Site Oil Co. of Missouri

National Labor Relations Board - Board Decisions

Jul 13, 1962

137 N.L.R.B. 1274 (N.L.R.B. 1962)

1274 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Site Oil Company of Missouri ; Site Oil Company of Michigan,
Inc. (its wholly owned subsidiary ) ; William Vaughn, Agent of
Site Oil Company of Missouri and Site Oil Company of Michi-
gan, Inc. ( its wholly owned subsidiary ) ; Baron Herman, Agent
of Site Oil Company of Missouri and Site Oil Company of
Michigan , Inc. (its wholly owned subsidiary ) and Local 299,
International Brotherhood of Teamsters , Chauffeurs, Ware-
housemen , and Helpers of America , Ind. Case No. 7-CA-2876.
July 13, 1962
DECISION AND ORDER
On March 8, 1961, Trial Examiner Louis Libbin issued his Interme-
diate Report in the above-entitled proceeding, finding that the Re-
spondents had engaged in and were engaging in certain unfair labor
practices and recommending that they cease and desist therefrom and
take certain affirmative action, as set forth in the Intermediate Report
attached hereto. Thereafter, the Respondents filed exceptions to the
Intermediate Report and a supporting brief. On November 21, 1961,
the Board heard oral argument in this matter. The Respondents, the
General Counsel, the Charging Party, and the National Congress of
Petroleum Retailers, Inc., pursuant to invitation of the Board to cer-
tain interested parties, all participated in the oral argument. Briefs
were also filed on behalf of the Charging Party and the National Con-
gress of Petroleum Retailers, Inc.
The Board has reviewed the rulings made by the Trial Examiner at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Interme-
diate Report, the exceptions and briefs, the oral argument, and the en-
tire record in the case, and hereby adopts the findings, conclusions,
and recommendations of the Trial Examiner.
Site Oil Company, referred to herein as Site, constructed a gasoline
service station on West Eight Mile Road in Detroit, Michigan, in
August 1960. On August 10, Vaughn, until then a supervisor of Site,
began operating the station as a lessee. On August 13, four of the five
attendants employed at the station signed union authorization cards
on behalf of Local 299, Teamsters, and on August 17 the Union claimed
majority representation and requested a meeting for negotiation of a
contract. On August 20, Vaughn voluntarily terminated his lease
with Site, and Baron Herman, who had not been previously associated
with Site, began operating the station under a lease agreement similar
to Vaughn's. Herman refused to rehire one of the station attendants,
discharged three others, and hired replacements for them.
The Board agrees with the Trial Examiner's finding that the dis-
charge of these employees violated the Act and that there was a re-
fusal to bargain in violation of Section 8(a) (5) if the individual
137 NLRB No. 145.
SITE OIL COMPANY OF MISSOURI, ETC. 1275
lessee-operators were not independent contractors. The paramount
issue for which the Board granted oral argument was, therefore, the
status of the lessee-operators. In determining the status of persons
alleged to be independent contractors, the Act requires the applica-
tion of the "right of control" test.' Where the person for whom the
services are performed retains the right to control the means by which
the result is to be accomplished, the relationship is one of employment;
but where control is reserved only as to the result sought, the relation-
ship is that of independent contractor. The resolution of this question
depends on the facts of each case, and any one factor alone is not
determinative.
Site owned the gasoline station and equipment which it leased to the
lessees for an indefinite period, subject to termination upon 30 days'
notice by either party. The lease also gave Site the additional option
of terminating the lease upon 24 hours' notice if the station was being
operated contrary to its terms. The lease required the lessee to devote
full time to operating the station and to accept no outside work. The
lessee obligated himself to pay a rental of 1 cent per gallon for all
gasoline sold; to accept all products delivered by Site on a consign-
ment basis; to keep inventory of all merchandise on hand; to make a
daily sales report on Site forms; and to remit daily on all sales of
Site products. Other provisions of the lease required the station to
be open 24 hours a clay and for attendants to wear standard Site uni-
forms; that the lessee would not sell any other products without the
written approval of Site; and that Site would set both the wholesale
and retail prices for its gasoline and oil products.
Herman's operation of the station conformed to the requirements
of the lease. Title to the inventory and supplies remained with Site.
He submitted a daily report to Site and deposited a part of the re-
ceipts, in payment of his account, to the credit of Site in a local bank.
He submitted a weekly inventory report to Site at which time the
necessary adjustments in amounts due were computed. Herman also
sold a number of items such as cigarettes, packaged coal and wood, and
auto accessories. He also owned certain small tools which were used
at the station. Site paid all utilities and the cost of a business license
while Herman paid the sales tax on all items except gasoline and oil.
Herman sold the gasoline at the prices established by Site but was in
fact permitted to sell oil at prices which he himself determined. The
only identification at the station was that of Site.
We are satisfied that Site reserved for itself extensive control over
Herman's daily operation. This is manifested primarily by the terms
of the lease which established the hours of operation, the price of
his principal product, gasoline, and the requirement that all other
'Golden Age Dayton Corporation, 124 NLRB 916; C J. Patterson d/b/a .Serv-Us
Bakers of Oklahoma, 121 NLRB 84 ; Albert Lea Cooperative Creamery Association, 119
NLRB 817
1276 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
products which Herman wished to sell could normally be handled only
upon prior approval by Site .2 Furthermore, the control which Site
exercised by virtue of the lease extended also to the lessee's capital
investment and opportunity for profit. No investment was required
for the lessee's major lines of products, since the gasoline and oil were
consigned to him.' While Herman did purchase other items for sale
at the station, his investment therein was small and was subject to the
approval of Site. With respect to the major product sold, gasoline,
the lessee's remuneration was in effect no more than a commission as
Site set both the price which the lessee was to pay and the price at
which he was to sell. Those items which Herman was permitted to
purchase in his own discretion could not have constituted a major part
of his income and were undoubtedly made available as convenience
items in order to encourage patronage at the station and the sale of
its petroleum products.
In view of the extensive control exercised or reserved by Site over
all the aspects of the lessee's operations, we conclude that the lessees
were not independent contractors but were employees of Site so that the
individuals under their control were also Site's employees.4
THE REMEDY
At the oral argument, counsel for Site stated that the station in-
volved here, which Herman had been operating as lessee, has been de-
stroyed by fire and that it was uncertain whether it would be rebuilt.
Consequently, the remedial order recommended by the Trial Examiner
must be changed in certain respects. The obligation of the Respondent
to bargain with the Union as exclusive representative of the service
station attendants at Respondent's West Eight Mile Road station is
hereby conditioned upon the resumption of business at that station.
The rights of the four discriminatees to backpay will run from the
date of the discrimination against them until the date when the West
Eight Mile Road station was shut down by the fire. If the station has
since been rebuilt, their backpay will run from the date of such re-
opening until 5 days after an offer of reinstatement to them has been
made, less their net earnings during the periods in which Respondents
were obligated to employ them. If the Respondent does not intend to
resume operations at the West Eight Mile Road station, its reinstate-
ment and backpay liability will be terminated as of the date operations
2 Like the Trial Examiner, we regard the Site Policy for Service, which was posted on
the premises, as an indication of Site's concern and right of ultimate control over the
daily operations of the station. The Site Policy for Service sets out detailed instructions
to the employees on how to conduct themselves with patrons.
8 Although Herman was required to make a $1,500 cash deposit upon signing the lease,
we view this as a security deposit to insure performance rather than as an investment of
capital since the entire amount would be returned to the lessee upon termination of their
business relationship.
4 We agree with the Trial Examiner's conclusion that this case, on its facts, is dis-
tinguishable from Clark Oil & Refining Corporation, 129 NLRB 750.
SITE OIL COMPANY OF MISSOURI, ETC. 1277
ceased. We also reserve the right to modify our Order if there is a
substantial change of conditions in the future or to clarify its appli-
cation to specific circumstances which are not now apparent. Bermuda
Knitwear Corporation, 120 NLRB 332.
ORDER
Upon the entire record in the case, and pursuant to Section 10(c)
of the National Labor Relations Act, as amended, the National Labor
Relations Board hereby orders that the Respondents, Site Oil Com-
pany of Missouri and Site Oil Company of Michigan, Inc., Detroit,
Michigan, their officers, agents (including Baron Herman), successors,
and assigns, shall :
1. Cease and desist from :
(a) Discouraging membership in Local 299, International Brother-
hood of Teamsters, Chauffeurs, Warehousemen, and Helpers of Amer-
ica, Ind., or in any other labor organization, by discharging or refusing
to reemploy their employees, or by discriminating in any other manner
in regard to their hire or tenure of employment or any term or condi-
tion of employment.
(b) Refusing to bargain collectively with respect to rates of pay,
wages, hours of employment, and other terms and conditions of em-
ployment with the above-named Union as the exclusive representative
of all their employees in the following appropriate unit :
All gasoline service station employees at Respondents' West Eight
Mile Road, Detroit, Michigan, station, excluding supervisors as de-
fined in the Act.
(c) Promising employees wage increases and other economic bene-
fits if they would repudiate the Union and threatening employees with
loss of employment in order to defeat the Union.
(d) In any other manner interfering with, restraining, or coercing
employees in the exercise of the right to self-organization, to form
labor organizations, to join or assist the above-named or any other
labor organization, to bargain collectively through representatives of
their own choosing, and to engage in other concerted activities for the
purposes of collective bargaining or other mutual aid or protection, or
to refrain from any or all such activities, except to the extent that
such right may be affected by an agreement requiring membership in
a labor organization as a condition of employment, as authorized by
Section 8(a) (3) of the Act, as modified by the Labor-Management
Reporting and Disclosure Act of 1959.
2. Take the following affirmative action which the Board finds will
effectuate the policies of the Act :
(a) Upon request, bargain collectively with Local 299, Interna-
tional Brotherhood of Teamsters, Chauffeurs, Warehousemen, and
Helpers of America, Ind., if and when operations at the West Eight
1278 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Mile Road station are resumed, as the exclusive representative of the
employees in the above-described appropriate unit with respect to
rates of pay, wages, hours of work, and other terms and conditions of
employment, and embody in a signed agreement any understanding
reached.
(b) Offer to Calvin Peacock, Arthur Whiteus, Wilbur Stone, and
Ronald Slone immediately and full reinstatement to their former or
substantially equivalent position, without prejudice to their seniority
and other rights and privileges, and make them whole for any loss of
earnings each may have suffered as a result of the discrimination
against him, in the manner set forth in the sections of the Intermediate
Report and of this Decision entitled "The Remedy."
(c) Preserve and, upon request, make available to the Board or its
agents, for examination and copying, all payroll records, social se-
curity payment records, timecards, personnel records and reports,
and all other records necessary to analyze the amount of backpay due
under the terms of this Order.
(d) Post at their West Eight Mile Road gasoline service station,
if and when it resumes operation, in Detroit, Michigan, copies of the
notice attached hereto marked "Appendix." I Copies of said notice,
to be furnished by the Regional Director for the Seventh Region,
shall, upon being duly signed by the Respondents' representatives, be
posted by them immediately upon receipt thereof, and be maintained
by them for 60 consecutive days thereafter, in conspicuous places,
including all places where notices to employees are customarily posted.
Reasonable steps shall be taken by the Respondents to insure that
said notices are not altered, defaced, or covered by any other material.
(e) Notify the Regional Director for the Seventh Region, in writ-
ing, within 10 days from the date of this Order, what steps have been
taken to comply herewith.
MEMBERS LEEDOM and RODGERS, dissenting :
The controlling issue in this case is whether the lessee of Site, at
the location here involved, is an employee of Site or an independent
contractor. On the record facts, we would find that the lessee is an
independent contractor, and consequently that the employees under
his control are his employees and not those of Site. In reaching a
contrary conclusion, and holding that the lessee is an employee of
Site, our colleagues have, in our opinion, incorrectly applied the
applicable precedents.
As our colleagues state, Board precedent supports the application of
the "right of control" test, in determining whether individuals are
5 This notice is amended by substituting for the words "The Recommendations of a
Trial Examiner" the words "A Decision and Order." In the event that this Order is en-
forced by a decree of a United States Court of Appeals, there shall be inserted before the
words "Pursuant to a Decision and Order " the words "Pursuant to a Decree of the
United States Court of Appeals , Enforcing an Order."
SITE OIL COMPANY OF MISSOURI, ETC. 1279
employees or independent contractors. While our colleagues also
properly state that each case turns on its own facts, we believe that in
reaching their conclusions they have taken a limited view of the facts.
Since it is the total situation which is determinative, the elements to
be considered should include not only the control exercised, but also
the risks undertaken, and the existence or nonexistence of opportunity
for profit resulting from the exercise of sound judgment by the indi-
viduals concerned 6
In assessing the total situation, we think it essential to allude to
these additional facts, which we deem significant. Thus, it is clear
that Site neither exercised nor purported to exercise control over the
lessee's day-to-day operations, inasmuch as Site's district supervisor
visited the station only once every 2 weeks, and then primarily for the
purpose of taking orders for products and distributing promotional
materials; and although Site may have been concerned with how the
lessee's employees conducted themselves, the lessee was under no obli-
gation to adhere to Site's suggestions as to service policy. In addition,
it was the lessee, and not Site, who (1) paid the premiums for the
fidelity bond and holdup insurance; (2) assumed any liabilities result-
ing from the operation of the station ; (3) determined the personnel
needs of the station, hired and discharged employees, and set the
employees' wages and hours, all without consulting Site; and (4) paid
social security taxes with respect to their employment. Finally, it
was the lessee, and not Site, who ran the risk of operational losses
and would benefit from operational profits. These are all elements
signifying an independent contractor relationship.
When the total situation, including the foregoing facts, is consid-
ered, the picture emerges of a station operator who, although subject
to certain controls, was nevertheless free to exercise his independent
operational judgment in the significanct areas which would determine
whether he made a profit or incurred a loss. The unit profit on gasoline
and oil was controlled by Site. Otherwise, whether, and the extent to
which, the station was operated at a profit or a loss, depended on the
amount of capital which the lessee had to invest in additional income-
producing items, and on the lessee's ability to minimize his operating
costs and to maximize his sales of other products, as well as Site's.
This case is, in our opinion, controlled by the Clark Oil case,' and
we cannot agree with our colleagues' attempt to distinguish it. In
Clark, the Board, in finding an independent contractor relationship,
relied in part on the fact that Clark's lessees were required to invest
from $800 to $1,400. Here, too, Site's lessee, Herman, was required to
6 U S. v Silk, doing business as Albert Salk Coal Co , 331 US 704, 718-719; National
Van Lines, Inc. v N L.R.B , 273 F 2d 402, 403-404 (C.A. 7) ; United Insurance Company
of America v. N L.R.B., 304 F. 2d 86 (CA 7).
7 Clark Oil & Refining Corporation , 129 NLRB 750.
1280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
make a substantial investment, in the amount of $1,500, in order to
secure the lease; and however it be named, the fact of the investment
remains, as does the fact that this lessee made other substantial in-
vestments, indicated an intention to purchase items such as tires and
batteries from suppliers other than Site, and in fact did purchase other
items, such as cigarettes, raincoats, and soft drinks, from suppliers
other than Site. Neither is the fact that Clark's lessees, unlike Site's,
could theoretically purchase gasoline and oil from other suppliers, a
valid basis for distinction. In Clark, the station rental was a nominal
$1 per month if the lessee purchased gasoline from Clark, but became
3 cents per gallon of gasoline sold if the lessee purchased the gasoline
elsewhere. This prohibitive rental differential insured as a practical
matter that Clark's lessees, like Site's, would purchase gasoline from
the lessor.
As the total picture reflects an independent contractor relationship,
we must disagree with our colleagues' conclusion that Site's lessee at
this station was an employee of Site. It seems to us that our col-
leagues' conclusion results from a too-limited view of the applicable
test and an attempt to distinguish the indistinguishable. Because of
this, their decision here can only cause uncertainty in the application
of the Act and will necessarily have an unsettling effect on a great
number of long-established relationships.
As the record fails to establish that the lessee's operations, con-
sidered separately from Site's, satisfy the applicable jurisdictional
standards, we would, accordingly, dismiss the complaint.
APPENDIX
NOTICE TO ALL EMPLOYEES
Pursuant to a Decision and Order of the National Labor Relations
Board, and in order to effectuate the policies of the National Labor
Relations Act, as amended, we hereby notify you that :
WE WILL NOT discourage membership in Local 299, Interna-
tional Brotherhood of Teamsters, Chauffeurs, Warehousemen,
and Helpers of America, Ind., or in any other labor organization,
by discharging or refusing to reemploy any of our employees or
by discriminating in any other manner in regard to their hire and
tenure of employment or any term or condition of employment.
WE WILL NOT promise employees wage increases or other eco-
nomic benefits if they would repudiate the Union, nor will we
threaten employees with loss of employment in order to defeat
the Union.
WE WILL NOT in any other manner interfere with, restrain, or
coerce employees in the exercise of the right to self-organization,
SITE OIL COMPANY OF MISSOURI, ETC. 1281
to form labor organizations, to join or assist the above-named or
any other labor organization, to bargain collectively through
representatives of their own choosing, and to engage in any other
concerted activities for the purpose of collective bargaining or
other mutual aid or protection, or to refrain from any or all such
activities, except to the extent that such right may be affected by
an agreement requiring membership in a labor organization as
a condition of employment as authorized in Section 8(a) (3) of
the Act, as modified by the Labor-Management Reporting and
Disclosure Act of 1959.
WE WILL offer to the following named employees immediate and
full reinstatement to their former or substantially equivalent
positions, without prejudice to their seniority and other rights
and privileges, and make each whole for any loss of pay he may
have suffered by reason of the discrimination against him :
Calvin Peacock Wilbur Stone
Arthur Whiteus Ronald Slone
WE WILL, upon request, bargain collectively with Local 299,
International Brotherhood of Teamsters, Chauffeurs, Warehouse-
men, and Helpers of America, Ind., as the exclusive representa-
tive of all employees in the appropriate bargaining unit described
below with respect to rates of pay, wages, hours of employment,
and other terms and conditions of employment, and embody in
a signed agreement any understanding reached. The bargaining
unit is:
All gasoline service station employees at our West Eight
Mile Road, Detroit, Michigan, station, excluding supervisors
as defined in the Act.
All our employees are free to become, remain, or to refrain from
becoming or remaining, members in the above-named or in any other-
labor organization.
SITE OIL COMPANY OF MISSOURI; SITE
OIL COMPANY OF MICHIGAN, INC. (ITS
WHOLLY OWNED SUBSIDIARY) ; AND
THEIR AGENT BARON HERMAN,
Employer.
Dated---------------- By-------------------------------------
(Representative ) (Title)
This notice must remain posted for 60 days from the date hereof,.
and must not be altered, defaced, or covered by any other material.
Employees may communicate directly with the Board's Regional
Office, Industrial Building, 232 W. Grand River, Detroit, Michigan,,
649856-63-vol. 137-82
1282 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Telephone Number, Woodward 2-3830, if they have any question
concerning this notice or compliance with its provisions.
INTERMEDIATE REPORT AND RECOMMENDED ORDER
STATEMENT OF THE CASE
Upon charges filed by Local 299, International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen, and Helpers of America, Ind., herein called the Union, against
the Respondents Site Oil Company of Missouri and Site Oil Company of Michigan,
Inc., the General Counsel of the National Labor Relations Board, by the Regional
Director for the Seventh Region (Detroit, Michigan), issued his complaint, dated
October 14, 1960, alleging violations of Section 8(a)(1), (3), and (5) of the
National Labor Relations Act, as amended. With respect to the unfair labor prac-
tices, the complaint alleges, in substance, that Respondents (1) discharged four
named employees because of their union and concerted activities, (2) refused to
recognize or deal with the Union which represented a majority of their employees
in a designated appropriate unit, and (3) engaged in specified acts of interference,
restraint, and coercion In their duly filed answers, as amended at the hearing, Re-
spondents admit certain jurisdictional and other allegations in the complaint but
deny the commission of any unfair labor practices.
Pursuant to due notice, a hearing was held before Trial Examiner Louis Libbin
at Detroit, Michigan, on November 30, 1960. The General Counsel and the Re-
spondents appeared and were represented at the hearing and were afforded full op-
portunity to be heard, to examine and cross-examine witnesses, to present oral argu-
ment, and to file briefs. On February 2, 1961, the Respondents and the General
Counsel filed briefs which I have fully considered.
Upon the basis of the entire record I in the case, and from my observation of the
witnesses and their demeanor, I make the following:
FINDINGS OF FACT
1. THE BUSINESS OF RESPONDENTS SITE OIL COMPANY
Site Oil Company of Missouri is a Missouri corporation. Site Oil Company of
Michigan, Inc., a Michigan corporation, is a wholly owned subsidiary of Site Oil
Company of Missouri. Both corporations, herein jointly referred to as Site or
Respondent Site, have their principal offices at the same location at Clayton, Missouri.
They are both engaged in the purchase, sale, and distribution of oil and petroleum
products and in the operation of gasoline stations, and are affiliated businesses with
common officers, ownership, directors, and operators.
During the calendar year 1959, Site Oil Company of Missouri did a gross volume
of business in excess of $1,000,000. During the same period it purchased, transferred,
and delivered to its various gasoline stations oil, petroleum, and related products,
valued in excess of $50,000, which were purchased and transported to said gasoline
stations directly from suppliers located in States other than the States within which
the particular gasoline stations being supplied were located. During the calendar
-year 1959 Site Oil Company of Michigan, Inc., transferred and delivered to its
Michigan gasoline stations oil, petroleum, and related products, valued in excess of
$50,000, which were purchased and transported to said gasoline stations from sup-
pliers located in the State of Michigan, which suppliers had received said oil, petro-
leum, and related products directly from States other than the State of Michigan.
Upon the above admitted facts, I find, as Respondents admit, that at all times
material herein, Respondents Site Oil Company of Missouri and its wholly owned sub-
sidiary, Site Oil Company of Michigan, Inc., at all times material herein, constitute
a single integrated enterprise engaged in commerce within the meaning of Section
2(6) and (7) of the Act.
H. THE LABOR ORGANIZATION INVOLVED
The complaint alleges, the answers admit, and I find that Local 299, International
Brotherhood of Teamsters, Chauffeurs, Warehousemen, and Helpers of America, Ind.,
is a labor organization within the meaning of Section 2(5) of the Act.
' On January 30, 1961, the General Counsel filed a motion to correct the record in one
specific respect. As the Respondents have filed no objections, the motion is granted and
the record is hereby corrected in accordance therewith. Said motion will be marked
"General Counsel's Exhibit No. 14" and will be placed in the official exhibit folder.
SITE OIL COMPANY OF MISSOURI, ETC. 1283
III. THE UNFAIR LABOR PRACTICES
A. Introduction; the issues
Respondents Site Oil Company of Missouri and Site Oil Company of Michigan,
Inc., its wholly owned subsidiary, are herein jointly referred to as Site or Respondent
Site. Early in August 1960, Site completed the construction of -a new gasoline
station at West Eight Mile Road in Detroit, Michigan. Respondent Vaughn began
operating this station on August 10 under a lease agreement with Site. On August 13,
four of the five attendants employed at the station signed union authorization cards.
On.August 17, the Union sent a telegram to Site, claiming majority representation and
requesting a meeting to negotiate a contract. On August 20, Vaughn terminated his
lease agreement and Respondent Herman began operating the station under a similar
lease agreement with Site. Herman retained three of the four employees who had
signed union authorization cards. Shortly thereafter, Herman discharged these three
employees.
The issues litigated in this proceeding are: (1) Whether Respondents Vaughn and
Herman were employees of Respondent Site or independent contractors when they
operated the gasoline station at West Eight Mile Road in Detroit, Michigan; (2)
whether the discharge of the four union adherents was violative of Section 8(a) (3)
of the Act; (3) whether Site's refusal to recognize and deal with the Union was viola-
tive of Section 8(a)(5) of the Act; and (4) whether Site engaged in independent
acts of interference, restraint, and coercion violative of Section 8(a)( I) of the Act
through the conduct of Vaughn and Herman. All parties agree that the dispositive
issue is whether Vaughn and Herman were employees of Site or independent
contractors.
B. Sequence of events 2
Prior to August 9, 1960, William Vaughn had been employed by Respondent Site
as regional supervisor under Regional Manager Denzil Hildebrandt. Both were ad-
mittedly supervisors within the meaning of the Act. About that time Site had com-
pleted the building of a new gasoline station at West Eight Mile Roard in Detroit,
Michigan. During the preceding week, Hildebrandt and Vaughn spent most of their
time at this station and hired two of the employee attendants. On August 9, Vaughn
executed a lease agreement with Site for the operation of this station, with the oral
understanding that he could resume his position as regional supervisor for Site when-
ever he decided not to continue as operator of the station. The lease was signed on
behalf of Site by Hildebrandt and Ward, regional sales manager for Site. The sta-
tion started to pump gas on August 10, and by August 12 Vaughn had five attendants
working at the station.3
1 Employees organize; Union claims majority representation and requests
contract negotiations
Pursuant to a telephone call from employee Calvin Peacock concerning union
organization, Union Organizer John Whittenberg appeared at the station on the eve-
ning of August 12 and inquired for Peacock. When he learned that Peacock was not
on duty that evening, he returned the following evening, August 13, and spoke to all
the employees except Page After explaining the benefits of a union, the four em-
ployees signed union membership application and authorization cards that evening.
On August 17, the Union sent a telegram addressed to Site's Regional Manager Hilde-
brandt at the West Eight Mile Road station in Detroit, claiming to represent a major-
ity of the station's employees and requesting a meeting to negotiate a collective-
bargaining agreement covering the employees. The telegram warned against taking
any discriminatory action against the employees and expressed the hope of an early
reply.
2. Vaughn's conduct following receipt of telegram
The Union's telegram was received at the West Eight Mile Road s4ation about 2:30
p.m. on August 17. Immediately after reading the telegram, Vaughn had a conversa-
tion with employee Dan Page in ,the office. Vaughn stated that "these fellows never
give us a chance to even open up the station before they went in the union," and ex-
pressed a desire to meet their committeeman or steward to see if he could not offer
2 Unless otherwise Indicated , the factual findings in this section are based on admissions
and credible evidence which Is uncontradicted.
3 These were Arthur Whiteus , Wilbur Stone , Dan Page , Ronald Slone , and Calvin
Peacock
1284 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
them a better deal than the Union did. Vaughn then asked Page if he had signed up
with the Union , and Page replied that he had not.
Employee Peacock, who was preparing forms for use on his shift which started
about 3 p .m., overheard Vaughn 's statements to Page. Peacock at that point volun-
teered the fact that he was one of those who had signed up with the Union . Vaughn
then asked Peacock why he had signed up. Peacock replied that it was to get job
security and better benefits.
Shortly thereafter , Vaughn called Site 's main office in St. Louis and attempted to
talk to Regional Manager Hildebrandt . In Hildebrandt 's absence , Vaughn informed
Regional Sales Manager Ward , one of the signers of the lease on behalf of Site, as
to what had transpired . Hildebrandt was informed at the St. Louis office of the re-
ceipt of the Union's telegram by Vaughn and later that day telephoned Vaughn who
read the telegram over the telephone . During the course of one of the above tele-
phone conversations , Vaughn stated that all the boys except Dan Page and Wilbur
Stone had joined the Union and that he thought that Peacock was the instigator of
the union activity ; urged that Hildebrandt return to Detroit as quickly as possible;
and suggested that Page be placed in charge of the station.
Beginning that night Vaughn for the first time called the attention of the employees
to a document , entitled "Site Policy For Service," which contained detailed instruc-
tions for employees to follow in waiting on customers .4 Vaughn stated that this
was the company policy and that he wanted the employees to follow these rules. The
document was then posted on the inside door of the supply cabinet to which em-
ployees had frequent occasion to go. The next morning Vaughn told Page that he
could defeat the Union if he could get five persons to lease the station with hun as
copartners.
3. Vaughn gives up operation of station and Baron Herman signs lease as operator-
On Thursday, August 18, Vaughn informed Hildebrandt that he no longer wished
to operate the station and would like to go back to his former job as regional super-
visor for Site, and suggested that Hildebrandt lease the station to Baron Herman who
had evidenced some interest in the station. On August 19 Hildebrandt met Baron
Herman at the station for the first time and negotiated a lease for the operation of
the station. On August 20, Herman executed a lease similar to the one executed by
Vaughn and about 3 p.m. assumed the operation of the station.
About that time Vaughn told all the employees except Slone, in the presence of
Herman and Hildebrandt, that he was terminating their employment because he was.
leaving the station, that Herman was the new lessee, and that Herman would decide
whether to rehire them. Slone was not in this group because he was not due to,
report until 11 p.m. When Slone reported that night, Vaughn was still at the station;
Herman, however, was not present. Vaughn told Slone that he was no longer the
operator of the station and was terminating Slone's employment. He also advised
Slone to remain and work his shift that night, and stated that Herman would hire
him the next morning.
4. The failure to reemploy Peacock
Calvin Peacock was the only employee not taken over by Herman. About 3 p.m.
on August 20, Herman told Peacock that he had "no use" for Peacock and that he
had another man whom he was going to bring in to take Peacock's place. Instead,
Stone, who had already worked an 8-hour shift that day, was asked to work an addi-
tional 8 hours, taking over Peacock's shift. A new employee by the name of Don
Janowski did not begin working until Monday, August 22.
5. Herman's conduct; the discharge of the remaining union adherents
After Herman became operator of the station, Hildebrandt spent the first week
with him and remained at the station throughout the "Grand Opening," which oc-
curred on the weekend of August 27. On or about August 22, Herman told em-
ployees Whiteus and Stone that he did not want the Union at the station, that, while
they had a right to vote as they pleased, he would give them increases in salary and
commissions on sales if they would vote against the Union.
On the evening of August 23, Union Representative Whittenberg, accompanied
by Peacock, went to the station to see Herman. Whittenberg introduced himself
as a representative of the Union and asked Herman if he could not put Peacock back
to work. Herman declined on the ground that he had to make jobs for those who,
had loaned him money to get started. Whittenberg specifically named Whiteus, Stone,.
'Copy is attached to this report marked "Appendix B."
SITE OIL COMPANY OF MISSOURI, ETC. 1285
and Slone as being members of the Union and warned Herman not to discriminate
against them.5
On Friday, August 26, on the eve of the "Grand Opening," Herman discharged
these three remaining union members. Hildebrandt was present at the station at
the time. Herman told the three employees that he had borrowed money from
friends who were asking him for jobs and he therefore had to let them go for that
reason . The "Grand Opening" operation was accomplished by three employees, with
the volunteer help of friends and neighbors . Three new employees were hired
- during the following week.
6. State mediation board meeting
At a meeting of the State mediation board on August 30, attended by Herman and
several union representatives , Herman stated that the reason the men were dis-
charged was because he had to give the jobs to friends from whom he had borrowed
money and whom he had to take in as partners . 6 He refused to discuss the matter
any further or to recognize the Union.
7. Further contacts with Herman 7
About 10 days after the State mediation board meeting , Union Representatives
'Whittenberg and Haggerty went to the station and attempted to discuss union recogni-
tion with Herman . Herman refused to discuss union recognition , stating that all the
employees were investors in the station and therefore were partners . At this point
Whittenberg pointed to one of the colored attendants and asked whether he was a
partner too. Herman replied in the negative but added that they were thinking
about it.
About 2 weeks later , when Union Representative Haggerty again drove up to the
station , Herman came out to the car , stated that he was having nothing to do with
the Union , and walked away.
C. Status of station operator and attendants
All Respondents concede in their brief , as previously noted, that the real dis-
positive issue is whether the station operator of the West Eight Mile Road station is an
employee of Site or an independent contractor . This is so because they recognize,
as the case was litigated , that the attendants employed at the station , who are the
subject matter of the unfair labor practice charges, would be employees of Site only
if the station operator were not an independent contractor . We first turn to a con-
sideration of the leases and manner in which the stations operated.
1. The leases executed between Site and Vaughn and Herman
Insofar as pertinent , the leases provide as follows:
The lease covers the service station and equipment in the station , to be used for
the specific purpose of a gasoline service station and limited services pertaining
thereto . It runs for an indefinite period but is terminable by either party upon 30
days' notice and further gives Site the option of terminating on 24 hours ' notice if
the station is not operated according to the terms of the lease or if the station is not
operated "in accordance with the proper business methods as are commonly followed
5 The findings in this paragraph are based on the credited testimony of Whittenberg
and Peacock . Herman admitted having discussed with Whittenberg the reasons for not
having taken Peacock over along with the others He denied being told at that time that
the other three employees were members of the Union and testified that he did not learn
that until it was mentioned at the mediation board meeting held on August 30. Herman
-did not testify in a frank and candid manner He admitted that the reasons he gave the
-employees for their discharge were not the true reasons Moreover, it is undisputed that
about August 22 he told Whiteus and Stone that he did not want the Union in the sta-
tion and offered them wage increases and commissions if they would vote against the
Union, as found in the text Under all the circumstances , including the demeanor of the
witnesses , I do not credit Herman's denials
9 This finding is based on the credited testimony of Whittenberg and the stipulated
testimony of Martin Haggerty, another union representative. Herman merely testified
that he did not remember giving that as the reason , that he believes the reason he gave
was that he wanted to bring in employees of his own choosing , and that he cannot remem-
ber whether he said anything else.
I The findings in this section are based on the credited testimony of Whittenberg and
the stipulated testimony of Haggerty.
1286 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
in operating a retail gasoline service station." In this connection the lessee agrees
to accept no outside work and to devote his full time to operating the station. As
rental the lessee is to pay 1 cent per gallon for all gasoline sold. All products, in-
cluding gasoline, are to be delivered to the lessee on consignment, with the require-
ment that the lessee keep a perpetual inventory of all merchandise on hand, showing
daily sales, and that he make a daily report on Site's report form and remit daily to
Site on all sales made by him of Site's products. The lessee is prohibited, on penalty
of automatic cancellation of the lease, from offering for sale or from purchasing any
products from anyone other than Site, without Site's prior written approval. The
lessee agrees that Site will establish he retail price on its products which Site can
change from time to time. The lease then sets forth the specific retail price which
the lessee is to charge for gasoline, and the lessee agrees that he will immediately
change the retail price upon 1 hour's notice from Site. The lease sets forth the price
which Site is to charge lessee for Site's gasoline and other products. The lessee agrees
to pay for all expenses of operating the station, except for utilities and the necessary
business licenses required to sell Site's products. The lessee also agrees to collect
sales tax on all consigned merchandise, except gasoline and oil, and to remit and
report paid taxes on Site's daily report. The lessee assumes the payment for gasoline
shortages in excess of normal shrinkage and Site is given the right to have its agents
enter the station to make an audit at any time to determine any gasoline shortages
or any other discrepancies in the account between Site and the lessee. The premises
may not be assigned, transferred, conveyed, or subleased without Site's written per-
mission. The lessee is prohibited from using the premises as a garage or parking lot,
from doing heavy repair, and from having pets, TV, female attendants, lessee's
children on the premises, and pinball or vending machines not authorized by Site.
Any of the foregoing practices "shall be construed as being in violation of this con-
tract." The lessee agrees to keep the station open 24 hours daily and that all
personnel at the station wear standard "Site" uniforms. The lease provides that the
lessee shall indemnify and hold Site harmless from any claims, suits, loss, and liabil-
ity resulting from the operation of the station by the lessee or his assistants or em-
ployees, and that it is agreed that the lessee is an independent contractor and shall
at no time pledge the credit of Site or hold himself out as Site's agent or employee.
The lessee agrees to carry holdup insurance , and to guarantee the performance of
the contract by depositing with Site a cash sum of money 8 and to pay an additional
annual premium of $50 for a fidelity bond. Site is given the right to proceed on the
fidelity bond if the performance guarantee is insufficient to pay Site's claims
2. The operations of Vaughn and Herman under the leases
As previously found, Vaughn operated the station only for 10 days and then re-
sumed his former position as a Site regional supervisor. The only money he paid
Site when he executed his lease was $50, which was returned to him when he gave
up the lease. Herman deposited with Site a cash bond of $1,500 to guarantee per-
formance of the lease.
All inventory and supplies on hand were taken over by both Vaughn and Herman
on a consignment basis, with title remaining in Site. All gasoline and other merchan-
dise thereafter delivered by Site to Vaughn and Herman were also on a consignment
basis, with title remaining in Site. They were responsible for receipts from sales of
such merchandise only after such sales had been made. Herman regarded Site's
retail price list for oil and accessories as suggestive and deviated from the listed
price on occasion. This was not true, however, with respect to the retail price for
gasoline specified in the lease. Herman is required to accept Site credit cards sub-
mitted by customers. Each day's receipts were picked up by Brinks daily and
deposited to Site's account in a local bank. Herman submitted to Site a detailed
weekly inventory together with notices of deposits. Herman also sold cigarettes and
packaged coal and wood, which were not purchased from Site. Regional Manager
Hildebrandt encouraged Herman in the sale of cigarettes as a business promotional
scheme.
The only identification appearing anywhere on the station is that of Site. Neither
Herman's nor Vaughn's name appeared anywhere on the station, although Herman
had registered under the Michigan Assumed Name Act as "Baron Herman Site
Service." Everyone employed at the station wears "Site" uniforms. The station
has been kept open 24 hours daily and only male attendants have been employed.
Herman and Vaughn hired and fired employee attendants who worked at the station
8 Herman's lease required a cash sum of $1,500 ; Vaughn's lease required no immediate
deposit but required the payment of $50 a month thereafter until a deposit of $1,000 was
built up with Site.
SITE OIL COMPANY OF MISSOURI, ETC. 1 287
and paid them from their own personal bank account. Herman withheld the income
and social security taxes from the wages of these employees and made the returns
on them. Posted on the inside door of the supply cabinet, where the pumping licenses
are also posted and where the employees have frequent occasion to go, are a set of
rules entitled "Site Policy For Service." These rules contain detailed instructions
on how to render service to a customer. Vaughn told employee attendants that
these rules were the company policy which he wanted them to follow. Herman
admitted that these rules continued to be posted in the same place after he assumed
the operation of the station and were still there as of the date of the hearing herein.
Herman pays State sales taxes only on items not purchased from Site; all other sales
taxes collected by him are transmitted to Site for payment by it. Site pays for elec-
tricity, illuminating and heating gas, telephone, property taxes, and the business license
fee. The station is visited periodically by Site's supervisors who take orders for ac-
cessories and merchandise, and make suggestions with respect to the appearance
of the station and the display of advertising. Herman has not always followed these
suggestions. One of the admitted functions of the regional supervisor was to make
sure that the station was not overstocked.
3. Concluding findings
In this case, as in most cases, there exist factors which point to both an employer-
employee relationship and to an independent contractor status. A determination
must be made as to what extent, if any, Site has reserved the right to control the
manner and means of operating the station. For it is the retention of this right
of control, and not the actual exercise of the control, which is the test of an employer-
employee relationship. The resolution of this question depends on the facts of
each case and no one factor is determinative. Thus the Board has held that neither
the precise terminology used by the parties in describing their relationship, nor the
fact that the operator is not on Site's payroll, receives no vacations and holidays,
and does not have social security and income tax deductions withheld by Site, nor
the fact that the operator hires attendants whom he pays out of his own earnings
and makes and remits the required social security and income tax deductions from
their wages, are controlling on their status as independent contractors .9
The parties do not quarrel with the foregoing established Board principles but are
in disagreement as to their application to the facts in this case. The Respondents
contend that the instant case is controlled by a recent decision of the Board in
Clark Oil & Refining Corporation, 429 NLRB 750, herein called Clark, in which
the Board held that gasoline station dealers were independent contractors. After
considering the provisions of the leases executed by the parties and the manner
in which the stations were operated, the Board concluded in the Clark case that
"the Respondent neither exercises nor has the right to control the manner or means
of performance by the dealers." The General Counsel contends that, while the leases
and operations in both cases are in many respects similar, there are nevertheless
sufficient significant differences which warrant a different conclusion in the instant
case. I agree.
The Board has held that one of the most important elements bearing on the
existence of the "right to control" is the right of the employer to hire and dis-
charge the person doing the work and that, where the employer has the right to
terminate the relationship at will, it indicates an employer-employee relationship,
and not that of an independent contractor.10 Although both the Clark and Site
leases permit termination by either party on 30 days' written notice, the lease in the
instant case gives Site the additional option of terminating it on 24 hours' notice if
the station is not operated in accordance with the proper business methods commonly
followed in operating a retail gasoline service station. The Site Policy For Service,
which was and remains posted on the inside door of the supply cabinet frequented by
the attendants and to which the attendants were instructed by Vaughn to adhere, is
an example of what Site regards as a proper business method to follow in operating
the station As previously noted, these prescribe in minute detail the means and
method of performing the work at the station. Even if these rules were to be
regarded as mere suggestions, Site has retained the right to enforce these suggestions
9 See, e g., Buffalo Courier-Express, Inc, 129 NLRB 932 ; American Broadcasting Com-
pany, a Division of American Broadcasting-Paramount Theatres, Inc, et at, 117 NLRB
13, 17-18; Squirt-Nesbitt Bottling Corp., 130 NLRB 24; Citizen-News Company, Inc, 97
NLRB 428, 433-434; NLRB. v. Nu-Car Carriers, Inc, 189 F. 2d 756, 759 (C A. 3)
10 See, e.9, Citizen-News Company, Inc, supra, Buffalo Courier-Express, Inc, supra;
and Southern Shellfish Co., Inc., 95 NLRB 957.
1288 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
through this power to terminate the lease. In these circumstances, control over the
manner and means of performing the work may be exercised just as effectively by
means of suggestions as by direct orders."
The element of risk of loss is another factor to be considered in determining
whether the status is that of employer-employee or that of an independent con-
tractor. Unlike the situation in Clark, the station operator in the instant case is not
required to make any capital investment. Herman was merely required to post a
$1,500 cash bond to guarantee performance of the contract and to pay the annual
$50 fee for a fidelity bond. Vaughn was not even required to deposit any cash bond
when he executed his lease. He merely agreed to pay $50 a month thereafter until
the sum of $1,000 was accumulated with Site as a performance bond. All he paid
down was $50, presumably for the fidelity bond premium, which wasreturned to him
when he terminated the lease. Neither Herman nor Vaughn purchased any inventory
or capital equipment. They each .took over the inventory and supplies on a consign-
ment basis, with title remaining in Site. However, in the Clark case the dealers were
required to purchase the equipment and inventory in the station and to provide work-
ing capital. These amounts varied from $800 to $1,400, a capital investment which
the Board did not regard as minimal. Lack of capital investment indicates a cor-
respondent lack of the independent contractor relationship because it minimizes
the operator's risk of loss and limits his control over equipment.12
Closely related to the risk of loss is the consideration of the opportunity for
making a profit which is associated with the independent contractor status. Although
the Clark lease required that the dealer maintain a spread of not less than 3 cents
per gallon between the distribution and the retail prices, the lessee is free to deter-
mine his own retail price above that spread and thereby regulate his profit. The
Site lease, however, sets forth the specific retail price which the operator must
charge for its gasoline and further requires the operator to change the retail price at
any time upon 1 hour's notice from Site Thus, the operator's compensation is not
controlled primarily by his industry or efficiency in performing the work required
under the lease but is in substantial part affected by the decisions and activities
of Site and is similar in this respect to wages in the nature of commissions paid to
employees who serve employers.13
Moreover, in the Clark case, unlike the instant case, the lessee may elect to dis-
continue his Clark franchise privilege and obtain his products from sources other
than Clark. The only penalty imposed in that event is the conversion of his rental
from $1 per month to 3 cents on each gallon sold in an average month. Such free-
dom of divorcement, which is an indicia of an independent contractor status, is not
permitted by the Site lease which provides that the lease shall automatically be
canceled when gasoline, kerosene, oil, and automobile products are purchased else-
where than from Site and offered for sale without the prior written approval of Site.
Additional restrictions in the Site lease, which reserve to Site a relevant measure
,of control over the manner and means of operating the station and which are absent
from the Clark lease, are the requirements that the stations be kept open 24 hours
daily, that the station operator devote his full time to the operation of the station,
that all personnel wear Site uniforms, the prohibition against the hiring of female
attendants, and the detailed limitations placed upon the use of the station.
There are other significant distinctions. For example, the Clark lease requires
the dealer operator to place signs on the premises stating that the business is owned,
operated, and maintained by the dealer. The Board found that in practice the
dealers complied with these requirements. There are no such requirements in the
Site lease. The only identification at the West Eight Mile Road station since its open-
ing is that of Site. Also, it is Site, and not the operator as in Clark, which is required
by the lease to, and does, pay all utility bills and business license fees for the sale of
its products.
Upon consideration of all the foregoing and the entire record as a whole, I am
convinced and find that the extent to which Site has reserved the right to control,
when and as it sees fit, the manner and means of operating the station is sufficiently
countervailing to outweigh other aspects of the station operator's relationship with
Site which might indicate independent contractor status. I therefore find that the
operation of the West Eight Mile Road gasoline service station is the business of Site,
11 See, e.g, Buffalo Courier-Empress, Inc, supra.
12 See, e g., Citizen-News, supra, at 429; Keystone Floors, Inc, d/b/a Keystone Universal
Carpet Company, 130 NLRB 4; Ernest Whiting, Arthur Whiting, E I. Whiting and
R. E. Whiting, d/b/a The Whiting Lumber Company, 97 NLRB 265; Southern Shellfish
and Nu-Car Carriers, Inc., supra.
12 See, e g., Citizen-News Company, Inc, and Buffalo Courier-Express, Inc. cases, supra
SITE OIL COMPANY OF MISSOURI, ETC. 1289
that all those employed in the operation of this business, including the station operator
and attendants, are employees of Site, and that the operator is Site's managing agent
who has supervision over the personnel working at the station and is a supervisor
within the meaning of the Act.
D. Discrimination with respect to hire and tenure of employment
Immediately upon receipt of the Union's telegram of August 17, claiming majority
representation and requesting a meeting to negotiate a contract, Vaughn indicated to
employee Dan Page his displeasure over the employees joining the Union so soon
after the opening of the station and expressed a desire to meet their steward or com-
mitteeman in order to try to get the employees to repudiate the Union by offering
them a better deal than the Union did. Upon Vaughn's inquiry, Page stated that he
had not signed up with the Union. At that point, employee Peacock, who had over-
heard this conversation, volunteered the fact that he was one of those who had signed
up with the Union. In answer to Vaughn's question as to his reason for signing
up, Peacock stated it was to get job security and better benefits.
That same day Vaughn informed his supervisors in St. Louis about the contents
of the Union's telegram, reported that all except Dan Page and Wilbur Stone had
joined the Union, expressed the belief that Peacock was the instigator of the union
activities, urged that Regional Manager Hildebrandt return to Detroit as quickly
as possible, and suggested that Dan Page be placed in charge of the station. That
evening Vaughn for the first time called the employees' attention to the document,
entitled "Site Policy For Service," and told them that these were the company
rules which he wanted the employees to follow.
The next morning, August 18, Vaughn told employee Page that he could defeat the
Union if he could get five persons to lease the station with him as copartners. Later
that same day, he informed Hildebrandt that he no longer wanted to operate the
station but desired to return to his former position of regional supervisor. This
was accomplished within the next 2 days. On August 19, Hildebrandt came to De-
troit and negotiated with Herman; the new lease was executed on Saturday, August
20; and Herman assumed the operation of the station at 3 o'clock that afternoon,
with Vaughn reverting to his former position. Herman told Peacock that he had
"no use" for him because he was bringing in another man in his place. All the
other employees were taken over by Herman.
The following Monday, Herman told employees Whiteus and Stone that he did
not want the Union at the station, and promised them wage increases and com-
missions on sales if they would vote against the Union. The next evening, August
23, Union Representative Whittenberg, accompanied by Peacock, visited the station
to seek Peacock's reemployment. Herman refused on the ground that he had to
make jobs available for those who had loaned him money to get started. Before
leaving, Whittenberg named Whiteus, Stone, and Slone as being union members and
warned Herman not to discriminate against them. Three days later, on the eve
of the station's biggest rush, the "Grand Opening," Herman discharged Whiteus,
Stone, and Slone. Only three employees were available to work during the "Grand
Opening," which was conducted with the additional volunteer help of neighbors and
friends. The only former employee who still continued to work at the station was
Dan Page, who had not signed a union card and had so informed Vaughn
At the hearing, Herman testified that he did not hire Peacock because he did not
need him. Yet, as previously found, Stone, who had already worked an 8-hour
shift by 3 p.m. on Saturday, was asked to take over Peacock's shift and worked an
additional 8 hours that day. No new employee began working in Peacock's place
until Monday, August 22. And a few days later when Union Representative Whitten-
berg sought Peacock's reemployment, Herman refused on the ground that he had
to make jobs available for those who had loaned him money to get started.
Herman admitted at the hearing that the reason be gave to the men for discharging
them was that he had to give jobs to persons who had loaned him money for the busi-
ness, and further admitted that that was not the true reason Yet, at the State medi-
ation board meeting on August 30 and in a discussion with union representatives
10 days later, Herman repeated that he had to replace the men with friends who
had loaned him money and whom he had to take in as partners.
Herman further testified that be discharged these employees because he wanted
to "replace them with people that I felt were the right type of people that could
run my business the way I wanted it." However, he was unable to explain what
there was about the discharged employees which made them not the right kind of
people. He testified that it was just in his own mind and that "it is hard just to pin
down" what was not right about them. At another point, he testified that "I wanted
to bring in new help that I thought would do my business justice and would handle
1290 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
my business as I saw fit and that I could be boss of ." He admitted that the discharged
employees were experienced in the business at the station and could not explain
why they did not satisfy his requirements.
I find without merit and reject the reasons asserted by Herman for not reemploy-
ing Peacock and for discharging Whiteus, Stone, and Slone because I am convinced,
as the record clearly demonstrates, that they were not the true motivating reasons
for his actions . Nor, in view of the findings hereinabove detailed, can I credit Her-
man's testimony that he had no knowledge of the union membership and activities
of these men prior to the mediation board meeting on August 30. It is particularly
significant that the concept of partners , advanced by Herman prior to the hearing
as the reason for the terminations , was first conceived by Vaughn on August 18 as a
method for defeating the Union. While the circumstances surrounding Vaughn's
sudden decision to terminate his lease and the employees are highly suspect, I deem
it unnecessary to determine whether it was discriminatorily motivated. Upon con-
sideration of all the foregoing and the entire record as a whole, I am convinced and
find that: ( 1) Herman was informed of Vaughn's belief that Peacock was the insti-
gator of the union activities , as in fact he was; (2) it was because of this belief that
Herman had "no use" for Peacock and refused to reemploy him on August 20;
and (3 ) Herman's discharge of Whiteus, Stone, and Slone on August 26 was pri-
marily motivated by their continued adherence to the Union, of which fact Herman
had been informed by Union Representative Whittenberg. As Herman was Site's
managing agent at the West Eight Mile Road station , as previously found, Respondent
Site is responsible for Herman's conduct. I therefore find that Respondents Site
and Herman discriminated with respect to the hire and tenure of employment of
Peacock, Whitens, Stone, and Slone, thereby discouraging membership in the Union
in violation of Section 8(a) (3) and (1) of the Act.
E. The refusal to bargain
1. The appropriate unit and the Union 's status as exclusive bargaining
representative therein
The complaint alleges, and the answers do not deny, the appropriateness of a unit
of all gasoline service station employees employed by Respondents at their West
Eight Mile Road , Detroit, Michigan , station, excluding supervisors as defined in the
Act. This unit covers all personnel working at the station , excluding the station
operator who, I have found , is a supervisor within the meaning of the Act and Site's
managing agent of the station . At the hearing in this proceeding, Respondents
made no claim nor contention that such a unit was inappropriate , and adduced no
evidence on this issue . I find that the aforestated unit is an appropriate unit for the
purposes of collective bargaining within the meaning of Section 9(b) of the Act.
I find , on the basis of undisputed evidence , that ( 1) during the period from
August 12 to 20, 1960, there were five men employed within the appropriate unit,
and (2 ) four of these employees signed union cards on August 13 , designating the
Union as their collective -bargaining representative . I therefore find that at all
times since August 13, 1960, the Union was designated as the collective -bargaining
representative by a majority of Respondents' employees in the appropriate unit, and
has been and is the exclusive representative of the employees in the aforesaid appro-
priate unit for the purposes of collective bargaining within the meaning of Section
9(a) of the Act.14
2. Conduct violative of the Act
As previously found , the Union's telegram , claiming majority representation and
requesting a meeting to negotiate a contract , was received by Site's Managing Agent
Vaughn on August 17, 1960, and its contents was reported by him that same day
to his superior in Site's main office in St. Louis, Missouri , Regional Manager Hilde-
brandt . Respondents admittedly have never replied to this telegram . At the media-
tion board meeting on August 30, and at the service station about 10 days later,
Site's Managing Agent Herman rejected the Union 's further requests for recognition.
Respondent Site's refusal to recognize and deal with the Union is based on its
position that the employees in the unit were not employees of Site because Vaughn
14 As any numerical loss of majority representation which may have occurred was
attributable to Respondents ' prior unfair labor practices , the Union ' s status as exclusive
bargaining representative continued as a matter of law. Franks Bros. Company v.
NLRB., 321 U.S. 702.
SITE OIL COMPANY OF MISSOURI, ETC. 1291
and Herman were independent contractors when they acted as operators of the
station. As I have previously found Site's position to be without merit in this
respect, I find that Respondent Site's refusal to recognize and deal with the Union
as the exclusive bargaining representative of the employees in the aforestated ap-
propriate unit constitutes a refusal to bargain within the meaning of Section 8(a) (5)
.and (1 ) of the Act.
F. Interference, restraint, and coercion
The complaint alleges that Respondents independently violated Section 8(a)(1)
of the Act by certain specified conduct of Agents Vaughn and Herman. I agree.
As previously found, Vaughn made the following statements to employee Dan
Page. On April 17, after expressing his displeasure over the employees joining the
Union so soon after the opening of the station, Vaughn expressed a desire to meet
the employees' steward or committeeman to try to get the employees to repudiate
the Union by offering them a better deal than the Union did. The next day, Vaughn
told Page that he could defeat the Union if he could get five persons to lease the
station as copartners. The first statement indicated a willingness to offer the em-
ployees economic benefits for rejecting the Union; the second statement carried an
implied threat of loss of employment in order to defeat the Union. Also, as pre-
viously found, about August 22, after stating to employees Whiteus and Stone that
he did not want the Union at the station, Herman promised them wage increases
and commissions on sales if they would vote against the Union.
I find that by the above-stated conduct of Vaughn and Herman, Respondents
interfered with, restrained, and coerced the employees in the exercise of their statu-
tory rights and thereby violated Section 8 (a) (1) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the Respondent set forth in section III, above, occurring in con-
nection with the operations of the Respondents described in section I, above, have
a close, intimate, and substantial relation to trade, traffic, and commerce among the
several States, and tend to lead to labor disputes burdening and obstructing com-
merce and the free flow thereof.
V. THE REMEDY
Having found that Respondents have engaged in certain unfair labor practices, I
will recommend that Respondent Site and its agents, specifically including Baron
Herman , 15 cease and desist therefrom and take certain action designed to effectuate
the policies of the Act.
Having found that Respondents discriminated with respect to the hire and tenure
of employment of Calvin Peacock, Arthur Whiteus, Wilbur Stone and Ronald
Slone, I will recommend that they be ordered to offer them immediate and full
reinstatement to their former or substantially equivalent position, without prejudice
to their seniority and other rights and privileges, and to make them whole for any
loss of earnings they may have suffered because of the discrimination against them,
by payment to each of a sum of money equal to the amount he normally would
have earned as wages from the date of the discharge or failure to reemploy, as the
case may be, to the date of said offer of reinstatement , less his net earnings during
said period, with backpay computed on a quarterly basis in the manner established
by the Board in F. W. Woolworth Company, 90 NLRB 289. I will also recom-
mend that the Respondents make available to the Board, upon request, payroll and
other records to facilitate the determination of the amount due under this recom-
mended remedy.
Having found that Respondents have refused to bargain with the Union in viola-
tion of Section 8 (a) (5) and (1) of the Act, I will recommend that Respondent Site
be ordered to bargain with the Union, upon request, as the exclusive representative
of all its employees in the appropriate unit concerning rates of pay, wages, hours,
and other terms and conditions of employment, and, if an understanding is reached,
embody such understanding in a signed agreement.
In view of the nature and extent of the unfair labor practices herein found, I am
convinced that the commission of similar and other unfair labor practices by Re-
spondents reasonably may be anticipated. I will therefore recommend that Re-
16 As Agent William Vaughn Is no longer acting as operator of the station, I believe
that the policies of the Act will be adequately effectuated without specifically naming him
In the Order.
1292 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
spondents be ordered to cease and desist from in any other manner infringing upon,
the rights guaranteed to employees by Section 7 of the Act.
Upon the basis of the foregoing findings of fact , and upon the entire record in the
case, I make the following:
CONCLUSIONS OF LAW
1. Local 299, International Brotherhood of Teamsters, Chauffeurs, Warehouse-
men, and Helpers of America , Ind., is a labor organization within the meaning of
Section 2(5) of the Act.
2. All gasoline service station employees at Respondent Site's West Eight Mile
Road, Detroit, Michigan, station, excluding supervisors as defined in the Act, con-
stitute a unit appropriate for the purposes of collective bargaining within the mean-
ing of Section 9(b) of the Act.
3. At all times since August 13, 1960, the above-named Union has been, and now
is, the exclusive representative of all the employees in the aforestated unit for the
purpose of collective bargaining within the meaning of Section 9(a) of the Act.
4. By refusing to recognize and deal with the Union as such representative, Re-
spondent Site has engaged in and is engaging in unfair labor practices within the
meaning of Section 8(a) (5) of the Act.
5. By discriminating with respect to the hire and tenure of employment of Calvin
Peacock, Arthur Whitens, Wilbur Stone, and Ronald Slone, thereby discouraging
membership in the aforesaid labor organization, Respondents have engaged in and
are engaging in unfair labor practices within the meaning of Section 8(a)(3) of
the Act.
6. By the above conduct and by the conduct set forth in section F, supra, Respond-
ents have interfered with, restrained, and coerced the employees in the exercise of
rights guaranteed in Section 7 of the Act and thereby have engaged in and are
engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act.
7. The aforesaid unfair labor practices are unfair labor practices affecting com-
merce within the meaning of Section 2(6) and (7) of the Act.
[Recommendations omitted from publication.]
APPENDIX B
"The chain is as strong
as its weakest link."
Site Policy For Service
1. Approach car HASTILY with ENTHUSIASM. Objective:-To reach the pump
BEFORE the customer does.
2. Greet the customer with ENTHUSIASM. He makes it possible for us to have
our jobs. Don't discuss the weather. "Yes, Sir" is a poor greeting. Say, "Good
Morning" or "Good Afternoon" or "May I fill your tank?" "How do you do"
is always good and correct.
3. One man wipes (not smears) the right windshield, then the sides and rear, then
the left windshield. While the other man requests permission to fill the tank.
Oil rags used on windshield lose customers.
4. Keep the gas cap in your hand while filling the tank.
5. Have clean uniform. Approach customer neatly dressed, with clean hands.
DON'T permit your changer to scratch car.
6. The man who gets thru first asks customer's permission to check radiator and oil.
7. Before another car reaches the pump island, one of the men should leave the
first car, ready to take care of the second car, unless there is a third man.
8. NO CUSTOMER should be permitted to air his tires UNLESS all men are serv-
icing cars. Be ALERT for low tires before car drives off.
9. RECOGNIZE a customer who is waiting for service while you are serving
another car by smiling and saying, "I'll be with you in a moment." Wait on
customers in their TURN.
10. Don't be busy doing something else when there is a CUSTOMER WAITING.
This is IMPOLITE, OFFENSIVE and NOT TO BE TOLERATED. If it hap-
pens accidentally, apologize.
11. Smile-You have reason to-you are working on the outside and not shut in
by four walls. Make friends by showing a willingness to SERVE and to•
PLEASE.
JACKSON TILE MANUFACTURING COMPANY 1293
12. BE COURTEOUS-Tip your hat to a lady ALWAYS. Thank your customer
WITHOUT FAIL and INVITE him to come again.
13. TAKE PRIDE in the appearance of your station and in each other as a team.
DON'T let a single man hurt the team.
14. NOLOITERING permitted at any time . NO EXCEPTIONS.
15. Do not approach a car with a cigarette , pipe or cigar.
16. Don 't make a FOOL of YOURSELF by giving out any private Company in-
formation.
Jackson Tile Manufacturing Company and Local No . 401, United
Glass and Ceramic Workers of North America , AFL-CIO.
Case No. 15-CA-f003. July 16, 19693
DECISION AND ORDER
On April 30,1962, Trial Examiner Lloyd R. Fraker issued his Inter-
mediate Report in the above-entitled proceeding, finding that Re-
spondent had not engaged in the unfair labor practices alleged in the
complaint and recommending that the complaint be dismissed in its en-
tirety, as set forth in the Intermediate Report attached hereto. There-
after the Charging Party filed exceptions to the Intermediate Report,
together with a supporting brief.
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 [Members Leedom, Fanning, and Brown].
The Board has reviewed the rulings made by the Trial Examiner at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Inter-
mediate Report, the exceptions and brief, and the entire record in this
case, and hereby adopts the findings, conclusions, and recommenda-
tions of the Trial Examiner.'
[The Board dismissed the complaint.]
' While the matter is not free from doubt and the circumstantial evidence presented in
support of the complaint , as indicated by the Trial Examiner, does raise a strong suspicion
as to Respondent 's motive in the discharge, we are constrained to conclude that a pre-
ponderance of the credited evidence falls short of establishing the violation . We there-
fore find that the General Counsel has failed in his burden of proof and for this reason
alone adopt the Trial Examiner 's recommendation that the complaint be dismissed The
Charging Party requested the Board to overrule the Trial Examiner's credibility findings.
It is established Board policy not to overrule such resolutions except where a clear pre-
ponderance of all the relevant evidence convinces us that the Trial Examiner 's findings
are incorrect. No such conclusion is warranted in this case See Staoula)d Dry Wall
Products, Inc., 91 NLRB 544, enfd . 188 F. 2d 362 (C.A 3).
INTERMEDIATE REPORT AND RECOMMENDED ORDER
1. STATEMENT OF THE CASE
A. The unfair labor practice charge and the complaint
The charge in this case was filed October 16, 1961 , by Local No . 401, United Glass
and Ceramic Workers of North America , AFL-CIO, herein called the Union,
against Jackson Tile Manufacturing Company, herein called the Respondent.
137 NLRB No. 140.