Southern Dolomite

National Labor Relations Board - Board Decisions

Jan 13, 1961

129 N.L.R.B. 1342 (N.L.R.B. 1961)

1342 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cluding that "there is a reasonable expectation that the Company under consideration
will in a period of 12 months attain the minimum jurisdictional requirement." 8
Since as aforestated , one of the other four stores was closed in 1959 , there can be
no "reasonable expectation" that its 1959 sales will be repeated and no reasonable
basis for considering the business done at the closed store in any computation of
the Company's anticipated annual volume of business for 1960. There was no
testimony in the record that the closed store would be reopened by the Company
when the Philadelphia Redevelopment Authority concluded its reconstruction work.
Indeed, the only testimony regarding the possibility that the closed store might be
reopened was that of the accountant, that an "offer was made to Mr. Morgan to
relocate at that location in the new store that they [the Redevelopment Authority]
were building." There was no testimony that the "offer" was accepted by the
Company, none regarding whether the Company had a legal commitment from the
Authority for a new store at its old location, and none as to when, if at all, such new
store would be reopened. In his brief (footnote 18) the General Counsel asserts
that the store in question would "be reopened in the future" and at page 9 asserts
that "it will reopen sometime in 1960," but these assertions are not supported by any
testimony in the record .0
Moreover, I can find no support for counting the business of the closed store by
projecting "back" as urged by the General Counsel. No case has been cited by
him in which the Board has ever projected backwards nor has my independent
research uncovered any. Indeed, the very word "project" means "to throw or
cast forward," 10 the antithesis of the meaning which the General Counsel seeks to
apply to it. In short, at the time of the alleged unfair labor practices (April 1960),
the Company was operating only five stores. The anticipated volume of the business
of the Company in these five stores on a projected basis is $465,572.22,11 and thus
is still short of the minimum required by the Board for assertion of jurisdiction over
retail enterprises.I2
In view of my findings and conclusions above, I do not reach or pass on the
unfair labor practices charged in the complaint.
For the foregoing reasons, and upon the basis of the foregoing findings of fact, I
make the following:
CONCLUSION OF LAw
The Company's operations do not meet the Board's standards for assertion of
jurisdiction over retail enterprises and it would not effectuate the policies of the
Act to assert jurisdiction in this case.
[Recommendations omitted from publication.]
8 General Seat and Back Mfg. Corp., supra.
6 At the reopened hearing herein on July 21, the General Counsel declined a proffered
opportunity to clarify the record regarding the possibility that the closed store might
reopen shortly.
1o Webster's New Collegiate Dictionary, p. 675.
u See footnote 5, supra.
12 Carolina Supplies and Cement Co., supra.
R. E. Smith and Florence B. Smith, a partnership, d/b/a South-
ern Dolomite and Ernest Powell, Montieth Pulver, and Emil
Adkins. Cases Nos. 12-CA-1347-1,12-CA-1347-2, and 12-CA-
1347-3. January 13, 1961
DECISION AND ORDER REMANDING CASE TO THE
TRIAL EXAMINER
On June 27, 1960, Trial Examiner George J. Downing issued his
Intermediate Report in the above-entitled proceeding, recommending
that the complaint be dismissed for the reason that the Respondents
are not engaged in commerce within the meaning of the Act, as set
129 NLRB No. 159.
SOUTHERN DOLOMITE 1343
forth in the Intermediate Report attached hereto.' Thereafter, the
General Counsel filed exceptions to the Intermediate Report, and a
brief in support thereof.
The Board has reviewed the rulings of the Trial Examiner made 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 the
case, and finds merit in the General Counsel's exceptions.
The record reveals the following facts. The Respondents are en-
gaged in the mining, selling, and spreading of dolomite limestone in
Florida. Dolomite is a soil conditioner. It is either applied directly
to the soil or used in small amounts as a filler in making fertilizer.
During the 1959 fiscal year the Respondents' gross volume of business
was in excess of $500,000. Of this amount $47,000.24 represented sales
to fertilizer companies, $10,620.23 to grower cooperatives, and
$26,708.46 to grower companies. Each of these customers of the Re-
spondents is engaged in commerce in that it exports or imports di-
rectly goods and materials valued in excess of $50,000 across State
lines. The fertilizer companies are engaged in commerce through
their out-of-State purchases of materials used in mixing fertilizers,
while the grower cooperatives and grower companies are in commerce
by virtue of their shipments of fruit and produce in interstate
commerce.
Proceeding on the assumption that under the Catalina Island and
related cases 2 the gross dollar volume test, standing alone, is insuffi-
cient to confer upon the Board jurisdiction contemplated by the Act,
and that no proof of the Board's statutory or legal jurisdiction had
been made, the Trial Examiner found that it would not effectuate the
policies of the Act to assert jurisdiction in this case. Specifically, the
Trial Examiner found that while the Respondent's operations affect
commerce in that the Respondents sell their product to enterprises
which are engaged in commerce, they do so only in indirect and remote
manner, and do not have a close and intimate relation to interstate
commerce.
However, jurisdiction in the instant case is not asserted on the basis
of any standard stated exclusively in terms of the gross dollar volume
of business. It is asserted on the ground that the operations of the
Respondents meet the requirements of the $50,000 indirect outflow-
inflow test. The Board has recognized the inherent distinction be-
tween these standards.' Under the first standard, the operations of
i The Intermediate Report makes no finding with respect to the unfair labor practices
alleged in,the complaint herein
2 Catalina Island Sightseeing Lines, 124 NLRB 813.
39outhwest Hotels, Inc. (Grady Manning Hotel), 126 NLRB 1151, where the Board
drawing distinction between the two types of standards said "Many of our standards
already embody the conclusion that the Board's legal jurisdiction has been proved, since
they are based on a substantial movement of goods across State lines."
1344 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
an employer could satisfy the gross dollar volume test, and yet be
purely local in character. Hence, some proof of legal or statutory
jurisdiction would be necessary. No such situation could conceivably
arise where jurisdiction is asserted on the basis of the outflow-inflow
test. Under the second standard the very meeting of the standard
establishes legal jurisdiction within the meaning of Section 2(6) or
(7) of the Act. In establishing this standard, the Board had already
concluded in the light of its experience that when the operations of
the employer meet this standard, they substantially affect commerce
within the meaning of the Act.' Accordingly, the Board requires no
further proof of legal or statutory jurisdiction in these cases 5
Nor is it necessary in asserting jurisdiction under the outflow-
inflow standard that there be additional evidence that the operations
of the employer have a substantial and direct relation to interstate
commerce. The Board in establishing this standard has already de-
termined that outflow-inflow which amounts to $50,000, or more has a
substantial and direct impact on commerce sufficient to warrant asser-
tion of jurisdiction.' Similarly, it is unnecessary in proceeding under
this standard to inquire into the nature of goods or services furnished
by the employer to its customers and as to whether they are utilized
directly or indirectly in the goods or materials crossing State lines.
The new standard requires that the employer's product merely be
used in the operations of the interstate enterprise. The Board defined
the indirect outflow as "sales of goods or services to users meeting any
of the Board's jurisdictional standards, except the indirect outflow or
indirect inflow standard." 7 Accordingly, we find it immaterial to
establish whether or not dolomite becomes an ingredient in fruits and
produce which are shipped out-of-State .8
4In the leading case which established the revised outflow -inflow standard , the Board
said that the adoption of this standard "will reasonably insure that the Board will process
all cases involving labor disputes which exert a pronounced impact on commerce "
Ssemons Mailing Service, 122 NLRB 81 . See also Hollow Tree Lumber Company, et al,
91 NLRB 634.
5 Hart Concrete Products Co., 94 'NLRB 1565 ( manufacturer of concrete blocks and mix
concrete ) ; Simplot Fertilizer Company, 100 NLRB 771 (mining of phosphate and making
of fertilizer ) ; Saemons Mailing Service, supra ( mailing service ) ; Trettenero Sand &
Gravel Co, 129 NLRB 546.
6 See footnote 4, supra.
7 Siemens Mailing Service, supra Before the Siemons case , the Board pointed out in
Whippany Motor Co., Inc ., 115 NLRB 52 , " the general impracticability of testing on a
case to case basis , the precise nature of utilization by a purchaser of the products of the
employer" and modified the then existing outflow-inflow standard by abolishing that
inquiry The Board then stated that it "will henceforth assert jurisdiction on the basis
of the indirect outflow test . . . without regard to the manner in which the purchaser
makes use of the goods or services"
9 We attach no significance, insofar as the Board 's commerce jurisdiction is concerned,
to the fact that the grower cooperatives and grower companies, the customers of the
Respondent , are engaged in commerce by virtue of their shipment across State lines of
fruits and produce, thereby suggesting that they are, wholly or in part engaged in farm-
ing and employ agricultural laborers . The Act defines "commerce" as "trade , traffic,
commerce , transportation , or communication among the several States . ." ( Section
2(6) of the Act). It does not except from "commerce " trade or traffic in agricultural
products . While Section 2(3) of the Act excepts from the term "employee" "any in-
SOUTHERN DOLOMITE 1345
In view of the foregoing, we find, for the purposes of this proceed-
ing, that the Respondents herein are engaged in commerce within the
meaning of the Act, and that it would effectuate the policies of the Act
to assert jurisdiction and to resolve the substantive issues raised by
the complaint.
[The Board remanded the above-entitled proceeding to the Trial
Examiner for the preparation and issuance of a Supplemental Inter-
mediate Report.]
dividual employed as an agricultural laborer" or an individual in the domestic service, or
an individual employed as a supervisor, these exemptions from the term "employee" may
not be construed as limitations on the Board's commerce jurisdiction. The latter extends
to all goods and services moving across State lines regardless of their nature. Cf.
0. B. Brown Fertilizer Co., 110 NLRB 1912, where the Board in computing indirect out-
flow took in consideration the sales to the customers who were engaged in the business of
growing, packing, and shipping farm products ; see also Goetz -lee Co, Case No. 21-RC-3892
(not published in NLRB volumes).
INTERMEDIATE REPORT
This proceeding, brought under Section 10(b) of the National Labor Relations Act,
as amended (61 Star. 136), was heard by George A. Downing, the duly designated
Trial Examiner, in Tampa, Florida, on May 16 and 17, 1960, on a complaint issued
by the General Counsel of the Board on March 31, 1960.
As I am convinced from the evidence that Respondents' operations are purely local
and intrastate in character, I do not reach the issues of unfair labor practices as
charged in the complaint and denied in Respondents' answer, for I shall recommend
a dismissal of the complaint for lack of a jurisdictional showing on the basis of the
stipulated facts and on undisputed testimony which may be summarized as follows:
Respondents are engaged in mining, near Palmetto, Florida, of dolomite, a form
of agricultural limestone which is sold directly or indirectly (through fertilizer
companies and grower cooperatives and associations) to citrus growers, truck
farmers, and ranchers within the State of Florida. It is a soil conditioner, not a
fertilizer, and is usually applied directly to the soil, though occasionally small
amounts of it are used by Respondents' fertilizer company customers as a filler in
making fertilizer. The latter customers, however, also sell such fertilizer wholly
within the State, and it is consumed within the State. Thus all of Respondents'
product is mined and consumed within the State; and because of its nature it does
not (as the General Counsel conceded) become an ingredient of the fruits or other
crops which are grown upon the land of the consumers.
But the General Counsel contends that this wholly intrastate operation falls under
the Board's jurisdiction because the stipulated facts recited below showed that Re-
spondents' business meets certain mathematical standards which the Board has pro-
scribed. Thus it was stipulated that though no part of the limestone is exported from
the State, Respondents' gross annual business exceeded $500,000, and that each of
some 13 listed customers (fertilizer companies, grower companies, and cooperatives)
whose purchases from Respondents in the aggregate exceed $84,000, was each within
the jurisdictional standards of the Board and were engaged in interstate commerce in
that they export or import directly goods and materials valued in excess of $50,000
across State lines.
The listed customers included some six fertilizer companies and some seven
groves, grower companies, or cooperatives. A representative of one of the fertilizer
companies (offered as a typical case) testified that his company exported no part
of its fertilizer, though it imported some of its materials from other States. Though
the stipulation is silent, it may reasonably be presumed that the listed grower
customers were covered by reason of exporting their fruits and other agricultural
products in interstate commerce. The fact, indeed, seemed implicitly conceded in
the colloquies at the hearing.
Respondents contend, on the basis of evidence concerning their method of soliciting
orders from growers and the manner of effecting deliveries, that except for the small
portion of dolomite which is used by fertilizer companies for mixing, Respondents'
sales were actually made direct to the grower consumers and that the trucking and
586439-01-vol. 129-86
1346 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
billing by and through the other companies or cooperatives were only incidental
phases of its sales to the growers. The General Counsel counters that even were
Respondents' contention upheld in that regard, then the sales were at retail, and
that Respondents met the Board's retail standards for coverage.
Though I regard the point as immaterial, I reject Respondents' contention that the
sales in question are to be regarded as having been -made directly to the consumers.'
I also reject the General Counsel's argument that even if Respondents' contention
were upheld, then the sales must be classified as retail sales. Not only were the
usual indicia of retail sales lacking, but Respondents' price to the fertilizer companies
for the dolomite which they sometimes used in mixing fertilizer was the same as
that which was charged on direct sales to customers. Respondents were also not
registered with the Florida Sales Tax Division, Retail Sales Tax.
The Board has frequently recognized in recent months that the gross dollar volume
test which it prescribed in its jurisdictional standards is insufficient, standing alone,
to confer upon the Board the jurisdiction contemplated by the Act, and that some
proof must be made of its legal and statutory jurisdiction. C. L. Morris, Inc., 127
NLRB 761; Southwest Hotels, Inc., 126 NLRB 1151; James D. Jackson, 126 NLRB
875; International Longshoremen & Warehousemen's Union, et al. (Catalina Island
Sightseeing Lines), 124 NLRB 813. To determine whether such proof has been
made ,here, it is necessary to go,back to fundamentals.
Purely intrastate activities, like Respondents', may, of course, fall within Federal
control, but only where a close and intimate relation to interstate commerce is demon-
strated. N.L.R.B. v. Jones & Laughlin Steel Corporation, 301 U.S. 1, 37-38. The
Board's jurisdiction does not obtain merely because a local activity may in some
indirect and remote way affect commerce. N.L.R.B. v. Shawnee Milling Company,
184 F. 2d 57, 59 (C.A. 10). It does not embrace effects upon interstate commerce
so indirect and remote as would effectually obliterate the distinction between what
is national and what is local. Jones & Laughlin, supra, at 37. The Board expressly
recognized the applicability of those principles and the pertinency of the cited cases
in the Catalina Island case, supra.
I do not find here that "close and intimate relation" to interstate commerce which
the Supreme Court spoke of in Jones & Laughlin, supra. Though Respondents'
purely local activity may be said to "affect" commerce, it does so only in an indirect
and remote manner. The fertilizer company customers are engaged in commerce
only through their extrastate purchases of some of the materials used in mixing
fertilizer (all sold locally), Respondents' contribution to which is inconsequential.
Thus to the extent that the operations of such customers are in commerce, the effect
on them, assuming a strike at Respondents' plant, would be practically nil. Some-
what more effect is demonstrated by the sales to the grower companies and co-
operatives listed in the stipulation, in that their coverage, presumably, consists of their
shipment of fruit and produce in interstate commerce. However, the nature of Re-
spondents' product is such that its use cannot be found to have "a close and intimate
relation to interstate commerce."
Decisions in cases involving similar enterprises have ,turned, typically, not on such
indirect or remote effects but on the fact that certain facets of the concerns' oper-
ations reflected either direct engagement in commerce, sales to instru -mentalities of
commerce for use on such instrumentalities, or sales to customers who used the prod-
uct directly in manufacturing goods which were sold in commerce. In Pembroke
Limestone Corporation, 74 NLRB 1043, for example, the Company itself not only
made both purchases and sales in interstate commerce, but it sold substantial quanti-
ties of its product to the Norfolk and Western Railroad for use as ballast on its right
of way and to the Virginia Department of Highways for use in the construction of
State highways. In El Dorado Limestone Company, 84 NLRB 746, the Company's
customers were manufacturing corporations (engaged in commerce) who used
crushed limestone in the processing, manufacturing, and refinement of their product.
In Simplot Fertilizer Company, 100 NLRB 771, 772, the Company mined phosphate
as an integral part of its manufacture of fertilizer, large quantities of which were
shipped in commerce.
For the foregoing reasons and upon the basis of .the foregoing findings of fact, I
make the following:
CONCLUSIONS OF LAW
1. Respondents are not engaged in commerce within the meaning of Section 2(6)
of the Act.
'Not only were the sales bsibed to and paid for by the ferilizer companies and co-
operatives, but the billing did not Identify the consumer customer.
ILLINOIS MALLEABLE IRON COMPANY, ETC . 1347
2. Respondents' operations do not substantially affect commerce within the meaning
of Section 2 (7) of the Act.
3. Assertion of jurisdiction by the Board would not effectuate the policies of
the Act.
[Recommendations omitted from publication.]
Illinois Malleable Iron Company and Appleton Electric Com-
pany and Local No. 788, International Union , United Auto-
mobile, Aircraft and Agricultural Implement Workers of
America, AFL-CIO, Charging Party and Local 1031 , Inter-
national Brotherhood of Electrical Workers, AFL-CIO, Party
to the Contract . Case No. 13-CA-1866. January 16, 1961
SECOND SUPPLEMENTAL DECISION AND AMENDMENT
OF ORDER
On April 16, 1958, the Board issued its Decision and Order 1 in the
above-entitled matter, finding that the Respondents had engaged in
and were engaging in certain unfair labor practices and ordering that
they cease and desist therefrom and take certain affirmative action,
as set forth therein. On its own motion, the Board has reconsidered
its decision in this proceeding, and hereby modifies and amends its
Decision and Order in the following respect :
In its original Decision and Order, the Board reversed the Trial
Examiner's conclusion that the Respondents had not discriminatorily
refused to employ Castelluccio. Upon reconsideration of the record,
the Board is of the opinion that the Trial Examiner's dismissal of the
complaint as to Castelluccio should be sustained.
[The Board amended the Board's Order in this case by striking out
"and William Castelluccio" from subparagraph (b) of paragraph
numbered 2 and subparagraph (c) of paragraph numbered 2, and
amended the notice attached as the Appendix to the Board's original
Decision and Order in this case, by striking from the eighth paragraph
of such notice the words "and William Castelluccio."]
[The Board dismissed the complaint insofar as it alleges that the
Respondents failed and refused to reemploy William Castelluccio in
violation of Section 8 (a) (3) of the Act.]
MEMBER KIMBALL took no part in the consideration of the above
Second Supplemental Decision and Amendment of Order.
1120 NLRB 451 ; Supplemental Decision and Order concerning the compliance status of
the Foundry Department (UAW-AFL-CIO), 127 NLRB 1509.
129 NLRB No. 168.