Local No. 24

National Labor Relations Board - Board Decisions

May 26, 1958

120 N.L.R.B. 1103 (N.L.R.B. 1958)

LOCAL NO. 2 4 1103
Local No. 24 , International Brotherhood of Teamsters , Chauf-
feurs, Warehousemen and Helpers of America ,' and its agents,
Kenneth A . Burke, George G. Allhouse , and Warren F. Buch-
waiter: Local 407, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America , and its
agents, William D . Cassidy and Frank Rubino ; International
Brotherhood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, and Central States Drivers Council , Inter-
national Brotherhood of Teamsters , Chauffeurs , Warehouse-
men and Helpers of America and A. C. E. Transportation Co.,
Inc.2
Local No. 24, International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America , and its agents
Kenneth A. Burke, George G. Allhouse and Warren F. Buch-
walter : Local 407, International Brotherhood of Teamsters,
Chauffeurs , Warehousemen and Helpers of America , and its
agents, William D. Cassidy and Frank Rubino ; and Interna-
tional Brotherhood of Teamsters , Chauffeurs , Warehousemen
and Helpers of America and Max Rabl, Paul Stutler, Inc.,
Robert E. Roach , Jasper W. Park, Lee Conner, William Chari-
tonovich, Marshall Boggs, R. J. Morgan, Hughey McDonald,
W. L. Day. Cases Nos. 8-CC-51, 8-CC-52,' 8-CC-53, 8-CC-64,
8-CC-55, 8-CC-56, 8-CC-57, 8-CC-58, 8-CC-59, 8-CC-60, and
8-CC-61. May 26, 1958
DECISION AND ORDER
On August 19, 1957, Trial Examiner Thomas N. Kessel issued his
Intermediate Report in these proceedings, a copy of which is attached
hereto, finding that the alleged violations of Section 8 (b) (4) (A)
and - (B) of the Act could not be sustained because ACE, the lessee,
and the Lessors were coemployers of the drivers furnished ACE by
the Lessors. He accordingly recommended dismissing the complaints
in their entirety. Thereafter, the General Counsel, Max Rabl, et al.,
and ACE, which also adopted as its own the exceptions filed by the
General Counsel and Max Rabl, et al., filed exceptions to the Inter-
mediate Report together with supporting briefs. The Respondents
filed a brief in support of-the Intermediate Report and a reply brief.
The Board has reviewed, the rulings made by the Trial Examiner
at the hearing and finds that no prejudicial error was committed. The
1 The Board having been notified by the AFL-CIO that it deems the Teamsters' cer-
tificate of affiliation revoked by convention action , the identification of this union is hereby
amended
2 Herein referred to as ACE or the Lessee , an I. C C. contract carrier.
8 Charging Parties herein referred to collectively as the Lessors or Fleet Owners
120 NLRB No. 150. _
1104 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
rulings are hereby affirmed. The Board has considered the Inter-
mediate Report, the exceptions and briefs, and the entire record in
these cases , and hereby adopts the factual findings of the Trial
,Examiner.4
The General Counsel and the Charging Parties except to the Trial
Examiner's failure to find that the Lessors were "independent con-
tractors" and, as such, "doing business" with ACE, within the mean-
ing of Section 8 (b) (4) (A), and an "other employer," within the
meaning of Section 8 (b) (4) (B). They except to his finding to the
contrary that "ACE together with the Lessors is an employer of the
drivers who operate the Lessors' equipment in the service of ACE";
and to his conclusion that "ACE and the Lessors were not neutrals
or wholly unconcerned third parties in the Union's disputes in this
proceeding with any of them," nor "shielded by Section 8 (b) (4) (A)
and (B) from the economic pressures exerted upon them." Their
further exceptions relate, for the most part, to the bases from which
he inferred a coemployer relationship. We find merit in these
exceptions.
The pivotal question in these cases is whether the independence of
two persons as employers, within the meaning of Section 8 (b) (4)
(A) and (B), depends upon whether they may have "employees" in
common within the meaning of Section 8 (a) (3).
In concluding that "ACE together with the Lessors is an employer
of the drivers who operate the Lessors' equipment in the service of
ACE," the Trial Examiner reasoned along these lines : (1) In cases
arising under Section 8 (a) (3) the Board has held the exercise of
veto power by a contractor over the hire and discharge of employees
by a subcontractor sufficient to make the contractor "jointly with the
subcontractor" an employer of the subcontractor's employees.' Be-
* Consistent with credibility findings made by the Trial Examiner, we make the follow-
ing supplementary findings of fact on the basis of exceptions to his failure so to do :
(1) ACE drivers were told by Kenneth A. Burke and George Allhouse that the picket
lines at Akron had been authorized by the Local and sanctioned by the International and
that they could be penalized if they crossed the lines; (2) Frank Rubino was designated
as union representative to administer the contract between ACE and Local 407; (3 ) Rubino
told Foreman Farrie that the line was authorized and sanctioned by the International in
the presence of two ACE driver -mechanics and members of Local 407 ; and (4) James
Hoffa, then vice president of the Central States Driver Council and of the International
Teamsters , informed the drivers that the picketing would be transferred to Rabl's premises
if ACE agreed to cease using Rabl equipment and drivers and requested employees of
other Lessors to honor the picket lines against Rabl at ACE. We regard the Trial
Examiner 's failure to make these findings as inadvertent and our supplementary findings
material to establishing the responsibility of each of the Respondents for the conduct
herein found unlawful . We wish to correct the Trial Examiner 's inadvertent mistake in
identifying chairman of the board of directors of ACE, Harley G. Hartline , as President
Hartline.
5 Citing West Texas Utilities Company, 108 NLRB 407, enfd . 218 F. 2d 824 (C. A. 5),
cert denied 349 U. S 953 , wherein the Board relied on the existence of a formal contract
provision in the contract between the general contractor and the subcontractor authorizing
the general contractor "to remove any employee from work " for finding the general con-
tractor also "an employer" of the employees and responsible , under the circumstances, for
securing their discharge in violation of Section 8 (a) (3).
LOCAL NO. 24 1105
cause ACE can threaten cancellation of its leases to compel the Lessors
to discipline or discharge their drivers, it has "implicit" "veto power"
over the discipline and discharge of such employees; it is, therefore,
"an employer" jointly with the Lessors, of the Lessors' employees;
(2) in cases involving the question whether owner-drivers were
"employees" or "independent contractors," the Board has relied
heavily on the extent to which an employer supervises the manner
in which the work was done.' A detailed drivers' manual established
that ACE supervised the manner in which the work was done; there-
fore, under the common-law test of control, ACE is "an employer"
of the Lessors' employees. Having found by such reasoning that
"ACE and the Lessors have been coemployers of the latter's em-
ployees," the Trial Examiner concluded that neither ACE nor the
Lessors were "neutral or wholly unconcerned third parties in the
Unions' disputes with any of them" and therefore not shielded by
Section 8 (b) (4) (A) and (B) from the economic pressure exerted
to compel ACE to cease doing business with the Lessors in order to
obtain recognition by the Lessors of the union as representative of
each of their employees. He asserted that this was a novel extension
of the "ally doctrine," distinguishing factually similar cases in which
the Board rejected such a defense on the ground that the Board had
not in those cases found sufficient control by the contractor over the
employees of the subcontractor to make them his employees and the
two for that reason coemployers 1 As an additional basis for showing
either that ACE was not "wholly unconcerned" with the dispute which
Respondents had with each of the Lessors over recognition for their
employees, operating lessor-owned equipment for ACE, or that ACE
regarded the employees of the Lessors "as its own," the Trial Examiner
emphasized the fact that the dispute "was the product of the State
6 Relying on National Van Lines , 117 NLRB 1213, 1214 , the Trial Examiner ignored the
material fact that in that case the Board had excluded "agent drivers who are the
employees of independent commission agents," and was concerned solely with the status
of owner-drivers.
7 Although this argument finds some warrant from the language in the decisions cited, it
is clear that the Board was concerned with the control of one employer over another
employer rather than the extent of control by one employer over the employees of another.
In Chauffeurs , Teamsters , Warehousemen & Helpers Local Union No. 135 , etc. (Hoosier
Petroleum Company, Inc.), 106 NLRB 629 , the Board reversed a Trial Examiner 's finding
that "Floyd 's anomolous relationship to Hoosier-Vortex as lessor , employment agent, and
transportation superintendent is so interrelated and integrated with Hoosier -Vortex as to
cause him to be an integral part of the integrated entity,despite the fact that the drivers
regarded him as an individual to be their employer . . ; because it was satisfied that
Floyd was an independent contractor and that there was "not such control by Hoosier
Pete over the manner and means of Floyd's performance of his contract as to establish
an employer-employee relationship [ between Floyd and Hoosier Pete]." The extent of
control over Floyd's employees was not a consideration in either the Board or court
decision. N. L. R. B. v. Chauffeurs, etc. (Hoosier Petroleum ), 212 F. 2d 216 (C. A 7).
See also Denver Building and Construction Trades Council , etc. (Climax Molybdenum
Company ), 108 NLRB 318 , 320 and footnote 5, explaining the straight-line ally doctrine
with reference to the control of one employer over the other employer , not over the
employees of either . ( Member Murdock dissenting.)
483142-59-vol. 120-71
1106 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
court litigation" which "disturbed the arrangement between ACE
and the Union" whereby the drivers for the Lessors had been "bar-
gained for by ACE as its own employees." s
This reasoning fails to recognize the differences in the purposes and
criteria for finding A to be an employer within the meaning of Section
8 (a) (3) of employees of B, and the criteria for finding that A and B
constitute a single employer within the meaning of Section 8 (b) (4).
As the Board has stated :
The statute •... precludes any employer from discriminating
with respect to any employee, for Section 8 (a) (3) does not limit
its prohibitions to acts of an employer vis-a-vis his own em-
ployees.
On the other hand, as the Board has also pointed out, other provisions
of the Act, including Section 8 (b) (4) (B), express a prohibition
with specific reference to "his employees."l1e This difference under-
lies a distinction between possible mutual responsibility under Section
8 (a) (3) for-discrimination by A against the employees of B and the
independence of A and B as employers under Section 8 (b) (4).
Under Section 8 (b) (4) the relationship of an employer vis-a-vis
"another employer" depends upon their business relationship.
The business relationship between "independent contractors" is
well established. There should be no confusion of the problem of
differentiating between "employee". and "independent contractor"
with the problem of determining whether an independent contractor
relationship exists between two admitted employers. The uniform
leases required the lessor-owners to furnish tractors and "competent
employees of his" as drivers; to maintain the equipment, furnish oil
and gas and licenses; to pay the drivers furnished by him, and all
social security, old age pensions, withholding tax, and unemployment
insurance and workmen's compensation for such drivers. It provides
that the "relationship herein created is that of an independent con-
tractor and not that of employer and employee," 11 and that the con-
tract is to be interpreted according to State law. The 11 Lessors
e We -consider this conclusion unwarranted. The Trial Examiner made the further state-
ment that he did not know the contentions the issuing court had before it . The General
Counsel and all the Charging Parties, including ACE, except to the Trial Examiner's
failure to find that the contract was, by its express terms , inapplicable to the Lessors, a
majority of whom are not owner-drivers, who are alone covered by article 32 thereof
Kenneth Burke , business agent of Local ' 24, admitted that the Union had "never bargained
in A. C . E. with respect to the drivers of the lessors." Under these circumstances, we
cannot conclude , as did the Trial Examiner, that this dispute grew out of the State
litigation or that ACE had bargained for the drivers of the Lessors
9 Austin Company , 101 NLRB 1257, 1259; Northern California Chapter, the Associated
deneral Contractors of America, Inc., etc ., 119 NLRB 1026.
10 Ibid.
11 Even in close cases involving owner-drivers , the Board gives weight to the express
intent of the parties to the equipment lease agreement , whether the intent be to create
"an independent contractor relationship " ( Eldon Miller, Inc., 107 ' NLRB 557 , 559) or an
"employee relationship" ( Hughes Transportation , Inc., 109 NLRB 458, 461).
LOCAL NO. 2 4 1107
involved leased between 2 and 19 tractors, each constituting a capital
investment of between $6,500 and $13,000, to ACE; a majority never
drive a tractor.' The annual revenues from these leasing arrange-
ments ranged from $18,500 to $300,000. A mere recital of these
factors should have sufficed to establish, ending the matter, that the
Lessor-owners are "independent contractors," depending "for their
income not upon wages but upon the difference between what they
pay for goods, materials, and labor and what they receive from the
end result, that is upon profits.713 The Supreme Court's and the
Board's criteria for determining the existence of an "independent con-
tractor" relation requires consideration of "the total situation, includ-
ing the risk undertaken, the control exercised, the opportunity for
profit from sound management...." 14 The control exercised by the
Lessee over the manner in which the work was done by the employees
of the Lessors cannot be solely determinative of the status of "inde-
pendent contractor," nor make the employees of a private contractor
the employees of the person with whom he contracts concerning their
service.15 As the Supreme Court said in United States v. Silk : le
Obviously the private contractor who undertakes to build at a
fixed price or on cost-plus a new plant on specifications is not an
employee of the industry thus served nor are his employees. The
distributor who undertakes to market at his own risk the product
'2 The option "to do the work himself or to engage others to do, it" goes far to establish
that even an owner-operator is an "independent contractor " rather than an "employee "
Greyvan Lines, Inc. v Harrison , 156 F. 2d 412, 416 ( C. A. 7) affd. sub nom , U S. v Silk,
331 U. S. 704 ; Eldon Miller, Inc., 103 NLRB 1627 , 1630, request for reconsideration denied
107 NLRB 557 , 559; Oklahoma Trailer Convoy, Inc., 99 NLRB 1019, 1024. .
13 1. Leg. Hist . of the LMRA 309; H. Rep. 245 on H. R. 3020, p. 18, ' states :
' In the law, there always has been a difference , and a big difference , between "em-
ployees" and "independent contractors ." . . . "Independent contractors" undertake to
do a job for a price , decide how the work will be done , usually hire others to do the
work, and depend for their income not upon wages , but upon the difference between
what they pay for goods , materials , and labor and what they receive for the end
result, that is, upon profits It is inconceivable that Congress , when it passed the act,
authorized the Board to give to every word in the act whatever meaning it wished.
On the contrary , Congress intended then, and it intends now , that the Board give to
words not farfetched meanings but ordinary meanings.
14 United States v. Silk, 331 U. S. 704 , 719, affirming Harrison v. Greyvan Lines, Inc.,
156 F. 2d 412 (C A- 7). In view of this statement of the test , we find no basis for the
Trial Examiner 's assertion concerning the drivers' manual involved in that case that "it
would seem that if the manual had been operative and strictly enforced , the result both in
the lower courts and in the Supreme Court would have been different ." Nor for his
grounds for distinguishing Oklahoma Trailer Convoy , Inc, 99 NLRB 1019, from National
Van Lines, 117 NLRB 1213 , 1216. We recognize that the Trial Examiner was perhaps
misled by the discussion in the latter case, at footnote 6, concerning Harrison v. Greyvan
Lines, Inc., 331 U. S. 704, 716, 717.
15 It is, therefore , immaterial whether drivers supplied by the Lessor-Employer ate at all
times subject to regulations of the Interstate Commerce Commission governing interstate
hauling and to the driving rules of the carrier in furtherance of these regulations Dallas
Transfer & Terminal Warehouse Company , 114 NLRB 18, 19-20 ; Oklahoma Trailer
Convoy, Inc., 99 NLRB 1019, 1024, and footnotes 10 and 16. Or that a carrier might,
without advance notice to a Lessor, discharge a driver furnished by a Lessor for in-
fractions of such rules and regulations . Dallas Transfer & Terminal Warehouse Company,
114 NLRB 18, footnote 5.
10 331 U. S . 704, 712, Casement v. Brown, 148 U . S. 615, 622. -
1108 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
of another, or the producer who agrees so to manufacture for
another, ordinarily cannot be said to have the employer-employee
relationship. Production and distribution are different segments
of business. [Emphasis supplied.]
Giving "independent contractor" its ordinary meaning, we cannot
refuse to recognize that an employer has the right to exercise such
control over the employees of an "independent contractor" "as is
necessary to secure the performance of the contract according to its
terms, in order to accomplish the results contemplated by the parties
in making the contract." 14
The conclusion that neither ACE nor the Lessors were "neutral or
wholly unconcerned third parties" in the Unions' dispute with any of
them disregards both the purpose and language of Section 8 (b) (4)
(A) and (B) and long-established and judicially approved law
concerning the protections afforded "independent contractors" as
employers.
Section 8 (b) (4) makes it an unfair labor practice for a labor
organization :
to induce or encourage the employees of any employer . . . to
perform any services, where an object thereof is: (A) forcing
... any employer . . . or other person to cease . . . doing busi-
ness with any other person; (B) forcing . . . any other employer
to recognize . . . a labor organization as the representative of his
employee unless such labor organization has been certified as the
representative of such employees under the provisions of Sec-
tion 9; . . . [Emphasis supplied.]
These sections clearly represent an effort by Congress to achieve a
satisfactory reconciliation of the interest of employees and labor or-
ganizations in exerting effective pressure upon employer participants
in labor disputes on the one hand, and the interest of neutral employers
in immunity from economic pressure, on the other. Section 8 (b)
(4) (A) was to eliminate strikes, or the inducement thereof, aimed at
employers who were "wholly unconcerned in the disagreement" be-
tween a union and another employer. The illustrations used by pro-
ponents of the bill disclose that by an "unconcerned" employer, Con-
gress meant an employer who is not involved in a labor dispute with
his immediate employees over such matters as union recognition or
particular economic issues directly affecting the terms and conditions
of employment of his own employees. Strike action directed against
an employer who is not in a position legally to grant the union's or-
ganizational or economic demands, i. e., a neutral or "secondary"
employer, is clearly forbidden by the purpose as well as by the lan-
ITN. L . R. B. v. Steinberg and Company, 182 F. 2d 850 ( C. A. 5), setting aside 78
NLRB 211 , citing Casement v. Brown, footnote 16, supra.
LOCAL NO. 24 1109
guage of Section 8 (b) (4) (A) and (B). By this test, ACE was a
"neutral" and "secondary" employer : ACE had no dispute with its
own employees and could not legally compel each of the Lessors to
recognize Local No. 24 as the representative of their employees or
recognize Local No. 24 as the representative of employees of each of
the Lessors.
In view of the legislative background and purposes of Section 8
(b) (4), the Board has consistently considered that an employer is
not deprived of his status as a "neutral" and made a party to a primary
dispute between himself and the union, within the meaning of Section
8 (b) (4) (A), by the mere fact that he persists in doing business with
an employer who is involved in such a dispute. As the Court of
Appeals for the Second Circuit has, with the approval of the Supreme
Court, said : 18
The gravamen of a secondary boycott is that its sanctions bear,
not upon the employer who alone is a party to the dispute, but
upon some third party who has no concern in it. Its aim is to
compel him to stop business with the employer.in the hope that
this will induce the employer to give in to his employee's demands.
We cannot see why it should make any difference that the third
person is .engaged in a common venture with the employer, or
whether he is dealing with him independently. The phrase,
"doing business," would ordinarily 'cover doing any business
which the third party is free to discontinue, regardless of whether
he is merely supplying materials to the employer, or has sub-
contracted with him to perform part of a work which the third
party has himself contracted to do. . . . Indeed, when the
coercion is upon the third person to break a contract with the
employer, his position is more embarrassing than if he may dis-
continue his, relations with the employer without danger of
liability. The, phrase, "cease doing business," is general and
admits of no such evasion. [Emphasis supplied.]
Nor is an employer deprived of his status as a "neutral" because his
business dealings have themselves created the condition giving rise to
the dispute."B Nor by the fact he has control over the employees of
another employer, in the manner in which they perform their work
for him ao
is International Brotherhood of Electrical Workers , Local 501 v . N. L. R. B., 181 F. 2d
34, at 37 (C. A. 2), affirmed in 341 U. S. 694.
19 See for its parallel to the reasoning of the Trial Examiner herein, Denver Building
and Construction Trades Council, et al. v N. L R. B., 186 F. 2d 326, 336-337 (C. A.,
D. C.), denying eLforcement of 82 NLRB 1195, reversed 341 U. S. 675; Denver Building
and Construction Trades Council, 90 NLRB 378 , 397-399.
20 For this reason , the extent to which a principal contractor could control the employ-
ment policies of his subcontractors under the existing contracts between them does not
appear of record in most cases involving violations of Section 8 (b) (4). It is well known
that in the building and construction industry effective secondary action frequently re-
sults in the general contractor's requiring the removal of nonunion craftsmen , although
1110 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
As the Supreme Court has stated : 21
... the fact . . . that the contractor had some supervision over
the subcontractor's work, did not eliminate the status of each as
an independent contractor or make the employees of one the em-
ployees of the other. The business relationship between inde-
pendent contractors is too well established in the law to be over-
ridden without clear language doing so. [Emphasis supplied.]
And that is precisely what the Trial Examiner did in finding-that the
employees of the Lessors were also the employees of the Lessee, and
that none of the employers was "unconcerned" with the Union's dis-
pute with any of them.
We find that all of the Respondents induced the employees of ACE
and various Lessors to strike with an object of forcing ACE to cease
doing business with other Lessors in order to force each of the latter
Lessors to recognize Local No. 24 as the representative of his em-
ployees, notwithstanding the fact that Local No. 24 had not been
certified as the representative of such employees, and that the Re-
spondents thereby violated Section 8 (b) (4) (A) and (B).
ORDER
Upon the entire record in the case, and pursuant to Section 10 (c)
of the National Labor Relations Act, as amended, the National Labor
Relations Board hereby orders that :
1. Local No. 24, International Brotherhood of Teamsters, Ware-
housemen and Helpers of America, and its agents Kenneth A. Burke,
George G. Allhouse, and Warren F. Buchwalter; Local 407, Interna-
tional Brotherhood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, and its agents William D. Cassidy and Frank
Rubino; International Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, and Central States Drivers Coun-
cil, International Brotherhood of Teamsters, Chauffeurs, Warehouse-
men and Helpers of America, their officers, representatives, agents,
successors, and assigns-shall:
a. Cease and desist from :
(1) Engaging in, or inducing and encouraging employees of A. C. E.
Transportation Co., Inc., or any Lessor (other than their own em-
ployer) to engage in, a strike or concerted refusal in the course of their
employment to use, manufacture, process, transport, or otherwise
handle or work on any goods, articles, materials, or commodities or
,to perform any services where an object thereof is (A) to force or
they are the employees of the subcontractor See Denver Building and Construction
Trades Council, 90 NLRB 378, 379 And that the contract usually grants him such
authority See, e g, the usual provision in that industry which provides that the con-
tractor shall at the purchaser's request "remove any employee from work." West Texas
Utilities Company, 108 NLRB 407, 430.
0 N. L. R. B. v. Denver Building & Construction Trades Council, 341 U. S. 675, 689-690.
LOCAL NO. 24
require any employer or other person to cease doing business with
Max Rabl, Paul Stutler, Inc., Robert E. Roach, Jasper W. Park, Lee
Conner, William Charitonovich, Marshall Boggs, R. J. Morgan,
Hughey McDonald, W. L. Day and A. C. E. Transportation Co., Inc. ;
or (B) to force or require Max Rabl, Paul Stutler, Inc., Robert E.
Roach, Jasper W. Park, Lee Conner, William Charitonovich, Marshall
Boggs, R. J. Morgan, Hughey McDonald, W. E. Day, or any of them
(other than their own employer) to recognize or bargain with Local
No. 24, International Brotherhood of Teamsters, Chauffeurs, Ware-
housemen, and Helpers of America, unless Local No. 24 shall be certi-
fied by the Board as such representative of each.
b. Take the following affirmative action which the Board finds will
effectuate the policies of the Act :
(1) Post in conspicuous places in their business offices, meeting
halls, and all places where notices to members of Respondent labor
organizations are customarily posted, copies of the notices attached
hereto marked "Appendix A"; 22 except that the Respondent Interna-
tional shall not be required to post such notices outside the territorial
jurisdiction of the Respondent Central States Drivers Council.
Copies of said notice to be furnished by the Regional Director for the
Eighth Region, shall, after being duly signed by official representa-
-tives of the Respondent labor organizations named in paragraph a (1),
above, and by. the individual Respondents named in paragraph a (1),
above, be posted by said Respondents immediately upon receipt thereof
and be maintained by them for sixty (60) consecutive days thereafter.
Reasonable steps shall be taken by said Respondents to insure that said
notices are not altered, defaced, or covered by any other material.
(2) Mail signed copies of the notice attached hereto marked
"Appendix All 23 to the Regional Director for the Eighth Region for
posting by A. C. E. Transportation Co., Inc., Max Rabl, Paul Stutler,
Inc., Robert E. Roach, Jasper W. Park, Lee Conner, William Chari-
tonovich, Marshall Boggs, Hughey McDonald, and W. L. Day, the
employers willing, at all locations where notices to their employees
are customarily posted; and for posting, A. C. E. Transportation Co.,
Inc. willing, at all locations where notices to A. C. E. Transportation
Co., Inc., employees and drivers for that Company, are customarily
posted. Copies of said notice, to be furnished by the Regional Direc-
tor for the Eighth Region, shall, after being duly signed by authorized
representatives of the Respondent labor organizations named in para-
graph a (1), above, and by the individual Respondents named in
paragraph a (1), above, be forthwith returned to the Regional Direc-
tor for such posting.
xa In the event that this Order is enforced by a decree of a United States Court of
Appeals, there shall be substituted for the words "Pursuant to a Decision and Order" the
words "Pursuant to a Decree of-the United States Court of Appeals, Enforcing an Order."
. = See footnote 22, supra.
1112 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(3) Notify the Regional Director for the Eighth Region, in writing,
within ten (10) days from the date of this Order, what steps the
Respondents have taken to comply herewith.
MEMBER FANNING, concurring :
I concur in the result reached in the majority opinion, but as con-
cerns,the issues of whether a "coemployer" or an "ally" relationship
existed, I rely only on the specific grounds, as elaborated below, that
in my judgment: (1) The facts do not support the Trial Examiner's
finding that ACE was a joint employer or "coemployer" of the Lessors'
employees; and (2) no-basis exists in the light of the statute or case
precedents for concluding that ACE was an "ally" of the Lessors,
and not a neutral employer for purposes of Section 8 (b) (4) (A)
and (B).
I recognize that the Lessors are independent contractors, as does
the Trial Examiner in effect, and readily concede that independent
contractors may in certain circumstances constitute coemployers of
a group of employees. Given the fact of a coemployer relationship,
I also would grant that the violations alleged here could not be main-
tained. But these are abstract propositions and not sustainable con-
clusions on the record before us. ' I .
There is the essential factual question, by way of Respondents'
defense, whether ACE is in the relation of employer-to the Lessors'
employees. As indicated, I have reached a negative finding on this
.issue-after considering the complete record. I. am persuaded par-
ticularly by these -factors, among others: (a) The Lessors, who ad-
mittedly are the employers of the drivers of the leased equipment, at
all times had full control over the hire, discharge,, and • conditions of
work of-these employees; (b) the relationship of'ACE' to the Lessors,
as well as to the Lessors' employees, legally derives from the terms of
the lease agreement, which specifically excludes the Lessors' drivers
from coverage, and no evidence appears- that the practice of the
parties varied from the terms of the lease ; (c) ACE's "control" over
these individuals, who operate the leased tractors in hauling ACE
trailers, is assignable entirely to ACE's mandatory obligations as a
common carrier under Interstate Commerce Commission and Public
Utility Commission certificates, and is subject in any case to the final
authority of the Lessors themselves; (d)- ACE has no financial in-
terests in the business operations of the Lessors, nor vice versa; and
(e) although Respondents now contend that ACE is a coemployer of
-the employees in question, and ACE recognizes Respondents with
respect to its own drivers, Respondents never requested ACE to bar-
gain or participate in bargaining concerning the Lessors' drivers.
The lease arrangement plainly is one in which the Lessors agree
to furnish ACE with a combination or package consisting of the serv-
ices of the contractor together with a qualified driver, the driver in
LOCAL -NO . 2 4 . 1 1113
unidentified form selected -and controlled by the Lessor, and neces-,
sarily subject to I. C. C. regulations for which the, Lessee,,, ACE, alone
had to assume responsibility. This does not connote to me an actual
or constructive, employment relation between ACE and Lessors'
drivers.14 Rather, the relationship appears to me to be analogous to
that existing between a contractor and employees of a subcontractor,
as, for example; was involved in the Denver Building case 25 In that
case, the Court of Appeals for the District of Columbia held that a
contractor and a subcontractor engaged in work on the same construc-
tion project were not neutral employers, but allies, and overturned the
Board finding of a secondary boycott violation .26 The U. S. Supreme
Court, which reversed the Court of Appeals and enforced the Board's
order, expressly stated, inter alia, ". . . that the' contractor had some
supervision over, the subcontractor's work, did not ... make the
employees of one the employees of the other."
Accordingly, on the foregoing grounds I join in finding violations
of Section 8 (b) (4) (A) and (B).
MEMBER BEAN, dissenting :
I cannot agree with the majority's finding of violations of Section
8 (b) (4) (A) and (B) in this case. Rather I would, as did the Trial
Examiner, dismiss the complaint, and I would do so for reasons sub-
stantially as set forth in the Intermediate Report.
I believe that my colleagues' decision misconceives the pivotal issue
in this case when it states it to be "whether the independence of two
persons as employers, within the meaning of 8 (b) (4) (A) and (B),
depends upon whether they may have `employees' in common within
the meaning of Section 8 (a) (3)." Rather I believe the issue is
whether the certified common carrier, ACE, stands in such relation-
ship to the drivers of equipment operated by ACE under lease from
the owner-Lessors of such equipment that it is entitled to the protec-
tion against strike action intended by Congress to be afforded to
neutrals or persons "wholly unconcerned" 27 with the primary dispute
which is the background of a charge of Section 8 (b) (4) (A) and (B)
24 E. g ., Cement Transport Inc., 111 NLRB 175 ; see also Oklahoma Trailer Convoy, Inc.,
99 NLRB 1019
25 N L. R. B v. Denver Building and Construction Council (Gould and Preisner), 341
U. S. 375.
2e Denver Building and Construction Trades Council v. N. L. if. B., 186 F. 2d 326
(C. A, D C), setting aside 82 NLRB'1195.
27 This characterization appears in the remarks of Senator Taft made during the debates
on the Act (93 Cong. Rec 4323, April 29, 1947) as follows: "This provision [Sec-
tion 8 (b) (4) ] makes it unlawful to resort to a secondary boycott to injure the business
of a third person who is wholly unconcerned in the disagreement between an employer
and his employees." These remarks have been referred to by the Board in support of its
"ally" doctrine to which the majority refers. See, e. g, J. C. Roy and Sons Company,
118 NLRB 286, footnote 1; Irwin-Lyons Lumber Company, 87 NLRB 54, 56, 84 Although
I do not regard the present case as falling strictly within the "ally" doctrine, I believe that
the sense of Senator Taft's remarks quoted above is equally cogent in its application to
these proceedings.
1114 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
violations. This, I believe, is the essential issue in this case, and I
would unhesitatingly answer it in the negative.
The persons who were the subject of the-Respondent unions' primary
dispute were the nonowner drivers of leased equipment as It is clear,
I believe, that these nonowner drivers occupy the status of employees
with respect to some employer or employers; I do not understand that
it is contended by any party that the nonowner drivers are inde-
pendent contractors. The Trial Examiner found that they are the
employees of both ACE and the owners of the equipment leased to
ACE; that is, the Trial Examiner found conversely that ACE and
the owner-Lessors are their coemployers. I accept this finding. The
significant feature of the finding, however, with respect to this pro-
ceeding, is that it defines the relationship of ACE to these employees
as that of employer to his employees. And I believe that in any event,
whether or not the owners of equipment leased to ACE may have
retained sufficient indicia of the relationship to constitute themselves
employers of the drivers of such equipment, it is certainly true that
these owner-Lessors have given over to a more-than-merely substantial
degree the indicia and exercise of the functions of an employer of
these drivers to ACE.
I need not reenumerate in detail here the facts concerning the
relationship of the nonowner drivers to the owner-Lessors of equip-
ment and to ACE which have been set forth at length by the Trial
Examiner in his Intermediate Report. Suffice it to say that, among
the many elements of authority and actual control over these em-
ployees which are possessed by ACE, I am impressed especially by the
detail in which the "ACE Drivers' Manual" prescribes the manner in
which all drivers, including the drivers of leased equipment, must
perform their tasks for ACE ; and by the measures which ACE exer-
cises on its own behalf to enforce these requirements. Thus ACE
apparently does not depend upon the owner-Lessors of equipment for
25 This is apparent from the fact that the Respondents ' strike and picketing were con-
ducted in support of demands for recognition made upon the owners of the leased equip-
ment. As to whether or not the Respondents ' demands upon the Lessor-owners were the
outgrowth of the decision in the State courts of Ohio enjoining the Respondents from
enforcing article XXXII of their contract with ACE, I believe that this is a question not
in fact necessary to a determination of the present case . An examination of the common
pleas and appellate court decisions , here in evidence , which I understand have since been
affirmed by the Supreme Court of the State of Ohio , indicates that those decisions were
limited to the issue of the effect of the Respondents ' contract with ACE upon the leases
of equipment executed by the owner -drivers to ACE, and the Respondents were narrowly
enjoined from applying any of the provisions of their contract with ACE which would
"require the alteration , cancellation or violation " of any owner-driver's equipment lease.
It also seems apparent , however , that the Respondents believed the terms of these leases
to impinge, in a manner not precisely disclosed here , upon the terms and conditions of
employment of the drivers of equipment generally . Although the Respondents' demands
upon the owner-Lessors disclosed in the present case may well have stemmed from their,
frustration in attempt to secure the ends they sought through their contractual relations
with ACE, in any event ' the precise matters involved in the State court litigation were not
relitigated in this case , and the position in which the Respondents may have deemed
themselves to be placed by the result of that litigation is not , I believe, in any manner
determinative of the present proceeding.
LOCAL NO. 2 4 1115
such enforcement , for it maintains its own patrol upon the highways
to police compliance both with its own rules and ICC requirements by
all individuals engaged as drivers in its transportation service. As to
the drivers of leased equipment it enforces such compliance by pre-
scribing either discipline or discharge, the effectuation of which can-
not be avoided by the owners of leased equipment without complete
removal of the equipment involved from ACE'S service. This effec-
tive exercise not merely of control over the end to be achieved through
the contractual relationship, or even in general of the means to achieve
that end, but of day-by-day inspection and control of the employees
engaged to perform its business functions, I believe is additional
persuasive demonstration of the existence of an employer-employee
relationship.
My colleagues assert that the Trial Examiner has applied to this
case, involving allegations of violation of Section 8 (b) (4), criteria
of an employer-employee relationship which are limited in their appli-
cability to the determination of violations of Section 8 (a) (3) 29 I
would concede that under Section 8 (a) (3) of the Act, a finding of
responsibility as an employer for a statutory violation is justified upon
the basis of a broader, less proximate relationship than that which is
otherwise usually regarded as involved in the relationship of employer
to employee.30 It seems plain to me, however, from an examination
of the Intermediate Report that the Trial Examiner has cited the
precedents in question only as demonstrative of the proposition that
a coemployer relationship may be found to exist between parties who
are otherwise bound to each other by no closer ties than merely their
contractual commitments.
However, in referring to precedents to demonstrate the applicability
of the Board's "right-of-control" test to determine employer status,
the Trial Examiner has not limited himself-and neither would I-
29 This assertion is made because of the Trial Examiner 's citation of West Texas
Utilities Company, 108 NLRB 407 , 412-414, enfd . 218 F 2d 824 ( C. A. 5), cert denied
349 U S . 953, and H E . Stoudt & you , Inc., 114 NLRB 838 These were cases in which
the Board found that a prime contractor was responsible for discrimination in violation
of Section 8 (a) (3) practiced by its subcontractor against employees , basing this con-
clusion upon the fact that the prime contractor in each case was able to exercise sufficient
control over its subcontractor to compel the latter to discriminate in its hiring practices.
The Board in these cases concluded that the exercise of control to this extent was sufficient
to constitute the prime contractor an employer of the subcontractor 's employees for pur-
poses of fixing responsibility for a Section 8 (a) (3) violation.
80 The greater reach of Section 8 (a) (3) is set forth more explicitly by the Board in
Northern California Chapter, the Associated General Contractors of America , Inc, et al.,
119 NLRB 1026 . There a majority opinion said :
We consider it immaterial that no formal employer-employee relationship existed be-
tween [the prime contractor ] and [the subcontractor's] employees A defense,
grounded on that fact , has no statutory support. . . . As the Board stated in [ Austin
Company, 101 NLRB 1257 , 12591:
. . the statute , read literally precludes any employer from discriminating with
respect to any employee , for Section 8 (a) (3) does not limit its prohibitions, to
acts of an employer vis-a-vis his own employees.
In (Austin ], the Board noted that other sections of the Act do limit their coverage
to employees of a particular employer.
1116 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to, cases which depend for their effect upon the breadth of, peach of
Section 8 (a) (3). He has referred, and rightly, to representation
cases which show that the Board applies the right-of-control test to
ascertain employer status for the purpose of conducting an election
to determine whether there is a statutory representative which may
be certified as entitled to bargain with such employer.31 To the cases
enumerated in the Intermediate Report, I would add another repre-
sentation precedent, Franklin Simon c Company, Inc., and Kays-
Newport, Inc., 94 NLRB 576, cited and followed by my colleagues in
a recent decision which reached a similar result, Macy's San Francisco
and Seligman & Late, Inc., 120 NLRB 69. These are two in a line
of cases dealing with a problem with which the Board has frequently
been confronted in representation proceedings-whether in a given
situation the firm which owns and operates a department store is an
employer of the employees of a leased department operated within
the store by a separate and independent enterprise. In each of these
cases the Board found that both the firm which owned and operated
the store and the firm which operated the leased department were
employers of the employees in the leased department. These cases
demonstrate that in an appropriate factual situation in a represen-
tation proceeding the Board does not hesitate to make a finding of a
coemployer relationship as between employers who otherwise are sepa-
rate and independent entities." As with all representation proceed-
ings, it was unquestionably the Board's intent that any certification
of representative resulting from the elections conducted in those pro-
ceedings should be valid, and one which, if necessary, would form
the proper basis for an order made in a proceeding brought under
Section 8 (a) (5) directing the employers designated in such certifi-
11 National Van Lines , 117 NLRB 1213; Orange Crush of P . If., Inc., 118 NLRB 217;
Citizen-News Company, Inc ., 97 NLRB 428 . These cases are ones in which the Board
has found that an employer 's exercise of a right of control over individuals who func-
tioned for it under a contract , lease, or other similar arrangement, was such as to con-
stitute these individuals employees within the meaning of the Act, and to constitute the
firm named in the case title their employer.
The Trial Examiner has adequately and correctly , I believe , distinguished on their
facts the cases of Harrison v. Greyvan Lines, Inc ., 67 S. Ct. 1463 , and Oklahoma Trailer
Convoy, Inc, 99 NLRB 1019. There were not present in those cases the full extent of
regulation and detailed control that are shown to reside in the employer , ACE, in the
present proceeding For similar reasons I would find that the cases of United States v.
Silk, 331 U S. 704; Dallas Transfer & Terminal Warehouse Company, 114 NLRB 18;
International Brotherhood of Electrical Workers, Local 501 v. N. L. If. B ., 181 F. 2d 34
(C A. 2) ; and other cases concerning the contractor-subcontractor relationship in the
construction or transportation industries, referred to in the majority opinion, are likewise
distinguishable.
52 As to the application of a right-of-control test these cases are merely cumulative, and
I find it unnecessary here to compare at length their factual detail. I cite them rather
to show that the Board has not deemed itself precluded , in proceedings other than those
based on Section 8 (a) (3), from finding as coemployers two employing entities not inter-
related by any ties other than a contractual , lease, or other business relationship.
'LOCAL NO. 24 1117
cation to 'bargain' with the representative concerning the conditions
of employment of the'employees involved. : 1. ' , ,
In sum; I take the Trial' Examiner's' findings and conclusions to
mean that, if the' issue here involved-the status of ACE as employer-
had been presented in the posture of a petition for representation of
the nonowner drivers of equipment leased by ACE, the Board, apply-
ing the test of a right of control, would have found ACE to occupy
the status of an employer of these employees. Having found ACE
to be such an employer, it would follow that ACE must be subject to
all the obligations of bargaining concerning the nonowner drivers
which the statute imposes; and an employer standing in such a rela-
tionship, and subject to such an obligation, cannot be regarded as a
neutral or "wholly unconcerned" with any dispute concerning these
employees." ' With all of these propositions I agree. Certainly there
is no reason for treating the question of employer status differently
for purposes of Section 8 (b) (4) than for purposes of representation
proceedings or for purposes of Section 8 (a) (5).3' Having found
that ACE stands in the position of an employer to the employees
concerning whom the dispute in this case-arose, I would accordingly
dismiss the complaint.
MEMBER RODGERS took no part in the consideration of the above
Decision and Order. -
'3 My colleagues in effect concede this when they say :
Strike action directed against an employer who is not in a position legally to grant
the union 's organizational or economic demands, i . e., a neutral or "secondary"
employer , is clearly forbidden by the purpose as well as by the language of Sec-
tion 8 (b) (4) (A) and ( B). [Additional emphasis supplied.]
34 We are not , of course , concerned in -this proceeding with whether the-Respondents
possess representative status or whether they are entitled to seek to bargain for the
employees which are the subject of the dispute . Those matters would be pertinent to
questions arising under other sections of. the Act . Here we are concerned solely with the
relationship of ACE to the employees as it may bear upon its asserted status as a neutral
within the contemplation of Section 8 (b) (4) (A) and (B).
APPENDIX A
NOTICE TO ALL OUR OFFICERS, AGENTS, REPRESENTATIVES, AND MEM-
BERS AND TO ALL EMPLOYEES OF A; C. E. TRANSPORTATION CO., INC.,
AND MAX RABL, PAUL STUTLER, 'INC., ROBERT E. ROACH, JASPER
W. PARK, LEE CONNER,- WILLIAM', CHARITONOVICH, MARSHALL
BOGGS, R. J. MORGAN, HUGHEY MCDONALD, W. L. DAY
Pursuant to a Decision and Order of the National Labor Relations
Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify you that:. - -- - -
WE WILL NOT engage in, or induce or encourage the employees
of A. C. E. Transportation Co., *Inc., or any employer (other
1118 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
than their own employer) to engage in, a strike or concerted
refusal in the course of their employment to manufacture, process,
transport, or otherwise handle or work on any goods, articles,
materials, or commodities or to perform any service where an
object thereof if (A) forcing or requiring any employer or other
person to cease doing business with Max Rabl, Paul Stutler, Inc.,
Robert E. Roach, Jasper W. Park, Lee Conner, William Chari-
tonovich, Marshall Boggs, R. J. Morgan, Hughey McDonald,
W. L. Day, and A. C. E. Transportation Co., Inc., or (B) forcing
or requiring Max Rabl, Paul Stutler, Inc., Robert E. Roach,
Jasper W. Park, Lee Conner, William Charitonovich, Marshall
Boggs, R. J. Morgan, Hughey McDonald, W. L. Day, or any of
them (other than their immediate employer), to recognize or
bargain with Local No. 24, International Brotherhood of Team-
sters, Chauffeurs, Warehousemen, and Helpers of America, un-
less Local No. 24 shall be certified by the Board as such
representative.
LOCAL No. 24, INTERNATIONAL BROTHER-
HOOD OF TEAMSTERS , CHAUFFEURS,
WAREHOUSEMEN AND HELPERS OF
AMERICA, AND ITS AGENTS, KENNETH A.
BURKE, GEORGE G. ALLHOUSE, AND
WARREN F. BUCHWALTER,
Union.
Dated---------------- By-------------------------------------
(Representative ) ( Title)
Dated---------------- By-------------------------------------
(KENNETH A . BURKE ) ( Title)
Dated---------------- By-------------------------------------
(GEORGE G ALLHOUSE ) ( Title)
Dated---------------- By-------------------------------------
(wARREN F. BUCHWALTER ) ( Title)
LOCAL 407, INTERNATIONAL BROTHERHOOD
OF TEAMSTERS , CHAUFFEURS, WARE-
HOUSEMEN AND HELPERS OF AMERICA,
AND ITS AGENTS WILLIAM D. CASSIDY
AND FRANK RUBINO,
Union.
Dated---=----=-=----- By--------------------------------------
(Representative ) ( Title)
Dated---------------- By-------------------------------------
(WILLIAM D. CASSIDY) (Title)
Dated---------------- By----------------------------------- -
(FRANK RURINO ) (Title)
LOCAL NO. 24 111'9
INTERNATIONAL BROTHERHOOD OF TEAM-
STERS, CHAUFFEURS , WAREHOUSEMEN
AND HELPERS OF AMERICA,
Union.
Dated---------------- By-------------------------------------
(Representative ) ( Title)
CENTRAL STATES DRIVERS COUNCIL, IN-
TERNATIONAL BROTHERHOOD OF TEAM-
STERS, CHAUFFEURS , WAREHOUSEMEN
AND HELPERS OF AMERICA,
Union.
Dated---------------- By-------------------------------------
(Representative ) ( Title)
This notice must remain posted for 60 days from the date hereof,
and must not be altered, defaced, or covered by any other material.
INTERMEDIATE REPORT
STATEMENT OF THE CASE
Upon charges and amended charges filed by the parties listed in the above
caption , the General Counsel of the National Labor Relations Board for ' the
Eighth Region ( Cleveland , Ohio ), issued on February 8, 1957, an order consoli-
dating cases and a consolidated complaint against the parties hereinabove listed
as Respondents . The complaint charges the Respondents with violation of the
secondary boycott proscriptions of Section 8 (b) (4) (A ) and (B ) of the Act.
The answers filed in their behalf deny commission of the alleged unlawful conduct
and also plead certain affirmative defenses . Copies of the formal documents filed
herein and a notice of hearing were duly served upon the parties, and , pursuant
to said notice , a hearing was held at Akron , Ohio, on March 4 , 5, and 6, 1957, before
the duly designated Trial Examiner to conduct the hearing . All parties appeared
through counsel and were afforded full opportunity to examine and cross -examine
witnesses and to present evidence . After the close of the hearing the Respondents
moved for a reopening of the record to receive certain evidence . Following the
issuance of a rule to show cause . on the motion, the record was ordered reopened
to receive the document which has been incorporated into the record as Respondents'
Exhibit No . 4, and a reconvened hearing was later held at Cleveland , Ohio, on
June 20, 1957 , to permit the introduction of evidence relevant to said exhibit. Such
hearing was held pursuant to notice and the parties were enabled to present evidence
relevant to the exhibit . After the close of this hearing the parties were afforded
opportunity to submit briefs limited to the matters raised at the reconvened hearing.
Such briefs along with all other briefs submitted by the parties have been carefully
considered . A stipulation from the parties has been received for the correction of
certain errors in the transcript of testimony . These corrections have been noted.
From the entire record in the case, and from his observation of the witnesses, the
Trial Examiner makes the following:
FINDINGS OF FACT
1. THE PERTINENT COMMERCE FACTS
A. C. E. Transportation Co., Inc., hereinafter referred to as ACE, is an Ohio
corporation engaged in the motor trucking business as a common carrier duly
certified by the Interstate Commerce Commission , and in the course of its business
maintains and operates terminals in several States. Annual revenue derived by
ACE from its operations exceeds $6,000,000 . Paul Studer , Inc., an Ohio corpo-
ration , and individuals Max Rabl , Robert E . Roach , Jasper W . Park, Lee Conner,
William Charitonovich , Marshall Boggs , R. J. Morgan, Hughey McDonald, W. L.
Day, and Shelton Hartline each are separately engaged in Akron, Ohio, in the
business of leasing certain motor equipment to ACE,for the interstate hauling of
1120 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
freight in the 'course of ACE's operations. The foregoing lessee corporation and
individuals are herein called Lessors. Revenues from ACE under leasing arrange-
ments with the Lessors in 1956 were as follows: Paul Studer, Inc., in excess of
$175,000; Rabl, in excess of $300,000; Roach, in excess of $30,000; Park, in excess
of $45;000; Conner, approximately $104,000; Charitonovich, approximately
$112,600; Boggs, approximately $35,000; Morgan, in excess of $48,000; McDonald,
$18,448; Day, in excess of $200,000; and Hartline, approximately $83,000.
H. THE LABOR ORGANIZATIONS INVOLVED
International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers
of America, AFL-CIO, its Locals No. 24 (Akron) and 407 (Cleveland), and its
Central States Drivers Council are all labor organizations within the meaning of
the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Circumstances relevant to the Union's dispute with the Lessors and the resultant
conduct alleged as unlawful
ACE has its principal office and terminal in Akron, Ohio. It has other terminals
in Cleveland, Ohio, North Bergen, New Jersey, Watervliet, New York, Milford,
Connecticut, and 'Needham, Massachusetts. ACE has on its payroll about 350
employees including office and dock workers and truckdrivers. Among these
drivers are 30 who make long-distance hauls from Akron to all the aforemen-
tioned terminals except the one in New York. Its other drivers deliver city
freight. In addition to those drivers carried on its own payroll, ACE utilizes the
services of other drivers who operate tractors owned by the Lessors hereinabove
named in section I and leased by them to ACE. These tractors and their drivers
are used exclusively by ACE to haul its long-distance freight between Akron and
the eastern terminals.
ACE bargains with Teamsters' Local No. 24 and the' Central States Drivers
Council of the' Teamsters for its drivers. _ The subsisting contract between the
parties is entitled "Central States Area Over-The-Road Motor Freight Agreement"
and runs from February 1, 1955, to January 31, 1961: Section 1 in article XXXII
of this contract also expressly provides coverage for the owners of the equipment
leased to ACE who themselves operate the leased equipment, and section 4 of the
same article provides that all leased equipment shall be operated by an employee
of the certificated carrier (ACE). None of the Respondent labor organizations has
bargained with the owners of the equipment leased to ACE for the drivers of this
equiliinent, 'nor has, any'of these labor organizations been certified' by the Board as
the exclusive bargaining representative for - these drivers as employees of such
owners of leased equipment.
Subsequent to the execution of the contract between ACE and Local No. 24
and the Central States Council, a proceeding was brought in the Ohio Court of
Common Pleas, Summit County, in which there was at issue the legality of article
XXXII of the contract., The resultant decree held that the plaintiff in the proceeding,
ostensibly' an owner-operator or fleet owner of tractors leased to a certificated
carrier, is an independent contractor and that the terms of article XXXII impinge
on that status in violation 'of an Ohio statute characterized in Respondents' brief,
herein, as, the Ohio Anti-Trust Act. The decree enjoined the parties to such
agreement from the enforcement of its'terms. The effect of this decree was to
prevent Local No. 24 and the Central States Council from applying with ACE
terms and conditions of employment for the drivers of equipment leased by the
Lessors herein' to ACE as if these drivers were employees of ACE. Thereupon
Local No. 24 turned to the Lessors and requested recognition from them as the
representatives of the drivers of their equipment, and further requested agreements
concerning terms and conditions of employment for these drivers.
These demands, first made upon Max Rabl on or about August 31, 1956, were
extended on or about January 3, 1957, to all the other Lessors. All refused to comply,
and insisted that recognition, would not be accorded without certifications from the
Board that Local No. 24 represented the drivers in question. Pursuant to the
unanimous decision of the, executive board of Local No. 24 strike action was started
on December, .29;',1956, against Max Rabl, and pickets were installed at ACE's
terminals in Akron and, Cleveland as well as at the ACE terminals in. the other
eastern States. Signs, carried by the pickets, conceded to have been agents of Local
No. 24, declared' "members of Teamsters Local No. 24 on strike against Max
Rabl, under lease to ACE Transportation Co., Inc." On January' 8, 1957, directly
after the other Lessors had rejected, the Teamsters' demands, the foregoing picket
signs were changed`to'state that Local No. 24 was on strike against all the Lessors
/' LOCAL NO. 2'4 - 1121
under contract to ACE.-All these Lessors were named in the sign. Picketing
at the ACE terminal was continuously conducted around the clock-until enjoined
on February 4, 1957, by a Federal court.
The record indisputably shows that in the course of the picketing= at the ACE
terminal in Akron officials of Local, No. 24 directly induced employees of ACE to
honor the picketing and to refrain from working. These employees were ACE
drivers who operated only ACE owned equipment and who'did not operate equipment
owned by the Lessors. The Local No. 24 officials involved in. this, conduct were
Respondents Kenneth A. Burke' and George G. Allhouse, respectively president and
vice president of Local No. 24. The conduct in question, related in the credited
testimony of ACE drivers Walter J. Tomlinson and Frank Shiplett, occurred follow-
ing the institution of, picketing on December 29, 1956, and before the strike against
Rabl was expanded to include the other Lessors.
During the same period, specifically on December 29, 1956, Earl Cherry, a
driver for Lessor Roach, had come to the ACE terminal in Akron to take out a loaded
trailer and was then informed by a picket in the presence of Burke that if he did
not honor.the picketing and proceeded to drive off with his vehicle that his Teamster
union card would be "pulled."
When the ACE terminal in Cleveland was first picketed on December 29, 1956,
the terminal manager communicated with Respondent Rubino, the business agent
of Teamsters' Locals 407. ACE's Cleveland employees are represented by Local
407 and are covered by a contract. Rubino advised the manager, Lachino, that he
was going "to have trouble" and explained that the terminal was being picketed in
connection with ,the strike against Rabl. When Lachino- asked how this affected
ACE, Rubino replied, "I would more than likely want my men to honor it (the
picket line)." Later that evening Lachino came to the terminal and there, saw
Rubino and Respondent, William D. Cassidy, also a business agent of Local 407,
leaving the premises. Rubino and Cassidy then returned with Lachino to the rear
of the terminal where McDonald and Bowser , Rabl drivers, were present. In an
ensuing conversation Lachino protested penalization of ACE if the strike were only
against Rabl, whereupon Rubino replied that "it was an authorized picket line" and
that it was sanctioned by the International Teamsters. This latter observation was
also voiced by McDonald and Bowser. The next day, December 30, 1956, Lachino
saw two unidentified men in an automobile parked at the terminal . That night
he saw at the terminal McDonald, Bowser, and a person named Smith who identified
himself as a "trustee" from Akron. Lachino told them he intended to operate that
night and McDonald, stated that he had no objection, that his orders were to stop
Rabl's trucks from 'entering and leaving Cleveland. _ On the following Wednesday,
Lachino observed Cassidy at the terminal sitting,in an automobile with,two pickets
who wore picket signs on their backs.
During' the first working day after. picketing started at' the Cleveland terminal
ACE employees, engaged in local city deliveries worked without interruption until
8 a. in. when certain pickets who had relieved McDonald,, Bowser, and Smith came
to the terminal dock and talked to them. The ACE employees-concluded their work
that day, but did not thereafter, until issuance of the Federal court injunction, make
any freight deliveries with the following exceptions . During the period in question
there was on hand at the terminal a• shipment of guns destined for the Cleveland
Cadillac plant and a shipment of freezable drugs. Lachino contacted William J.
Welch, secretary-treasurer of Local 407, and informed him of his desire to deliver
these shipments. Lachino testified that Welch gave him permission for delivery
of the guns, but stated, that he would have to check with Akron concerning delivery
of the drugs. Welch ben called back to advise that the drugs also could be delivered.
Lachino thereupon called in drivers who delivered, both the guns and the drugs.
Welch testified that Lachino had communicated with him, and that when he was
informed that the goods had not been delivered because of the ' refusal of the men
to go through the picket line he disclaimed any involvement by Local 407 in the
strike or any personal knowledge of the strike or picketing. He, suggested to Lachino
that he communicate with Akron, and finally simply told'Lachino that if he could
obtain drivers "we will deliver" the shipments. He denied that he spoke to any
ACE employees concerning these or any other shipments, or that he had authorized
anyone on behalf of Local 407 to give any instructions to these employees concerning
the handling of shipments. He further denied. that Local 407 employed anyone
to picket the ACE Cleveland terminal or that any, Local 407 members engaged in
such activity.
Victor Farrie, the dock foreman at the'ACE Cleveland terminal, related that he
had been at the terminal when Rubino and Cassidy arrived there in the evening of
December 29, 1956 , and that Rubino's comment to Lachino over the telephone that
483142-59-vol. 120-72
1122 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
,picket lines were to be established against Rabl and that there was going to be
trouble was made in the presence of two ACE employees who were members of
Local 407 . The first time he saw signs carried by pickets at the terminal was on
.the following Wednesday morning. The dockmen had reported on this day at 5:30
a. in. Rubino, who arrived at 6 a. in., was asked by them whether they , should work
or not and he merely stated that there was going to be a picket line . He departed
-a few minutes later . All but a couple of the dockmen told Farrie to call them
"just in case ," and then left the premises.
Several witnesses ' credibly testified concerning what transpired at a meeting con-
ducted by Local No. 24 at its hall on January 4, 1957. In substance, their testimony
is that Local No. 24 President Burke presided over a meeting which was at first
;limited to Rabl drivers of whom about 13 were in attendance . Burke introduced
James Hoffa to the drivers as the vice president of the Central States Drivers Council
and as a vice president of the International Teamsters ,2 and declared that Hoffa
-was there "to get this thing through for us." 3 Burke further stated that Hoffa
wanted a certain agreement from the Rabl drivers . He then yielded the floor to
'Hoffa who urged the drivers to vote in favor of terminating strike action against
all the Lessors but Rabl, provided that ACE were to agree to cease using Rabl equip-
tment and drivers in its operations. Hoffa noted that at that very moment represen-
tatives of ACE and the Union were in an adjoining office conferring over an agree-
ment whereby ACE in consideration of withdrawal of pickets from its terminals
,by the Union would cease dealing with Rabl.4 Having been thus informed, the Rabl
drivers voted in favor of the proposition put to them by Hoffa. This accomplished,
a group of drivers for the other Lessors who had been outside the meeting room
were ushered in, and were told by Hoffa what had been decided by vote of the
,Rabl drivers.
Burke conceded that he had introduced Hoffa at the January 4 meeting as vice
president of Central States Council and of the International Teamsters. He acknowl-
edged that Hoffa had come to Akron in response to the call of Local No. 24 for
assistance in its dispute with Rabl and ACE , particularly as Hoffa is the negotiating
.-chairman for the Central States Council of which Local No. 24 is a member,5 and
because in such capacity Hoffa is involved in securing acceptance by employers of
-the Central States over-the-road agreement. This is the contract which, as noted
-above, subsists between Local No. 24 and Central States Council with ACE, and
which the Union was seeking to secure from Rabl and all the other Lessors. Burke
denied, however, that Hoffa had told the drivers that he was trying to get the over-
-the-road agreement signed for them, but claimed that Hoffa had said that Local No.
24 was engaged in securing this result. While Burke insisted that over-the-road
agreement would, if accepted by the Lessors, have been signed only by Local No.
-24, he did not dispute that Central States Council had also signed this agreement
when made with ACE. He contended that the Council had not signed as a party.
Article XII of the International Teamsters ' constitution empowers its general
executive board to pay strike benefits to its local unions, but conditions entitlement
to such payments upon prior recognition by the general executive board that the
-locals' strike is "properly subject" under the constitution to the payment of strike
'enefits. The general executive board, as provided in article IV, consists of the
'International 's general president , 11 vice presidents , and its general secretary -treas-
urer. Burke testified that he had requested approval of the strike by the International
.in a telephone conversation with the International 's general secretary -treasurer, and
followed up this call by forwarding to the International a document entitled "Request
-for Strike Sanction" which is an official form used by locals to report strikes and to
'These witnesses are Robert Stuckey, a driver for Charitonovich, Russell Ebersole, a
.driver for Rabl, Earl Cherry, a driver for Roach, Glen A. Bowser who at the time was a
,driver for Rabl and now drives for McDonald, and Robert Walhck who also drove for Raul
.at the time in question but now drives his own tractor.
2It was stipulated that Hoffa, in fact, holds these offices
8 According to Ebersole.
• A typewritten copy of such agreement is in evidence ACE refused to execute this
agreement.
5 The Central States Council has a committee which at certain intervals meets to devise
an over-the-road contract through "negotiations " among its members The Teamsters
local unions in the several States which belonged to the Council are represented in these
.negotiations by three persons from each State selected by the local unions. When the
.agreement has been negotiated and approved by the various State committees representing
the local unions it is sent to the locals for presentation to the employers with whom they
- bargain fgr-execu-tion by them.
LOCAL NO. 24 1123
secure authorization from the International for strike benefits. This form was dated
December 28, 1956, and signed by W. F. Buchwalter, the Local No. 24 secretary-
treasurer. In response to the printed demands for certain information, the form was
completed to show that the dispute involved the refusal by "Fleet Owners A.C.E.
Transp. Co." to sign the Central States, over-the-road contract. Strike benefits were
paid by the International to Local No. 24 during the strike while there was picketing,
and the International continued to make such payments thereafter. Burke denied
that he had sought approval of the strike by the Central States Drivers Council or by
any other Teamsters' body except the International as above related.
B. The contentions
The General Counsel and the Charging Parties contend that each Lessor is an
independent contractor maintaining his business separately from ACE and all other
Lessors; that the dispute with Raul was not the concern of ACE or any other Lessor,
and when in the course thereof the Union picketed ACE's premises and induced its
employees and Lessor employees to cease working for their employers with an object
of disrupting ACE's operations so that pressure would thereby be applied by it upon
Rabl to capitulate to the Union's demands the Union was engaging in unlawful
secondary strike activity within the proscriptions of Section 8 (b) (4) (A) and (B)
of the Act. Similarly, the continued picketing by the Union of ACE's premises and
inducement of its employees after the strike was enlarged to include all the Lessors
was violative of the same statutory proscriptions.
The Respondents contend that all the picketing and inducement of employees,
whether of ACE or Lessors, at any time in question, was not conduct proscribed by
the Act. They argue that the operations of the Lessors should not be construed as
divisible from those of ACE or of each other so that any one may be regarded as
primary and any of the others as secondary as those terms are understood in relation
to Section 8 (b) (4) (A) and (B) of the Act. Rather, the Respondents say, the
businesses of the Lessors and ACE are so integrated operationally that for purposes
of this proceeding they must be deemed either a single employer, a joint or common
venture, a "straight line" operation within the Board's understanding of that term,
or an alliance of interest. The Respondents maintain that whichever term may best
be used- to describe the relationship among ACE and the Lessors, their business
arrangements are such that in the Union's dispute with the Lessors or any one of
them neither ACE nor any of the Lessors is so unconcerned therewith that it is
statutorily shielded as a neutral from an extension of the dispute by the Union to
its operations, and, therefore, the Union's picketing and inducement herein occurred
at premises which in this proceeding should be regarded as primary and not second-
ary. Accordingly, the Respondents contend, the complaint should be dismissed.
C. The business arrangements between ACE and the Lessors
As noted above, the bulk of ACE long-distance freight is hauled between its
Akron terminal and its terminals in other States by tractors owned by the Lessors and
leased by them to ACE. The trailers in which the freight is loaded and which are
drawn by these tractors are the property of ACE. • All the leases are drawn on
identical printed forms and in relevant part contain these provisions: The Lessor is
to render the agreed services between the points and over the routes designated by
ACE for each shipment following only routes for which ACE has been certified; the
equipment furnished by the Lessor is to be maintained by him in first-class repair at
his own expense, the Lessor is to pay all costs' for the operation of his equipment, and
he is to provide the license plates and registration certificates required by the State
of his residence; the Lessor's equipment is to be operated either by himself or by
competent employees of his; the Lessor is to render the agreed services in such
manner as to promote the good will and reputation of ACE; the Lessor's equipment
while in the service of ACE is to display the ACE certificate numbers; the Lessor
is to provide workmen's compensation coverage for his drivers and employees, to
pay all State and Federal taxes for unemployment compensation insurance, old age
pensions, and social security and to make -any other social-payments covering em-
ployees which may be required by law; -ACE is to provide insurance for property
damage, public liability, and cargo, except for cargo losses resulting from fire, theft,
wet freight, collision, or upset occurring when equipment is in transit, and in that
event the Lessor's liability is limited to $250; ACE is exempt from liability for any
fines or settlements assessed against the Lessor or his employees resulting from any
violation of law or regulation by him or them; ACE is exempt from liability to the
Lessor for damage to his equipment during the performance of the agreed services
or for loss by confiscation or seizure of such equipment by any public authority; the
1124 DECISIONS OP' NATIONAL LABOR- RELATIONS BOARD
Lessor's liability to ACE,for damages to'its trailer while being pulled by the Lessor's
tractor is lirrlitedto. $250 for each accident; compensation for the Lessor's services
is to be on the 'basis of the weight of the freight hauled pursuant to an agreed sched-
ule between the parties which is to be attached to each lease; the lease expressly pro-
vides that "the relationship herein created is that of independent contractor and not
that of employer and employee," and that the Lessor is a contractor only and not the
employee of ACE; and the lease "shall terminate when all conditions have been
complied with by the parties hereto." - '
ACE has no financial interest in the business operations of the Lessors. Each
Lessor owns his own equipment. While in a few cases, ACE has signed notes or
otherwise pledged its credit to help a,-Lessor purchase equipment, ACE makes no
advances or loans to Lessors for the purchase of such equipment.
Each Lessor maintains his own books relative to his accounts with ACE, and
there are regular periodic settlements between the parties with respect to such
accounts. The drivers for the Lessors receive their pay upon the conclusion of
their trips directly from ACE and are paid by checks issued by that company.
Before departing with freight from Akron these drivers may also receive advances
from ACE pursuant to arrangements with the Lessors to defray expenses on the
road. When the drivers return to Akron after a trip they receive a statement on
a form furnished by ACE which is prepared by a bookkeeper or auditor in the
service of the Lessor: This statement includes a computation of the driver's earn-
ings for his completed trip with notation for withholding of taxes, social security,
and unemployment compensation insurance payments. ACE pays the driver upon
presentation of this statement. Payments to the Teamsters' welfare fund are also
made for each driver by ACE. All these payments are ultimately deducted by ACE
from, the amounts payable to the Lessors in the periodic accountings with them.
Only ACE has the necessary certificates and authorizations from the Interstate
Commerce Commission and the Ohio Public Utilities Commission permitting it to
engage in the transportation of freight. None of the Lessors has such authority,
and each hauls freight for ACE only under the latter's authority. ACE itself pays
the fees for such authority, and also for motor vehicle licenses in States traversed
by the Lessors other than Ohio.' The Lessors' tractors are painted with the green
coloring and yellow lettering distinguishing ACE vehicles, and ACE's name is
prominently displayed on the tractors as required by ICC regulation.
As noted, the leases require the Lessors to maintain their tractors in "first-class
repair," at their own expense. The leases also require the Lessors to pay for the
operation of their tractors. While ACE has facilities for servicing and maintaining
its own equipment, and although it regularly inspects the Lessor's tractors to insure
their 'proper condition, it does not service or repair these tractors in its shop. Nor
does ACE suggest to the Lessors or require that such work be done at any particular
shop, or that purchases of fuel or any other products used for operation, servicing,
or repair be purchased at any particular establishment. The Lessors pay for the
public liability and other insurance to protect their property interests in their tractors.
All freight hauled by Lessor-owned equipment for ACE is loaded at its terminal
docks by ACE employees and is dispatched by its own dispatchers. ACE maintains
three separate dispatch boards for its over-the-road hauls. One board lists drivers
of ACE-owned equipment, another lists drivers of Lessor Day who covers the run
to the New York terminal, and a third lists all the remaining drivers of Lessor-
owned equipment. Drivers are dispatched from these boards on 'a rotating basis
of first-in first-out. If there are insufficient drivers on the boards listing Lessor,
drivers to take out available loads, drivers of ACE equipment may be given such
assignments. ACE's policy at Akron for dispatching drivers calls for notification
of the Lessors who in turn are expected to notify their drivers of the time when
they are to pick up loads at the terminal. It appears, however, that in practice the
ACE dispatcher notifies either the Lessor or the driver directly. '
When drivers of Lessor tractors return to Akron with an ACE trailer, with or
without a load,6 they proceed directly to the ACE terminal. After the trailer has
G If upon arrival by a Lessor 's tractor with a load at an eastern terminal of ACE the
latter has. no freight at that point to be hauled to Akron on the return trip, the Lessor
may, but, only with permission of ACE, arrange with another shipper to haul its freight
to Akron. ACE In this circumstance permits the Lessor to use its trailer without charge,
and permits the Lessor to retain the entire fee charged the shipper. This arrangement
eliminates the expense ACE would incur should its trailers be returned by a Lessor to
Akron without' freight. Although Metcalf, an ACE official, testified these arrangements
are frequently made; he gave' no objective indication of the frequency. On the other hand,
Lessor Charitonovich testified it is "very rare" for his tractors to haul an empty trailer
back to Akron.
LOCAL NO.'24 1125
been uncoupled , the driver usually proceeds with the tractor to premises designated
by the Lessor where it is to be serviced and maintained in readiness for its next
operation and where it is parked until such time? In some instances , tractors owned
by Lessors have remained at the Akron terminal of ACE overnight . Lessor Morgan
permits his drivers to drive his tractors to their homes and to park them there.
All the Lessors own and lease to ACE more than one tractor. Four Lessors,
including Boggs, Park , McDonald, and Hartline , regularly drive one of their tractors
hauling for ACE. Roach drives a tractor occasionally. The other Lessors do not
drive at all. During times material herein , Rabl leased 19 tractors to ACE, Paul
Stutler , Inc., leased 9, Day 11 , Boggs 2, Charitonovich 8, Conner 6 , Roach 2, Morgan
3, Park 2, McDonald 2, and Hartline 5.
Drivers of Lessor-owned tractors are not carried on ACE payroll records as its
employees . In securing employment they sometimes apply directly to ACE and
are referred to a Lessor who may have informed ACE of his need for a driver.
Whether the applicant goes first to ACE for a job or whether he applies directly
to a Lessor , there are certain procedures which must be followed before he is
permitted to haul for ACE as the driver of a Lessor-owned tractor. He must fill
out an application form which bears the name of ACE at its top and which ACE
has distributed to the Lessors, and he must be physically examined by a doctor
designated by ACE. The application when completed is scrutinized and investigated
by ACE and it determines the suitability of the applicant as a driver . Special
emphasis during this review and investigation is accorded the applicant's past
employment record and his driver safety record as such information is particularly
pertinent to the capability of the applicant as a driver in accordance with ICC re-
quirements . The application form , however , is replete with demands for information
from the applicant which concededly bear little if any relation to ICC regulations
and call for such information as marital status and history, whether the applicant
has relatives employed by ACE, family data, identification of the person who referred
the applicant for employment , physical characteristics such as color of hair and eyes,
the salary desired , educational accomplishments , special training courses (other than
driving ), previous employment record ( other than as a driver), affiliation with
labor organizations , and membership in fraternal organizations . Upon completion
of the application, it is retained in ACE files, and this is so whether the applicant
secures employment as a driver for ACE or for a Lessor. The retention of these
applications by ACE is to permit inspection from time to time of driver records by
representatives of the ICC and the Ohio Public Utilities Commission.
William T . Metcalf, the ACE director of personnel, testified that the application
form was prepared by the American Trucking Association and that he is interested
solely in the information given by an applicant which pertains to ICC requirements.
He conceded , however , that applicants are not told to answer only certain questions
on the form. He further testified that in addition to ACE's interest in the applicant's
capabilities as a driver, as would be reflected by information concerning his safety
record , ACE is also interested in other factors. This is because all drivers for
ACE, whether driving the Lessors' equipment or its own, represent ACE in their
contacts with customers and the general public and in effect are salesmen promoting
ACE's business interests. Metcalf indicated that ACE desires and expects the
Lessors' drivers to be courteous and polite and "to conduct [ themselves] as any
normal person would representing [ themselves ] to the public for [ their ] benefit
as well as ours." Harley C. Hartline , ACE's president, testified substantially to
the same effect.
Metcalf firmly insisted that ACE does not hire drivers for the Lessors. He
maintained that although he received applications from drivers who may have
filled out the forms and were examined by the ACE doctor before they were
referred to a Lessor, the hiring did not take place until the applicant had been
interviewed by the Lessor and accepted by him for employment. Metcalf related that
almost without exception applicants who had been approved by Lessors as their
drivers had been declared acceptable by ACE. It appears, however, as Metcalf
conceded, that ACE's failure to reject such approval of applicants was because they
generally had the qualifications demanded of them by ACE. It is clear that before
7 Paul Stutler , Inc., owns and maintains an automotive repair shop with a parking area
for its tractors , and Park also keeps his tractors there Day leases premises which in-
clude a garage and lot on which he parks his tractors . Charitonovich has his own garage
and grounds where he parks his tractors . Boggs parks them behind his house . Conner,
McDonald , Hartline , and Roach park their tractors at public service stations. Roach
sometimes takes his tractors _ to his home for repairs . Rabl has his own garage and park-
ing lot. All these places are within a few miles from the ACE terminal in Akron.
1126 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
these applicants may drive a Lessor's equipment in the service of ACE they must
be "Okayed" by Metcalf's office.
Metcalf has in the past conducted briefing sessions with all newly hired drivers
including ACE and Lessor drivers, and in the course thereof presented to them
rules and regulations contained in the booklet prepared by ACE entitled "Drivers
Manual." Appearing first in the manual is a foreword with a message from Presi-
dent Hartline. It begins by stating that the purpose of the manual is to acquaint "all
drivers" with the specific rules of ACE, and closes with this notice:
You are charged with the knowledge of the rules and regulations contained in
the manual and you are expected to abide by them.
The next section of the manual is entitled "Rules for Drivers" and lists 23
separate instructions. Several pertain to inspection and maintenance of equipment
and possession of licenses and other documents required by law, and others give
specific directions for operation of equipment during transit such as speeds, parking
off the road, passing vehicles, taking necessary rests in the event of mental or
physical fatigue, stopping for school buses, and giving required signals to other
traffic. Use of tractors and trailers is forbidden for personal transportation; courtesy
is demanded in dealing with customers; changes of home address or telephone
numbers must be reported to the ACE personnel department; directions are given as
to the making of long-distance telephone calls; and drivers are directed not to change
jobs "within the company" without approval of the ACE Operation Department.
There is a special grouping of 4 "don'ts" including an instruction not to carry
unauthorized passengers, not to drink intoxicating beverages before or while on
duty, not to be dishonest in handling company funds or property, and not to drive
recklessly or at excessive speeds. The Company's speed limit is here stated to be
50 miles per hour. Following these four directives is the admonition that "violation
of any above rules will result in your discharge."
The manual next contains a statement of the ICC restrictions concerning
continuous driving, and requirements for compulsory rest periods. There follows
a section pertaining to accidents and what drivers must do in such situations.
Having detailed these instructions the manual states that each "must be followed at
all times," and that failure to report accidents promptly will result in immediate
discharge. A section captioned "Safety Equipment" details a variety of parts with
which each tractor and trailer must be outfitted for emergencies. There is a
section dealing with advances to "regulars" which was not operative during times
material herein. Under the heading "Driver's Log Books" are directions for main-
taining and turning in these records following each trip, with notice to the drivers
that they must keep and maintain these logs on the road and "never be more than
4 hours behind in the posting at any one time." A section entitled "Safety On
the Road" stresses the need for caution and safety on the highways, and includes a
specific direction for the placing of cautionary flags or torches when vehicles are
disabled on the road. Under "Sales" the manual reminds drivers of their frequent
contact with shippers and urges them to promote the company's sales. A section
"Turnpike Traffic Regulations" is devoted to an itemization of traffic regulations
on the Pennsylvania Turnpike, with detailed directions for operation of vehicles
to comply with these regulations. The section "Equipment" specifically directs the
manner in which tires are to be changed, the manner in which radiators are to
be serviced with antifreeze, and how tow chains should be attached when equipment
is being towed. Drivers are cautioned that when "pulling heated trailers (they)
will be responsible for load, and must check heater at regular intervals." A section
entitled "Weight" directs drivers to weigh their trailers before and after delivery if
they believe the shipper to have made an error in weight and requires them to
obtain certified weight slips in duplicate. A statement in heavy type notifies drivers.
that "OVER LOADS WILL NOT BE TOLERATED."
The manual next contains several sections captioned "Claims," "Shipments
Refused or Reconsignments," and "Freight Bills" which give detailed instructions
to the drivers concerning the documents they must carry with them in delivering
shipments, checking their freight to insure accuracy with directions as to non-
acceptance of freight in bad condition and the hauling of "over" freight. With
regard to the latter the manual specifically orders drivers "under no circumstances"
to deliver "over" freight, and cautions that "if a driver picks up a load and the
same driver delivers this load and shortage or damaged freight is present that
driver will be responsible for claim." There is a careful description of the manner
in which drivers are to obtain receipts upon making deliveries, on procedures to be
followed in making certain deliveries designated "Order Notify," and on the
collection of charges on C. O. D. shipments. A section, "Maintenance," relates
to a report to be completed by a driver showing needed repairs to equipment after
LOCAL NO. 24 1127
each trip. This section, as distinguished from all others in the manual, includes-
the subcaption "(COMPANY)." Under "Purchase Orders For Repairs" appear-
instructions for notice by drivers to Akron via telephone if repairs to their equip-
ment must be made on the road.
A section in the manual captioned "Call-In-New England Terminals" directs,
drivers to call or wire the nearest terminal upon arrival at delivery point. Under
"Direct Deliveries" there is the express mandate that "no driver will leave any
Customers Dock or A. C. E. Dock without full knowledge of dispatcher and move-
at no time without having bills for same." There is a further directive not to move
trailers not fully loaded unless ordered to do so by the dispatcher, with an added
instruction to "always offer all aid and service possible to our customers." Under
"Delay Enroute" the manual states "it shall be the duty of any driver to notify his
destination terminal by wire or telephone if he is delayed enroute more than four
(4) hours for any reason other than regular rest periods."
The manual next specifically states the running schedule from Akron or Cleveland-
to North Bergen and to New England. There is also outlined a schedule of depar-
tures for New England and, with regard to the latter, the manual provides "(e) It
is the dispatcher's duty to see that his trucks are dispatched promptly. More,
loading of trailers with owner-operators moving at his option will not be tolerated.
Violation of instructions, late arrivals, etc., must be reported to Akron for disci-
plinary action." There are further provisions concerning the movement of trucks
at the New England terminals with a directive that movement of these vehicles
are to be controlled by the dispatchers at these points.
The manual further contains information concerning the Company's check-in
department where log books, expense money, and wage payments are obtainable,
and there are instructions as to the manner in which log sheets and time checks are
to be handled by drivers in order to receive payments from this department.
Finally, the manual lists the locations of its terminals and cartage setups and ACE's
authorized routes to these locations.
There is a final page in the manual with a perforated edge to facilitate its removal.
Printed thereon is the following:
ACE TRANSPORTATION COMPANY, INC.
I ------------------------------------ have received and read all Rules
and Regulations that appear in manual and hereby state that I am familiar with,
rules and will abide by rules set forth.
-------------------------------------
(Driver's signature)
Witness:
Metcalf was examined at considerable length concerning the manner in which the
manual affected ACE's drivers, with special emphasis upon the difference in its effect
upon drivers of company equipment and drivers of leased equipment. President-
Hartline was also examined on the same subject but not so searchingly as Metcalf.
Metcalf related that he personally handed the manual to each driver before he
embarked on his duties. This was part of the briefing session he held with each
new driver, as noted above, which was of 30 to 35 minutes duration with company
drivers and 10 to 15 minutes with drivers of leased equipment. Metcalf claimed
that he went over the specific sections of the manual with company drivers, but
that he did not do the same with the Lessors' drivers. With the latter, he spent
about 5 of the 10 to 15 minutes discussing the out-of-State routes they would have to
traverse by referring to a map hanging on the wall of his office. Concerning atten-
tion to the manual while briefing the Lessors' drivers, Metcalf testified:
In respect to drivers of leased equipment we will give them a copy of the manual,
with one exception. With that man we would tell him, that we were giving it
to him for his knowledge and in the event that he would want to question the
applicability of any item in the book to his operation, that he should come in
and inquire of us, whether it did or did not apply to him.
He further testified that in his discussion with the Lessors' drivers he did not tell
them that any particular provision in the manual failed to apply to them, and that
he spoke only generally to them about certain subjects covered by the manual, and
summed them up to include "the insurance company requirements of reporting the
'accidents; the routes which we traverse and the various ICC regulations pertaining to
Log Books and vehicle maintenance," and also safety on the road.
Apart from his varying comments to both classes of drivers when presenting the
manual to them , Metcalf testified that its provisions apply differently in the follow-
ing respects to company drivers as opposed to drivers of leased equipment. ACE is
1128 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
not concerned with failure by the Lessors', drivers to, report, changes of home ad-
dresses and- telephone numbers; the rule forbidding changes of jobs by drivers with-
out approval by the operations department pertains only to company drivers; the
instruction as to overloads is for the benefit of company drivers only; the require-
ment under "Maintenance" specifically applies only to company drivers, although
drivers of leased equipment must -also fill out the same maintenance form as com-
pany drivers, the difference being that they ,obtain their forms from the Lessors; the
instructions as to Purchase Orders has no application to the Lessors' drivers; and the
"check-in" provisions apply differently in that Lessors' drivers must present a form
for payment which has first been approved by the Lessors., Concerning the author-
ized routes set out in the manual, Metcalf stated that they contain several alternate
routes for reaching the out-of-State ACE terminals which ACE permits the Lessors'
drivers to choose at their discretion, whereas company drivers must follow the routes
specifically designated by ACE on a given trip. While there may be alternate routes
to these terminals, each runs along the same highways for a portion of the trip.
ACE has established check points on these common roads where its company drivers
are supposed to clock in, and there are nearby rest facilities provided for these drivers
by ACE where they may lay over for the rest period required by ICC. The Lessors'
drivers have also been instructed to clock in at these check points, but ACE does not
regard their failure to do so as a breach of its rules. They may also use the ACE
rest facilities, but do so at the expense of the Lessors.
Concerning the detachable sheet at the back of the manual on which the drivers
acknowledge familiarity with the rules and their agreement to abide by them, Met-
calf stated it is ,compulsory for company drivers to sign and that having done so
the page is retained in the driver's personnel file. As to the Lessors' drivers, they
are not compelled to sign, but many do and their signed forms also are retained in
their personnel files kept by ACE.
President Hartline testified that rule 5 (check oil frequently during trip), rule 7
(report of change of address and telephone number), and rule 17 (prohibiting use
of tractors and trailers for other than company business), do not apply to drivers of
leased equipment. He was unable to specify any other provision in the manual which
did not apply to these drivers, claiming lack of recent familiarity with it. He con-
ceded that while ACE made no attempt to "force" the Lessors' drivers to read the
manual, ACE nevertheless presented the manual to them so that they should "know
the rules and regulations," and that these rules apply, with the exceptions he noted,
to both drivers of company and leased equipment, and that both classes of drivers
were expected to live up to these rules.. Questioned specifically as to the notice in
the manual to drivers that overloads will not be tolerated, he stated it applied to all
drivers, and not just to company drivers. Concerning the signing by drivers of the
detachable sheet acknowledging familiarity with the rules and agreement to abide by
them, he agreed with Metcalf's testimony that drivers of leased equipment were
not required to sign although some did. He admitted, however, that he had testified
in a 1953 legal proceeding that both classes of drivers signed the page. and that
ACE's practice has not changed since then.
Regarding enforcement of the Rules and Regulations, Metcalf testified that viola-
tions by drivers of company equipment were dealt with directly by ACE and gen-
erally involved a procedure in which there was a hearing with participation by the
Union. Violations by drivers of leased equipment were handled by a procedure in
which the driver and the Lessor whose tractor he operated were both notified, and
in this situation ACE looked to the Lessor to impose and carry' out the necessary
discipline. If ACE felt that the breach by the driver was sufficiently aggravated to
warrant a particular penalty, including the discharge of the driver, it would so
inform the Lessor and would expect him to take its recommended action. If the
Lessor was unwilling to follow ACE's recommendation, the latter's recourse was
cancellation of the lease, which, Metcalf testified without qualification, ACE was
empowered to accomplish .8
8 How this ACE policy was practiced is clearly shown by testimony given in the
Federal court proceeding by a former driver for Rabl whose employment had been
terminated on December 26, 1956 According to this driver, Neal, he had just returned
to Akron from a New England trip and had been summoned by Metcalf who sent him to
his superior, Huntsman, the ACE operations manager. Huntsman informed Neal that he
had been driving on,the Pennsylvania Turnpike in excess of the ACE 50 mile per hour
speed limit, and that be had also violated the ACE dispatch rules-by trading loads at the
New England terminal with another Rabl driver. He concluded by telling Neal that "we
regard your services as very unsatisfactory and-if you wish to make an appeal to
Mr. Rabl, if he wants to continue to wish, to have you in his employ-we're going to
cancel his lease on any equipment that you drove." Huntsman testified that after
LOCAL NO. 2 4 1129
Metcalf related that ACE maintains patrols on the highways to observe the opera-
tion of its equipment. When they observe violations they stop the drivers and inform
them that they had noted the violations, and require compliance with ACE's rules.
The patrol's report is then forwarded to ACE at Akron. This procedure is exactly
the same for company drivers and drivers of leased equipment. When the report
arrives at Akron, the guilty driver, whether he drives company or leased equipment,
is called in and he receives a warning letter from ACE which informs him, if a safety
rule has been violated "that such violation would not be tolerated and that, if it were
repeated that such a violation of law or whatever, that ACE would take steps to
effect disciplinary action." In the case of the driver of leased equipment there might
then follow the procedure of notifying the appropriate Lessor followed by a recom-
mendation for certain discipline enforced by ACE's threat to cancel the lease upon
failure of the Lessor to abide by the recommendation.
I find that ACE together with the Lessors is an employer of the drivers who
operate the Lessors' equipment in the service of ACE.9 The determination of an
employer-employee relationship in proceedings under the Act depends, as the Board
has frequently stated, upon the application of the common law "right of control"
test. Under this test, an employer-employee relationship is said to exist where the
party for whom the services in question are performed reserves the right to direct
and control the manner in which these services are to be performed, that is the
right to determine not merely the result but the methods and means by which such
result is to be accomplished. 10' Applying the foregoing test to the circumstances of
this case, it is abundantly clear that not only does ACE comprehensively regulate
and supervise in minute detail the manner in which the drivers of leased equipment
must perform services for it," but it polices them in the performance of their services
to insure compliance with its rules and regulations. ACE, moreover, invokes dis-
ciplinary procedures, involving even discharge, against them for breach of its rules
and regulations. Not only is ACE empowered by exercise of threat of cancellation
of its leases with the Lessors to effect such discipline against these drivers, but through
the same power may control the employment of these drivers by the Lessors. The
Board has regarded such'veto power by a contractor over the hire and discharge of
employees by its subcontractor of itself sufficient to constitute the contractor and
employer jointly with the subcontractor over these employees,12 and this is especially
so, where, as here, such veto power is implicit in the terms of the leases which
contain no termination date, are in effect cancellable at will, and which ACE's
official testified ACE will cancel if a Lessor refused to abide by its determination
with respect to the employment or the disciplining of the drivers in question.
My conviction that the facts of this case disclose sufficient elements of control
by ACE over the employment of the Lessors' drivers to compel the conclusion that
it is also their employer has been formed'only after thorough consideration of the
opposing 'arguments presented in the briefs of the General Counsel and other
counsel aligned with him. In this connection I have noted the many points of
similarity in the facts of the instant case and those of the Harrison v. Greyvan Lines,
Inc., case, 331 U. S. 704, where the Supreme Court held that certain drivers of
leased equipment were not' employees but independent contractors, but do not
regard that case as a controlling precedent. That case significantly differs from the
present one because there the Court specifically noted that the manual which the
trucking company had given to'the drivers alleged to be employees was, according
criticizing Neal's conduct he told'him that he was going to notify Bahl, "and that from
there 'on out, it was up to him and Mr. Rabl." ' He further told Neal that he didn't fire
"operator's drivers. All I do is'tell them about their equipment, and its up to them " He
conceded that he had spoken to Rabl and had "told him just plain that we couldn't use
his equipment with a violator on it, and its entirely up to him."
That this ACE policy was understood by the Lessors and acquiesced in by them is
further revealed by the testimony of a Lessor, Conner, that when an ACE official had
told him to get rid of a driver who had failed to turn in an accident report, President
Hartline had told the official that ACE had no'right to fire an operator's driver, but had
also said, "You cancel the lease if you think it is serious, otherwise the man drives."
9 See West Texas Utilities Company, 108 NLRB 407, enforced 218 F. 2d 824 (C A 5),
cert denied 349 U. S. 953 and H E. Stoudt & Son, Inc., 114 NLRB 838, where the Board
made findings of dual or concurrent employment of employees by separate employers
10 National Van Lines, 117 NLRB 1213; Citizen News Company, Inc , 97 NLRB 428;
56 C J. S 33, Sec. 2
11I am satisfied this is so even after taking into account all the rules in the ACE
manual which Metcalf or Hartline claim do not apply to the drivers of leased tractors.
Is West Texas Utilities Co., supra, and H. E. Stoudt & Son, Inc., supra.
1130 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to a company official , "impractical and that no attempt was made to enforce it."
The Court's opinion, on page 717, quotes the opinion of the Appellate Court
(reported at 155 F. 2d 356, 358-359 (C. A. 10), with which it concurs as stating:
While it is true that many provisions of the manual, if strictly enforced, would
go far to establish an employer-employee relationship between the Company
and its truckmen, we agree with appellee that there was evidence 'to justify
the court's disregarding of it. . . one driver testified that he was never in-
structed to follow the rules therein provided; an officer of the Company
testified that it had been prepared by a group of three men no longer in their
employ, and that it had been impractical and was not adhered to.
It would seem that if the manual had been operative and strictly enforced, the
result both in the lower courts and in the Supreme Court would have been different.
At the very least, it must be said that the Greyvan decision, because of its factual
differentiation from the instant case , is not determinative here.
Nor do I regard the Board's decision in Oklahoma Trailer Convoy, Inc., 99
NLRB 1019, as sufficiently apposite to require a finding that the drivers of leased
equipment herein are not employees of ACE. That decision does not mention a
company manual of rules and regulations minutely detailing the manner of perform-
ance of duty by the drivers of leased equipment, as here, with the policing of these
drivers by the company, as ACE policed them, to insure strict observance of the
requirements of the manual . Because the Board , in the Oklahoma Trailer case,
specifically found the relevant circumstances to be "closely analogous to those
considered by the Supreme Court in the Greyvan case, it must be presumed that
as in the Grey van case there was not present in Oklahoma Trailer a manual which
"if strictly enforced, would go far to establish an employer-employee relationship
between the Company and its truckmen."
The significance of a manual, such as that presently involved , in determining that
the company which issues and applies it to drivers of leased equipment is the
employer of such drivers, is demonstrated by the Board's recent decision in the
National Van Lines case, supra, where the Board held that owner-drivers of leased
equipment were employees of the trucking company with whom they had leases
and were not independent contractors. It is especially noteworthy that in this
decision the Board apparently borrowed the language of the Greyvan opinion by
the Supreme Court and said, after first remarking that "the manual regulates the
conduct of the drivers in the performance of their duties in the most comprehensive
and minute detail ," that the manual "therefore goes very far to establish an
employer-employee relationship between the Employer and the drivers." It should
be observed that in footnote 13 of its decision the Board expressly compared the
result in National Van Lines with the holdings in the Greyvan and Oklahoma Trailer
cases. In view of the broad factual similarity of all these cases, it must be assumed
that the Board regarded National Van Lines as crucially distinguishable from
,Greyvan and Oklahoma Trailer because of the evidence in the former of the manual
and the absence of such evidence in the latter cases. I am constrained to regard
the instant case with respect to the question under consideration in like manner.
In concluding that ACE is an employer of the drivers of leased equipment I have
.given consideration to the provision in the leases that the Lessors' equipment is to
be operated by their employees. Such agreement by the parties in their contract is,
however, not conclusive as to the legal status of the drivers which is controlled not
by their designation in the contract, but by the actual relationship existing between
these drivers and the party for whom they perform their employment functions.13
I have also considered the argument by the General Counsel and other counsel
that the rules and regulations in the ACE manual, as well as other forms of control
exercised by ACE over the drivers referred to in the foregoing recital of facts, were
essentially a fulfillment by ACE of its obligation under its 'ICC certificate to carry
out the regulations of that agency, and that other ACE rules and regulations with
respect to operation of vehicles on the highways were merely insistence upon obser-
vation by the drivers of State or municipal motor vehicle statutes or ordinances.
I could dispose of this argument with the observation that the record indicates that
ACE's rules and regulations are not identical with or as precise as ICC or other
official regulations and laws. But there is this also, which I believe should be said.
Neither ICC nor any other governmental agency stands in the position of an
13 See for example a recent Board proceeding in which persons designated in a contract
as independent contractors were by the application of the above-stated criterion found to
be employees . Orange Crush of P. R., Inc., 118 NLRB 217; see also the Supreme Court's
similar view stated in Rutherford Food Corp. et al. v. McComb, 331 U. S. 722, 729.
LOCAL NO. 2 4 1131
employer to the drivers with power to compel them to comply with governmental
regulations or laws in performing their duties by the imposition of discipline
affecting their employment status. Only ACE or the Lessors maintain such relation
to the drivers , and only they , in the manner of an employer , are able to enforce
compliance by the drivers of the rules and regulations under which they must work.
That, in my view , is sufficient to warrant a conclusion that ACE under the common
law "right of control" test is an employer of these drivers.
Finally, consideration has been given to the various indicia in the record favoring
the conclusion that ACE is not an employer of the drivers of leased equipment, in-
cluding the fact that they are not listed on ACE payrolls , that the Lessors carry
workmen 's compensation insurance for them , and maintain their.social security,
unemployment compensation , and income tax accounts , and fix the rates and methods
,of compensation for their drivers.14 I am, however , satisfied that the extent of
ACE's right of control over the work of the drivers is sufficiently countervailing
to outweigh the foregoing aspects of their relations denoting that ACE is not their
employer.i5
D. Conclusions
Having found that ACE and the Lessors have been coemployers of the latter's
employees, I turn to the defense that the Respondents' allegedly unlawful conduct is
exempt from the proscriptions of Section 8 (b) (4) because of the alliance of
interest among ACE and the Lessors in the labor disputes involving first one and
then all the Lessors.
The Board and the courts each have on two occasions accorded validity to an
"ally" defense to allegations of 8 (b) (4) violations. None involved the precise
factual situation here present. In Irwin-Lyons 16 and J. G. Roy and Sons 17 the
Board held picketing and inducement of the employees of an alleged secondary
employer defensible because of common ownership and management of the secondary
and primary employers' businesses which together constituted "one straight line
operation." The courts, in the Ebanco 18 and Royal Typewriter 19 cases, declared that
an employer who accepts work from a strike-bound employer for performance by
his employees, which, but for the strike, would have been work performed by the
employees of the struck employer is an ally of the latter in his labor dispute and
is not statutorily insulated from an extension by the union of the dispute to him.
The General Counsel argues that because these precedents involve factual situa-
tions different from that presented in the instant proceeding, the "ally" doctrine
is not available as a defense to the Respondents. I do not agree with the General
Counsel's premise. Neither the Board nor the courts in their holdings have indi-
cated that the "ally" concept as applied by them was to be confined exclusively to
factually identical cases. It may fairly be reasoned that the contrary is true. The
principles fundamental to the concept spring from the -remarks by Senator Taft in
the course of the Congressional debate preceding adoption of the Taft-Hartley
amendments to the Act. In explanation of the meaning of Section 8 (b) (4) (A)
and (B), Senator Taft had said that this section:
Makes it unlawful to resort to a secondary boycott to injure the business of
a third person who is wholly unconcerned in the disagreement between an
employer and his employees 20
Thus, the controlling criterion for -invoking the "ally" concept is, in the Board's
words, "to avoid going beyond the Congressional purpose of protecting innocent
14 It would appear, however, that the practice by Lessors of fixing rates and methods of
.compensation for their drivers obtained only after the State court decree enjoined ACE
and the Union from applying the provisions in their contract relative to terms and condi-
tions of employment for these drivers.
15 In National Van Lines, supra, the Board. found the employer-employee relationship
to exist although the employer did not deduct or make income tax withholding or social-
security payments for the drivers Moreover, the inclusion of an individual's name on an
employer's payroll is not an essential ingredient of an employer-employee relationship,
Jones v. Goodson, 121 F. 2d 176 (C. A. 10).
16 Irwin-Lyons Lumber Company, 87 NLRB 54
17 J G Roy and Sons Company, 118 NLRB 286.
'8 Douds v. Metropolitan Federation of Architects, Local 231 , etc., 75 F. Supp., 672
(D. C, N. Y.).
19N L R B v. Business Machine and Office Appliance Mechanics Conference Board,
et al. (Royal Typewriter), 228 F. 2d 553, 259 (C. A. 2).
20 93 Cong. Rec. 4323.
1132 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
third-party employers in a labor dispute," 21 This is a general principle which
imposes no limits for its application to specifically defined factual situations. It
requires a factual evaluation in any case in which the defense is raised as to whether
the alleged secondary employer is neutral, wholly unconcerned, or an innocent third
party in the primary employer's labor dispute within the intendment of Senator
Taft's remarks 22
As noted, the cases in which the "ally" defense was applied involved the farming
out of struck work and the commonly owned and managed straight line operation.
There are also cases in which the defense was unsuccessfully raised, and where
the Board by its observations implied that under certain facts not established in
these cases the defense could have been invoked. In Hoosier Petroleum Company,
Inc., 106 NLRB 629, the facts in many respects resembled those of the instant case.
There is one critical difference. In'the Hoosier Petroleum case the Board found
that the oil company to which Floyd, the primary employer, leased its tractors
supplied with drivers was not with Floyd a coemployer of these drivers. The
Board held that because the company was not such a coemployer it was a neutral in
Floyd's dispute with the union and protected by Section 8 (b) (4) from involvement
in that dispute. The impression logically derived from this holding is that if the
Board had found the oil company to be a coemployer of Floyd's drivers that it
would not have been a neutral in the dispute, and that the union could without
statutory sanction have extended the dispute to it by picketing and by exerting
economic pressure upon it.
Similarly, in Denver Building and Construction Trades Council, 108 NLRB 318,
the Board rejected the union's defense to 8 (b) (4) conduct that the alleged sec-
ondary employer was the primary employer's ally. This defense was predicated on
the claim that Climax, the secondary employer, exercised various controls over the
employees of Ryan, the primary employer. A Board majority was satisfied that the
evidence of "negative control" of Ryan's employees by Climax was "without more"
insufficient to constitute the latter Ryan's ally. The dissenting member of the Board
felt that the evidence of control was sufficient at least to establish that Climax and
Ryan were joint employers of the employees who were the subject of the dispute and
that Climax should therefore be regarded, as a primary employer. I believe that it
may be fairly implied, as in Hoosier Petroleum, that had the Board found' Climax
to be a joint employer or coemployer of'Ryan's employees that it would have regarded
it as Ryan's ally in the latter's dispute with the union and therefore not entitled to
be shielded from extension of that dispute by Section 8 (b) (4).
The instant facts, in my view, present far more cogent reasons for the invocation
of the "ally" doctrine than would have been the case in either Hoosier Petroleum or
Denver Building hid the element of coemployership been established there. Here,
the evidence forcefully establishes that ACE has been a coemployer at all times
material with the employers involved in the labor dispute of the employees who
are the subjects of the dispute. In this connection, it should not be overlooked that
there is a subsisting labor contract between ACE and the Union in which ACE has
bargained for these employees as if were its own, and that, basically, the labor dispute
in this case is the product of a State court decree- which disrupted that bargaining
relationship. I`do not presume to'quarrel with the correctness or propriety of that
decree, for I do not know what record or contentions the issuing court had before
ii. Suffice it to say, that the current record reveals, contrary to the court's implicit
holding, that ACE is an employer under the Act of the employees who drive its
m J. G. Roy and Sons Company , supra.
ra Board Member Murdock noted in his dissent in the Nationat Cement Products Co case,
115 NLRB 1290 , in which the Board majority rejected an "ally" defense in an 8 (b) (4)
proceeding,
My colleagues point out that in the 1 Board and 1 court case in which it has thus
far been found that a secondary employer was unneutral or an ally of the primary
employer , there was either evidence of common ownership ' and managerial control, or
transfer of struck work, neither of which are present here There is nothing in those
cases, however , which even suggests that in no'other situation can a finding be made
that the secondary employer is not a neutral or "wholly unconcerned " employer.
(Citing the remark by Senator Taft , referred to above, 93 Cong Rec. 4323
The majority holding did not differ with this statement by former Member Murdock.
Board Member Rodgers' views as to the application of the "ally " rule are also relevant
in this connection , for, in his dissent in the J. G Roy and Sons case, supra, he declared,
without disagreement by the majority , that the rule was meant by Senator Taft to be
applied not only to "struck work" cases but also to those cases where the secondary em-
ployer "is engaged with the primary employer in a unified and integrated production effort "
OTTAWA MACHINE PRODUCTS CO. 1133
leased equipment and may be statutorily required to bargain for these employees
with their representative. Can it convincingly be said under these circumstances
that ACE was "wholly unconcerned" in that labor dispute? I think not. ACE's
interest is so direct and intimate that it must, in my view, be regarded in this pro-
ceeding as primary.
Nor, in my view, would it be tenable to hold that during the period from December
29, 1956, to January 8, 1957, when the Union's strike had been declared against
Max Rabl only, that the other Lessors were neutrals or wholly unconcerned in the
dispute. Each Lessor was an inextricable part of the ACE operational scheme, and
all, like spokes in a wheel, were bound to and serviced ACE identically. What the
drivers of one were prevented by a strike from doing for ACE, would have been
required by ACE to have been done by the drivers of all the others unless also
prevented by the Union. Each Lessor within the ACE framework was an alter ego
for the others. In this connection, it should here also be emphasized that Rabl's
dispute was the product of the State court litigation which disturbed the arrangement
between ACE and the Union whereby Rabl's drivers, as well as the drivers for all
other Lessors, were bargained for by ACE as its own employees. Each Lessor was
affected by this action in the same way, and all had the same intimate concern with
Rabl in the outcome of his dispute with the Union.
Because I find that ACE and the Lessors were not neutrals or wholly unconcerned
third parties in the Union's disputes in this proceeding with any of them, I conclude
that ACE and the Lessors were not shielded by Section 8 (b) (4) (A) and (B) from
the economic pressures exerted upon them by the Respondents in the course of these
disputes. The allegations of the complaint that the Respondents by such conduct
have violated the Act have consequently not been sustained.23
[Recommendations omitted from publication.]
93 The Respondents belatedly argued in their supplemental brief that ACE's contract
with Local No. 24 and the Central States Council contains a "hot-cargo" agreement which
justified the inducement of ACE employees to cease working alleged herein as unlawful. In
view of the disposition of the entire proceeding on other grounds, I find it unnecessary to
consider this unlitigated defense.
Ottawa Machine Products Co. and Ottawa Independent Union of
Tecumseh, Petitioner. Case No. 7-RC-3579. May 26,1958
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing was held before Bernard Gottfried, hearing
officer. The hearing officer's rulings made at the hearing are free from
prejudicial error and are hereby affirmed.
Upon the entire record in this case, the Board finds :
1. The Employer is engaged in commerce within the meaning of the
National Labor Relations Act.
2. The labor organizations here involved claim to represent certain
employees of the Employer.'
3. The Petitioner became a labor organization on February 26,1957,
after employees of this Employer severed association with Allied
Independent Unions, affiliated with Confederated Unions of America,2
' United Brotherhood of Carpenters and Joiners of America, APL-CIO, intervened in
this proceeding on the strength of an adequate showing of interest. Each union challenged
the status of the other as a labor organization. On the evidence presented we find that
both qualify as labor organizations within the meaning of the Act.
2 In January 1957, Allied Independent Unions, hereinafter referred to as Allied, affili-
ated with Local 158, International Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America. Disapproval of this action brought abcut the disassociation
action by the employees and the formation of the Petitioner.
120 NLRB No. 151.