The Denver Post, Inc.

National Labor Relations Board - Board Decisions

May 19, 1972

196 N.L.R.B. 1162 (N.L.R.B. 1972)

1162 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Denver Post , Inc. and Denver Newspaper Guild,
Local 74, AFL-CIO-CLC, Petitioner. Case 27-RC-
4188
May 19, 1972
DECISION AND ORDER
BY CHAIRMAN MILLER AND MEMBERS KENNEDY AND
PENELLO
Upon a petition duly filed under Section 9(c) of the
National Labor Relations Act, as amended, a hearing
was held on various dates from October 27 through
November 10, 1971, before Hearing Officer Douglas
R. Hjelle. Following the hearing and pursuant to Sec-
tion 102.67 of the National Labor Relations Board
Rules and Regulations and Statements of Procedure,
Series 8, as amended, and by direction of the Regional
Director for Region 8, this case was transferred to the
National Labor Relations Boards for decision. There-
after, the Employer and Petitioner filed briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has reviewed the Hearing Officer's rul-
ings made at the hearing and finds no prejudicial error
was committed. The rulings are hereby affirmed.
Upon the entire record in this case, including the
briefs of the parties,' the Board finds:
1. The Employer is engaged in commerce within the
meaning of the Act, and it will effectuate the policies
of the Act to assert jurisdiction herein.
2. The labor organization involved claims to repre-
sent certain employees of the Employer.
3. No question affecting commerce exists concern-
ing the representation of employees of the Employer
within the meaning of Sections 9(c)(1) and 2(6) and
(7) of the Act.
The Denver Post, Inc.,' is a Colorado corporation
with its principal office and place of business in Den-
ver, Colorado, where it is engaged in the publication
and distribution of daily and Sunday editions of a
newspaper known as The Denver Post. The Petitioner
seeks a unit of three distributors in the City Circula-
tion Department' who are engaged principally in the
delivery' of the newspapers to subscribers either di-
rectly or through carriers. The Employer contends,
inter alia, that the distributors are independent con-
tractors, not employees within the meaning of Section
1 The Employer's request for oral argument is hereby denied as, in our
opinion, the record and briefs adequately present the issues and positions of
the parties.2
Herein also referred to as the Employer, the Company, or the Post.
3 The individuals involved are Francis Davis, Pansy Aultman, and Earl
Lybarger, Sr.
2(3) of the Act, and that the petition should therefore
be dismissed.
The Employer's major circulation geographically is
around the Denver metropolitan area, but it has a
general circulation throughout the State of Colorado
and in the neighboring States of Kansas, New Mexi-
co, Utah, and Wyoming. Delivery in the Denver met-
ropolitan area is handled by the "City" Depart-
ment.4 which is subdivided into "home delivery" and
"street dealer" departments.
The three distributors sought herein are in the
"home delivery" department along with motor route-
men,5 carriers, and helpers, while the "street dealer"
department includes dealermen and streetmen, street
salesboys, and adult vendors.
The relationship of the distributors to the Post was
established by contracts which are from 11 to 17 years
old. Entitled the "Independent Merchant's Lease and
Agreement," they set forth certain terms and condi-
tions of the operation which the record reveals are not
in fact followed currently. Thus, a geographic area is
described and granted by the Post, but changes have
been made in these areas which have not been incor-
porated in the agreement; it states that no money or
other consideration was paid to anyone for the route
and list of subscribers, whereas one distributor sold
his distributorship; it requires that the list of subscri-
bers be kept up to date and not disclosed to anyone
but the Post, but the record contains no indication
that current lists of subscribers are supplied to the
Post at any time. In addition, the contracts provide
that if the paper is not delivered to a subscriber, the
Post may deliver it at an extra, established charge to
the distributor, but in practice the distributor is in-
formed of complaints of nondelivery in order that he
may take care of them himself, and it appears that no
delivery charge has ever been made. These documents
further state that the distributors will pay the estab-
lished wholesale rate for papers purchased, but the
record reveals that in at least one instance the whole-
sale rate was established by negotiation between the
distributor and the Post; and certain bonding require-
ments are set out to secure payment to the Post, but
one of the distributors has a different arrangement to
provide security to the Post which was established
pursuant to discussions with the Post. These doc-
uments state specifically that the distributors are inde-
pendent contractors and require that each distributor
accomplish the sale and delivery of the paper at his
own expense, using his own means and methods and
° The "City" Department is under the circulation division manager, who
also directs the "Country" Department which handles the operations in all
other areas.
5 The motor routemen operate in more rural areas, performing the same
role in the distribution system. The parties stipulated that these motor route-
men are independent contractors, although their status is not in issue in this
proceeding.
196 NLRB No. 169
THE DENVER POST, INC. 1163
hiring any substitutes needed; that the distributor give
30 days' written notice before giving up a route; that
the Post may cancel immediately for fraud or viola-
tion of the agreement but on 30 days' written notice
for any other reason; and that the Post may maintain
newsboys and newsdealers (apparently for other than
home deliveries) in the areas assigned.
In general, the three distributors perform the same
functions in the delivery process as do the dealermen
and motor routemen, in that they all take large quan-
tities of papers and distribute them to carriers, sales-
boys, vendors, and/or places of business for sale or
delivery to customers . There is no restriction on the
number of papers any of the distributors may draw
each day, and changes in the number drawn are made
only by the distributors, but they are given no credit
for returns or damaged papers. The dealermen either
pick up bundles of papers at the dock and deliver
them for sale or the Employer delivers the papers to
the dealermen and motor routemen by private hauler
who drops them ("spots" them) at predetermined lo-
cations.' The three distributors receive their papers
from the same private hauler who "spots them at
locations designated by the distributors. Some of
these locations are in rented structures used by the
Post and distributor; in these situations, the distrib-
utor pays for his proportionate share of the rental cost
for the space he utilizes.
Dealermen are employees, having been so found by
the Board in a prior proceeding,' and are represented
by the Petitioner. The carriers who make the home
deliveries of the papers, which they receive from deal-
ermen , are also employees of the Employer. However,
the three distributors accomplish the home deliveries
themselves or through carrier boys or motor route
carriers (who may have their own carriers) selected
and hired by the distributors. These carriers are con-
cededly not employees of the Post and, in fact, no
regular list of such carriers is supplied to the Post,
although such information may come into the
Company 's possession incidentally in connection
with bonding where the distributor bonds his carriers
through the Company's group plan which the Post
makes available to the distributors. Such coverage is
optional, however, and one distributor uses another
method'
6 About half the dealermen have the papers delivered by the private
hauler's "spotting" the bundles . Acme, the contractor-hauler hired by the
Post, carries papers in the same truck to dealermen , distributors, and some
motor routemen.
7 Case 27-RC-2574, not published in NLRB volumes. In that proceeding,
which involved the identical parties as the instant case, the Regional Director
for Region 27 found appropriate a unit of dealermen , but excluded distrib-
utors and motor routemen , concluding that their interests and conditions of
employment were substantially different . The Union contended therein that
distributors were independent contractors , while, as one alternative , the Em-
ployer contended that all dealermen , distributors, and motor routemen were
independent contractors or that all should also be included in one unit.
The distributors purchase the papers from the
Company at the set price and sell them to the carrier
boys or motor route carriers at a higher price de-
termined by the distributor; the carriers in turn sell to
the residential customer at a retail price above the
price they pay-in some instances, this retail price
may be above that shown on the masthead of the
newspaper. The income of the distributors is not sup-
plemented by subsidies, allowances, bonuses, or the
like, but, when material is to be inserted manually in
the paper, the distributors are allowed one-half cent
per insert and each distributor determines whether
any portion of that amount should be paid to carriers
and, if so, what it should be. Each distributor pays for
his newspapers only once a month, either in person to
a cashier or to a supervisor at a collection meeting or
by mail.
The distributors determine the sequence of delivery
and to which customers they will extend credit. Ad-
vance payments by subscribers need not be turned
over to the Post. The Post conducts contests among
the dealermen in securing additional subscriptions;
the distributors may participate, except they must re-
ceive any prize in goods or cash; unlike dealermen,
they cannot accept trips as prizes because of the possi-
bility of Company liability in the event of injury while
traveling. To secure additional subscriptions, the Post
sends about 15 free "sample" papers to the distributor
and the distributor also buys on his own account a
certain number of additional papers, all of which he
leaves at various places to induce persons to become
subscribers. He determines where he will leave the
samples, is not paid for sampling, and does not make
a report on the results of this sampling or otherwise
account to the Post.
As indicated previously, all three distributors have
been performing their functions for many years. It
appears that when they took over their routes the
Post's employees worked closely with them, advising
and guiding them until they were able to cope with the
routes themselves. At the present time, there is little
contact with the supervisors, who meet each of the
distributors in the field about 12 times each year. The
distributors are not required to meet the liaison men
at specified locations, and the liaison men do not
check to determine whether or how the distributors
are covering their routes? In contrast, the supervisors
8 Carriers pay their own bond to secure payment to the distributors. The
Company permits the distributors to have a bond issued at a group rate by
forwarding payments to the Post, which pays the premium. None of the
Company's employees appear to be covered by this bond. Two of the distrib-
utors use this method, while the third is, in effect, self-insured in that he
retains the premium payment made by each carrier and will himself bear the
loss if any carrier should fail to pay for the papers.
9 It appears that the only way in which the Post may become aware that
a distributor has failed to make a delivery on his route is through complaint
calls made to the Company's office . These complaints are not adjusted by
Continued
1164 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
meet with dealermen at least weekly and do oversee
their methods of operation. The Company conducts
meetings of dealermen daily, at which their atten-
dance is mandatory; the distributors are not required
to attend these sessions , and one of them does not do
so at all, while the other two attend voluntarily about
twice a week at their own convenience. The distrib-
utors make no reports to the Company at the present
time, except one which is required as proof of sub-
scriptions obtained in sales drives. A distributor is not
restricted in any way. He may hold another job and
may carry anything he wishes, including competing
newspapers, may dress as he chooses (dealermen wear
prescribed clothing), and may schedule his own work-
ing time.10
The Company maintains no personnel or payroll
records for distributors or for their carriers, and it
does not charge, withhold, or provide in any way for
distributors' Federal income tax, workmen's compen-
sation, health and hospitalization insurance, or pen-
sion benefits.
In making the determination as to whether individ-
uals are employees or independent contractors, the
Board applies the right-of-control test. As has often
been stated, the resolution of the status of disputed
persons depends on all the facts in each case.
In the instant case , we are satisfied that the distrib-
utors are independent contractors. We are mindful
that, as seems typical in cases of this kind, there are
factors present supporting the position taken by both
parties with respect to the distributors' status. Thus,
on the one hand, the distributors at the outset of the
relationship were given counsel and guidance by the
Company; they voluntarily participate in promotions
and meetings; the Company furnishes certain forms
for use by distributors; customer calls of complaint
about service and stop and start orders may be re-
ceived by the Company; the price at which the paper
is sold is "established" by the Company; the written
contract contains terms which provide for extensive
control by the Post and would, standing alone, seem
to establish an employee-employer relationship; the
Company acts as middleman for bonding of carrier
boys and motor routemen and requires credit bonds
for distributors; the Company gives prizes for in-
creased subscriptions; the Company raises prices to
distributors when its costs rise; and the distributors'
areas are said to be limited by agreement with the
Company.
the Company but are transmitted to the distributor when he calls in each
night to inquire whether there have been any complaints.
° Although it appears that the Company expects papers to be delivered
within 2 hours after they are dropped off to the distributor, this apparently
has to do with merchantability of the commodity rather than with control
of the operation.
On the other hand, most of the other factors noted
above reveal the independence of the distributors. For
example, supervisors of the Company in recent years
have spent little time with distributors and then only
as observers; whether or how they perform their dis-
tribution is not monitored by the Company; sugges-
tions and criticism of distributors by the Company are
solely to stimulate sales of its newspapers; extension
of credit to subscribers is determined solely by the
distributor, who sustains any loss which. may result;
the route, dress, time off, and substitutes or helpers or
their pay, are not regulated by the Post; the distrib-
utor determines where the Company will drop off
their papers; the method of a distributor's credit
bonding to secure payment to the Company is subject
to negotiations, as is the method of the credit bonding
of his carriers; distributors determine whom to put on
as carrier boys and motor routemen and designate
their territory and the price which they must pay for
the newspaper; complaints are serviced by the distrib-
utors and action concerning stops and starts must be
initiated by distributors; the Company does not ac-
cept returns or reimburse the distributors for dam-
aged or lost newspapers; their income is based on the
difference between the price at which they buy, plus
labor costs, and the price at which they sell to custom-
ers or carriers; the contract of the parties is not ob-
served in practice; the Company's price to distributor
is subject to negotiations; distributors own, operate,
and maintain their own vehicles, which have no mark-
ings identifying them with the Company; and they
may carry anything they wish, including rival newspa-
pers. We note also that in the prior proceeding 11 the
Petitioner argued that these distributors should not be
included in a unit of dealermen, since they "operate
completely independently, they are independent con-
tractors." Neither the function nor the relationship of
the distributors and the Company has changed since
that time.
Having given careful consideration to all the facts
of this case , we are persuaded and find that the dis-
tributors are not "employees" within the meaning of
the Act, but are independent contractors who under-
take to perform a particular job and themselves con-
trol the manner and means by which it shall be
accomplished.12 The Company exercises little, if any,
control over the details of their operations and is con-
cerned only with the ultimate accomplishment of the
result desired, i.e., sale of the newspaper to home sub-
scribers. Unlike other cases involving somewhat sim-
ilar functions, the distributors' opportunities for
11 See In . 7, supra.
12 Cf. The Herald Company v. N.L.R.B., 444 F.2d 430 (C.A. 2), enfg. 181
NLRB 421; The News-Journal Co. v. N.L.R.B., 447 F.2d 65 (C.A. 3), enfg.
I"', NLRB No. 40.
THE DENVER POST, INC. 1165
profits in the instant case are not limited by the ORDER
Company's regulation or control of important aspects
of their work. It is hereby ordered that the petition herein be, and
As we have concluded that the distributors sought it hereby is, dismissed.
herein are independent contractors, we shall dismiss
the petition.