Di Giorgio Fruit Corp.

National Labor Relations Board - Board Decisions

Nov 29, 1948

80 N.L.R.B. 853 (N.L.R.B. 1948)

In the Matter of Di GIORGio FRUIT CORPORATION, EMPLOYER and
AMERICAN FEDERATION OF LABOR, PETITIONER
C',w e No. 10-RC-64.-Decided November 29,1948
DECISION
AND
DIRECTION OF ELECTION
Upon a petition duly filed, a hearing was held before a hearing of-
ficer of the National Labor Relations Board. 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 Employer is engaged in commerce within the meaning of
the National Labor Relations Act.
2. The Petitioner is a labor organization which claims to repre-
sent employees of the Employer.
3. The Petitioner seeks a unit of all employees of this Employer's
Lucerne Park, Florida, cannery, excluding guards, clerical and pro-
fessional employees, and supervisors as defined in the Act.
The Employer, a Delaware corporation with its main offices in San
Francisco. California, is engaged in growing, packing, and canning
citrus fruits and vegetables. Its primary operations are conducted
in the States of Florida and California. The main office of the Em-
ployer's Florida Division is located on its Lucerne Park grove where
there is situated the cannery with which we are here concerned, to-
gether with a packing house.
The total capital investment of the Employer in its Florida opera-
tions is about $4,400,000. The cannery is valued at approximately
$106,000 and constitutes about 2.41 percent of this investment. The
total sales from the Florida operations last year amounted to approxi-
mately $2,500,000, of which about $425,000 or 17 percent was derived
from the cannery operation.
' The Employer operates 9 citrus fruit groves in Florida totaling 5,866 acres , including
the Lucerne Park grove which consists of 725 acres and is the fourth largest . About one-
third of the fruit processed is grown on the grove on which the cannery is located.
80 N. L. R. B., No. 138.
853
854 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
At the cannery, the Employer extracts and cans citrus fruit juices.
It states that it cans only such fruit from its groves 2 as cannot be sold
on the market in a fresh state, either because the fruit fails to meet the
requirements of the United States Department of Agriculture's Grow-
ers and Shippers Committee or because production has reached such
a volume that the market is unable to absorb the entire amount at
satisfactory prices. No fruit other than that grown in the Em-
ployer's own groves is processed at this cannery. After the juice is
strained from the pulp, the latter is sold to feed mills where it is con-
verted into cow feed.
The cannery employees, averaging about 21 in number, are semi-
skilled 3 and work during the normal canning season which runs for
about 6 to 9 months from September or December in 1 year until the
,end of June in the following year. After the season, the number
,of employees is reduced to a skeleton force of about 10 or 12 which is
retained for maintenance and shipping work in the cannery. A sep-
arate pay roll is maintained for the cannery and its employees, who
are under separate supervision and are interchanged infrequently
with grove and packing house workers. Such interchange is effected
only during the periods of reduced operations in order to give each
employee as full a workweek as possible.
At the conclusion of the hearing, the Employer filed a motion to
dismiss the petition. The hearing officer reserved to the Board ruling
on this motion. The position of the Employer is that it is a farmer
engaged in the production, cultivation, growing, and harvesting of
its own agricultural products on its own farms; that the citrus juice
canned in its canning plant comes from fruit grown on the Employer's
own groves ; that the canning operation is an incident to marketing the
fruit and is carried on in conjunction with the farming operations; and
that the employees engaged in such canning operation are agricultural
laborers and, therefore, exempt under the National Labor Relations
Act from the authority and jurisdiction of the Board.
Section 2 (3) of the Act excludes from the definition of the term
employees "any individual employed as an agricultural laborer."
Although the term "agricultural laborer" is not otherwise defined in
the Act, Congress in the "riders" to the Appropriation Acts relating
to Board funds for the past several years, has incorporated by refer-
ence into Section 2 (3) the definition of "agriculture" contained in
Section 3 (f) of the Fair Labor Standards Act of 1938. The Board
2 The groves are within a radius of 115 miles of the Lucerne Park grove on which the
cannery is located.
8 All of the cannery operations are performed by the use of machinery , but apparently
a great amount of skill is not required.
DI GIORGIO FRUIT CORPORATION 855
is now required to follow that definition 4 in determining whether par-
ticular employees are "agricultural laborers" within the meaning of
Section 2 (3) of the Act.'
The courts have interpreted the definition as excluding from the
agricultural exemption under the Fair Labor Standards Act employees
engaged in processing operations which involve commodities grown
by others, while generally including thereunder employees performing
operations which relate to commodities grown by the employer con-
cerned.s As the cannery employees involved herein are engaged in
processing fruits grown on their Employer's own groves, we are now
presented with the question whether that fact per se is sufficient basis
for excluding them from coverage of the Labor Management Relations
Act, irrespective of the nature of the operation. In our view it is the
essential character of the work performed which should be determina-
tive.7 Neither the fact that these cannery employees are engaged in
handling agricultural products, nor the fact that they perform their
tasks on a farm is a conclusive reason for finding them to be "agricul-
tural laborers." The ultimate test is whether the services of the
employees involved are performed in connection with a mercantile
enterprise or an agricultural operation." It is clear that there is a
differentiation between those employees engaged in industrial activities
connected with the marketing of agricultural products and those who
are engaged in work incidental to ordinary farming operations .9 Em-
ployees who perform duties which are incidental to the farming opera-
tions of the Employer come within the agricultural exemption, but
not employees whose tasks are related to commercial activities. If
the practice involved is an integral part of ordinary production or
farming operations, and is an essential step before the products can
be marketed in normal outlets, it retains its agricultural character-
4 Matter of William H. Elliott d Bona Company , 78 N. L . R. B. 1078.
° The definition , insofar as applicable here, reads as follows :
"agriculture" includes farming in all its branches and among other things includes
• • • the production , cultivation , growing, and harvesting of any agricultural
• • • commodities * • * and any practices * n * performed by a farmer or
on a farm as an incident to or in conjunction with such farming operations , including
preparation for market , delivery to storage or to market or to carriers for transporta-
tion to market.
e Walling v. Peacock Corporation, 58 F. Supp . 880 (Dist . Ct. E. D. Wisc. 1943) and
cases cited therein.
4 Matter of Pepeekee Sugar Company , 59 N. L . R. B. 1532 and cases cited therein.
'It is to be noted that the Treasury Department in Its Regulations 107 relative to the
excise tax on employers under the Federal Unemployment Compensation Act, also adopts
this distinction . It interprets the definition of agriculture in Section 403.208 of its Regu-
lations, and in Section 403.208 (e) (3) it states that services performed in connection with
commercial canning are not excepted as agricultural labor.
9 Matter of American Fruit Growers, Incorporated , 75 N. L . R. B. 1157 ; Matter of L.
Maxey, Inc., 78 N . L. R. B. 525.
856 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
istics.1° However, if the practice is not actually required as a con-
dition precedent to preparing the products for market, but is adopted
in order to add greater value to the farm products, it acquires the
attributes of a commercial venture.
The courts have held that the agricultural exemption under the Fair
Labor Standards Act should be narrowly construed.11 Practices such
as packing, packaging, or transporting products grown on the Em-
ployer's own farm can be said to be performed as an incident to or in
conjunction with farming operations as defined in the agricultural
exemption," because such practices are usually necessary for the dis-
posal of farm products. Accordingly, employees engaged in these
practices may well be considered "agricultural laborers." However,
we do not believe that Congress intended that practices, such as are
performed by the cannery employees involved herein, which result
in a substantial alteration of the original farm commodity, should
also be included within the scope of the agricultural exemption. Our
view appears, moreover, to be supported by statements in the Senate
debates with regard to Section 2 (3) of the Act.13 In accordance with
this view, when fruit is sold in its raw state and the only processing
involved consists of boxing or crating it in order to ship it to market,
the operation retains its agricultural aspect. This is quite different
from the situation in the instant case where the employees work in a
cannery, operate machines, cut up and transform fruit into juices, add
other materials such as sugar, and can the resulting product. The form
of the fruit is thus changed and the activity becomes a commercial one,
10 Matter of L. S Hunn Packing Co ., 65 N. L. R. B. 631.
31 Waialua Agricultural Co, I,td. v. Ciraco Maneja et al., 77 F Supp 480
1z See footnote 5, supra.
78 The original House bill would have included in Section 2 (3) the definition of agricul-
tural labor in Section 1426h of the Internal Revenue Code . The Senate bill would have
incorporated the definition in Section 3 (f) of the Fair Labor Standards Act. It was
finally agreed not to define the term in the National Labor Relations Act, but to continue
to do so in the appropriations rider. In view of the fact that the rider contains the Fair
Labor Standards Act definition , which is the one the Senate bill would have included, the
following remarks by Senators Ball and Murray made when that definition was in the Sen-
ate bill remain apposite :
Sen. BALL. The Senator from Montana is aware that all the bill does in regard to agri-
cultural workers is to define them . They are not defined in the National Labor Relations
Act as it now stands. It simply adopts the definition of "agricultural worker" which is in
the Fair Labor Standards Act, and which , by reason of a rider in the appropriations bill last
year, is the definition which N L . R B. is now following , and to which , as I understood
their testimony the Board itself has no substantial objection The definition does leave
covered by the proposed act, packing sheds and the so -called "industrial operations" in con-
nection with farming and merely excludes packing actually done on the farm as incident
to the farmer 's operations
Sen MURRAY . My recollection is that the definition under this bill does exempt many
workers who perform industrial work on single farms such as freezing , packaging, and
canning.
Sen. BALL. I think no canning factory is affected . They are covered by the act , as they
are now. ( Italics supplied .) The bill does not change in the slightest degree the defini-
tion presently being used by the Board . ( Cong. Rec. Senate , 1st Sess. 1947 , p. 4150.)
DI GIORGIO FRUIT CORPORATION 857
because the additional processing is conducted to enhance the value
of the fruit and is not required for the sale of the fruit in the normal
course of business.
The Employer cites the case of N. L. R. B. v. Johan W. Campbell,
Inc.," in support of its position that its cannery employees should be
considered as "agricultural laborers" and thus removed from the pro-
tection of the Act. In that case the Circuit Court of Appeals for the
Fifth Circuit held that the employees of a packing house who packed
only tomatoes grown on the Employer's own farm were agricultural
laborers. The Court declared that packing and preparing agricul-
tural products is a necessary step in any agricultural operation. We
believe that decision is distinguishable from the instant proceeding
where the activity is not necessary in order to prepare the product for
market, but, in fact, is performed to change the nature of the product
and thereby increase its value for purposes of sale.
The Employer further contends that the agricultural nature of its
cannery operations is established by the fact that one of the purposes
of the cannery is to dispose of such fruit as cannot be sold in the
natural state. While the Employer thus characterizes its canning
operation as one carried out primarily for salvage purposes, the record
discloses that it also cans fruit when the market is unable to absorb
the entire amount it has produced, at satisfactory prices. In this
respect, the canning operation does not appear to be necessary for the
sale or marketing of the raw fruit, but rather to be a device for main-
taining the prices of the Employer's products and thus an industrial
activity conducted for general business purposes. We regard this as
an additional indication that the processing by the cannery employees
involved herein is performed in connection with a commercial opera-
tion rather than a farming operation.
In view of the foregoing, we find that the cannery employees in-
volved herein are not "agricultural laborers" and that they are there-
fore entitled to the benefits of the Act. Accordingly, we shall deny
the Employer's motion to dismiss the petition.
We find that a question affecting commerce exists concerning the
representation of employees of the Employer, within the meaning of
Section 9 (c) (1) and Section 2 (6) and (7) of the Act.
4. The following employees of the Employer constitute a unit
appropriate for purposes of collective bargaining within the meaning
of Section 9 (b) of the Act:
All employees of the Employer's Lucerne Park, Florida, cannery,
excluding guards, clerical and professional employees, and super-
-visors as defined in the Act.
14159 F. ( 2d) 184 (C. C. A. 5, 1947).
858 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
DIRECTION OF ELECTION
As part of the investigation to ascertain representatives for the
purposes of collective bargaining with the Employer, an election by
secret ballot shall be conducted as early as possible, but not later than
thirty (30) days from the date of this Direction, under the direction
and supervision of the Regional Director for the Tenth Region, and
subject to Sections 203.61 and 203.62 of National Labor Relations
Board Rules and Regulations-Series 5, as amended, among the em-
ployees in the unit found appropriate in paragraph numbered 4, above,
who were employed during the pay-roll period immediately preced-
ing the date of this Direction of Election, including employees who
did not work during said pay-roll period because they were ill or on
vacation or temporarily laid off, but excluding those employees who
have since quit or been discharged for cause and have not been rehired
or reinstated prior to the date of the election, and also excluding
employees on strike who are not entitled to reinstatement, to determine
whether or not they desire to be represented, for purposes of col-
lective bargaining, by American Federation of Labor.
CHAIRMAN HERZOO and MEMBER MURDOCK took no part in the con-
sideration of the above Decision and Direction of Election.