Frostco Super Save Stores, Inc.,

National Labor Relations Board - Board Decisions

Aug 14, 1962

138 N.L.R.B. 125 (N.L.R.B. 1962)

FROSTCO SUPER SAVE STORES, INC. 125
the reopened hearing held by the Board in this proceeding shows
multiple-unit bargaining at other facilities. The Employer-at the
Ray Mines Division, 23 miles from Hayden-bargains with five units
in addition to a production and maintenance unit, and its three other
western divisions engaged in copper mining and reduction opera-
tions-Nevada Mines, Chino Mines, and Utah Mines-are character-
ized by multiple units, including craft and departmental groups. Thus
more than 10 different unions are involved in representing employees
of these western divisions of the Employer, including the Hayden
reduction facility. In these circumstances, it is noteworthy that there
is no evidence before the Board suggesting that the Employer's opera-
tions have, as a result, been disturbed by jurisdictional disputes or that
the employees, on their part, have not received proper and adequate
representation in such units. Based upon this record I see no com-
pelling reason for denying severance to the various craft groups now
sought. They appear to be skilled employees with interests and duties
sufficiently different from those of other employees of the Employer
to warrant their representation in separate units-such as exist gen-
erally in the Employer's western divisions-if they so desire.
Frostco Super Save Stores , Inc. and Local 534, Amalgamated
Meat Cutters & Butcher Workmen of North America, AFL-
CIO, Petitioner
Sav-Co., a Corporation Operator of Sav-Mart and Local 229, Re-
tail Clerks International Association , AFL-CIO, Petitioner
Illinois Catering Company, a Subsidiary of Topsy's Interna-
tional , Inc. for Topsy Catering Co., Inc. and Culinary Work-
ers and Bartenders Local 755, Hotel & Restaurant Employees
and Bartenders International Union , AFL-CIO, Petitioner.
Cases No. 14-RC-4180, 14-RC-4188, and 14-RC-4 -S . August
14, 1962
DLCISION, ORDER, AND DIRECTION OF ELECTIONS
Upon separate petitions' duly filed under Section 9(c) of the
National Labor Relations Act, a hearing was held before Thomas W.
Seeler, hearing officer. The hearing officer's rulings made at the hear-
ing are free from prejudicial error and are hereby affirmed.
'The, petitions in Cases Nos 14-RC-4180 and 14-RC-4188 were consolidated for pur-
poses of hearing The petition in Case No 14-RC-4233 was filed after the consolidated
hearing closed , but a stipulation was entered into setting forth agreed facts and proud-
ing for incorporation of the record in the consolidated hearing
A notice to show cause issued by the Board on \tay- 23, 1962 , provided for this con-
solidation , and further provided , inter alia , that certain additional named companies who
operated licensed departments in the Sav -Efart store should be made parties to these pro-
138 NLRB No. 14.
126 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
1. Sav-Co., a Corporation Operator of Sav-Mart, herein referred
to as Sav-Co., owns and manages the building in Collinsville, Illinois,
in which is located a discount department store known as Sav-Mart.
Only persons holding membership cards from Sav-Co. may purchase
merchandise there. Sav-Co. determines the eligibility of members
and collects the membership fees. The Sav-Mart store has a single
entrance ; the departments are not partitioned ; all bags, wrapping
materials, fixtures, and furnishings are of a uniform type; in fact,
the entire operation is designed to create the appearance of an inte-
grated department store. In addition, all the licensed departments
are serviced by a single switchboard and office maintained by Sav-Co.,
and there is a single parking lot for the entire store.
The operators of 16 of the 17 departments in the Sav-Mart store
have license agreements with Sav-Co. under which each pays to Sav-
Co. a license fee and it percentage of its gross sales. The 17th opera-
tion is the grocery and meat department, which is subleased by Frostco
Super Save Stores, Inc., herein referred to as Frostco, pursuant to an
oral agreement with Sav-Co., for which it pays a flat rental plus a
percentage of its gross sales.2 Sav-Co. operates none of the depart-
ments, but employs clerical and maintenance employees who service
all the departments except Frostco.
Under the provisions of the license agreements, which are uniform
in all essential respects, Sav-Co. retains the keys to the building; con-
trols all advertising; is empowered to audit and inspect the records
kept by each licensee, and may require each to furnish additional
records; may designate the items which the licensees may sell at cost;
supervises and directs the installation of furnishings and equipment,
all of which must meet its approval ; investigates customer complaints
and may require adjustment thereof by the licensee; can require the
discharge of an employee it considers objectionable; and an employee
discharged at Sav-Co.'s request may not be rehired by another depart-
ment without its consent, nor may employees be transferred from one
department to another without its approval. Licensees must purchase
from Sav-Co. certain supplies; can use only the name Sav-Mart on
its signs and labels; are required to maintain adequate personnel ; and
ceedmgs unless cause to the contrary were shown Answers objecting to such joinder
were filed on behalf of Sav-Co , Sands Drugs Company, Sav-Mart Photo. Sav-Mart Hard-
ware, Sav-Mart Playland, Holly Stores, Inc , and Fashion Thimble Shoe Company, but, as
set forth in section numbered 1 below, no persuasive reasons were advanced to show why
these companies should not be joined Accordingly, the caption set forth is hereby
amended by (1) adding Sav-Co as a party in Case No 14-RC-4180, and (2) adding, as
parties in Case No. 14-RC-4158, Frostco, Sav-Mart Furniture Company, Dave Paul ;
Sav-Mart Record & Music Department (IIesco Corporation) ; Sav-hart Home Improvement
Center, Inc ; Holly Stores, Inc ; Thebault-Olsen Company (Tocomo) ; Sands Drug Com-
pany ; Sav-Mart Photo, Sav-Mart Hardware ; Sav-Mart Playland, United Shirt Shops,
Fashion Thimble Shoe Company, Inc ; John Green Store ; A & G Millinery : and Auto-
motive Supply Co , Inc
2 At the hearing, an official of Frostco testified that execution of a written sublease was
imminent.
FROSTCO SUPER SAVE STORES, INC. 127
must require personnel compliance with the Sav-Co. store rules. The
rules applicable to all employees which Sav-Co. is empowered to
promulgate cover : hours of work, employee badges, employee arrival
and departure, parking, outgoing calls by employees, instructions to
cashiers, work breaks, and prohibitions against smoking or drinking
on the job. The license agreements also contain uniform provisions
regarding labor relations,3 and require each party to act as the agent
of the other in regard to the service of process.' The Frostco lease
contains many of the same provisions as the license agreements, in-
cluding those regarding labor relations agreements and service of
process.
However, the Frostco operation differs in certain respects from the
operations of the other departments. Its complement of about 55
employees includes meatcutters, grocery clerks, produce clerks, check-
ers, bag boys, and carryout boys. The Frostco employees punch a.
separate timeclock and use separate washroom and other facilities.
Frostco also uses shopping carts of a different color, has its own pickup
station and incinerator, is partially separated from other departments
by display shelves, and, unlike the other departments, is closed on
Sunday. Customers entering the Frostco department pass through a
turnstile, and can leave only through the Frostco checkout line.
Frostco also has a separate office, where a clerk keeps its records. The
lease agreement held by the lessor from whom Frostco subleases the
operation differs in a number of ways from the license agreements of
the other department operators. It does not provide, for example, for
control by Sav-Co. over such matters as advertising, purchase of sup-
plies, prices, and records.
Each department, including Frostco, has separate direct manage-
ment, including the hire, discharge, and supervision of employees.
Each department operator maintains its own records, pays the wages
of its employees, schedules their hours of work, and carries insurance
and workmen's compensation. There has been no interchange between
departments in the short period that the store was in operation prior
to the hearing herein.
The Retail Clerks contends that only a storewide unit is here ap-
propriate on the ground that Sav-Co. is the employer of all the em-
3 Paragraph 24 of the license agreement provides : ". . . Neither LICENSOR nor
LICENSEE will enter into any negotiations or agreement , oral or written , with any
labor organization with respect to employees without having the written consent of the
other. Moreover , either party will allow the other to participate in any negotiation con-
cerning labor relations, and reasonable notice shall be given concerning the time, place
and subject mattes of such negotiations It is expressly understood and agreed that the
best interest of LICENSOR and all LICENSEES shall be best served by complete and
haimonious cooperation with respect to all matters pertaining to labor relations and union
contracts "
4 Paragraph 26 of the license agreement provides. both of the parties hereto will
promptly submit a copy of any notice received by such party from any third person, affect-
ing the rights of either party under this agreement "
128 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ployees in the Sav-Mart store, whereas the Meat Cutters contends that
Frostco is the employer of the grocery and meat department em-
ployees, who constitute a separate appropriate unit. Where such an
issue has arisen in other cases, the Board has decided the question
largely on the basis of whether the licensor or the licensee had the
primary right of control over the employment relationship.' As the
facts set forth above demonstrate, there is considerable control exer-
cised herein by the licensor as well as by the licensees. As pointed out,
each licensee hires, discharges, and supervises its employees in matters
pertaining to day-to-day operations. It is clear, however, that Sav-
Co., in order to operate the store ostensibly as a single integrated
enterprise and to achieve uniformity in the operations of all the
departments, maintains a considerable degree of control over all the
store employees, including their general working conditions, trans-
fers, discharges under some circumstances, and rehire. Moreover, we
note that paragraph 24 of the license agreements provides that Sav-
Co. is to be present at, and participate in, labor contract negotiations,
and that Sav-Co. holds a veto power over the execution of labor rela-
tions contracts by the licensees. Such a contractual relationship be-
tween Sav-Co. and the licensees places Sav-Co. in a position to in-
fluence all the licensee's labor policies. Under all the circumstances
of these cases, we find that Sav-Co. and each licensee are the joint
employers of the employees in such licensee's department.'
In this respect, the relationship of Sav-Co. and Frostco to the
employees in the grocery and meat department is similar to that of
Sav-Co. and each licensee to the employees of such licensee's depart-
ment. As the foregoing facts demonstrate, both Sav-Co and Frostco
exercise substantial control over certain aspects of the employment
relationship of the Frostco employees. We find, therefore, that Sav-
Co. and Frostco are the joint employers of the grocery and meat de-
partment employees. We find further that all the joint employers are
engaged in commerce within the meaning of the Act.
2. The labor organizations involved claim to represent certain em-
ployees of the Employers.
3. Questions affecting commerce exist concerning the representation
of employees of the Employers within the meaning of Section 9 (c) (1)
and Section 2 (6) and (7) of the Act.
4. The Retail Clerks seeks a unit of all employees of the Sav-Mart
store. The Meat Cutters seeks a unit of employees in the grocery and
meat department operated by Frostco. The Culinary Workers seeks
a unit of cooks, counter employees, busboys, and employees operating
the popcorn concession, employed by Illinois Catering Company, a
subsidiary of Topsy's International, Inc., for Topsy Catering Co., Inc.,
See Franklin Simon d Company, Inc . and Hays-Newport , Inc., 94 NLRB 576
6 See Gaylord Discount Stores of Delaware, Inc, 137 NLRB 557 (IR).
FROSTCO SUPER SAVE STORES, INC. 129
one of the licensees, herein referred to as Topsy. None of the Em-
ployers took any unit position' There is no history of bargaining.
As found above, Sav-Co. and each licensee constitute joint employers
of each respective department. And as described above, the Sav-Mart
operation resembles in its physical aspects a single retail department
store. The Board's long-established policy in cases involving retail
department stores is to find storewide units appropriate.' Many of
the factors in which this policy was based are present herein, including
the exercise by all the employees of the same general skills, the use
of common facilities, and the similarity of their working conditions.
In view of all the indicia of their mutuality of employment interests,
and the fact of the joint-employer relationship, we find that a store-
wide unit is appropriate.
As already described, however, although Frostco is also a joint em-
ployer, its operation differs somewhat from the operations of the other
departments. Its employees do not work on Sunday. Additional dif-
ferences arise from the fact that the terms of the Frostco lease are not
the same as those in the license agreements in that certain provisions
regulating advertising, purchase of supplies, prices, and records are
lacking. Frostco also maintains its own office. In addition, Frostco
employees punch a separate timeclock, use separate washroom and
other facilities, and their operations are partitioned from the other
departments to some extent by display shelves. Frostco also uses
distinctive shopping carts, and has its own pickup station, incinerator,
and departmental entrance and exit. In view of all the indicia of
Frostco separateness which are lacking as to the other departments,
we find that the Frostco employees may, if they so desire, constitute
a separate appropriate unit, or they may be included in the storewide
unit found above to be appropriate.'
The employees sought by the Culinary Workers, on the other hand,
do not comprise a group with sufficiently disparate employment in-
terests to warrant a self-determination election. These employees
work under a license agreement like those held by the other licensees,
and their employment conditions are similar to those of the employees
of the other licensees. Accordingly, the petition in Case No. 14-RC-
4233 will be dismissed.
7 The show cause order issued by the Board on May 23, 1302, referred to above, pro-
vided that, unless cause to the contrary were shown, the Board would (1) find the store-
wide unit appropriate ; ( 2) find that the Frostco eniployces may constitute a separate
appropriate unit or may be part of the storewide unit, depending upon their desires ; and
(3) find the requested unit of Tops emplolees inappropriate The responses filed to this
order were not addressed to any of the proposed unit findings
s Polk Bs others , Inc, 128 NLRB 330
'Member Brown would prefer to direct an election in an overall storewide unit ,.s he
would not differentiate between Frostco and the other departments for unit purposes
However, in the alternative , he joins his colleagues in the direction of elections in the
two voting groups established herein.
130 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
As either a storewide unit of all employees, or separate units of (1)
all store employees other than those in the Frostco department, and
(2) all Frostco employees, may be appropriate, we shall direct sepa-
rate elections in the following voting groups :
(a) All employees in the Sav-Mart store, Collinsville, Illinois, ex-
cluding professional employees, guards, and department managers and
all other supervisors as defined in the Act, and the employees in the
Frostco department.
(b) All grocery and meat department employees of the Frostco
Super Save Stores, Inc., a department of the Sav-Mart store, Collins-
ville, Illinois, including regular part-time employees, but excluding
professional employees, produce and meat department managers,10
and all other supervisors as defined in the Act.
If a majority of the employees in voting group (b) select the Meat
Cutters, they will be taken to have indicated their desire to constitute
a separate bargaining unit, and the Regional Director conducting the
elections is hereby instructed to issue a certification of representatives
to the Meat Cutters for such unit, which the Board, in these circum-
stances, finds appropriate for the purposes of collective bargaining.
If, in those circumstances, a majority of the employees in voting group
(a) select the Retail Clerks, then the Regional Director is instructed
to issue a certification of representatives for a unit of all the store
employees, excluding the meat and grocery department, which the
Board, under the circumstances, finds to be appropriate for the pur-
poses of collective bargaining. If, however, a majority in voting
group (b) do not vote for the Meat Cutters, such group will be ap-
propriately included with the employees in voting group (a), and the
votes of the two groups will be pooled."
If a majority of the employees in the pooled group select the Retail
Clerks as their bargaining representative, the Regional Director is
instructed to issue a certification of representatives to such labor or-
ganization fora storewide unit of employees, which the Board, in such
circumstances, finds to be appropriate for the purposes of collective
bargaining.
[The Board dismissed the petition filed in Case No. 14-RC-4233.]
[Text of Direction of Elections omitted from publication.]
MEMBERS RODGERS and LEEDOM took no part in the consideration of
the above Decision, Order, and Direction of Elections.
10 The Meat Cutters would include in the unit the produce and meat department heads ;
the other parties took no position as to then unit placement As the record shows that
these two individuals have authority to hire and discharge employees, we find that they
are supervisors within the meaning of the Act
'1 If the votes are pooled they are to be tallied in the following manner. The votes for
the Meat Cutters shall be counted as valid votes, but neither for nor against the Retail
Clerks , all other votes are to be accorded their face value, whether for or against repre-
sentation by the Retail Clerks