IFS Virgin Island Food Service, Inc.

National Labor Relations Board - Board Decisions

Nov 27, 1974

215 N.L.R.B. 174 (N.L.R.B. 1974)

174 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
IFS Virgin Island Food Service, Inc. and SIU of the
Virgin Islands, affiliated with Seafarers Interna-
tional Union of North America, AFL-CIO, Peti-
tioner . Case 24-RC-5342
November 27, 1974
DECISION ON REVIEW
BY MEMBERS FANNING, KENNEDY, AND PENELLO
On May 16, 1974, the Regional Director for Region
24 issued a Decision and Direction of Election in the
above-entitled proceeding in which he directed an elec-
tion in an appropriate unit. Thereafter, in accordance
with Section 102.67 of the National Labor Relations
Board Rules and Regulations, Series 8, as amended, the
Employer filed a timely request for review of the Re-
gional Director's decision, together with a supporting
brief, on the ground, inter alia, that the Regional Direc-
tor erred in failing to find that Petitioner was disquali-
fied from representing the Employer's employees be-
cause Petitioner intended to engage in direct, open
market competition with the Employer.
By telegraphic order dated June 19, 1974, the Na-
tional Labor Relations Board granted the Employer's
request for review and stayed the election pending deci-
sion on review.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the entire record in this
proceeding, including the Employer's brief on review,
with respect to the issues on review and hereby affirms
the Regional Director's decision for the following rea-
sons:
The Regional Director denied the Employer's mo-
tion to dismiss the petition which alleged that Peti-
tioner intends to engage in a competing business with
the Employer and therefore would be an inappropriate
bargaining representative under the rule established in
Bausch & -Lomb Optical Company.' Citing Lord &
Taylor, a Division of Associated Dry Goods
Corporation,' the Regional Director concluded that
there was no "compelling evidence that Petitioner will
engage in open market competition with the Employer,
rather than operate a non-profit cooperative meat mar-
ket restricted to its members." We agree.
In support of its assertion that the Petitioner intends
to engage in competition with it, the Employer points
to the evidence regarding Petitioner's purposes and ob-
' 108 NLRB 1555 fn 4 (1954)
2 150 NLRB 812 (1965)
jectives as stated in its Provisional Constitution and
By-Laws as follows:
. . . To bring to the working men and women of
the Virgin Islands the benefits of their own medi-
cal and dental clinic, their own legal services, their
own pharmacy, their own meat market, their own
occupational training and placement offices, their
own recreational rooms and facilities, and their
own pension and welfare plans, all to be operated
by and for Virgin Islanders, not for profit, but for
the working men and women of the Virgin Islands.
The record further discloses that, in response to the
question whether Petitioner was "actively now engaged
in pursuing all those objectives," Petitioner's General
Vice President Peters replied, "Not all, not at the same
time . . . of course we do not attempt to do everything
at one time." Peters testified that the Petitioner has
examined building sites in St. Croix for the medical
clinic and has applied for a license to operate the re-
creational facilities. As to the meat market, Peters
stated that a resident who imports meat offered to pro-
vide S.I.U. with meat to sell at a reduced price. While
Peters reported that "nothing has been done about this
as of this moment," he acknowledged that establishing
a meat market was still one of S.I.U.'s objectives. In
fact, Peters welcomed the Employer's business, stating,
"I'd be happy to have the I.F.S. be one of our patrons
. . . ." In further clarification of his testimony, Peters
affirmed the Union's intention to open a low-cost meat
market.
While it is clear that an objective of Petitioner,
among others, is to provide a meat market "for the
working men and women of the Virgin Islands" and
that certain preliminary steps have been taken toward
that objective, we are of the view, in accord with the
Regional Director, that the record evidence is insuffi-
cient to conclude that the Petitioner intends to engage
in direct, open market competition with the Employer
so as to render it inappropriate as a bargaining re-
presentative of the employees herein.' It is readily ap-
parent that the Petitioner's plans for a meat market
have not yet materialized and it is questionable at this
juncture whether such a market, if established, will
compete with the business of the Employer. We note
that the Employer is primarily engaged in the whole-
sale distribution of food products, including meat
items, and the extent to which Petitioner's proposed
market will affect the Employer's operations, if any, is
unclear. Thus, we find there is insufficient basis at this
time to conclude that the Petitioner is a potential com-
3 We also agree with the Regional Director's conclusion that the Peti-
tioner is a labor organization and with his rulings with respect thereto
215 NLRB No. 27
IFS VIRGIN ISLAND FOOD SERVICE
petitor of the Employer.' In answer to our dissenting
colleague we note that, if circumstances change requir-
ing further consideration, the Employer may raise this
issue at such time through the appropriate procedures
available under the Act.
Accordingly, the case is hereby remanded to the Re-
gional Director for the purpose of conducting an elec-
tion pursuant to his Decision and Direction of Election,
as affirmed herein, except that the payroll period for
determining eligibility shall be that immediately
preceding the date of issuance of this Decision.'
MEMBER KENNEDY, dissenting:
I dissent from my colleagues' conclusion that there
is insufficient basis at this time for finding that Peti-
tioner is a potential competitor of the Employer. I
would not direct an election herein.
In my view, the evidence firmly establishes that the
Petitioner is a potential competitor. Indeed, the tes-
timony of Petitioner's own vice president prohibits any
other conclusion, establishing that Petitioner has taken
positive action toward setting up its own meat market
by beginning negotiations with a meat distributor and,
further, that such meat market will not be for members
only as in Lord & Taylor, relied on by my colleagues.
Rather, the market, according to Petitioner's constitu-
tion, will be open to all "working men and women of
the Virgin Islands," and, according to Petitioner's vice
president, to the Employer as well.
4 Employer's motion requesting oral argument or to remand the case for
further hearing with respect to Petitioner's qualifications to represent the
employees is hereby denied as there is no affirmative showing that there is
newly discovered evidence warranting such action
5 [Excelsior footnote omitted from publication]
6 Bausch & Lomb Optical Company, 108 NLRB 1555, 1562 (1954),
Bambury Fashions, Inc, et al., 179 NLRB 447 (1969)
7 N.L.R.B v David Buttrick Company, 361 F 2d 300, 304-305 (1966),
R & MKaufmann, A Division ofRuss Togs, Inc, v N.L.R B, 471 F.2d 301,
304 (1972)
175
In light of Petitioner's announced and unqualified
intention to establish a meat market and in light of the
record evidence that such market will be open to all
"working men and women" on the island and to private
employers as well , I find inescapable the conclusion
that Petitioner intends to engage in direct, open market
competition with the Employer.
As the Board has held, "in a situation such as is
involved here, which possesses latent dangers," the
Board need not refrain from finding such a bargaining
relationship inappropriate "merely because the hazards
which can be anticipated have not yet been
realized. s6 Similarly, the Court of Appeals for the
First Circuit, quoted with approval by the Seventh Cir-
cuit, held:
The principles attaching to the concept of conflicts
of interest . . . in the field of collective bargaining,
look to the prevention and forestalling of condi-
tions which are likely to divide loyalties.'
By planning and taking steps to implement its own
meat market, Petitioner has created "a situation which
[will] drastically change the climate at the bargaining
table from one where there would be reasoned discus-
sion in a background of balanced bargaining relations
upon which good-faith bargaining must rest to one in
which, at best, intensified distrust of the Union's mo-
tives [will] be engendered.i' This danger will poison
the collective-bargaining relations between the Em-
ployer and the Petitioner by subjecting every issue to
the questioning of ulterior motives and to the suspicion
that the Petitioner is motivated by purposes other than
its loyalty to the employees it represents.
Accordingly, I would find that Petitioner intends to
engage in open market competition with the Employer
and, therefore, I would dismiss the petition herein.
8 Bausch & Lomb, supra, 1561