Moderate Income Management Co.

National Labor Relations Board - Board Decisions

Jul 14, 1981

256 N.L.R.B. 1193 (N.L.R.B. 1981)

MODERATE INCOME MANAGEMENT CO. 1193
Moderate Income Management Company, Inc., and
Marineview Housing Company No. 1 and Local
Union No. 560, a/w International Brotherhood
of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, Petitioner. Case 22-RC-
8352
July 14, 1981
DECISION ON REVIEW AND
DIRECTION OF ELECTION
On November 28, 1980, the Acting Regional
Directior for Region 22 issued his Decision and
Order in the above-entitled proceeding in which he
dismissed the amended petition seeking a unit of all
porters and maintenance employees at Marine-
view's two-building complex in Hoboken, New
Jersey, on the basis that Marineview shares the
State of New Jersey's exemption from the Board's
assertion of jurisdiction pursuant to Section 2(2) of
the Act.
Thereafter, in accordance with Section 102.67 of
the National Labor Relations Board Rules and
Regulations, Series 8, as amended, Petitioner filed a
timely request for review of the Acting Regional
Director's decision on the grounds that he erred in
declining to assert jurisdiction and, additionally, in
finding Moderate and Marineview are not joint em-
ployers under the Act. Moderate and Marineview
each filed a statement in opposition.
By telegraphic order dated December 29, 1980,
the National Labor Relations Board granted Peti-
tioner's request for review. Moderate and Marine-
view each relied on briefs previously submitted to
the Acting Regional Director; Petitioner did not
file an additional brief.
The Board has considered the entire record in
this case with respect to the issues under review,
including all briefs submitted by the parties, and
makes the following findings:
Regarding the joint-employer question, the
Acting Regional Director found that, as Moderate
performed only a bookkeeping function for Marine-
view and had no direct control over Marineview's
labor relations policies, they were not joint em-
ployers within the meaning of the Act.
Marineview Housing Company No. 1 is a New
Jersey limited partnership created solely to pur-
chase and operate the Marineview low to moderate
income housing project. The housing project is
comprised of two buildings in Hoboken, New
Jersey. Marineview purchased the project pursuant
to a morgage agreement entered into with the New
Jersey Housing Finance Agency (herein called
NJHFA) in May 1973. The morgage agreement
contains general provisions concerning rental fees
and tenant eligibility, and authorized the mortgagor
256 NLRB No. 179
to enter into a management agreement. Marineview
entered into such an arrangement with Moderate
Income Management Company in May 1979. The
agreement was renewed for a -year period in May
1980, and is currently in effect but may be termi-
nated with or without cause by NJHFA or Marine-
view upon 30 days' written notice.
Moderate is a legal entity separate from Marine-
view, with its main offices in Trenton, New Jersey,
and a site office at the Marineview project. There
is no evidence of Moderate and Marineview having
common ownership, directors, or officers.
Pursuant to the management agreement, Moder-
ate is responsible for collecting rent from the ten-
ants and for screening and recommending tenants
for the vacant units. Moderate arranges for all
services-utilities, extermination, and the like-and
purchases all needed tools, supplies, and equipment,
subject to Marineview's final approval. Moderate,
on behalf of Marineview, pays all expenses, includ-
ing all employee salaries. Moderate also prepares
the proposed operating budget for Marineview's
approval. The budget includes, inter alia, proposed
rent increases and employee wage increases.
Moderate's office at the site is staffed by its own
employee during hours set by Marineview. This
office handles rentals and tenant complaints which
are forwarded to the project superintendent for re-
medying.
Upon entering into the management agreement,
Moderate inherited the current work force. It then
formulated all the current labor relations policies,
including policies for hiring, disciplining, and dis-
charging employees, for setting work schedules,
and for vacation and sick leave. The policies were
all subsequently approved by Marineview pursuant
to the agreement.'
The implementation and day-to-day administra-
tion of labor relations policies is the responsibility
of the housing project superintendent. He estab-
lishes all work schedules, hands out all assignments,
and directs all unit work. The superintendent can
authorize overtime, but must first clear it with
Moderate's Trenton office. The superintendent
does all hiring for the buildings. He advertises in
local newspapers, interviews all applicants, and no-
tifies the Trenton office to place the new employee
on the payroll. The superintendent is free to disci-
pline employees but discharges must first be
cleared with the Trenton office.
The agreement provides that
On the basls of an operating scedule. job stardards, and wage rate
s
previously approved bh [Marineviesw and [NJIIFA]. [Moderate
shall inxcstigate hire, pa, anlld discharge the personnel Such
persi,nnel hall eCSer Ins(;ance he 1i [1Marinevic .1] and not [Mo d-
cratt'Cs] mpolo
1194 DECISIONS OF NATIONAL LABOR RELATIONS BO()ARI)
The current superintendent was advertised for,
interviewed, and recommended by Moderate to
Marineview for its approval. Moderate personnel
trained the new superintendent, and he obtains
many of his work assignments from the site man-
ager. The superintendent is expected to act in ac-
cordance with all of Moderate's policies and proce-
dures at the risk of discharge by Moderate. Thus,
the preceding superintendent was discharged for
failure to work up to Moderate's standards, but not
before Moderate brought in other personnel in an
attempt to retrain the individual.
Marineview has little, if any, contact with the su-
perintendent. All of its work requests for the super-
intendent are first transmitted to Moderate, which
in turn forwards them to the superintendent.
Upon the foregoing, we find, contrary to the
Acting Regional Director, that Moderate and Mar-
ineview are joint employers within the meaning of
the Act. 2
Thus, although Moderate provides no unit em-
ployees, it exercises direct control over Marine-
view's employees. Moderate, subject to Marine-
view's approval, promulgated the entire range of
employee benefits and policies. Moderate devel-
oped the guidelines for the hiring of new employ-
ees, as well as the salary schedule. And, it is Mod-
erate, not Marineview, who initiates wage increases
for the unit employees.
The project superintendent has the most direct
control of labor relations at the day-to-day level. 3
Although technically Marineview's employee, he
was selected by Moderate, trained by Moderate,
looks to Moderate for his work assignments, and is
ultimately responsible to Moderate. Indeed, in this
regard it is significant that Marineview has no con-
tact with the superintendent or the other unit em-
ployees; its only contact is through Moderate.
Therefore, while Marineview retains active and
complete control over its employees' wages, hours,
and other terms and conditions of employment by
exercising its right of approval of all labor relations
policies prior to implementation by Moderate, it is
Moderate through its daily management of the
properties which has equal, if not greater, impact
upon the terms of the employees' working condi-
tions. Such involvement is more than sufficient to
2 The case relied on by the Acting Regional irector is dislilnguiabhle
In Shannon & Luchs and Andrews Manor .locxila'z, 1Ih NlRB I(X)
(1967), the owner supplied and directed the work frce in accordance
with its own labor relations policies. The management company mnlrcly
handled financial matters and, thus, acted primarily as a bookkeeping
service, unlike Moderate in the instant case.
3 The record supports and swe adopt the parties' stipulation that the
project superintendent is a supervisor within he neaninig of the Act
confer joint-employer status upon Moderate and
Marineview. 4
With regard to the jurisdictional issue, the
Acting Regional Director found that Marineview's
labor relations policies are effectively controlled by
the State of New Jersey through NJHFA to such
an extent that meaningful collective bargaining
with Petitioner is precluded, and, therefore, that
Marineview shared New Jersey's statutory exemp-
tion. Consequently, the Acting Regional Director
dismissed the instant petition.
The record reveals that, pursuant to the mort-
gage agreement with NJHFA, Marineview for-
wards its budget, prepared by Moderate, to
NJHFA for review. Moderate determines the var-
ious budgetary needs, including wage increases,
based on its independent evaluation. There are vir-
tually no NJHFA regulations or guidelines pertain-
ing to Marineview's labor relations.5 A schedule is
submitted to NJHFA with the budget showing the
size of the work force and the expected costs, but,
again, the initial determinations are independently
made by Moderate.
The budget does not indicate that particular
funds are being used for particular employee bene-
fits such as sick leave or vacation leave. NJHFA,
upon review of the budget, has proposed modifica-
tions both upward and downward, to which the
Employers usually acquiesce. In one instance,
NJHFA suggested increasing rent beyond the level
decided on by the Employers. Once the budget has
been cleared through NJHFA, all modifications re-
quiring increased expenditures must be routed
through NJHFA. There is no evidence such modi-
fications are discouraged or are difficult to obtain.
NJHFA does not have a representative at the hous-
ing project on a daily basis. NJHFA does, howev-
er, regularly send auditors who inspect the finan-
cial records, the purchasing procedures, and the
physical condition of the buildings. The morgage
agreement makes no mention of labor relations or
of any other labor standards.
As noted above, NJHFA holds Marineview's
mortgage. The mortgage agreement sets forth the
basic requirements for selecting tenants as well as
NJHFA's right of access to all financial records,
and provides for the establishment of various ac-
4 See Ilarnlblrg Indurries. Inc, l idilith Serviccs Inc & Indusrrial I,(h-
nical Servcies, In(., 191 NlRB 67 (1971) See also Stoil Induvries, Inc..
223 NLRB 51. 53-54 (1976). Cf. idelity 14aintlnance & C(,nstrucion
('o mpany. Irl. and (C ,lutrhiu .trogcn (C'orporatiun, 173 Nl RB 1032, 1037
( I96)
Apparently, NJ II:A has an "Ilnformal" guideline of one mainteilance
nmplohyee or porter for every 60 tenants However, Moderate's president
testified tha t as free to deiate upward r dov,:iow:ard from this ratio
so lg as it could dmonstrate thilt h t buildings acre being properl
mainlained
MOI)[ERATlI INCO)NM MANAGENIEN1 CO) 1 195
counts comprised of all rents received. Disburse-
ments from these accounts are made in accordance
with the approved budget, must be documented,
and must be cleared by NJHFA before the funds
will be released by NJHFA.
NJHFA's enabling statute, the New Jersey
Housing Finance Law of 1967, N.J.S.A. 55:14J-1,
et seq., places no restrictions upon a mortgagor's
labor relations. The act permits mortgagors to
maintain an 8-percent return on their equity.
NJHFA provided Moderate and Marineview
with a standard management agreement. NJHFA
reviewed the agreement after execution, and re-
tained the right to terminate it with or without
cause upon 30 days' written notice to the parties.
Notwithstanding the terms of the agreement (see
fn. 1, supra) there is no evidence that NJHFA has
ever reviewed or disapproved the Employer's
labor policies.
Contrary to the Acting Regional Director, we
find, based on the record as a whole, that the Em-
ployers have substantial control of their labor rela-
tions and, therefore, can engage in meaningful col-
lective bargaining with Petitioner. 6
The Employers have promulgated all of their
labor relations policies subject only to their own
discretion. They alone implement the policies on a
day-to-day basis-interviewing, hiring, disciplining,
and discharging employees, setting all work sched-
ules and directing employees' work, and granting
vacation and sick leave. NJHFA neither laid down
guidelines for the Employers to follow in promul-
gating the policies7 nor is involved in any of the
day-to-day decisions. Further, there is no evidence
that NJHFA has ever approved or reviewed the
Employers' labor relations policies notwithstanding
the contractual right to do so, and there is no evi-
dence that NJHFA is ever notified of any person-
6 National Transportation Senrice, Inc., 240 N1 RI 565 (1979) he cases
relied on by the Acting Regional Director have both been overruled See
The Singer Company. Education Division. C(areer Syvremn. Detroit Job (Corp
C'enter, 240 NLRB 965, 966 (1979), overruling 7led.vne Economic Devil-
opment (ornpany. 223 NL R 1040 1976); Young Women ~l Chrlrtian ,Isvo-
ciation of Metropolitan Chiago. 235 NL.RBH 788. 789 (1978), ,serruliig
Young W8omen s Christian .-Issxiarlaion of Metroplhtal n Chicago. 221 NI RB
262 1975) In the case relied aon by the Employers, Kingshurv Corp, 22
RC-6989 (unpublished), we note that the Regional Director there applied
the then existing "intimate connection" test rejected in National Transpor-
ration, supra Additionally, we note that in Kingshury the Regional Direc-
tor relied on a section of NJHFA's Management Standards and Proce-
dures which gave NJHFA the right to review the number. types. qualifi-
cations, and rates of pay of the employees required for the proper mainte-
nance and operation of the property In the instant case, the parties did
not enter the Management Standards into esvidence; however, assuming
arguendo the Standards are still in effect, we do not believe the afioremen
tioned section to be controlling. NJHFA merely has a right of revlesA,
not approval of the Employer's policies Moreover. the evidence indi-
cates that NJHFA has never reviewed any of the Employers' labor rela-
tions policies in any context other than re tew of the budget
I In this regard, Moderate's president testified that the policies nd
benefits were all promulgated based on Moderate's past experience il
managing housing complexes.
nel actions. Rather, the evidence leads us to con-
clude that NJHFA's review of the budget is to
ensure that the Employers have adequately pro-
vided for the maintenance of the buildings and for
tenant services and, thus, adequate housing; and, at
the same time, to ensure that Marineview has real-
istically budgeted its funds so that the mortgage
loan provided by NJHFA will be repaid. Signifi-
cantly, NJHFA provides the Employers with no
operating funds-all such funds are apparently ob-
tained from rental receipts. The fact that NJHFA
reviews midterm budget modifications does not es-
tablish control over labor relations by NJHFA, for
there is no evidence that NJHFA routinely denies
or discourages midterm modifications, or that it
would attempt to do so to thwart collective bar-
gaining. Moreover, the right to review the budget,
without more, is not, in and of itself, effective con-
trol of labor relations.8
Based on the foregoing, we conclude that the
Employers do not share the State of New Jersey's
statutory exemption from jurisdiction and that it
will effectuate the purposes of the Act to assert ju-
risdiction over the employers. Accordingly, we
shall reinstate the petition and direct an election in
the unit stipulated to be appropriate by the par-
ties:9
All porters and maintenance employees em-
ployed at the Employers' Hoboken, New
Jersey, site, excluding the building superin-
tendent, office clerical employees, guards, all
other employees, and supervisors as defined in
the Act.
[Direction of Election omitted from publication.
Excelsior footnote omitted from publication.]
MEMBER JENKINS, dissenting:
The majority's finding that Moderate is a joint
employer with respect to Marineview's employees
in the stipulated unit is ill founded. The employees
are employed by Marineview, are supervised by
Marineview's project superintendent, and have
little if any contact with Moderate's supervisory or
management personnel. Moderate has its own em-
See. g, Loma Prieta Regional Center. Inc.. 241 NLRB 1071 (1'7))
Open ai.rt L.ot Operation-San Francirco International .4Airprt, 241 NRB
8()08 (1979) See also N.L.R.B. St. Louis Comprehensive .'eighborhood
lealth Center, In(. 633 F.2d 1268 (8th Cir 1980)
Even assumilg NJHFA would set outer limits for operating costs of
the property, such would not preclude collective bargaining See The
Singer Co., supra, NL.R.B. v Neighborhood Health Center. supra.
I The parties are in dispute as to whether the assistant building superin-
tendent should be excluded from the unit as a supervisor From the limit-
ed testimony, it appears that the assistant fills in for the superintendent in
the superinlendent's absence, hands out work assignments after they have
been determined hb the superintendent, directs some work, and also per-
forms uit ork As the extent of his discretion in directing work is un-
clear from the record, we shall permit this individual to vote subject to
challenge
119h DECISIONS OF NATIONAL. ILABOR RELATIONS BOARD
ployees, who are separately supervised. Moderate
and Marineview are separate enterprises having no
common ownership, directors, or officers, and nei-
ther has financial control over the other except to
the extent that their contractual relationship makes
them mutually dependent for economic advantage.
Therefore, I find insufficient basis for deeming
these two enterprises to be joint employers. Sakrete
of Northern California, Inc., 137 NLRB 1220, 1222
(1962). Moreover, all of Marineview's financial de-
cisions that could affect its conduct of labor rela-
tions are controlled by NJHFA, an exempt admin-
istrative arm of the State of New Jersey. NJHFA
must approve Marineview's budget, any modifica-
tions requiring increased expenditures, and the
rents to be charged. Thus, the range in which Mar-
ineview can make economic decisions regarding
labor relations is so circumscribed as to make it un-
realistic to suppose that it could bargain effectively
without the participation of NJHFA. In these cir-
cumstances, Marineview shares NJHFA's exemp-
tion and the Acting Regional Director properly
dismissed the petition.