Provident Life and Accident Insurance Co.

National Labor Relations Board - Board Decisions

Jun 28, 1957

118 N.L.R.B. 412 (N.L.R.B. 1957)

412 DECISIONS OF NATIONAL. LABOR: RELATIONS BOARD
Brotherhood . of Carpenters and Joiners : of America, AFL-CIO; Local 633, United
Brotherhood of Carpenters and Joiners of America , AFL-CIO; and z Local A77,
Um ud Brotherhood of Carpenters and Joiners of America, AFL-CIO, are Labor
organizations within the meaning of Section 2 (5) of the Act.
3. By maintaining and enforcing an agreement , understanding, hiring arrangement,
,and other unlawful practices with Merritt -Chapman & Scott Corporation, which
require membership in or clearance by a labor organization as a condition of em-
ployment , Respondent District Council, Local 377, and Local 633 have engaged in
;and are engaging in unfair labor practices within the meaning of Section 8 (b) (1)
^A) and Section 8 (b) (2) of the Act.
4. By causing or attempting to cause Merritt -Chapman & Scott Corporation.to
discriminate against Harold A. Hanlon , applicant for employment , in violation of
Section 8 (a) (3) of the Act, Respondents District Council, Local 377, and Local
633 have engaged in and are engaging in unfair labor practices within the meaning
of Section 8 (b) (1) (A) and Section 8 (b) (2) of the Act.
5. By imposing intraunion disciplinary action , fines, and penalties upon Harold A.
Hanlon , Henry H. Michel , and Michael J. Lesko because they filed charges with, and
furnished information against Respondent Unions to, the National Labor Relations
Board in the exercise of the rights guaranteed in Section 7 of the Act, which impaired
their opportunities for employment , Respondents District Council, Local 377, and
Local 633 have restrained and coerced and are restraining and coercing employees,
and have thereby engaged in and are engaging in unfair labor practices . within the
meaning of Section 8 (b) (1) (A) of -the Act.
6. The aforesaid unfair labor practices are unfair labor practices within the mean-
ing of Section 2 (6) and (7) of the Act.
[Recommendations omitted from publication.]
Provident Life and Accident Insurance Company and Insurance
Agents' International Union , AFL-CIO, Petitioner. Case No.
21-RC-4695. June 28,1957
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 Fred W. Davis,
.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-
member panel [Chairman Leedom and Members Murdock and
Jenkins].
Upon the entire record in this case, the Board finds :
1.,'The Employer is engaged in commerce within the meaning of
the Act.
2. The labor organization involved claims to represent certain
employees of the Employer.
3. The Petitioner seeks a unit of all full-time and part-time in-
surance agents in the western area of the Employer's railroad
department. The Employer contends that the agents are independent
contractors and not employees within the meaning of the Act.
The Employer is engaged in selling life, accident, and health in-
surance throughout the United, States. The agents involved herein
sell accident and health insurance to employee groups, principally
118 NLRB No. 53.
PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY 413
railroad employees, throughout western United States, including the
States of Texas, New Mexico, Arizona, California, Nevada, Utah,
Wyoming, and Idaho. The principal office for the Employer's.
western department is located in San Francisco, California, and is
under the direction of the west coast manager. The west coast
manager devotes 90 percent of his time to processing claims made
upon the Employer by policyholders and the remainder of his time
recruiting and training new agents and assisting and directing the
work of other agents. The only other management representative
in the western area is a supervisor of group plans, located in Los
Angeles, California. He likewise trains, directs, and assists those
agents located in the Los Angeles metropolitan area. The Employer
furnishes to all agents materials in the form of manuals, pamphlets,
and other literature designed to assist them in selling insurance.
When an agent is hired, he signs a contract which may not be
assigned without the consent of the Employer. This contract pro-
vides, inter alia, that: The agent may sell insurance only according-
to premium rates, classification of risks, and practices of the Com-
pany; he may not accept risks of any kind or make, alter, or discharge
contracts, or waive forfeiture or obligate the Company, except as
specifically set forth in the contract; the Company may withdraw any
forms or types of policies and reserves the right, under the contract,
to change its manual and premium rates; the agent must report
immediately the transaction of any business to the home office of the
Employer, and must remit any premiums to the Company before the
end of the month in which such collections are made; if an agent
fails to collect the initial or renewal premiums he shall return the-
policy to the Company, and in the event that he fails to do so may
be required to pay the pro rata earned premium whether or not it may
be collected; if an application for insurance is rejected, the agent
shall return to the applicant the sum that is due him; and the agent
shall maintain sufficient records to assure that all requirements of
the contract are met and shall furnish an indemnity bond, with
sureties approved by the Company for the faithful accounting and
transmission of moneys to the Company. The contract may be termi-
nated by either party upon 20 days' notice to the other. Upon termi-
nation of the contract all commissions are also terminated. The
commission rate is established by the Employer. A terminated agent
may not continue to use his license, which is required by State law,
until he obtains appointment with another company. He is not, how-
ever, limited to soliciting the Employer's policyholders after his
termination, nor is he limited to selling insurance for the Employer
but may sell policies for other insurance companies except that they
may not sell health and accident insurance of the type sold by the
Employer to anyone who is insured by the Employer.
414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The agents are also provided with a manual which, in addition to
prescribing premium rates, contains detailed and extensive instruc-
tions regarding, inter alia, procedures to be followed by the agents in
writing insurance applications, dealing with the policyholders re-
garding claims, selection of risks, collection of premiums, and customer
relations generally.'
Agents do not receive a minimum salary but are compensated by
commission based upon a percentage of the policyholder's premium
fee. At times, however, as required by the Employer, an agent or
group of agents may be required to canvass all the employees of a
particular employer with whom the Employer is trying to place a
group plan. In such cases the agents are paid on a salary basis.
Agents are not reimbursed for expenses incurred by them in writing
insurance.
Agents may seek business anywhere they choose and set their own
work schedules and vacations. Although the Employer asserts that
the agents do not have any established quota of business that they
are required to write, the west coast manager testified that he exhorts
the agents to increase their volume of business and notifies them of
the minimum amount of business that the Employer expects an agent
to obtain. Some of the full-time agents have been required to furnish
to the Employer weekly activity reports indicating the amount of
time. devoted to the soliciting of insurance applications.2 The Em-
ployer carries no compensation insurance, nor does it make income
tax, social security, unemployment insurance, or other deductions.
However, it has in effect a group insurance plan for full-time agents
which is financed in part by the Employer. The record reveals one
instance, in 1952, when an agent purchased the business of another
agent. No other such transaction appears in the record.
As the Board has held in many cases, the determination of whether
an individual is an independent contractor or an employee is dependent
on the common law "right to control" test.' Application of this test
requires that we find that an employer-employee relationship exists
where the person for whom the services are performed reserves the
right to control not only the end to be achieved but also the manner
and means to be used to achieve this end. It is sufficient that this
right exists, whether or not it is exercised.' Upon consideration of
all the foregoing circumstances, and particularly in view of the fact
that under their contract of employment, as implemented by the
'Although the Employer contends , in effect , that the instructions in this manual are not
mandatory upon the agent , these instructions are in many instances couched in mandatory
terms.
2 The record shows that these reports are required only . in those cases where the agent
has received advances in money against future commissions.
3 N. L. R. B. v . Phoenix Mutual Life Insurance Co., 167 F . 2d 983, cert . denied 335 U. S.
845.
4 Ibid. -
BOB SAUNDERS COMPANY 415
agents' manual, the Employer reserves and exercises the right to con-
trol many aspects of their relationship with it and with its policy-
holders, actual and prospective, we find that the full-time and part-
time agents 5 are not independent contractors but are employees within
the meaning of Section 2 (3) of the Acts Accordingly, we find that
a question affecting commerce exists concerning the representation
of employees of the Employer within the meaning of Section 9 (c)
(1) and Section 2 (6) and (7) of the Act.
4. We find that the following employees of the Employer constitute
a unit appropriate for the purposes of collective bargaining within
the meaning of Section 9 (b) of the Act :
All insurance agents, including full-time and part-time agents in
the western area of the railroad department of the Employer, exclud-
ing all other employees and supervisors as defined in the Act.
[Text of Direction of Election omitted from publication.]
c We find no merit in the Employer 's secondary contention that, in any event , its part-
time agents are not employees , but independent contractors . The record contains no evi-
dence that part-time agents are treated differently from full-time agents, except that weekly
activity reports are not required from them , they do not devote all of their time to selling
insurance , and they are ineligible for participation in the Employer 's group insurance
;plan. These circumstances are not sufficient , in'our opinion , to require a different con-
clusion as to their status.
6 See Hweet -Orr and Co ., Inc., 117 NLRB 796. We do not believe that the isolated in-
stance of the sale of an agency 5 years prior to the hearing herein is a significant factor,
standing by itself , pointing to the existence of independent contractor status.
Bob Saunders, d/b/a Bob Saunders Company, Petitioner and
United Packinghouse Workers of America , Local 78, AFL-CIO.
Case No. fO-RM-213. July 1, 1957
SUPPLEMENTAL DECISION, DIRECTION, AND ORDER
On January 4, 1957, pursuant to a Board Decision and Direction
,of Election dated December 27, 1956,' an election was conducted
herein, under the direction and supervision of the Regional Director
for the Twentieth Region, among employees in the unit heretofore
found :appropriate. Upon the conclusion of the balloting, a tally of
ballots was issued and served upon the parties in accordance with the
Board's Rules and Regulations.
The tally of ballots shows that there were approximately 65 eligible
voters; that 3 votes were cast for, and 10 votes were cast against, the
Union; and that 68 ballots were challenged.
On January 9, 1957, the Union filed objections to the conduct of the
election and to conduct affecting the results of the election. There-
after the Regional Director investigated the issues raised by the
challenged ballots and the Union's objections; and, on March 15;
1 Not reported in printed volumes of Board Decisions and Orders.
118 NLRB No. 51.