Southern Shellfish Co., Inc.Download PDFNational Labor Relations Board - Board DecisionsAug 3, 195195 N.L.R.B. 957 (N.L.R.B. 1951) Copy Citation SOUTHERN SHELLFISH CO., INC. 957 absent 30 days' notice. Since that date, neither of the contracting parties has served notice to change, modify, or terminate the contract. While the employees covered by the contract enjoy various vacation and insurance benefits, none of these benefits has ever been the sub- ject of negotiations between the Employer and the Intervenor. It appears that no representative of the Local has ever met with the Employer or requested negotiations regarding any term or condition of employment contained in the contract; no grievance committee has ever been established pursuant to the contract, and no grievances have been processed; no union dues have ever been checked off; nor has the Local ever utilized the bulletin board which the Employer made available for the posting of union notices. Furthermore, there is no evidence that the employees at the Employer's plant were aware of the existence of a contract covering them, nor is there evidence as to what number of employees are members of the Local; as to when, if ever, meetings were held ; or as to whether or not any dues have been paid by the employees directly to the Local. Thus, it appears that the Local has abandoned the administration of its contract with the Employer, and has ceased actively to represent the Employer's employees since the execution of that contract 7 years ago. Under all the circumstances, we find that it will best effectuate the purposes of the Act to direct an election at the Employer's plant at this time.3 Accordingly, we find that the contract between the Em- ployer and the Local is not a bar to this proceeding. 4. The parties have stipulated, and we find, that all employees of the Employer at its Grand Rapids, Michigan, plant, excluding all office and clerical employees, truck drivers, service truck salesmen, salesmen, professional employees, guards, foremen, and all other supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9 (b) of the Act. [Text of Direction of Election omitted from publication in this volume.] 8 Cf. American Manufacturing Company, 91 NLRB No . 171; Reynolds & Manley Lumber Company, 88 NLRB 1300. SOUTHERN SHELLFISH CO., INC. and INTERNATIONAL FUR AND LEATHER WORRIERS UNION OF THE UNITED STATES AND CANADA, PETITIONER. Case No. 15-RC-474. August 3, 1951. Decision and Direction of Election Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before John W. Irving, hearing offi- 95 NLRB No. 114. 958 DECISIONS OF NATIONAL,, LABOR RELATIONS. BOARD cer. The hearing officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. Pursuant to the provisions of Section 3 (b) of the Act, the Board has delegated its powers in connection with this case to a three-member panel [Chairman Herzog and Members Reynolds and Murdock]. Upon the entire record I in this case, the Board finds : 1. The Employer is engaged in commerce within the meaning of-the Act. 2. The labor organization involved claims to represent certain em- ployees of the Employer. 3. The Petitioner seeks to represent the captains and the crews of certain fishing boats which the Employer either owns -or on which it has a mortgage or lien.2 The Employer contends, inter alia,, that the captains are independent contractors within the meaning of Section 2 (3) of the Act and,. hence, that neither the captains nor the crews are its employees. We agree with the Employer's contention only with respect to the captains and the crews of the "lien boats." As `stated by the Court of Appeals for the Fifth Circuit in N. L. R. B. v. Steinberg d Co., on which'the Employer relies, the .determination of whether an individual is an employee or an inde- pendent contractor, ".... in each case, must depend largely upon 'its own peculiar facts. The usual test employed for determining the distinction between an independent contractor and an employee is found in the nature and the amount of control reserved by the person for whom the work is done, and the employer-employee relationship exists only where the employer has the right to control and direct work not only as to the result to be accomplished by the work, but also as to the manner and means by which that result is accomplished. It is the right and not the exercise of control which is the determining element." [Emphasis supplied.] As we find below, the evidence establishes that the relationship between the Employer and the captains and the crews on the boats owned by the Employer is that of employer and employee. It is not the same as that which exists between the Employer and the crews on the "lien boats." Although there are some similarities in the opera- tions performed by the captains and the crews on both categories of the boats, the material difference in the relationship arises from the I The Employer filed a motion for permission to file a reply brief, copies of which were attached to its motion. The motion is hereby granted. The reply brief has been considered along with the Employer's brief and the Petitioner' s brief. 1 The boats on which the Employer has a mortgage or lien are hereafter referred to as the "lien boat's." 8182 F. 2d 850, 857 (C. A. 5, 1950). Accord, N. L. R. B. v. Nu-Car Carriers, Inc.; 189 F. 2d 756, 28 LRRM, 2160 (C. A. 3, 1951) ; N. L. R. B. v. Phoenix Mutual Life Insurance Co., 167 F. 2d 983, cert. denied 335 U. S. 845; Restatement , Agency, Section 226; 56 C. J. S., pp. 4 .1-_62; 27 Am . Jur. 479-540. SOUTHERN SHELLFISH CO., INC. 959 facts disclosing, as we hereafter find, that the Employer has reserved the right to control both the work result and the manner and means by which the work is performed on the Employer-owned boats. The Employer does not possess the same right of control in the case of the captains and crews on the "lien boats." The record upon which we base our findings and conclusions discloses the following : The Employer is engaged in the operation of a seafood cannery and ice plant at Harvey, Louisiana. All of the persons sought to be repre- sented by the Petitioner are engaged primarily in catching fish. Their "catch," which is turned over to the Employer under certain condi- tions described below, represents approximately 20 percent of the total seafood used by the Employer in the course of its cannery operations. The Employer-Owned Boats The Employer owns about 12 fishing boats, each of which is manned by a captain and 1 or 2, boatmen or fishermen. With respect to these boats, it is the practice of the Employer in each case to enter into an oral agreement with an experienced fisherman, who is designated as a captain, and to whom the boat is assigned for purposes of operation. This agreement, which. is terminable at will, provides for the captain's undertaking to fish with the boat, his undertaking to deliver all of his catch to the Employer (even. though higher prices may be obtainable elsewhere) ,4 and the terms on which the shares, discussed below, will be divided. As a part of the agreement, anct in accordance with the custom prevailing in maritime operations, the Employer authorizes the captain to hire and fire the boatmen who make up the crew 5 How:- ever, the record shows that the Employer has, not considered the grant of such authority to the captain as precluding an exercise of over-all control in this respect .6 The Employer also carries public liability insurance on the boats to protect itself from claims arising from the negligence of the captains or the boatmen. It also appears that, under the oral agreement between the Employer and the captain, the manner and method of the acquisition' and main- tenance of the equipment, or "tools," and the supplies essential to the performance of the fishing operations are substantially under the Employer's control. Thus, the Employer determines whether and when repairs shall be made on its boats and has such repairs made In those cases in which a shortage of fee or a small - catch makes return to the Employer 's docks inadvisable , the captains telephone the.`Employer : for authority tp sell the shrimp elsewhere . Checks in payment , for such shrimp are sent to . the Employer, are made payable to the boat, and are endorsed by the captain of the boat. The proceeds are applied to the captain 's account in the Employer 's books in the usual fashion. 5 The Employer also ' authorizes the captain to determine the size of • the crew. As a practical matter , however , the size of the crew is actually determined by the size of the boat assigned to the captain. e Thus, at the Employer's direction , a boatman was fired for damaging a boat while drunk, . _'960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD at its own repair yard at. Biloxi, Mississippi. The captain obtains the rig 7 with which the boat is fitted out from the Employer's store- room, and the Employer charges the cost of the rig to a special account opened on its book in the name of the captain. With regard to con- sumable supplies, the Employer requires the captain to obtain ice from its ice plant and fuel oil and groceries from suppliers designated by the Employer. The Employer pays for these items initially and charges them to an account also kept in the name of the captain, but separate from that used for the rig. The, Employer deducts the cost of the rig and the consumable supplies, as described below, from the money which the Employer pays.to the captain for the catches of the boat. When the boats return from a fishing trip, the Employer unloads them at its docks, throws out the spoiled shrimp,8 grades the accept- able shrimp by size, and weighs them. The Employer .then deter- mines the value of the catch from its own price lists. From the total -value of the catch, the Employer. first deducts the cost of the fuel oil, ice, and groceries, and divides the balance into five or five and one-half shares. The Employer withholds one share for upkeep of the boat and one or one and one-half shares for application to the .captain's account for the rig, and delivers the -remaining three shares to the captain, who, in accordance with the prevailing custom, divides the amount equally among the crew members and himself. In addi- tion, the Employer pays the captain a bonus of $1 for each barrel of shrimp delivered .9 In addition to the catching of shrimp, the Employer's boats are also engaged in'what is called freighting. Freighting involves pur- chasing shrimp at sea from another boat. This is usually done when, the seller has a small catch or a depleted supply of ice. The price paid for the shrimp is determined from the Employer's price list, from which a standard deduction for transportation is made. Ordi- narily, the purchasing captain gives the seller a printed receipt form 'bearing the name of the Employer. On this form the amount and grade of the purchased shrimp are noted. The Employer makes pay- ment to the seller, or, if the seller has so requested, the Employer gives the 'cash to the purchasing captain for delivery to the seller. The ' The rig consists of nets, cables , boards, and kitchen utensils. The Employer allows the captain to designate the net maker from whom he desires to obtain the fishing net. However, the Employer actually purchases the net and charges it to the account of the captain * for whom it is 'purchased , as described below. . s The captains receive no payment for the spoiled shrimp, which the Employer utilizes in making fertilizer . However, the Employer makes no profit from the operation of its fertilizer plant, which it maintains merely . to have a means of disposing of waste products. 9,A]1 of the bookkeeping with regard to the operation of the boats and the determination of the value of the shares is performed by the Employer. SOUTHERN SHELLFISH CO.., INC . 961 from the Employer in the usual fashion. ed shrimp It appears that the Employer has power to control the type of fish- ing to be done by determining the type of rigging and fixtures that is- put on the boats. At the time of the hearing, the captains were required to fish for shrimp. The Employer has also been able to con- trol the use of its • boats in fishing and freighting operations by. unilaterally changing the number of shares which it withholds on freighted shrimp. Furthermore, although the Employer hires the captains for an indefinite period, apparently as long as their services are satisfactory,1° it may terminate the agreements for use of the boats at will and without cause." Under the circumstances described above, in which the Employer furnishes and maintains not only all of the "basic tools" essential for performance of the work result,12 either directly or through the lending of its capital, but all the consumable supplies used in the fishing operations, the fact that the agreements for the "tools" most essential to the performance of the work-namely the boats-are terminable at will assumes great significance and permeates the re- lationship between the Employer and the captains. Through its option to terminate the agreement for use of the boat, the Employer has the right to control the length of the lay-overs, the hiring and firing of boatmen, the type of fishing done, the quantity of produc tion required,,and the manner in which the fishing is done. Regard- less of whether or not it has found it necessary to exercise such con- trol, the existence of this right of control negates the contention that the relationship between the Employer and the captains on the Em- ployer-owned boats is that of independent contractors. We are mindful that the above facts do disclose the existence of some elements in the relationship of the captains to the Employer similar to those in Alaska Salmon Industrj, Ine.,13 and J. Howard S ri, th; Inc;,14 recently decided by the Board, in which we found that the captains there involved were independent contractors. Like- 10 The permanence of a relationship is indicative of an employer -employee relationship. Restatement , Agency, Section, 220 (2) (f). It has been said by some courts that no other single fact is so conclusive in showing that the relationship Is not that of an independent contractor as that the employer has, the right to terminate the particular service whenever he chooses . . See, for example,,' Rislain v. Industrial Accident 'Commission, 23 Cal . 2d 248, 144 F. 2d 16 ( 1943) and Clausen v., Dept. of Labor and Industries , 15 Wash. 2d 62, 129 F. 2d 777. (1942). See also, Vaughn Brothers , et al., 94 NLRB 382; J . G . Howard Lumber Company, 93 NLRB 1230. . It Is noted that the rigging and the nets, which , like the boats, (all into the category of the "tools" basic to performance of the fishing operations , are usually worn out before they have been paid for by the shares deducted and applied to the accounts for the rig. 1a 81-NLRB 1335. 14 95 NLRB 21. 962 DECISIONS OF NATIONAL LABOR RELATIONS BOARD wise,, there are similarities with some of the elements in the relation- ship at issue in N. L. R. B.; v. Steinberg d Co., supra. An over-all consideration of the factors involved here persuades us, . however, that there are important distinctions between the facts involved in those .cases and those in the instant case; compelling the finding .we here make that the relationship between the Employer and the cap= 'thins and crews which operate its . boats, is that of employer and employees. Thus, in both the Alaska Salmon case and the J. Howard Smith case, the agreements- established the duration of the fishing season as the period during which the relationship, between the parties would exist, whereas in this case, the Employer, hires the captain for an indefinite period. In both of the cases mentioned above, the price to be paid for the fish was established by a bilateral agreement for the duration of the fishing season, whereas in this case the Em- ployer unilaterally determines and changes the price it will pay for the shrimp. In the Alaska Salmon case 85 percent of the "skippers" involved owned, or were in the process of purchasing, their boats, and, in the J. Howard Smith case the charter agreements gave the captains "full and exclusive possession, management, navigation con- trol and operation" of the fishing vessels for the duration of the fishing season 15 In this. case, as previously mentioned, the agree- merits for use of the boats are terminable at will and without cause. Because the Employer deducts the expenses of the trip from the value of the catch before it determines the value of the shares (in- eluding the share for use and upkeep of the boat), the Employer; unlike the employers in the J. Howard Smith case and the Alaska Salmon case, in fact shares the expenses of the trip with the captains and the crews. Whereas the boats in the J. Howard Smith were manned by 24 fishermen, the Employer's boats are small. and are manned by a captain and 1 or 2 boatmen. Thus, the possibility of a captain realizing profit through economical management in operat- ing the boat and directing the crew is much less than it was in the J.. Howard Smith case. The situation here more nearly approaches that of a group incentive pay system. The existence of an employer-employee relationship. is not rebutted by the fact that here, as in the Alaska Salmon "case and the J. Howard Smith case , the captains decide where and when to fish. The exist-' ence of an area in which judgment may. be exercised by 'a-skilled °6 Compare with N. L.. R.. B.. V. Steinberg Co., supra, in which the Court-of Appeals for the Fifth Circuit found that'the'fur-trapping, leases there involved were terminable, only upon breach of the terms of the agreement or' violations of law.. We also note that, in the Alaska Salmon case, the 'fishing' areas had been flaed by custom among the fishermen themselves and were subject to sale and transfer. SOUTHERN SHELLFISH CO., INC. 963', worker is not inconsistent, or incompatible, with the existence of an. employer-employee relationship.16 Nor is the existence of such a relationship rebutted by the fact that the captains and their crews. bear the risk of loss through spoilage of freighted shrimp and may profit or suffer losses through fluctuations in the price of the shrimp. they purchase for freighting. The record contains no indication. that such profits and losses appreciably affect the income of the cap-- tams and their crews. The Employer's price lists, which the captains. use to determine the prices they will give for such shrimp, are issued. several.times a year, and it does not appear that the prices thereafter paid by the Employer to the captains vary significantly from the prices set in the price lists. Although the Employer does not with- hold taxes from the income received by the captains and the boatmen, nothing appears in the record to indicate that the captains withhold. such taxes, or that they have been informed that it is their duty to do. so. - In conclusion, we note that, as described above, the captains and boatmen are independent of the Employer in the conduct of the fish- ing operations only insofar as their skill and value as workmen give them freedom in the labor market. In effect, the captains and boat- men bring to the fishing operations only their labor, and do not, in the language of the House Committee Report on the Labor-Manage- ment Relations Act of 1947, "depend for their income ... upon, the difference between what they pay for goods, materials, and labor and what they receive for the end result." 17 Accordingly, we find that. the captains and boatmen of the Em- ployer-owned boats are employees of. the Employer. "Lien Boats" The Petitioner also seeks to represent the captains and boatmen on the,"lien boats." 1s These are boats owned by the captains who op- erate them, but on which the Employer holds liens or mortgages ac- quired as a part of the agreement for sale of the boats or the rigging to the captains. The record indicates that, although the Employer expects the "lien boat" captains to deliver. their catches to. the Em- ployer in return for the favor of the credit advance, it has not ob- jected when "lien boat" captains `have made sales of their catches to. 16 Cf. United States v. Vogue, Inc., 145 F.'2d 609, 611 (C. A. 4, 1944). Such a.determinn- tion appears to be based, largely upon the season , the weather , and the captain's knowledge of, the fishing graunds . • Likewise, ithe length of the fishing. trips depends upon how soon 'a full catch is made or how long the supply of ice and groceries lasts. "H. Rep..*1245 , 80th Cong . 1st Sess., p. 18, Vol . 1, Legislative History of the Labor I elatlons Act; 1947 , page 309. 1 There are two or three boats in this category. 961974-52-vol. 95-62 964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD other companies. Nothing appears in the record to negate the in- ference which thus arises that here, unlike the situation with regard to the Employer-owned boats, the Employer does not require the "lien boat" captains to deliver all their catches to it. Nor does the Em- ployer generally deduct any fixed share of the catch of a "lien boat" for application to the debt, but accepts such payments as the "lien boat" owners desire to make. Furthermore, since the boats are in- dependently owned, the Employer does not have the right to control, and cannot control, the type of fishing done, the layovers between fishing trips, or the hiring and firing of the boatmen. Accordingly, we find that the captains of the "lien boats" are independent con- tractors and that they and their boatmen are not employees of the Employer. The petition is therefore dismissed as to those individuals. In view of our conclusion that there is an employer-employee re- lationship between the Employer and the captains and boatmen on the Employer-owned -boats, we find that a. question affecting commerce exists concerning the representation of employees of the Employer within the meaning of Section 9 (c) (1) and Section 2 (6) and (7) of the Act. 4. The appropriate unit : Although the parties are in general agree- ment as to the appropriate unit, the Petitioner would include the cap- tains while the Employer would exclude them on the basis of their supervisory duties. As the record clearly establishes that the cap- tains have the power to hire and discharge employees, and are there- fore -supervisors within the meaning of Section 2 (11) of the Act, we shall exclude them from the unit. We find that all fishermen or boatmen on the Employer-owned boats, excluding the captains and all or any other employees, con- stitute an appropriate unit for the purposes of collective bargaining within the meaning of the Section 9 (b) of the Act. [Text of Direction of Election omitted from publication" ii :this volume.] EMERSON & STEVENS MFG. CO., INC., AND SPILLER AXE AND TOOL COM- PANY and TEXTILE WORKERS UNION OF AMERICA, CIO, PETITIONER. .Case No. 1-RC-2226.. August 3,1951 Decision and Direction of Election Upon a petition duly filed under Section 9 (c) of the National- .Labor Relations Act, a hearing was held before Robert_,,S.Fuchs, hearing officer. The hearing officer's rulings made at the hearing are free from prejudicial error ' and are hereby affirmed. 95 NLRB No. 109. Copy with citationCopy as parenthetical citation