Mellody Mills, Inc.

National Labor Relations Board - Board Decisions

Mar 27, 1953

103 N.L.R.B. 1202 (N.L.R.B. 1953)

1202 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
MELLODY MILLS, INC 1 and DISTRICT LODGE No . 140, INTERNATIONAL
AssoCLATION OF MACHINISTS , PETITIONER . Case No. 13-RC-93977.
March 27,1953
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 Herman J. De Koven,
hearing officer. The hearing officer's rulings made at the hearing are
free from prejudicial error and are hereby affirmed.
Pursuant to the provisions of Section 3 (b) of the Act, the Board
has delegated its powers in connection with this case to a three-mem-
ber panel [Members Houston, Murdock, and Styles].
Upon the entire record in this case, the Board finds :
1. The Employer is an Illinois corporation. It was incorporated
on or about April 1, 1952. It is engaged in producing and selling
feed for farm animals, and also manufactures some fertilizer. From
the date of its incorporation until the date of the hearing, January
19, 1953, it sold products valued at approximately $123,626, 2 percent
of which represents products shipped by it to points outside the State
of Illinois; $102,797 of which represents sales to the Hawthorn-Mel-
lody Farms Division of the American Processing and Sales Company,
hereinafter called American; 2 and $19,194 of which represents sales
made to other individuals or firms within the State of Illinois, the
details of whose operations are not revealed in the record. The Em-
ployer's total purchases during this period amounted to approximate-
ly $109,049, of which approximately 87 percent was made within the
State of Illinois, approximately 11 percent was made from firms lo-
cated within the State of Illinois who in turn received such materials
from points outside the State of Illinois, and approximately 2 per-
cent of which was shipped directly from points outside the State of
Illinois.
Hawthorn-Mellody Farms Division, hereinafter called Farms Di-
vision, is 1 of 3 operating divisions of American, an Illinois corpora-
tion. In addition to the Farms Division, American operates a Rapid
Roller Division, which manufactures rollers for printing presses,
and the Hawthorn-Mellody Farms Dairy Division, hereinafter called
1 As amended pursuant to the Employer's motion to correct the record submitted subse-
quent to the hearing.
2 Mellody Mills, Inc ., and Hawthorn -Mellody Farms are located on contiguous property.
The mill of Mellody Mills was constructed by employees of Hawthorn-Mellody Farms
but the Farms was paid for it by Mellody Mills, Inc. There is no interchange of employees
between the Employer and any of the other entities , divisions , or branches hereafter
referred to. The Employer 's stock is held by a single stockholder who has no connection
whatever with the other entities , divisions , or branches hereafter referred to.
103 NLRB No. 113.
MELLODY MILLS, INC. 1203
the Dairy Division. The Rapid Roller Division purchased ma-
terials from points outside the State of Illinois valued in excess of
$500,000, and its sales of products to points outside the State of Illi-
nois exceeded $25,000 in value during the March 1951-April 1952 pe-
riod. The Dairy Division is divided into three branches, Hawthorn-
Mellody Farms Dairy of Illinois, Hawthorn-Mellody Farms Dairy
of Wisconsin, and Hawthorn-Mellody Farms Dairy of Indiana.3 The
Illinois branch of the Dairy Division has its office and plant in Chi-
cago. It made no direct sales to points outside the State of Illinois,
but during the March 1951-April 1952 period it sold at least $50,000
worth of goods to firms in Illinois which in turn shipped at least $25,-
000 worth of goods to points outside the State of Illinois. During
the same period, it purchased materials and products valued in ex-
cess of $500,000 from points outside the State of Illinois. The Em-
ployer concedes that the Dairy Division is engaged in commerce with-
in the meaning of the Act.
The Farms Division is engaged in the business of raising and selling
various animals, growing and selling produce, and producing milk.
It does not process milk, however. During the March 1951-April
1952 period its total purchases amounted to $72,523 of which 26 per-
cent represents products shipped to the farm from points outside the
State of Illinois, and its total sales were $473,005, 2 percent of which
was shipped to points outside the State of Illinois. Of its total sales,
$272,429 represents sales of milk, poultry, and eggs to the Hawthorn-
Mellody Farms Dairy of Illinois, and over $50,000 represents sales
of grain to the Employer.
The Employer contends that the three divisions of American should
be considered as separate and distinct entities and not integral parts
of a single operation for the purpose of applying the Board' s juris-
dictional tests, and that therefore the sales of goods by the Employer
to the Farms Division do not constitute sales of goods necessary to
the operations of an employer engaged in commerce under the test
laid down in the Hollow Tree Lumber Company case,4 because the
Farms Division's operations meet neither the inflow nor outflow juris-
dictional standards applied by the Board. The record shows that all
three divisions of American are operated by a separate manager, each
division determines its own labor policy, there is no interchange of em-
ployees, each division has separate accounting procedures, and finan-
S The Wisconsin and Indiana branches are organized as separate corporations whose
stock is wholly owned by American. The parties stipulated that these two divisions are
functionally integrated as part of American's Dairy Division operations, and that each
branch made sales in excess of $25,000 to points outside their respective home State during
the period of March 1, 1951, to April 1, 1952.
4 91 NLRB 635.
1204 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cial transactions between the divisions are treated in the same manner
as transactions with other customers. On the other hand, the comp-
troller for the Dairy Division is the comptroller for American, and
each division is required to submit quarterly financial reports to Amer-
ican 's board of directors. The comptroller testified that major policy
decisions governing the operation of the various divisions are made by
American's board of directors. Thus although it appears that the
managers of the divisions are allowed great latitude in the conduct of
the operations of the divisions, they are permitted this latitude as a
matter of policy set by the board of directors, which has the power to
change this policy at any time.
On the basis of the foregoing findings of fact and on the record as a
whole, we find that the divisions of American are not so independent
and free from control by the central and paramount authority re-
posed in American's board of directors to justify a finding that they
are separate and distinct business entities as contended by the Em-
ployer. Accordingly, we conclude that for the purpose of applying
the Board's jurisdictional standards all the divisions of American
constitute a single enterprise, which sold products valued at more
than $25,000 in interstate commerce e We find too that the Employer
is engaged in interstate commerce within the meaning of the Act, and
that as it sold goods valued in excess of $50,000 per annum to Amer-
ican, it will effectuate the policies of the Act to assert jurisdiction in
this case .'O
2. The labor organization involved claims to represent certain em-
ployees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of employees of the Employer within the meaning of Section 9 (c)
(1) and Section 2 (6) and (7) of the Act.
4. In accordance with the stipulation of the parties, we find that the
following employees of the Employer at its Libertyville, Illinois, plant
constitute a unit appropriate for the purposes of collective bargaining
within the meaning of the Act : All production and maintenance em-
ployees, office and clerical employees, guards, professional employees,
and supervisors as defined in the Act.
[Text of Direction of Election omitted from publication in this
volume.]
9 Basic Lumber Products Division , New York Coal Company, 92 NLRB 875.
6 The Hollow Tree Lumber Company , 91 NLRB 635.