Center has been , and is now, engaged primarily in the building and construction
industry ; within that industry it performs contract construction services as a special-
trade contractor.
4. Respondent Union has not, through its negotiation , maintenance or effectuation
of a contract with Indio Paint and Rug Center which includes a 7-day union-security
clause , caused the Company designated to discriminate against its employees in vio-
lation of Section 8 (a) (3) of the Act, as amended ; Respondent Union , therefore, has
not engaged in unfair labor practices affecting commerce within the meaning of
Section 8(b)(2) and Section 2(6) and (7) of the Act, as amended.
RECOMMENDED ORDER
Upon these findings of fact and conclusions of law, and upon the entire record in
the case, my recommendation is that the Board, pursuant to Section 10(c) of the
National Labor Relations Act, as amended , dismiss the present complaint in its
entirety.
United Nuclear Corporation and United Steelworkers of Amer-
ica, AFL-CIO, and Local No. 5605, United Steelworkers of
America, AFL-CIO. Case No. 28-CA-1138. January 18,1966
DECISION AND ORDER
On June 22, 1965, Trial Examiner Howard Myers issued his Deci-
sion in the above-entitled proceeding, finding that the Respondent had
engaged in and was engaging in certain unfair labor practices and
recommending that it cease and desist therefrom and take certain
affirmative action, as set forth in the attached Trial Examiner's
Decision. Thereafter, the General Counsel and the Respondent filed
exceptions to the Trial Examiner's Decision and supporting briefs.
156 NLRB No. 83.