The Ransom and Randolph Co.

National Labor Relations Board - Board Decisions

Dec 31, 1954

110 N.L.R.B. 2204 (N.L.R.B. 1954)

2204 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the entire appropriate unit. The Employer may then insist that they
do in fact bargain jointly for such employees as a single unit .3
We further find no merit in the Employer's contention that to enter-
tain this petition will result in a denial to employees of their right
to join or assist labor organizations of their own choosing as guar-
anteed by Section 7. We fail to perceive how the holding of an elec-
tion in which employees are given the opportunity of voting for either
of two possible representatives or for neither can possibly have the
result claimed by the Employer.
6. Although the unit found to be appropriate is broader than that
sought by the Petitioners, it appears that their showing of interest is
sufficient to enable them to participate in the election hereinafter
ordered. Accordingly, we shall direct such an election, and place
the Petitioners on the ballot, subject to the right to withdraw their
names by notice to the Regional Director to that effect within 5 days
from the date of the issuance of this Decision and Direction of
Election.'
[Text of Direction of Election omitted from publication.]
3 (7usdorf & Son , supra, J. J Moreau & Son, Inc, 107 NLRB 999
4Leuns & Bowman, Inc, 109 NLRB 772
THE RANSOM AND RANDOLPH COMPANY 1 and INTERNATIONAL CHEbI-
ICAL WORKERS UNION, LOCAL No. 11, AFL, PETITIONER. Case No.
21-RC-3578. December 311 1954
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 Fred W. Davis, hearing
officer. The hearing officer's rulings made at the hearing are free
from prejudicial error and are hereby affirmed.
Upon the entire record in this case, the Board finds :
1. The Employer is an Ohio corporation engaged in the manu-
facture of dental supplies. Its principal manufacturing plant is
located in Toledo, Ohio. It operates branch plants in Indiana, Michi-
gan, and California. The Petitioner seeks to represent only the
employees of the California plant. The record discloses that the
California plant was established because the Employer considered
that it could thereby capture a larger share of the West Coast market
in its industry. It is under the overall direction of the Employer's
factory manager, who is also in charge of the Employer's Toledo
plant.
1 As amended at the hearing.
110 NLRB No. 271.
THE RANSOM AND RANDOLPH COMPANY 2205
After the hearing, the parties entered into a stipulation to the effect
that the Employer shipped goods valued in excess of $250,000 from
its plants in Ohio and California to points outside those two States.
This stipulation is hereby received into the record. The Employer
contends, however, that the Board should not assert jurisdiction over
the California plant, because in the 7 months of its operation prior
to the hearing, the Employer shipped goods valued at only approxi-
mately $5,000 to points outside the State of California.
As the total amount of direct outflow of the Employer's multistate
operations exceed $250,000, in value, we find in accordance with Jones-
boro Grain Drying Cooperative 2 that it will effectuate the policies of
the Act to assert jurisdiction over the Employer's California
operations.
2. The labor organization involved claims to represent certain em-
ployees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of employees of the Employer within the meaning of Section 9
(c) (1) and Section 2 (6) and (7) of the Act.
4. The parties are in agreement as to the scope of the bargaining
unit. Accordingly, we find that all production and maintenance
employees including shipping and warehouse employees at the Em-
ployer's Los Angeles, California, plant, but excluding office employees,
plant clerical employees other than shipping and warehouse employees,
guards, professional and technical employees, and supervisors as de-
fined in the Act, constitute a unit appropriate for the purposes of col-
lective bargaining within the meaning of Section 9 (b) of the Act.
5. The Employer contends that it would be inappropriate to hold
an election at this time, because it intends to expand its operations.
At the time of the hearing, the Employer employed two employees
who performed all the various operations that would be performed
were the plant to expand. The Employer contemplates no further
addition to the machinery now in the plant. The Employer expects
that it may eventually employ 6 to 8 employees, but its expansion
plans are indefinite in nature and depend for realization on economic
factors over which the Employer has no direct control.
We find that a substantial number of employees are currently em-
ployed and that they constitute a representative group of the ultimate
personnel complement. Therefore, we shall, in accordance with the
Board's policy in such cases, direct an election among the employees in
the unit herein found to be appropriate.3
[Text of Direction of Election omitted from publication.]
3110 NLRB 481.
3 General Electric Company, 106 NLRB 364.
2206 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
MEMBER MURDOCK, concurring in part and dissenting in part :
I concur in my colleagues' conclusion that it will effectuate the poli-
cies of the Act to assert jurisdiction over the Employer's California
operations . However, I do not agree with the jurisdictional stand-
ard utilized by the majority to reach their decision and I base my con-
currence in the result solely on the ground that the Board should assert
jurisdiction over any establishment operating as an integral part of a
multistate enterprise. ,
The Board, of course, has, in the past, consistently asserted juris-
diction over units of multistate systems.4 Now new and severe restric-
tions upon such assertion of jurisdiction are adopted by my colleagues.
As these restrictions were first published, without rationale, in a July
press release and then announced in a revised form by the majority
in a case which had nothing to do with their application,' this is the
first judicial vehicle in which I could appropriately comment on the
effects of the standard and its actual use by the Board.
As one of a number of standards in a program designed to severely
slash the Board's jurisdiction, the new multistate standard is, of
course, subject to the basic objections to that program and those stand-
ards set forth in my dissenting opinion in Breeding Transfer Com-
pany, 110 NLRB 493. I shall therefore restrict myself herein to the
particular defects and dangers inherent in the majority approach to
multistate enterprises alone.
The new multistate standard consists of certain stringent minima
which must be satisfied prior to the assertion of jurisdiction. As set
forth in the Jonesboro potpourri, jurisdiction will be asserted, hence-
forth, over enterprises which are integral parts of a multistate system
only if :
(a) The particular establishment involved meets any of the
foregoing standards [for independent enterprises] ; 6 or
(b) The direct outflow of the entire enterprise amounts to
$250,000 or more; or
(c) The indirect outflow of the entire enterprise amounts to
$1,000,000 or more.
Reduced to its simplest terms-if indeed any simple explanation is
possible-tie majority is holding that the assertion of jurisdiction
over units of multistate enterprises will be judged by the same stand-
ards applying to an enterprise confined to one State except where the
multistate enterprise as a whole meets certain stated minima.
To judge this standard it is necessary to look at the general nature
of the enterprises with which we are specifically dealing herein. The
4 The Borden Company, 91 NLRB 628.
5 Jonesboro Grain Drying Cooperative, 110 NLRB 481.
6 Direct outflow of $50 ,000, indirect outflow of $ 100,000, direct inflow of $500 .000 or,
indirect inflow of $1 ,000,000
THE RANSOM AND RANDOLPH COMPANY 2207
Board and the courts have consistently held that the problem of labor
disputes in a business operating in several States is a special one. By
their very organization, these enterprises are interstate and comprise
commerce of the type the Act was designed to protect. Thus the Board
formerly held, with the approval of the courts that :'
We continue to believe that when a plant is owned and oper-
ated by a company which is a multistate enterprise, we should
exercise our discretion in favor of taking jurisdiction, even
though management is entrusted to local officials and the par-
ticular plant may sell its entire product within the State where
it is located.
The reasons for this approach are both numerous and elementary.
The operation of a multistate enterprise almost inevitably results in
interstate activity of one type or another. Moreover, the history of
labor-management relations has shown conclusively that patterns of
conduct in industrial relations are usually consistent within one firm
though it may have numerous plants. The States and their agencies
can only deal with the problems arising in such enterprise to the ex-
tent that the enterprise happens to be within its geographical bound-
aries. Conflicting or divergent methods of control over these prob-
lems has inescapable effect upon the flow of commerce.
Accordingly, from the very nature of these multistate enterprises
and the inherent impact upon commerce of labor disputes occurring
therein, it is clear that our requisites for the assertion of jurisdiction
should be more liberal in the case of such enterprises than in the case
of many others whose operations are confined to one State. We must
therefore question whether the new standard, in fact, reflects the in-
herent difference in the relationship to commerce of multistate busi-
nesses and that of concerns operating in only one State. Even a
cursory analysis of the new standard shows the answer to be in the
negative. Indeed, despite the implicit interstate character of these
multistate organizations, the new standard actually requires larger
operations with a greater impact upon commerce for the assertion of
jurisdiction over multistate organizations than will be required for
those located in only one State.
As I have noted, the new standard is divided into three parts. The
first part is nothing more nor less than the minima required for asser-
tion of jurisdiction over enterprises which do not have an interstate
organization. Obviously, then, there is nothing in this part of the
standard which reflects the greater impact upon commerce of an in-
terstate organization. The remaining two sections of the standard
apply to the operations of the multistate chain as a whole and require
The Borden Company, supra ; see also N . L. R. B. v. Charles E. Daboll, Jr., 216 F. 2d
143 (C A 9).
2208 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
5 times the direct outflow of a single enterprise and 10 times the in-
direct outflow . Nothing is said about the combined or total direct or
indirect inflow. Does this haphazard multiplication of the individual
minima for outflow reflect the greater impact of a multistate enter-
prise? There is no evidence supporting such a conclusion and there
are many illustrations to the contrary.
Suppose, fog- example, that a manufacturing concern owns and
operates a plant in the State of New York which sells and ships.
$50,000 worth of goods to purchasers outside that State. The ma-
jority will assert jurisdiction even if the plant has no other sales
or purchases which enter into the stream of commerce . Another
manufacturing concern, however, owns and operates four plants in
the States of Pennsylvania, Maryland, New Jersey, and Rhode
Island. Each of these plants has $45,000 in direct outflow and
$95,000 in indirect outflow. As none of these individual plants meets:
the individual minima created by the majority, jurisdiction would
be rejected over the separate plants . Here, then, is the test of the
majority plant as to multistate enterprises for, while each of these
plants has slightly less than the minimum amount of outflow nec-
essary for assertion of jurisdiction , the additional factor of inter-
state control and operation of the plants is present . We would as-
sume, accordingly, that the slight margin by which the individual
plants failed to meet the individual minima would be overcome by
this important additional factor of interstate operation . This, un-
fortunately, is not the case.
While the four plants in the example each meet 90 percent of
the $50,000 direct outflow standard for individual plants, their com-
bined $180,000 of outflow is only 76 percent of the $250,000 direct
outflow standard for multistate enterprises . While the $95,000 in
indirect outflow at each plant is 95 percent of the $100,000 minimum
for individual plants , the combined total of $380,000 is only 38
percent of the $1,000,000 minimum for multistate plants. Yet, the
total direct or indirect outflow of this multistate enterprise whose
lines of ownership and control cross State lines is many times the
outflow of the single New York plant over which my colleagues
would assert jurisdiction . And, even if the direct and indirect out-
flow of this multistate enterprise exceeded the $1,000,000 minimum
for indirect outflow alone, my colleagues would not combine the two
despite the obvious reasons for doing so. Finally , even if the total
inflow of this multistate group of plants reached a total of millions
of dollars a year, the majority would not assert jurisdiction for the
majority, unaccountably, make no provision for the exercise of juris-
diction on such a basis no matter what the total. To say that this
is illogical is to understate the case. It is a course of procedure in
THE RANSOM AND RANDOLPH COMPANY 2209)
direct opposition to this Agency's duty to protect interstate com-
merce from the impact of labor disputes.
But this is not the complete story. In fact, to adequately examine
and explain the inherent fallacies in the majority's multistate stand-
ard would require both the time and talents of a mathematician
lather than a member of an administrative board dedicated to the en-
forcement of a labor relations statute. And, indeed, perhaps one of
the most obvious inadequacies of the new standards created by my
colleagues is that their very complexity and confusion will result
in doubt to litigants as to their status before this Board and the ex-
penditure of countless hours of work on the part of the staff of the
Agency in attempting to use the standards.
I shall limit myself, therefore, to one more pertinent example.
The multistate standard discussed herein, of course, does not apply,.
for reasons never explained, to so-called "service" or retail enter-
prises. In the process of silent amending and alteration of the spe-
cial standard set up for these latter organizations, however, my col-
leagues have adopted a rule that retail or service chains located en-
tirely in one State will come within the new standards if the entire
operation of the chain meets one of the minima for an individual
store. Thus an individual store or an interstate chain of such stores
which has a direct inflow of at least $1,000,000, or indirect inflow or
at least $2,000,000 or direct outflow of at least $100,000 will be sub-
ject to the Board's jurisdiction. Yet, a chain of nonretail or service
establishments existing in many States rather than in one State with,
the same inflow or outflow will be excluded from the Board's juriR-
diction. To make the picture completely without logic, the standards
for such retail or service stores were supposedly made more strict be-
cause those establishments had a lesser effect upon commerce as en-
visaged by the majority.
But even if the multistate standard here applied were revised to.
require only that the total operations of the multistate chain meet
any of the minima applicable to individual enterprises, the standard
would still not reflect the actual character of multistate enterprises..
For all of the sales or purchases of a multistate organization, whether
in or out of the State in which it is located, are, when properly viewed,,
seen to be direct sales or purchases in interstate commerce. For, as
the Employer in this case pointed out, the California plant which is
a part of this multistate organization, was established to enable the
Employer to capture a larger share of the West Coast market in its
industry, and that, if it failed to do so, it would discontinue the plant.
By thus increasing its sales to West Coast consumers both within-
and without the State of California, over the sales which it would
have been able to make by selling directly from its Toledo plant, the
2210 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Employer increased its sales in interstate commerce. Yet the major-
ity regards all the California plant's sales in that State to be intra-
state and completely fails to perceive the impact on commerce which
would occur from a disruption of the California plant's operations
and the resulting dislocation of the Employer's operations in both
Toledo and California.
Enough has been said to disclose that the application of this new
multistate standard will result in the arbitrary exercise and rejection
of jurisdiction by the Board. But to gain an adequate idea of the
scope of the recision of jurisdiction with respect to multistate estab-
lishments, one must also consider the effects of other new standards
to be applied to franchised dealers and multistate retail and service
organizations. For they are all part of the majority's new and arbi-
trary approach to the assertion of jurisdiction over enterprises oper-
ating in many States. I have discussed the shortcomings of the lat-
ter two standards in my dissenting opinions in Wilson-Oldsmobile,
110 NLRB 534, and Hogue and Knott Supermarkets, 110 NLRB
543. That there is no justification or rationale for these standards
is perhaps best illustrated by the fact that the majority, in each case,
has contented itself with the bare announcement of the standard
without any attempt to show its basis or explain the necessity for its
existence.
Accordingly, because the standard applied herein to multistate en-
terprises is not only subject to all the objections which I set forth in
my Breeding Transfer opinion but fails completely to reflect the
interstate aspects of multistate establishments I must dissent from
the establishment of that standard.
MEMBER PETERSON, concurring in part and dissenting in part :
What Member Murdock has said is so correct and persuasive that
I see no need to add any embellishment. I join in his views.
O