MENARD, INC.

National Labor Relations Board - Administrative Judge Opinions

Nov 17, 2017

18-CA-181821 (N.L.R.B. Nov. 17, 2017)

JD–92–17
Minneapolis, MN
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
MENARD, INC.
and 18-CA-181821
LOCAL 153, OFFICE & PROFESSIONAL
EMPLOYEES INTERNATIONAL UNION, AFL-CIO
Tyler J. Wiese, Esq.
for the General Counsel.
Gary K. Roehm, Esq.,
Eau Claire, Wisconsin,
for the Charging Party.
DECISION
STATEMENT OF THE CASE
PAUL BOGAS, Administrative Law Judge. This case was tried in Minneapolis,
Minnesota, on May 31 and June 1, 2017. Local 153, Office & Professional Employees
International Union, AFL-CIO (Charging Party) filed the charge on August 10, 2016, and an
amended charge on September 14, 2016. The Regional Director for Region 18 of the National
Labor Relations Board (the Board) issued the Complaint on December 22, 2016. The Complaint
alleges that Menard, Inc. (the Respondent or Menard) violated Section 8(a)(1) of the National
Labor Relations Act (the Act) by misclassifying delivery drivers as independent contractors
rather than employees of the Respondent and by maintaining delivery service agreements that
contain a mandatory arbitration clause that delivery drivers would reasonably understand as
prohibiting them from filing class actions against the Respondent in any legal or arbitral forum,
and from filing unfair labor practice charges with the Board. The Respondent filed a timely
Answer in which it denied committing any of the violations alleged.
A threshold issue in this case is whether the individuals who deliver the Respondent’s
merchandise to customers are employees of the Respondent for purposes of the Act’s coverage
or, as the Respondent claims, independent contractors who are not within that coverage.
Section 2(3), 29 U.S.C. Section 152(3) (excluding from coverage “any individual having the
status of an independent contractor”). Whether the Respondent has committed either of the
violations alleged – the unlawful misclassification of employees as independent contractors or
the imposition of an unlawful mandatory arbitration provision on those putative employees –
depends at the outset on whether the individuals at issue are employees and not independent
contractors.
JD–92–17
2

On the entire record, including my observation of the demeanor of the witnesses, and
after considering the briefs filed by the General Counsel and the Respondent, I make the
following findings of fact and conclusions of law. 5
FINDINGS OF FACT
I. JURISDICTION
10
The Respondent, a corporation, is a home improvement retailer with a principal office
and place of business in Eau Claire Wisconsin. In conducting its operations it annually derives
gross revenues in excess of $500,000, and purchases and receives goods valued in excess of
$50,000 from entities located outside the State of Wisconsin. The Respondent admits, and I
find, that it is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) 15
of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
A. BACKGROUND FACTS20
The Respondent sells home improvement merchandise. It has approximately 300 stores
in the continental United States. In addition to selling merchandise, the Respondent sells
delivery services for the merchandise that customers purchase at its stores.1 If a customer
requests delivery, staff of the Respondent’s stores arranges the delivery services, collects25
charges, makes initial delivery arrangements with the customers, determines the deliveries that
will be assigned to a hauler for a particular delivery excursion, and loads the deliveries onto the
delivery truck or trailer at the store. The Respondent has a decades-long history of using
hauling contractors to transport the merchandise from its stores to the delivery locations and to
unload the merchandise for the customer. The hauling contractors use their own trucks to 30
perform this work and all of the contractors who testified were incorporated separately from the
Respondent. The Respondent has three standard types of contracts – referred to as delivery
service agreements – that it uses to enter into its relationships with these haulers. Each type of
contract covers deliveries that the hauler makes using one of three general categories of
trucks/instrumentalities.2 Although the record does not show when the Respondent first began 35
using hauling contractors, one such contractor testified that he has been party to hauling
contracts with the Respondent since 1993. The evidence did not show that there was ever a
time when this delivery work was performed primarily by acknowledged employees of the
Respondent rather than by the hauling contractors. However, the record did show that in
instances when a particular store does not currently have a relationship with a hauling 40
contractor, the Respondent will have acknowledged employees deliver the merchandise using
Respondent-owned trucks. The record indicates, however, that only a tiny fraction of deliveries
are made by acknowledged employees rather than by the hauling contractors whose status is
at-issue in this case.3

1 The Respondent refers to its store customers as “guests,” and those customers are sometimes
referred to as guests in the record.
2 One type of contract is for deliveries the contractor makes using the contractor’s own truck with a
forklift or knuckle crane. A second type is for deliveries the contractor makes using the contractor’s own
forklift truck and a Respondent-owned trailer. A third is for deliveries the contractors make using a cube
van/cargo van/box truck.
3 The General Counsel presented evidence showing that for a recent period of roughly 1 year the
JD–92–17
3
The evidence regarding the delivery work is discussed below in some detail, but it is
helpful to note at the outset that the hauling contractors’ circumstances vary widely. At one end
of the spectrum are contractors who own a single truck, do the driving and delivering exclusively
or almost exclusively themselves, have the Respondent as their sole account, and started their 5
hauling company for the purpose of contracting with the Respondent. At the other end of the
spectrum are larger, established, hauling contractors with multiple trucks, employees, and
clients. One such contractor had as many as 15 trucks and 21 of its own employees, Transcript
at Page(s) (Tr.) 412, 417, and made deliveries for multiple accounts besides the Respondent.
The Complaint alleges that all the “delivery drivers” have been misclassified at all of the 10
Respondent’s 300 facilities. The variety of circumstances, however, makes it hard to understand
exactly who the Complaint is alleging have been misclassified. With respect to a hauler who
has a single truck and does all the deliveries him or herself, it is easy to discern which individual
the Complaint is claiming should be classified as the Respondent’s employee. However, with
respect to larger hauling contractors, in particular those who have multiple employees that the 15
hauling company itself pays and for whom it makes payroll deductions and provides insurance
and other benefits, it is not clear who the General Counsel is alleging should be classified as
employees of the Respondent. Is it employees of a hauling contractor who handle deliveries
pursuant to the contractor’s agreement with the Respondent? It would not seem so since neither
the Complaint nor the General Counsel have asserted that these hauling contractors and the 20
Respondent are joint employers of the drivers employed by the contractor. If not them, is it the
owner of the hauling company who signed the contract and runs the business, but does a small
fraction, if any, of the deliveries under the contract?
A similar incoherence results from the fact that the General Counsel, rather than seeking 25
a remedy for named hauling contractors or individuals about whom the record contains specific
evidence, is seeking a general remedy that would affect all the drivers who make deliveries for
the Respondent’s approximately 300 stores. In particular, the remedy that the General Counsel
is seeking includes a proposed order requiring the Respondent to rescind every single contract
and policy across the entire Company that refers to delivery drivers as independent contractors. 30
See Brief of General Counsel at Appendix A. The General Counsel contends that this is
warranted given the standard terms in the contracts that the Respondent uses with hauling
contractors nationwide. However, as discussed below, the record presented showed that the
manner in which business is conducted between the Respondent and hauling companies under
those contracts varies significantly.4 The General Counsel and the Respondent each presented 35

Respondent’s acknowledged employees made approximately 1500 deliveries. At first blush this appears
to be a considerable number, but the record indicates that given the Respondent’s size it is not a
significant portion of total deliveries. The Respondent has approximately 300 stores. There was
testimony that one hauler made about 1000 deliveries a year under a single cube van contract at a single
one of the 300 stores. Transcript at Page(s) (Tr.) 126, 157. If only one hauler was making that many
deliveries per year from each store, that would be a total of 300,000 deliveries, and the 1500 completed
by the Respondent’s acknowledged employees would amount to only one out of every 200 deliveries –
or 0.5 percent of the total. Moreover, the record shows that it is not unusual for the Respondent to have
multiple hauling contracts at a single store. If one assumes that each store has three contracts and that
1000 deliveries are being made annually under each contract it would mean there were 900,000 total
deliveries. In that case, the 1500 completed by the Respondent’s acknowledged employees would
amount to only one out of every 600 deliveries – or 0.17 percent of the total.
4 On the question of whether an individual is a statutory employee who comes within the jurisdiction
of the Act, it is appropriate to look to the way the individual’s work is actually performed and not to
consider the written descriptions of that work to be controlling. That is the way the Board has analyzed
the issue in the analogous situation where the dispute revolves around whether a particular individual is a
statutory employee who is covered by the Act’s protections, or a supervisor who, like an independent
JD–92–17
4
the testimony of a small number of hauling contractors regarding their experiences with how
their relationship with the Respondent works in practice. It is not possible from that small
sample to discern to what extent the experience of a witness is, in certain aspects, consistent
with how these relationships are conducted with the hauling contractors across all 300 stores, or
even to discern to what extent there is consistency. 5
B. EMPLOYEES OR INDEPENDENT CONTRACTORS?
1. General Legal Standard
10
Section 2(3) of the Act excludes “any individual having the status of an independent
contractor” from the definition of “employee,” and thus from the protections the Act reserves for
employees. The Board determines whether a worker should be classified as an employee or an
independent contractor by considering the relevant common-law factors. Specifically, the
Board has looked to the following, nonexhaustive, list of factors, which the Supreme Court has 15
cited with approval:5
(1) The extent of control which, by the agreement, the master may exercise over the
details of the work.
(2) Whether or not the one employed is engaged in a distinct occupation or 20
business.
(3) The kind of occupation, with reference to whether, in the locality, the work is
usually done under the direction of the employer or by a specialist without
supervision.
(4) The skill required in the particular occupation.25
(5) Whether the employer or the workman supplies the instrumentalities, tools, and
the place of work for the person doing the work.
(6) The length of time for which the person is employed.
(7) The method of payment, whether by the time or by the job.
(8) Whether or not the work is part of the regular business of the employer.30
(9) Whether or not the parties believe they are creating the relation of master and
servant.
(10) Whether the principal is or is not in the business.
FedEx Home Delivery, 361 NLRB 610, 611 (2014), enf. denied, 849 F.3d 1123 (D.C. Cir. 2017). 35
No single one of these factors predominates in the analysis, and the weight given to a particular
factor turns on the factual circumstances of each case. Ibid. In addition to these factors, the
Board considers whether the individual has “actual” “entrepreneurial opportunity for gain or loss”
– an inquiry that encompasses such considerations as whether the individual can work for other
clients, can hire their own employees, and has a proprietary interest in the work. Ibid. The 40
Board construes the independent-contractor designation narrowly so as to avoid “deny[ing]
protection to workers the Act was designed to reach. Id. at 618-621.6

contractor, is not. See Oakwood Healthcare, Inc., 348 NLRB 686, 690 fn.24 (2006); Chicago Metallic
Corp., 273 NLRB 1677, 1690 (1985), enfd. 794 F.2d 527 (9th Cir. 1986).
5 See Nationwide Mutual Insurance Co. v. Darden, 503 U.S. 318, 323-324 (1992); Community for
Creative Non-Violence v. Reid, 490 U.S. 730, 740, 751-752 and fn. 31 (1989); NLRB v. United Ins. Co.,
390 U.S. 254, 256-259 (1968).
6 The General Counsel contends that the Respondent has the burden on the issue of whether a
worker is an independent contractor or a covered employee. Although the Board has held that a
respondent has that burden in representation cases, see, e.g., FedEx, 361 NLRB at 610-611, it has never
held that a respondent has that burden with respect to individuals for whom there is no chosen bargaining
JD–92–17
5
2. Findings and Analysis Regarding Relevant Factors
a. Extent of Employer’s Control over the Details of the Work
5
Facts
Regarding the Respondent’s degree of control over the work of the contract haulers, the
parties presented evidence on a number of fronts. These fronts included evidence regarding
the extent of the Respondent’s control over: what the hauling contractors are paid for deliveries;10
the schedule for the haulers’ deliveries; the types of equipment used by the haulers; the liability
insurance that haulers maintain for work under their contracts; the manner in which the delivery
work is performed; the training of delivery personnel; whether the haulers are required to do
business in the Respondent’s name; and the standardized terms of the hauling contracts.
15
The amount that haulers are paid to deliver the Respondent’s merchandise is generally
set by the contracts between the haulers and the Respondent. At the outset, I note that when
the hauling contractors are performing work for clients other than the Respondent, as a number
of the contractors do, Tr. 237-238, 247-248, 385, 399-401, 421-424, 446-449, 454, the
Respondent would have no control over the contractor’s compensation for the work. With 20
respect to the work that the hauling companies perform for the Respondent’s stores, the
evidence showed that the standard contracts provide for the Respondent to make payments to
the hauler based on the distance between the particular store and the “zone” to which the
delivery is going. The hauler is not free to negotiate these general distance-based delivery
charges with the customer, but hauling contractors testifying for both the General Counsel and 25
the Respondent stated that they have negotiated with the Respondent for additional
compensation. Tr. 167-168, 434. The hauler does not receive these distance-based payments
from the customer, but rather the customer pays the Respondent, and the Respondent pays the
hauler.
30
The contracts also set forth amounts that are paid to the hauler for special handling at
the time of the deliveries – for example, when the hauler performs the extra work of placing
shingles on the customer’s roof rather than leaving the shingles in a default location such as a
driveway. Often this special handling is arranged in advance between the Respondent’s store
and the customer. However, the record shows that in some instances such special handling is 35
not requested by the customer until the delivery arrives. When a customer first requests special
handling at the time of delivery, some haulers will initiate contact with the Respondent’s store,
which will sell the special handling services to the customer, receive payment from the
customer, and then compensate the hauler for the additional work according to the terms of the
store’s contract with the hauler. Tr. 47-49. This is the procedure described in guidance that the 40
Respondent has created for store employees. Joint Exhibit Number (J Exh.) 8 at Page 5.

representative, but with respect to whom the General Counsel is alleging that misclassification as non-
employees constitutes an independent violation of Section 8(a)(1) of the Act. Indeed, the General
Counsel recognizes that the Board has never even held that such misclassification would, if established,
constitute an independent violation of Section 8(a)(1) as is alleged here. At any rate, I would expect that
the General Counsel could not, simply by making the bare allegation that the Respondent violated the Act
by misclassifying employees as independent contractors, put the burden on the Respondent to disprove
that it had done so. Some initial showing on the General Counsel’s part would seem to be in order where,
as here, a bargaining representative has not already been selected for those individuals. At any rate, in
this case it is not necessary to reach a conclusion regarding where the burden lies since the record
contains substantial evidence regarding the relevant factors and my determination would be the same
regardless of who bears the burden of proof on the issue.
JD–92–17
6
However, not all of the hauling contractors follow, or even appeared to be aware of, the
procedure that the Respondent describes in that guidance for store employees. Rather the
record shows that some hauling contractors, when asked by a customer to provide special
handling that has not been pre-arranged, will negotiate a price for these services directly with
the customer and obtain payment directly from the customer without involving the Respondent 5
at all. Tr. 435-436, 450, 462-463, 471; see also Tr. 170 (hauling contractor testifying for the
General Counsel states that he works out special handling charges with the customer).
Another component of the hauling contractors’ compensation comes in the form of a
contractual “retention bonus.” If, at the start of the calendar year, an existing hauling contractor10
continues its relationship with the Respondent by entering into a contract for the coming year,
the Respondent pays the hauler a retention bonus that is based on the value of the
merchandise the hauler delivered under the preceding year’s contract. A hauler who enters into
a new contract with the store is not required to continue that contract for a full year, but rather
may cancel the contract after giving the store 60 days’ notice. 15
The parties also presented evidence regarding the extent of the Respondent’s and the
hauling contractors’ control over the scheduling of deliveries. This is an extremely important
matter since hauling contractors who testified for both sides agreed that the profitability of their
business depended in large part on whether the deliveries were scheduled in an efficient 20
manner. Tr. 151, 194, 211, 236, 465. The schedule for a hauling contractor’s daily deliveries is
set, at least in the first instance, by a store employee known as a delivery coordinator. The
delivery coordinator does this after consulting with the customer and attempting to meet the
customer’s desires. These schedules are communicated to the hauling contractors on the
evening before the day when the deliveries are to be made. The store suggests a route that 25
hauling contractors can take to the delivery locations, but the haulers are free to deviate from
those routes.
The testimony of hauling contractors showed that although delivery coordinators create
these schedules without input from the haulers who will be making the deliveries, the haulers30
can seek modifications to the schedules. Josh Zima, the owner of a hauling company with 13
full-time employees, routinely contacts the Respondent to make changes to schedules that he
views as unworkable. Tr. 425-426. Zima also directly contacts the Respondent’s customers on
a daily basis to modify the delivery schedule in order to improve his efficiency. He does not
seek approval from the Respondent before calling customers to make modifications and the 35
Respondent has never penalized him for doing so. Todd Stephens, who operates a hauling
company with 10 of its own employees, does not strictly follow the delivery schedule given to
him by the Respondent. Rather he testified that he uses that schedule as “a basic guideline”
and “routes the way it needs to be routed,” without notifying the Respondent about these
deviations from the schedule. Tr. 463-464. Like Zima, he contacts customers about the timing 40
of deliveries on a daily basis. Another hauling contractor, Ahmed Elbassiouny, testified that he
uses the schedule generated by the Respondent to determine which deliveries he will make in
the morning and which in the afternoon, but that he is the “one to decide which one to do first
and how to do my route.” Tr. 381-382. Kevin Fisher, a contractor who testified on behalf of the
General Counsel, stated that he “sometimes” contacts customers to change the delivery 45
schedule set by the delivery coordinator, although he indicated that he does not do this
normally. Tr. 159-160. Nick Gronemus, the manager of the Respondent’s entire yard shipping
and receiving operation, testified that the hauling contractors are free to contact the customers
and seek to modify the delivery schedule created by a store’s delivery coordinator. Tr. 333-334.
On the other hand, there was evidence that this freedom was not shared by at least one hauling 50
contractor. Specifically, Laife Denning testified that when he had a hauling contract with the
Respondent he tried to increase his efficiency by calling customers to rearrange the delivery
JD–92–17
7
schedules, but then a delivery coordinator intervened and directed him to stop calling
customers. Tr. 99-100.7
In the case of the work that hauling contractors perform under the three types of
standard contracts with the Respondent, the evidence shows that each contract is limited to 5
work using a particular category of truck and/or equipment.8 The hauling contractors purchase
the necessary trucks from third parties – sometimes dealers, sometimes other hauling
contractors – not from the Respondent. Although the trucks are always owned by the
contractors, the contractors do sometimes haul Respondent-owned trailers. The haulers
choose which trucks to purchase and which potential seller to purchase them from.10
Nevertheless, the General Counsel contends that the Respondent exercises significant control
over the equipment the hauling companies use. The focus of this argument is the work done
under the contracts covering deliveries made using a truck with a forklift or knuckle crane. In
this regard, the evidence shows that the Respondent encourages employees to use a particular
type of forklift, known as a “Masterlift,” that the Respondent itself manufacturers and installs 15
onto flatbed trucks for use loading and unloading merchandise.9 The Respondent does not sell
these devices directly to the hauling contractors, but rather sells them to third-party dealers who
then sell Masterlift-equipped trucks to hauling contractors.10 The nature of the work itself does
not dictate the use of a Masterlift as opposed to some other type of lift device. Nevertheless,
the record establishes one instance in which the Respondent’s efforts to encourage a hauler to 20
use a Masterlift truck could reasonably be characterized as coercive. In that instance a hauler
who already had a suitable non-Masterlift truck refused a store manager’s urging to purchase a
Masterlift truck. In an apparent reaction to that refusal, the Respondent awarded a second
contract for the same type of work at the store to a hauling contractor that did use a Masterlift
truck. This resulted in the first contractors’ share of the work at that facility being dramatically 25
reduced. Tr. 35-39. On the other hand, the record shows that hauling companies have used
non-Masterlift trucks to perform work under the forklift/knuckle crane contracts and that hauling
companies have used Masterlift trucks to perform work for clients besides the Respondent.
The contracts that the Respondent enters into with the hauling contractors set forth 30
certain requirements for liability insurance that the contractor must maintain. Unlike a number of
other areas, the record does not indicate that the actual practices under those contract
provisions varied significantly. Contractors purchase and pay the premiums for this insurance
and the Respondent does not require them to use a particular insurance provider. In addition to
requiring certain levels of liability coverage, the Respondent requires that the hauling35
contractors include the Respondent as an “additional insured.” The parties presented additional

7 Gregory Sondag, a hauling contractor, stated that he had no input into how the delivery coordinators
scheduled the deliveries and that they would routinely schedule deliveries in a way that was highly
inefficient. Tr. 236-237. However, Sondag’s testimony did not establish whether, after receiving the
schedule from the delivery coordinator, he was able to contact customers and reschedule to improve
efficiency.
8 For work that haulers do for clients other than the Respondent, it is fair to infer that the Respondent
exercises no control over the types of equipment the hauling companies use. The record evidence does
not indicate otherwise.
9 The record does not provide a basis for determining whether the Respondent encourages the use of
Masterlift-outfitted trucks because it considers them superior or better adapted to the Respondent’s
operations, or because the Masterlift device is more familiar to its employees, or because the Respondent
profits from the sale of Masterlift devices, or for all, some, or none of these reasons.
10 Some Masterlift truck sales, while made by third-party dealers, are for trucks onto which the
Respondent has recently installed Masterlifts and which trucks are physically present at a facility of the
Respondent at the time of the sale. Based on my review of the entire record, this is what I find was likely
meant when a hauler referred to obtaining a Masterlift truck from the Respondent. Tr. 190-191.
JD–92–17
8
evidence regarding the insurance that the Respondent requires under contracts applicable to
work that haulers perform using their own truck, but a Respondent-owned trailer. One hauler
testified that until recently the Respondent paid for the insurance coverage relating to the
Respondent-owned trailer, but that the Respondent had started requiring him to pay for that
coverage. Tr. 227-228. An agent of an insurance company testified that the Respondent had5
once contacted him directly to increase the amount of coverage that a hauling contractor had for
a Respondent-owned trailer. The Respondent had not previously contacted the hauling
contractor about this increase and when the insurance company informed the hauling contractor
about the increase and the higher premium, the hauling contractor declined to authorize the
increases and, instead, ceased using the Respondent’s trailers. 10
Regarding the extent to which the Respondent directly oversees or participates in the
delivery work, the evidence showed that once the Respondent gives the hauler a delivery
schedule and loads the truck, the hauler then proceeds to secure the load, transport it, and
deliver it, without any recognized employee of the Respondent accompanying to operate 15
equipment or otherwise provide assistance or oversight. All the latter work is performed by the
hauling contractor and any persons the contractor has hired or partnered with for that purpose.
That being said, the Respondent’s stores do remotely monitor the whereabouts of the hauling
contractors while they are out making deliveries. The monitoring is accomplished using a Global
Positioning System (GPS) device that the hauling contracts require the haulers to install in any 20
truck used under those contracts. According to Zima, this tracking information has allowed the
stores to answer customer inquiries about the timing of Zima’s deliveries. Gregory Sondag, a
hauling contractor, testified that by using the GPS device the Respondent had been able to tell
where he was, whether he was on the route that the Respondent suggested, and whether he
had stopped for a period of time. Tr. 232-233, 244-245. One hauling contractor stated that the 25
Respondent had never used the GPS tracking information to take action against him, and the
record did not show that the Respondent had ever used it in that manner against anyone.11
Although no recognized employees of the Respondent operate the haulers’ equipment
or assists in making the deliveries, the Respondent does have a program under which its store 30
general managers accompany hauling contractors approximately four to six times per year while
they are out making deliveries. Afterwards, the store managers provide a report regarding their
observations to Gronemus, an upper level manager. Gronemus credibly testified that the
purpose of this program is for the general managers to better understand the “environment” in
which the haulers are operating, and also to assess whether the customers are satisfied. Tr. 35
335. The Respondent has never taken adverse action against a hauling contractor based on
information gleaned from this “ride along” program.
The evidence was somewhat mixed regarding the extent to which the Respondent
exerts control by requiring the haulers to do business in the Respondent’s name. On the one 40
hand, the hauling contractors do not wear uniforms bearing the Respondent’s name or logo and
indeed there was no evidence that the Respondent requires them to wear a uniform at all. One
hauling contractor testified that the persons making deliveries wear the hauling contractor’s own

11 The hauling contractors are also required to have cell phones and store employees can, and do,
contact the contractors on their cell phones during delivery runs. However, the General Counsel’s
contention that this is evidence of a level of control that is inconsistent with independent contractor status
is frivolous. Brief of General Counsel at 18. For better or worse, it has become a common expectation
that people will be available by cell phone to employers, customers, and clients. It is not unusual for cell
phone contact information to be included on business cards and at websites in order to facilitate contact.
According to one recent study, 95 percent of all American adults have cell phones. See
http://www.pewinternet.org/fact-sheet/mobile/ (pew research report from January 2017).
JD–92–17
9
uniforms. Tr. 376. Regarding the trucks themselves, the standard contracts state that the
haulers should place their own company name on the trucks. The contracts also mention that
the Respondent will provide decals to the contractor for placement on trucks, but not what type
of decals. The record establishes that the contractors who operate the flat-bed trucks display
their own company name on those vehicles, but do not display the Respondent’s logo decals. 5
Tr. 158, 215, 450.12
The situation is more ambiguous with respect to the hauling work performed using the
cube vans. The record shows that the Respondent urged the haulers to place the Respondent’s
logo on the sides of those vehicles. Gronemus characterized this as a “recommendation” rather 10
than a requirement. However, there was testimony from hauling contractors called by both
sides that the stores indicated that the Respondent required the display of its logo on the cube
vans. On the other hand, Zima stated that he did not display the Respondent’s logo on a cube
van that he used to make deliveries to the Respondent’s customers. A store manager
recommended that Zima place the Respondent’s logo on that cube van, but Zima had not done 15
so. Tr. 440-441.
The hauling contractors make their own decisions about hiring and firing of workers to
assist them in making the deliveries under the contracts with the Respondent. The Respondent
does not have control over the contractor’s employees and, indeed, the record suggests that 20
contractors sometimes hire day laborers without informing the Respondent. If a hauling
contractor is going to use one of its employees on the Respondent’s property, the contracts
require that the employee pass a background check. The compensation and other terms of
employment for the hauling companies’ own employees are set between the hauling company
and their employees, not by the Respondent. Any training received by the hauling contractor’s 25
employees is provided by the contractor, not the Respondent. Tr. 376-378, 445. Witnesses
credibly testified that the hauling contractors, in some instances, withhold taxes from the
paychecks of their employees, provide them with benefits, and issue w-2 forms. Hauling
contractors are permitted to subcontract work under the contracts and while the contractor’s
choice of a subcontractor is subject to the Respondent’s approval, the contracts provide that the 30
Respondent may not “unreasonably with[o]ld” such approval. J Exh. 1, Page 7; J Exh. 2, Page
7; J Exh. 3, Page 8. The Respondent does not provide training to the hauling contractors
themselves.
The General Counsel contends that the Respondent’s stores present the contracts to the 35
haulers as non-negotiable and that this evidences a level of control that is inconsistent with the
haulers being independent contractors. The record supports the General Counsel’s factual
contention that the Respondent presents the contracts without prior negotiation, although there
was testimony about one hauler who had negotiated special contract terms, Tr. 364, and that
others had obtained adjustments for particular delivery locations, Tr. 167-168, 434. The record 40
shows that the way the relationship between the Respondent’s stores and the haulers is
conducted under these standard contracts varies substantially.
45

12 One hauler testified, that when he purchased a particular Masterlift-equipped truck it already had
mud flaps that referenced the Respondent. He stated that a store general manager told him that the
Respondent “wants [the mud flaps] for advertising . . . and they want them to stay on.” However, the
evidence did not show that any other trucks used by that, or any other, contractor had mud flaps
referencing the Respondent.
JD–92–17
10
Discussion
Although the evidence is somewhat mixed regarding the extent of the Respondent’s
control over the details of the hauling companies’ work, I find that, on balance, this factor weighs
in favor of finding that the hauling companies are independent contractors. In this regard I note, 5
as is alluded to above and discussed more fully below, that haulers are not prevented from
working for other clients and the Respondent has no control whatsoever over what the hauling
contractors earn for such work, what equipment they use, or how they perform it. This ability to
work for other clients weighs in favor of independent contractor status. See FedEx, 361 NLRB
at 621 (whether owner-operators can make deliveries for other clients is a factor to consider in 10
making determination regarding independent contractor status), Dial-A-Mattress Operating
Corp., 326 NLRB 884, 886 and 892 (1998) (truck owner-operators are independent contractors
where, inter alia, they may have more than one vehicle performing deliveries and work for
clients other than the alleged employer), C.C. Eastern, Inc., 309 NLRB 1070, 1070-1071 (1992)
(ability to work for other customers weighs in favor of independent contractor status). Even with 15
respect to the work that the hauling companies perform when the Respondent is their client, the
haulers have a level of control that the Board has found consistent with independent contractor
status in the case of drivers making deliveries for a retailer. As in Dial-A-Mattress – where the
Board found that the drivers were independent contractors – the hauling contractors in this case
sometimes deal directly with the customers to impose special handling charges, they hire and 20
train their own staff, they select and purchase their own trucks from third-party sellers, and they
do not use acknowledged employees of the Respondent to operate their equipment or
accompany them to help make deliveries. Dial-A-Mattress, 326 NLRB at 886 and 891; see also
NLRB v. United Ins. Co., 390 U.S. 254, 256-259 (1968), and Roadway Package System, 326
NLRB 842, 851 (1998) (whether the individuals are trained by the putative employer is a factor 25
in independent contractor analysis). The haulers who contract with the Respondent are free to
decide upon the routes they use to make deliveries and although they receive a schedule for
each day’s deliveries, they can seek modifications to that schedule to improve their efficiency.
Independent contractor status is also indicated by the haulers’ control over the hiring of helpers
and employees, and the engagement of subcontractors. See, e.g., C.C. Eastern, Inc., supra.30
In finding that the balance of the parties’ control over the details of work weighs in favor
of independent contractor status, I considered the evidence that the Respondent can track the
whereabouts of the haulers using a GPS system and that several times a year store managers
accompany the haulers to observe their work environment and assess customer satisfaction. 35
Under the circumstances present here, this is not inconsistent with independent contractor
status. A company that pays for work by an independent contractor, like one that pays for work
by an employee, has an understandable interest in ensuring the quality and value of the work
being performed. See North Am. Van Lines, Inc. v. NLRB, 869 F.2d 596, 599 (D.C. Cir. 1989)
(“[E]fforts to monitor, evaluate, and improve the results or ends of the worker’s performance do 40
not make the worker an employee”).13 Nor is the existence of an independent contractor
relationship inconsistent with the Respondent’s requirement that the hauling companies
maintain adequate liability insurance and name the Respondent as an additional insured.
Indeed, such a requirement actually weighs in favor of independent contractor status since in
employer-employee relationships the employers generally assume the risk of third-party 45
damages, and do not require indemnification from their employees. Dial-A-Mattress, 326 NLRB
at 891.

13 The Court of Appeals disagreed with the Board finding of employee status, 288 NLRB 38 (1988),
but the Court did not suggest that the specific observation quoted above was at odds with the Board’s
analysis.
JD–92–17
11
I recognize that the Respondent generally presents the delivery service contracts to the
haulers without negotiation and that this does indicate that the Respondent has a level of control
over the terms under which the delivery work is performed. But this is insufficient to tilt the
“control of the details of work” factor in favor of employee status. As the Board has observed,
in both employer-employee relationships and independent contractor relationships the relative 5
bargaining strength of the parties has a significant impact on each side’s ability to dictate terms.
St. Joseph News-Press, 345 NLRB 474, 481 (2005), but see FedEx, 361 NLRB at 625-626
(overruling St. Joseph News to the extent that it suggests that the Board cannot consider
evidence that the putative employer has imposed constraints on the individual’s ability to
operate an independent business). It is not surprising that a large retailer like the Respondent 10
would either use its relative bargaining strength or standardize the delivery service contracts
across its operation. The fact that it does these things is not, under the circumstances here,
inconsistent with the haulers operating as independent contractors.
b. Are the Hauling Contractors Engaged in a Distinct Occupation or Business15
and is the Work Part of the Employer’s Regular Business?
Facts and Discussion
The Respondent is in the business of retail sales of home improvement merchandise, 20
and I find that the hauling contractors are engaged in the distinct business of providing hauling
and delivery services. Although the Respondent’s stores arrange delivery services with their
customers, the record indicates that they do this exclusively with respect to their own
merchandise, and are not in the business of arranging deliveries for other companies. It is
telling that in cases cited by the General Counsel where delivery drivers were found to be 25
employees rather than independent contractors, the employers were themselves delivery and
transportation services not merchandise retailers. The General Counsel relies, for example, on
cases involving drivers making deliveries for FedEx Home Delivery, Time Auto Transportation,
Corporate Express Delivery Systems, Slay Transportation Co., Roadway Package, Central
Transport, Inc., Dixie Transport Co., and Aetna Freight Lines, Inc.14 If in those cases the 30
delivery drivers were viewed as being in the same occupation as the delivery services for whom
they were working it is not persuasive precedent with respect to haulers who, like those at-issue
here, were making deliveries not for a delivery service, but for a merchandise retailer. Indeed,
when the Board considered the status of drivers who made deliveries to the customers of Dial-
A-Mattress – like the Respondent, a merchandise retailer – the Board found that the drivers 35
were independent contractors. 326 NLRB 884.
In reaching the conclusion that the hauling contractors in the instant case were engaged
in a distinct occupation or business, I considered the evidence that the Respondent depends on
the ability to arrange delivery services to facilitate the sale of some of the merchandise, 40
particularly the heavier and larger merchandise, offered in its stores. However, even if one
assumes that the delivery service is not only important, but essential, to the Respondent’s
business that does not mean that the Respondent is in the delivery business. If such
dependence did establish that then the majority of on-line retailers – from giants like Amazon to
individuals selling collectibles out of their home – would have to be considered delivery services 45

14 FedEx Home Delivery, supra; Time Auto Transportation, 338 NLRB 626 (2002), enfd. 377 F.3d 496
(6th Cir. 2004); Corporate Express Delivery Systems, 332 NLRB 1522 (2000), enfd. 292 F.3d 777 (D.C.
Cir. 2002); Slay Transportation Co., 331 NLRB 1292 (2000); Roadway Package System, 326 NLRB 842
(1998); Central Transport, Inc., 247 NLRB 1482 (1980); Dixie Transport Co., 218 NLRB 1243 (1975);
Aetna Freight Lines, Inc., 194 NLRB 740 (1971).
JD–92–17
12
since their businesses generally depend on being able to arrange for services that deliver their
products to customers.
While the Respondent enters into contracts with hauling companies that are ongoing
concerns, it is also true, as the General Counsel points out, that the Respondent recruits 5
individuals to start hauling companies and provides those individuals with information resources
to help them get started. These resources include lists of trucks for sale and the names of
lenders familiar with financing the purchase of the trucks. Based on my consideration of the
entire record, I view these activities not as evidence that the Respondent is in the delivery
business, but, if anything, as evidence that the Respondent is taking pains to attract outside 10
hauling contractors so as to avoid having to get into the delivery business. I note, moreover,
that although the Respondent provides the haulers and potential haulers with information about
trucks for sale and potential lenders, the haulers are not required to use the Respondent’s
information. The testimony showed that hauling contractors can, and do, identify trucks and the
funds to purchase them, without reference to any information provided by the Respondent. 15
Independent contractor status is also indicated because the haulers are incorporated.
Tr. 41. In Dial-A-Mattress the Board found the fact that several of the disputed workers
“function in the corporate form” to be evidence lending support to finding independent contractor
status. 326 NLRB at 891; cf. Roadway Package System, 326 NLRB at 851-852 (when delivery 20
drivers are not separately incorporated this lends support to finding them to be employees). In
the instant case, that factor weighs even more heavily because all of the hauling contractors
who testified “function[ed] in the corporate form.”
Finally, I note that the haulers are not required to display the Respondent’s name or logo 25
on their trucks (although those operating cube vans are pressured to do so) or to wear uniforms
referencing the Respondent. To the contrary, the haulers are required to display their own
company name on their trucks and some drivers wear the hauling company’s own uniform. In
one of the cases relied on by the General Counsel, Roadway Package System, Inc., supra, the
Board ascribed employee to status to delivery drivers only after noting that the drivers, inter alia, 30
were required to wear Roadway-approved uniforms, operate identical custom-designed
vehicles, and display Roadway’s name, logos and colors. Conversely, the absence of such
requirements here weighs against employee status.
c. Kind of Occupation35
Facts and Analysis
The record evidence does not focus on how the occupation of hauling contractor is
generally performed in the relevant localities. Rather the evidence focused on how it is 40
performed when the contract is with the Respondent. As to the contracts with the Respondent,
the evidence showed that once the hauler leaves the Respondent’s store to make a delivery, no
acknowledged employee of the Respondent accompanies the driver to operate the truck or
other equipment, perform any labor, or direct or oversee the unloading of the merchandise. It is
true that the Respondent’s store handles some related tasks – selling the delivery service to the 45
customer, collecting payment from the customer, making initial delivery plans with the customer,
loading the deliveries onto the truck or trailer. But the hauling contractors make the deliveries
on their own without anyone from the Respondent present to direct or assist the contractor with
the delivery or unloading. Given the only limited oversight that the Respondent exercises over
the haulers’ work, I find that the evidence bearing on this factor weighs lightly in favor of 50
independent contractor status.
JD–92–17
13
d. Skill Required for Work and Level of Supervision
Facts and Analysis
The evidence indicated that the haulers are required to obtain a commercial driver’s 5
license (CDL) if they operate some, but not all, of the types of trucks called for by the standard
contracts with the Respondent’s stores. Tr. 96-97, 422. The record does not show how
common it is for the haulers to be required to have a CDL or how much training is required for
them to obtain it. Although I expect that persons operating the knuckle cranes and forklifts would
require some training or practice, the parties did not explore this and I do not have a basis for 10
concluding that the skills required are significant. Indeed, the evidence indicates that the
Respondent does not require the drivers to submit or demonstrate their qualifications. Tr. 127.
As the General Counsel notes, in FedEx Home Delivery, supra, the Board found that the
skill level required of delivery drivers weighed against independent contractor status where, inter 15
alia, those drivers were are able to obtain all the necessary skills during a 2-week training. In
the instant case, not even 2 weeks’ worth of training was shown to be required. On the record
here, and given the Board’s FedEx decision, I find that the skill level of the hauling contractors in
this case weighs against finding them to be independent contractors.
20
e. Does Employer or Worker Supply the Instrumentalities and Place of Work?
Facts
The hauling contractors own the trucks that they use to perform work under their 25
contracts with the Respondent’s stores. They select their own trucks and purchase them from
third-parties of their own choosing. The trucks are not custom-designed for work under the
contracts. The haulers are responsible for the necessary financing, inspection, and
maintenance relative to these trucks. They pay for all of this themselves, as they do for fuel,
tires and everything else associated with truck ownership and operation. The Respondent does 30
offer the haulers, and prospective haulers, information about vehicles for sale, and sources of
financing, but the haulers are not required to use this information or any of the resources
identified by the Respondent, and there was credible testimony from hauling contractors that
had not used those resources. Tr. 396-397, 407, 432-433.15 The hauling contractors also own
the other instrumentalities required for the work, with the exception that in some instances 35
contractors haul Respondent-owned trailers. The Respondent does not require the contractors
to use the Respondent’s trailers and the record does not establish how prevalent such usage is.
There was credible testimony that using the Respondent’s trailers is attractive to the hauling
contractors because it saves them time inasmuch as deliveries can be loaded onto the trailers
before the hauler arrives. The Respondent offers the use of its trailers without charge to the 40
hauler. The Respondent pays for the maintenance and inspection of the trailers, but the hauling
contractors who use them are required to escort the trailers through necessary maintenance
visits and inspections.
Regarding the location where the haulers perform their work, I note at the outset that the 45
haulers can perform work for clients other than the Respondent, and when they are doing that

15 According to Gronemus, it is rare for a hauling contractor, or potential contractor, to be rejected
when seeking financing to purchase a truck for use under one of the contracts. Gronemus testified that,
although the Respondent does not itself provide financing or control whether a lender grants it, the
Respondent will sometimes reach out to lenders regarding a prospective hauler who is having difficulty
obtaining financing.
JD–92–17
14
work it is fair to infer they are at locations other than the Respondent’s. Even with respect to the
haulers’ deliveries to the Respondent’s customers, the evidence showed that most of the
haulers’ time is spent on the road and at the locations where they are unloading merchandise
for customers. When the hauling contractors are doing work under their contracts with the
Respondent, they spend a limited amount of time at the Respondent’s facilities obtaining and 5
tying down loads. One hauler testified that obtaining and tying down the loads takes about an
hour, and that he sometimes returns to the facility for additional loads during the course of the
day.
The Respondent allows the hauling contractors to use available parking areas at its 10
locations to store trucks, but it does not require them to park there and the haulers are able to
make other arrangements. When a hauler does choose to park its truck at one of the
Respondent’s stores, the Respondent requires them to use the area in front of the store rather
than in the loading area, both because space is limited in the loading area and because placing
the trucks in a visible location raises customer awareness regarding the availability of delivery 15
services.
Analysis
I find that this factor weighs in favor of finding that the hauling contractors are 20
independent contractors. Most significant is the fact that the hauling contractors select,
purchase, own, and maintain what is by far the most important instrumentality for their hauling
work – the trucks. They can do this without any involvement by the Respondent. Although
some choose to take advantage of lists offered by the Respondent, the evidence showed that
others accomplish these activities without using those lists. The haulers in this case, unlike25
those in cases where employee status was found, are not dependent on the Respondent to
obtain their trucks, and this lack of dependence weighs in favor of independent contractor
status. See, e.g., Portage Transfer Co., 204 NLRB 787, 787-789 (1973). Moreover, unlike the
Roadway case, in which the company dictated “[e]very feature, detail, and internal
configuration” and therefore the drivers could find “no ready market” unrelated to Roadway for 30
the trucks, the Respondent in the instant case does not require the contractors to use heavily
customized trucks. The evidence shows that trucks used for work under the haulers’ contracts
with the Respondent can be purchased and re-sold on the open market, and that haulers can
use the trucks with which they make deliveries for the Respondent to perform services for other
clients. 35
As noted above, most of the hauler’s work is performed away from the Respondent’s
facilities. The Respondent does not require the haulers to park their trucks at its facilities during
off-hours, and some haulers do make other arrangements. These circumstances are
meaningfully different than those in Roadway where the drivers were not permitted to use their 40
trucks for other clients during the day and were required to return their trucks to the company’s
facilities during the evening hours where they were not “readily available” to be used for work
with other clients. 326 NLRB at 851. The evidence that the haulers spend most of their time
away from the Respondent’s facilities and are not required to return their trucks to the
Respondent’s facilities after hours weighs in favor of independent contractor status.45
f. The Length of Employment
Facts and Analysis
50
A hauling contractor who wishes to continue his or her relationship with the Respondent
after the end of the calendar year may execute a new hauling contract. Either party is able to
JD–92–17
15
cancel that contract on 60 days’ notice. The General Counsel presented the testimony of a
few contractors who have continued to contract with the Respondent for long periods. The two
with the longest tenures had contracted with the Respondent for 13 years and 24 years
respectively. The General Counsel did not introduce evidence showing that this was typical of
haulers working across the Respondent’s approximately 300 stores. Since the General Counsel 5
alleges a violation, and seeks a remedy, covering the “delivery drivers” at all 300 stores, the fact
that a tiny sample of hauling companies have chosen to continue their relationships with the
Respondent by repeatedly executing new annual contracts is of very little significance. Not only
that, but it is often the case that the delivery drivers are not the contractor who maintains a
relationship with the Respondent of any length. Rather the drivers can be employees of the10
hauling contractor. Indeed, Stephens Delivery – the contractor who the General Counsel points
to as having a 24-year relationship with the Respondent – has nine of its own employees. The
General Counsel did not present evidence regarding how long these employees had been
employed by Stephens Delivery, much less how long any of them had been making deliveries
under Stephens’ contracts with the Respondent.15
I find that the relatively short life of the hauling contracts, coupled with the ability of either
party to end the contracts with 60 days’ notice, weighs in favor of finding independent contractor
status.
20
g. Method of Payment, Whether by the Time or by the Job
Facts and Analysis
As noted above, the Respondent’s stores compensate the hauling contractors by the job25
based on distance-based “zones” and the provision of special handling services, and offer the
haulers a retention bonus based on the merchandise the hauler has delivered during the term of
the prior contract. The hauling contractors themselves purchase the fuel for the trucks, although
two of the drivers stated that adjustments to their distance rates are triggered based on
fluctuations in the price of fuel. The haulers invoice the Respondent for the services they 30
provide in order to receive compensation. The Respondent does not guarantee the hauling
contractors any minimum amount of compensation or number of deliveries. Cf. Roadway
Package System, 326 NLRB at 853 (delivery drivers found to be employees based on, inter alia,
evidence showing that the putative employer guaranteed new drivers a minimum income level).
The Respondent does not pay the haulers a salary or an hourly rate. Nor does it withhold 35
social security or other taxes, make workers compensation payments, or provide benefits such
as health insurance or paid vacation. The haulers do not clock in, or clock out, for work with the
Respondent. Board decisions show that a by-the-job compensation arrangement without
paycheck withholding, like the one present here, is indicative of independent contractor status.
Minnesota Timberwolves Basketball, 365 NLRB No. 124, slip op. at 10 (2017); Dial-A-Mattress, 40
326 NLRB at 892. I find that the “method of payment” evidence weighs heavily in favor of
independent contractor status.
JD–92–17
16
h. Whether the Parties Believe they are
Creating an Employer-Employee Relationship
Facts and Analysis5
A preponderance of the evidence shows that the hauling contractors and the
Respondent generally believe they are creating an independent contractor relationship, not an
employee-employer relationship. Indeed, the General Counsel’s brief does not identify a single
witness – among either hauling contractors or managers – who testified that he or she believed 10
an employee-employer relationship was created. To the contrary, witnesses for both the
General Counsel and the Respondent testified that they understood the haulers to be
independent contractors. Even Denning, a hauler who was a witness for the General Counsel,
testified that he signed on with the Respondent as his own business, not as an employee. Tr.
77. Gronemus – the Respondent’s corporate manager of shipping and receiving –15
characterized the haulers as independent contractors as did John Pedretti – a former store
manager who no longer works for the Respondent. It is also worth noting, though certainly not
controlling, that each of the three types of standard contracts that the Respondent and haulers
sign to create or extend their relationships characterizes the hauler as an independent
contractor. See J Exh. 1 at Page 1, J Exh. 2 at Page 1, and J Exh. 3 at Page 1.16 20
In the absence of any testimony, even from its own witnesses, that the parties believed
the haulers to be employees of the Respondent, the General Counsel attempts to make its case
on this factor by grasping at two stray and ambiguous remarks gleaned from the troves of
communications the General Counsel obtained from the Respondent. One was a 25
communication from a “2nd assistant general manager” at a store, who opined to another
manager: “I believe we should be in control not the hauler. They work for us not vice versa.”
General Counsel Exhibit Number (Exh.) 77 at Page 1. This evidence is woefully inadequate not
only because it is a single remark by a person who appears to be a low-level manager at a
single store, but also because it does not reference or suggest the existence of an employer-30
employee relationship. This individual’s view that the haulers “work for” the Respondent says
nothing about the question of whether the haulers work for the Respondent as employees as
opposed to as independent contractors. The second communication relied on by the General
Counsel was also made by a “2nd assistant general manager” who stated during a contentious
oral discussion with Fisher, a hauler, that, “It’s an independent contractor but it’s not, it’s not a 35
true independent contractor, because you’re still contracted through us.” GC Exh. 18(a) at Page
2. Not only is this a stray remark, but it actually characterizes the relationship as “independent
contractor” and never mentions the possibility of an employee-employer relationship. What this
2nd assistant store manager meant when he told Fisher that their independent contractor
relationship was not a “true” one is not clear, except to the extent that, in context, it is obvious 40
that he was generally communicating that it reflects badly on the Respondent when customers
do not receive their deliveries at the expected time. At any rate, I note that the hauler involved
in this exchange, Fisher, was called by the General Counsel as a witness and, if Fisher believed
he was an employee, he could have testified to that belief. He did not so testify.
45

16 As noted previously, when deciding whether a worker is a statutory employee who falls within the
Act’s protection, it is appropriate to look to the way the individual’s work is actually performed and not to
consider the written descriptions of that work to be controlling. See Oakwood Healthcare, Inc., 348 at 690
fn.24; Chicago Metallic Corp., 273 NLRB at 1690.
JD–92–17
17
For these reasons, I find that the understanding of both the Respondent and the hauling
contractors is that haulers are working for the Respondent as independent contractors and that
this weighs in favor of finding independent contractor status.
i. Significant Entrepreneurial Opportunity for Gain or Loss5
Facts and Analysis
In addition to the list of common-law factors, the Board has examined whether the at-
issue individuals have significant entrepreneurial opportunity. Relevant to this inquiry is, for 10
example, evidence about the workers’ ability to hire their own employees and work for other
clients, and the extent of any proprietary interest in the work. FedEx Home Delivery, 361 NLRB
at 617-619.
As alluded to earlier, the hauling contractors select their own employees and helpers 15
without input from the Respondent. The only condition is that, before the hauling contractor
may bring one of its own employees onto the Respondent’s property, the hauling contractor is
required to provide store management with identifying information for the employee and certify
that the contractor “has conducted a criminal background check of the employee and found
them free of criminal convictions for retail theft, theft related crimes, felony charges or 20
convictions and property damages crimes.” The contracts do not impose this requirement for
employees the hauling contractor does not bring onto the Respondent’s property. The freedom
to hire, or partner with, other individuals gives the hauling contractors the ability to work for
clients in addition to the Respondent. Zima’s hauling company, for example, has 13 full-time
employees and obtains upwards of 70 percent of its business from clients other than the 25
Respondent. Zima uses some of the same equipment to perform services for both the
Respondent and other clients. Tr. 421-423. Similarly, Stephens’ hauling company has nine of
its own employees and about half of its revenue comes from work it does for clients other than
the Respondent. Tr. 461, 473. Elbassiouny’s company has five of its own employees and uses
some of the same equipment to service both the Respondent and his other clients. Tr. 371, 30
384-385. Contractors Janice Melby, Mark Oberg, and Sondag all also perform work for clients
in addition to the Respondent. Tr. 237-238, 247-248, 399-401.
Some hauling contractors either could not, or chose not to, expand their business
beyond work for the Respondent. The General Counsel argues that this was because the 35
Respondent imposed two obstacles that rendered the contractor’s entrepreneurial opportunities
theoretical rather than actual. The two obstacles identified by the General Counsel were: the
availability requirements in the contracts, which demand that the contractor make its delivery
services available during store hours, J Exh. 1 at Page 1, J Exh. 2 and Page 1, J Exh. 3 at Page
1, and the non-compete clause in the contracts. J Exh. 1 at Pages 7-8, J Exh. 2 at Page 8, J 40
Exh. 3 at 8. Regarding the availability requirement, the record shows that hauling contractors
can, and do, overcome this hurdle by obtaining additional trucks and/or personnel so that they
can meet their contractual availability obligation to the Respondent while also performing
services for other clients. Moreover, there was credible evidence that the Respondent had
worked with haulers to permit them to designate hours, days, or weeks, when they would be 45
excused from providing services to the Respondent. Tr.161-162, 173, 401.
As to the non-compete clause in the contracts, the record shows that this, by its terms,
applies only to contract hauling for competitors of the Respondents and only to those
competitors who are within 25 miles of the store location where the hauler is providing services 50
to the Respondent. This limitation does not prevent the contractors from doing outside non-
hauling work, or from doing hauling work for clients who do not compete with the Respondent,
JD–92–17
18
or from doing hauling work for the Respondent’s competitors as long as those competitors are
not within 25 miles of the relevant store. The fact that Zima, Stephens, Elbassiouny, Melby,
Oberg, and Sondag have all been able to provide services to other clients shows that the actual
entrepreneurial opportunity for such work exists, regardless of whether other contractors exploit
that opportunity. The General Counsel cites Corporate Express Delivery Systems, 332 NLRB 5
1522 (2000), enforced, 292 F.3d 777 (D.C. Cir. 2002), as support for its argument that, given
the non-compete clause, the contractors do not have a meaningful opportunity for
entrepreneurial gain. However, in Corporate Express the contractors were “not permitted to use
their vehicles to make deliveries for anyone other than [Corporate Express].” Ibid. (emphasis
added). That is a formidable barrier to outside work, and one that is not comparable to the 10
limitation in this case, which permits the haulers to use their vehicles to work for a broad range
of other clients.
Regarding the proprietary interest in the work, the record shows that the hauling
contractors can, and sometimes do, sell their companies. In addition they have the express 15
right under the contracts to subcontract their work with the Respondent to others. On its face,
that right is not limited in any way that would preclude a hauler from seeking something from the
subcontractor in exchange for agreeing to cede the work. Facially the opportunity for such
activity exists under the contracts and the record does not show that it is precluded.
20
I find that the haulers have a meaningful opportunity for entrepreneurial gain and that
this weighs in favor of finding that they are independent contractors.
Conclusion
25
For the reasons discussed above, I find that the overwhelming majority of the factors
identified in Board decisions favor a finding that the hauling contractors who contract with the
Respondent’s stores are independent contractors not employees.17 Factors weighing in favor of
such status include: the balance of control over the haulers’ work, the extent to which the
haulers are engaged in a distinct business, the type of occupation, the extent to which the 30
haulers supply the instrumentalities of work, the length of employment, the method of payment,
the belief of the parties as to the nature of their relationship, and the degree of entrepreneurial
opportunity. Only one factor – the level of skill required – weighs in favor of employee status
under Board precedent. That factor is outweighed by the many factors favoring independent
contractor status. Of the alleged employees discussed in the cases cited by the parties, the 35
ones who most closely resemble those in the instant case are the truck owner-operators in Dial-
A-Mattress, supra, a case in which the Board found that the owner-operators who made
deliveries for a merchandise retailer were independent contractors, and rejected the contention
that they were employees. Like the owner-operators in Dial-A-Mattress, the hauling contractors
in this case are making deliveries to customers of a merchandise retailer, hire their own 40
employees, acquire and own their own trucks, are not guaranteed any minimum compensation
by the Respondent, are identified in relevant documents as non-employees, and have
significant entrepreneurial opportunity for gain or loss. I find that the same result reached in
Dial-A-Mattress is warranted here.
45
Since the hauling contractors are independent contractors who, pursuant to Section 2(3),
do not fall within the protections of the Act, the General Counsel’s allegations that the

17 I note that the record indicates that some of the drivers who make, or assist, with deliveries are
employees, but employees of the hauling contractors, not of the Respondent. The complaint does not
make any allegation regarding the hauling contractors’ treatment of their employees and I make no
finding in that regard.
JD–92–17
19
Respondent violated Section 8(a)(1) of the Act by misclassifying those individuals as
independent contractors and by requiring them to agree to an improper mandatory arbitration
clause necessarily fail. Those allegations must be dismissed.
CONCLUSIONS OF LAW5
1. The Respondent is an employer engaged in commerce within the meaning of Section
2(2), (6) and (7) of the Act.
2. The drivers that make deliveries pursuant to the delivery service agreements between 10
hauling contractors and the Respondent are not employees of the Respondent.
3. The Respondent was not shown to have violated Section 8(a)(1) by classifying
drivers that make deliveries pursuant to its delivery service agreements with hauling contractors
as independent contractors.15
4. The Respondent was not shown to have violated Section 8(a)(1) by maintaining a
mandatory arbitration clause in its delivery service agreements with the hauling contractors.
On these findings of fact and conclusions of law and on the entire record, I issue the 20
following recommended Order.18
ORDER
25
The complaint is dismissed.
30
Dated, Washington, D.C. November 17, 2017.

35
PAUL BOGAS
Administrative Law Judge
40

18 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and Regulations, the
findings, conclusions, and recommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed waived for all purposes.
~~.-~--~~