The Natural Gas Utility District of Hawkins County

National Labor Relations Board - Board Decisions

Oct 6, 1967

167 N.L.R.B. 691 (N.L.R.B. 1967)

NATURAL GAS UTILITY DIST. OF HAWKINS COUNTY 691
The Natural Gas Utility District of Hawkins County,
Tennessee and United Association of Journeymen
and Apprentices of the Plumbing and Pipe Fitting
Industry of the United States and Canada, Amer-
ican Federation of Labor , Local No. 102, Peti-
tioner . Case 10-RC-7070
October 6, 1967
DECISION AND DIRECTION OF
ELECTION
BY CHAIRMAN MCCULLOCH AND MEMBERS
FANNING , BROWN , AND JENKINS
Upon a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held before Hearing Officer George L.
Card, Jr. Thereafter, the Employer and the Peti-
tioner filed briefs.
The National Labor Relations Board has
reviewed the Hearing Officer's rulings made at the
hearing and finds that they are free from prejudicial
error. They are hereby affirmed.
Upon the entire record in the case, the National
Labor Relations Board finds:
1. The Employer, also referred to as the District,
moved to dismiss the petition on grounds that, as an
exempt political subdivision of the State of Tennes-
see, the Board may not assert jurisdiction herein. In
rejecting this contention, we find that the Employer
is not a political subdivision within the meaning of
Section 2(2) of the Act.'
In this connection, the facts show that the Em-
ployer was incorporated in December 1957 under
the provisions of the Tennessee Utility District Act
and is engaged in the sale and distribution of natural
gas to residential houses, commercial businesses,
and industrial firms, all of which are located within
Hawkins County, Tennessee.
The Employer is organized to supply gas utility
service without pecuniary profit. The Employer
conducts its business without supervision of the
State or any political subdivision thereof. It hires its
own employees, and sets their terms and conditions
of employment. It also has the usual powers of a
private corporation, e.g., it may sue and be sued,
incur obligations, issue bonds, sell and encumber its
property, and enter into contracts necessary or con-
venient to the exercise of the powers granted to it.
The Employer contends, however, that it is not
the customary public utility inasmuch as the Ten-
nessee statute under which it is organized specifi-
cally declares that a utility district is a "municipali-
ty" or "public corporation,"2 and the Supreme
Court of Tennessee has held that utility districts are
"arms or instrumentalities" of the State of Tennes-
see.3 However, while such State law declarations
and interpretations are given careful consideration
by the Board, they are not necessarily controlling.4
Rather, the determination of whether a particular
entity falls within the exemption for political sub-
divisions entails an assessment of all relevant fac-
tors. Upon examination of the instant record in the
light of the "economic realities and statutory pur-
poses,"5 we are satisfied that the Employer exists
as an essentially private venture, with insufficient
identity with or relationship to the State of Tennes-
see to support the conclusion that it is an exempt
governmental employer under the Act. Thus, unlike
the usual situation where jurisdiction has been
declined on political subdivision grounds,6 the Em-
' Sec. 2(2) reads in material part- "The term 'employer '. . . shall not in-
clude ... any State or political subdivision thereof 11
2 Tennessee Code, title 6 , ch. 26, sec. 7, District as municipality -
Powers.
From and after the date of the making and filing of such order of in-
corporation , the district so incorporated shall be a "municipality" or
public corporation in perpetuity under its corporate name and the
same shall be a body politic and corporate with power of perpetual
succession , but without any power to levy or collect taxes. Charges
for services authorized herein , shall not be construed as taxes The
powers of each district shall be vested in and exercised by a majority
of the members of the Board of commissioners of the district . So long
as the district continues to furnish any of the services which it is
herein authorized to furnish , it shall be the sole public corporation
empowered to furnish such services in the district unless and until it
shall have been established that the public convenience and necessity
requires other or additional services. [Acts 1937, ch. 248, sec 3, C.
Supp . 1950, sec. 3695.28.1
'First Suburban Water Utility Dist . v. McCanless, 177 Tenn. 128,
146, S.W. 2d 948 (1941)
' In N.L.R.B. v. Randolph Electric Membership Corporation, and
N.L.R.B. v. Tri-County Electric Membership Corporatiom 343 F.2d 60,
62 (C.A. 4), the court , in sustaining the Board 's finding that the companies
were not "political subdivisions" despite the State legislatures declara-
tion to the contrary and similar interpretations by State Attorney
167 NLRB No. 100
Generals, held:
In the absence of a plain indication to the contrary, however, it is to
be assumed when Congress enacts a statute it does not intend to
make its application dependent on State law.
In accord N L R.B. v Hearst Publications, 322 U S. 111, 123 (1944),
11. . Nothing in the Statute 's background, history, terms or purposes in-
dicates its scope is to be limited by varying local conceptions, either
statutory or judicial, or that it is to be administered in accordance with
whatever different standards the respective States may see fit to adopt for
the disposition of unrelated, local problems."
s See Randolph, supra at 62
6 See, e g , Mobile Steamship Association, 8 NLRB 1297 , where the
State Docks Commission, one of the employers , was created by specific
legislation of the State of Alabama, Oxnard Harbor District, 34 NLRB
1285, a harbor district organized by district residents under a general
enabling act of California, but governed by a board of commissioners
elected for a term of office by qualified voters of the district, New Jersey
Turnpike Authority, 2-RC-2245, April 16, 1954, an authority specifically
created by the Legislature and governed by members appointed by the
Governor with advice and consent of the Senate, New Bedford, Woods
Hole, Martha's Vineyard, and Nantucket Steamship Authority, 127
NLRB 1322, a body corporate created by Massachusetts, consisting of
members appointed and removed by the Governor with the advice and
consent of the Executive Council.
310-t41 0 - 70 - 45
692 DECISIONS OF NATIONAL
ployer in this case is neither created directly by the
State,7 nor administered by State-appointed or
elected officials." Furthermore, its operations and
services do not differ significantly from those of en-
terprises in private industry including utilities
whose employees are entitled to the benefits of the
Act. The Employer is completely autonomous in
the conduct of its day-to-day affairs, with the State
exercising no supervisory role with respect thereto,
or reserving any power to remove or otherwise
discipline those responsible for the Employer's
operations. In these circumstances, we are satisfied
that the State pronouncements are not determina-
tive of the public nature of the Employer's functions
and activities. We are also not persuaded that mere
possession of the power of eminent domain which,
as here, has been conferred in aid of a venture
which is essentially private in nature, requires us to
find that the Employer constitutes a political sub-
division under Section 2(2) of the Act. In this re-
gard, we think it significant that legislatures have
frequently delegated such power to nonexempt
privately owned and operated service corpora-
tions.`' Indeed, the Tennessee Legislature itself has
delegated such authority to private corporations. "
In these circumstances we find that the District
is an Employer within the meaning of Section 2(2)
The Utility Districts are not created directly by the State They are
formed by petition of property owners upon a County Judge's determina-
tion of the feasibility thereof Thus, the District is no more a direct crea-
tion of the State than such privately owned public service companies as
railroads and motor carriers , which also require some form of governmen-
tal approval , such as a certificate of convenience and necessity
8 The County Judge exercises no independent discretion in naming the
members of the board of commissioners He must by statute appoint those
persons nominated in the petition seeking formation of a district
" N C Public Service Co v Southern Power Co , 282 F 2d 837 (C A
4), writ of cert denied 263 U S 508, Whiting Mfg Co v Carolina Alu-
minum Co, 207 N C 52, 175 S E 698, Berry v Southern Pine Electric
Power Assn , 222 Miss 260, 76 So 2d 212, Bookhart v Central Electric
Power Coop , 219 S C 414, 65 S E 2d 781, as explained in Black River
LABOR RELATIONS BOARD
of the Act. Accordingly, and as the record shows
and the parties agree that the Employer's opera-
tions satisfy the Board's commerce standards for
public utilities, we find that the Employer is en-
gaged in commerce within the meaning of the Act.
2. The labor organization involved claims to
represent certain employees of the Employer.
3. A question affecting commerce exists con-
cerning the representation of employees of the Em-
ployer within the meaning of Section 9(c)(1) and
Section 2(6) and (7) of the Act.
4. In accordance with the parties' stipulation, we
find that the following employees of the Employer
constitute a unit appropriate for the purposes of col-
lective bargaining within the meaning of Section
9(b) of the Act:
All pipe fitters employed at the Employer's
Rogersville, Tennessee, operation, but exclud-
ing all other employees, office clerical em-
ployees, salesmen, warehousemen, profes-
sional employees, guards, and supervisors as
defined in the Act.
[Direction of Election" omitted from publica-
tion.]
Electric Coop., v Public Service Commission, 238 S C 232, 120 S E 2d
6, 12, Hagans v Excelsior Electric Membership Corp, 207 Ga 53, S E
2d 162, Alabama Power Co v Cullman County Electric Membership
Corp , 234 Ala. 396, 174 So 866
"'Tennessee Code, title 48 , ch 1, sec I, et seq
" An election eligibility list, containing the names and addresses of all
the eligible voters, must be filed by the Employer with the Regional
Director for Region 10 within 7 days after the date of this Decision and
Direction of Election The Regional Director shall make the list available
to all parties to the election No extension of time to file this list shall be
granted by the Regional Director except in extraordinary circumstances
Failure to comply with this requirement shall be grounds for setting aside
the election whenever proper objections are filed Excelsior Underwear
Inc, 156NLRB 1236