The Rhode Island Catholic Orphan Asylum

National Labor Relations Board - Board Decisions

Jun 21, 1976

224 N.L.R.B. 1344 (N.L.R.B. 1976)

1344 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Rhode Island Catholic Orphan Asylum , a/k/a St.
Aloysius Home and Rhode Island Alliance of Social
Service Employees, Local 580 , Service Employees
International Union , AFL-CIO, Petitioner . Case 1-
RC-13573
June 21, 1976
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held on November 27, 1974, before
Hearing Officer Roy M. Schoenfeld. Following the
hearing, and pursuant to Section 102.67 of the Na-
tional Labor Relations Board Rules and Regulations,
Series 8, as amended, the Regional Director for Re-
gion 1 transferred this case to the National Labor
Relations Board for decision.
The Board has reviewed the Hearing Officer's rul-
ings made at the hearing and finds that no prejudi-
cial error was committed. They are hereby affirmed.
Upon the entire record in this case, the Board
finds:
1. The Employer operates a year-round residential
facility providing education and treatment for chil-
dren between the ages of 6 and 18, experiencing be-
havioral difficulties that stem from disruptive family
environments. All children are referred to the Em-
ployer through the Child Welfare Services of the De-
partment of Social and Rehabilitative Services of the
State of Rhode Island. The Employer is capable of
providing complete residential services for 72 chil-
dren, but, as of the date of the hearing, only 57 chil-
dren were in residence. Children are admitted only
for long-term care of at least 1 full calendar year; the
average stay is between 2 and 2-1/2 years.
The Employer occupies two buildings, one of
which is a school. The other building provides the
children with all the necessities incidental to residen-
tial living; i.e., a dormitory, an infirmary, and dining
and recreational facilities.
The full-time professional staff consists of 1 regis-
tered nurse, 2 social workers, 6 teachers, and 13 child
care workers. The Employer also employs on a part-
time basis a general physician, a dentist, and a psy-
chiatrist.
Although the primary function of the Home is the
care, training, and education of children having be-
havioral problems, the Home also operates a fully
accredited Catholic parochial school. In attendance,
aside from the residents, are 25 children from the
surrounding community. Unlike the residents, these
students pay tuition which defrays part of the operat-
ing expenses of the Home. There is no indication in
the record that any of these students suffer from be-
havioral irregularities.
The treatment program in practice involves both
the child and his family. Since it is believed that child
behavioral difficulties usually stem from home envi-
ronment irregularities, the family of each child is as-
signed a social worker who works directly with the
family on a regular (sometimes weekly) basis to help
normalize the home environment. The goal is to help
both child and family, so the child can return to a
normal supportive family environment.
The Employer's total income for 1974 was approx-
imately $459,000. The State of Rhode Island provid-
ed $400,000 of the total, and the Roman Catholic
Diocese of Providence contributed the remainder.
The Employer spent approximately $128,000 of its
1974 income on the purchase of various goods, the
bulk of which were received directly or indirectly
from out-of-state sources.
Traditionally, the Board has declined jurisdiction
over this type of employer simply because it is a non-
profit institution whose activities are primarily non-
commercial in nature and intimately connected with
the charitable purposes of the institution.' Ming
Quong was premised on the theory that, under the
definition of employer in Section 2(2) of the Act, the
Board has the authority to decline jurisdiction over
nonprofit charitable organizations by virtue of the
nature of the organization itself and without specifi-
cally examining the impact of its activities upon in-
terstate commerce. However, it was recognized that
when such an organization had "a massive impact on
interstate commerce" assertion of Board jurisdic-
tion was warranted.2 But nothing short of that stan-
dard was deemed to be sufficient to override the gen-
eral policy of declining jurisdiction over such
eleemosynary institutions based on interpretation of
Section 2(2).
Whatever the soundness of such a policy, its un-
derpinning was removed by the recent health care
amendments to the Act.' These amendments deleted
the only reference to the exclusion from Board juris-
diction of charitable organizations to be found in
Section 2(2) of the Act, i.e., the one for nonprofit
hospitals, and left the broad coverage of that section
applicable to all employers, except for certain exclu-
sions not relevant here.
In short, the deletion of the nonprofit hospital ex-
emption from Section 2(2) of the Act removed any
statutory basis the Board may have had for declining
jurisdiction over nonprofit organizations on the basis
of their charitable function or worthy purpose. In
Ming Quong Children's Center, 210 NLRB 899 (1974)
2 Cornell University, 183 NLRB 329 (1970)
3 Public Law 93-360 (July 26, 1974)
224 NLRB No. 70
ST. ALOYSIUS HOME
directing the Board to exercise its jurisdiction over
health care institutions, Congress drew no distinc-
tions between institutions which are purely eleemosy-
nary in nature and those which are not. On the con-
trary, it told the Board to take jurisdiction over all
such institutions as a class. In such circumstances,
there appears to be no present basis for giving special
consideration to the charitable function or activities
of institutions outside the health care field, when in-
stitutions within the coverage of the amendments
may serve an equally charitable purpose, but are spe-
cifically made subject to the Board's jurisdiction.4
Our dissenting colleagues, in reaching the contrary
conclusion, rely principally on the fact that in 1947
one house of Congress proposed to broaden the stat-
utory hospital exemption to include specifically other
charitable enterprises, and receded from this propos-
al only because it regarded the Board's interpretative
expansion of the exemption as satisfactory. But the
argument from this action, or more accurately inac-
tion, ignores two points: first, the proponents of the
proposed statutory amendment may not have had
the strength to enact it;5 and second, the congression-
al intent may have been simply to let the Board's
interpretative "worthy purpose" gloss stand or fall
with the basic statutory exemption of nonprofit hos-
pitals upon which it was founded. Even less comfort
is provided to the dissent by the 1974 legislative com-
ments, which were directed solely to health care insti-
tutions and not to the issue involved here. These
comments hardly warrant assuming, as our col-
leagues do, that, when Congress removed the statuto-
ry base upon which the "worthy purpose" interpreta-
tion was built, Congress nonetheless intended
retention of the superstructure without the founda-
4 Our dissenting colleagues take the position that there is no correlation
between the deletion of the nonprofit hospital exclusion from Sec 2(2) of
the Act and the general posture the Board should assume in its handling of
"worthy cause " organizations that fall without the definition of a health
care institution We disagree We regard this act of Congress as constituting
evidence in support of the position we now take that the nonprofit character
of such "worthy cause" organizations no longer affords a rational basis
upon which to decline jurisdiction
Prior to the 1974 amendment , the Board had already extended its juris-
diction to such nonprofit employers as colleges, Cornell University, supra,
secondary schools, Shattuck School, 189 NLRB 886 (1971), nursing homes,
Drexel Home, Inc, 182 NLRB 1045 (1970), and homes for the aged, Bethany
Home for the Aged, 185 NLRB 191 (1970) After the amendment , jurisdic-
tion was extended to nonprofit hospitals including hospitals for crippled
children, Shriners Hospitals for Crippled Children, 217 NLRB 806 (1975),
institutions for the care of mentally retarded or handicapped children, Bev-
erly Farm Foundation, Incorporated, 218 NLRB 1275 (1975), and Woods
Schools, 219 NLRB 242 (1975), family planning clinics, Planned Parenthood
Association of Miami Valley, Inc, 217 NLRB 1098 (1975), and "half-way"
houses , Baker Places, Inc, 219 NLRB 86 (1975) In view of this steady and
broad erosion of the nonprofit charitable basis for refusing to assert the
Board's jurisdiction , it would be illogical to continue to employ the charita-
ble concept to a few employers who are not really in any substantial way
differentiated from other "worthy cause" employers
Sit is this type of infirmity which renders perilous any argument from
legislative inaction
1345
tion. We, at least, are unwilling to draw such an in-
ference in the absence of clearer congressional ex-
pression that this anomalous result was specifically
intended.
The Ming Quong decision preceded the enactment
of the health care amendments and whatever vitality
it may have had was removed by these amendments.
Now, the only basis for declining jurisdiction over a
charitable organization is a finding that its activities
do not have a sufficient impact on interstate com-
merce to warrant the exercise of the Board's jurisdic-
tion. The remaining issue involves what discretionary
jurisdictional standard should be employed regard-
ing these institutions.
We have decided that a separate jurisdictional ca-
tegory encompassing all charitable, nonprofit, non-
health-care institutions is unnecessary inasmuch as
these institutions can be classified according to their
substantive purposes, e.g., the Employer is, for all
intents and purposes, an institution involved with the
specialized care and custody of children. Since the
distinction between profit and nonprofit institutions,
for jurisdictional purposes, has been eliminated, we
see no reason to establish separate standards for in-
stitutions that seek to accomplish the same end but
differ only in whether they are charitable or nonchar-
itable. The sole basis for declining or asserting juris-
diction over charitable organizations will now be
identical with those which are not charitable. There-
fore, since the Employer's gross revenue exceeds the
jurisdictional standards for such specialized institu-
tions,' we find that it would effectuate the policies of
the Act to assert jurisdiction herein.'
2. The labor organization involved claims to rep-
resent certain employees of the Employer.
3. A question affecting commerce exists concern-
ing the representation of certain employees of the
Employer within the meaning of Section 9(c)(1) and
Section 2(6) and (7) of the Act.
4. In accordance with the stipulation of the par-
ties, we find that the following unit is appropriate for
the purposes of collective bargaining within the
meaning of Section 9(b) of the Act:
All full-time and regular part-time employees,
including child care workers, recreation workers,
social workers, maintenance men, housekeepers,
laundry workers, the seamstress, kitchen and
dining room workers, drivers and receptionists
6 Salt & Pepper Nursery School & Kindergarten No 2, 222 NLRB 1295
(1976) In this decision, a majority of the Board established ajurisdictional
standard of $250 , 000 gross revenue for day care centers , institutions mvoly-
in^ specialized care and custody of children
Member Walther would , for all the reasons set forth above , assert juris-
diction over charitable organizations He believes that in light of economic
developments, including the increasing incidents of related disputes in this
area, the time has arrived when the Board must exercise its authority under
the Act
13,'6 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(who answer the telephone and doorbell but per-
form no office clerical work), employed by the
Employer at its Greenville, Rhode Island loca-
tion; excluding any resident of the Employer's
Home, office clerical employees, professional
employees, guards, and supervisors as defined in
the Act.
[Direction of Election 8 omitted from publication.]
MEMBER FANNING, concurring:
I concur in the assertion of jurisdiction herein and
join my colleagues in overruling the Ming Quong de-
cision. As the majority opinion herein discloses, the
Ming Quong decision was based on the theory that
the Board could decline to assert jurisdiction over
nonprofit charitable institutions without regard to
the impact of their activities on interstate commerce.
In my dissent in Ming Quong I set forth the reasons
why a general refusal to apply the Act to nonprofit
charitable institutions was wrong not only as to the
employer in that case but also as a matter of policy
generally; that indeed it was contrary to the Board's
own precedents which rejected the theory that "an
institution's effect on commerce may be measured by
its nonprofit status, its title, its religious affiliation, or
its [patients or clients]." 9 Accordingly, although I
agree with my colleagues' observation that the pas-
sage of the health care amendments serves to demon-
strate the fundamental error in the Ming Quong deci-
sion, I reject any implication that Ming Quong was
reasonably decided on the basis of the law as it ex-
isted at that time.
I would assert jurisdiction over the Employer on
the basis of my dissenting opinions in Ming Quong
Children's Center, 210 NLRB 899 (1974); East Oak-
land Community Health Alliance, Inc., 218 NLRB
1270 (1975); and Salt & Pepper Nursery School & Kin-
dergarten No. 2, 222 NLRB 1295 (1976).
CHAIRMAN MURPHY and MEMBER PENELLO, dissent-
ing:
In today's decision, the majority discards the Ming
Quong doctrine on the premise that the passage of
the 1974 health care amendments to the Act "re-
moved any statutory basis the Board may have had
for declining jurisdiction over nonprofit organiza-
tions on the basis of their charitable function or wor-
thy purpose." We believe, however, that the legisla-
tive history of the Act lends no support to this
assertion, and in fact proves the opposite. Indeed,
Ming Quong itself represented a careful policy of ex-
ercising our discretionary jurisdiction under Section
8 [Excelsior footnote omitted from publication ]
9 Drexel Home, Inc, 182 NLRB 1045, 1047 ( 1970) See also Cornell Uni-
versity, 183 NLRB 329 (1970)
14(c)(1) of the Act 10 in harmony with the clear indi-
cation of Congress' attitude toward charitable, non-
profit, noncommercial organizations, as revealed in
the Act's legislative history.
The term "employer" has always been defined in
Section 2(2) of the Act. The original Wagner Act de-
finition of "employer" contained no exclusions for
nonprofit organizations of any kind. The Taft-Hart-
ley Act of 1947, however, amended Section 2(2) to
remove from the definition of employer "any corpo-
ration or association operating a hospital, if no part
of the net earnings inures to the benefit of any pri-
vate shareholder or individual." The 1974 health care
amendments to the Act deleted this phrase from Sec-
tion 2(2), thus eliminating the statutory exemption
for nonprofit hospitals. This summarizes the history
of references to nonprofit organizations of any sort
in Section 2(2).
The majority takes the position that Ming Quong
was based on the express exclusion in Section 2(2) of
nonprofit hospitals from the coverage of the Act, and
thus that removal of this exemption in 1974 de-
stroyed the rationale undergirding Ming Quong.
Quite to the contrary, it is no exaggeration to say that
Ming Quong had nothing to do with the phrase in
Section 2(2) excluding nonprofit hospitals from our
jurisdiction. Rather, Ming Quong sought to effectuate
the obvious intent of Congress that the Board not
assert jurisdiction over certain types of charitable in-
stitutions other than nonprofit hospitals, which were
already exempt from the Act by statute.
We are thus at a loss to understand how the major-
ity is able to detect a change in the legislative attitude
toward such charitable organizations, as a result of
congressional action to solve a wholly separate prob-
lem in the health care industry. Instead, an examina-
tion of pertinent legislative history to the 1947 and
1974 amendments to the Act, as well as of the
Board's decision in Cornell University, 183 NLRB
329 (1970), will serve to demonstrate that the logic
underlying Ming Quong is as sound today as it was
before the enactment of the health care amendments.
As the Board observed in Ming Quong, the House
of Representatives had proposed in 1947 that a spe-
cific exemption be included in Section 2(2) for non-
profit concerns "organized and operated exclusively
for religious, charitable, scientific, literary, or educa-
tional purposes." 11 Such an exemption was not
10 Sec. 14(c)(1) provides "The Board, in its discretion, may, by rule of
decision or by published rules adopted pursuant to the Administrative Pro-
cedure Act, decline to assert jurisdiction over any labor dispute involving
any class or category of employers, where, in the opinion of the Board, the
effect of such labor dispute on commerce is not sufficiently substantial to
warrant the exercise of its jurisdiction Provided, That the Board shall not
decline to assert jurisdiction over any labor dispute over which it would
assert jurisdiction under the standards prevailing upon August 1, 1959 "
" Sec 2, H R 3020, 80th Cong , I st sess
ST. ALOYSIUS HOME 1347
adopted by the full Congress, according to the Con-
ference Report on the Taft-Hartley Act, because
. . . only in exceptional circumstances and in
connection with purely commercial activities of
such organizations have any of the activities of
such organizations or of their employees been
considered as affecting commerce so as to bring
them within the scope of the National Labor Re-
lations Act.1z
Relying on this legislative history, the Board dis-
missed a petition to represent clerical employees in
the libraries of a university in The Trustees of Colum-
bia University in the City of New York, 97 NLRB 424
(1951). The Board concluded that Congress had ap-
proved a Board policy of not asserting jurisdiction
over certain nonprofit organizations except in the
special circumstances alluded to in the quoted mate-
rial.
However, Cornell University, supra, overruled Co-
lumbia University because extensive information in
the record showed that private, nonprofit, education-
al institutions in general had come to "have not only
a substantial, but massive, impact on interstate com-
merce," 13 since Columbia had been decided 19 years
earlier. The Board therefore concluded, in effect, that
changed circumstances had removed such education-
al institutions as a class from the categories of non-
profit employers over which Congress had not in-
tended the Board to take jurisdiction. In other words,
the Board found the "exceptional circumstances" in
which Congress believed that the Board had properly
asserted jurisdiction over nonprofit organizations
now to be present in the case of private educational
institutions. Furthermore, Cornell did not decide that
jurisdiction should be asserted over all private col-
leges and universities, but only those "whose opera-
tions have a substantial effect on commerce." 14
The meaning of Cornell, as merely reaffirmed by
Ming Quong, can therefore be summarized as fol-
lows. If a thorough reevaluation of the effect on com-
merce of a certain category of nonprofit employers
reveals that it is exerting such a massive influence
that it no longer comports with Congress' original
intent that it remain outside the Board's jurisdiction,
the Board would assert over that class. Jurisdiction
12
H R 510, 80th Cong, 1st sess, p 32, I Leg Hist 505, 536 (1947)
13 The Board also pointed out in Cornell that private colleges and univer-
sities were deriving a substantial profit from engaging in purely commercial
activities, such as providing housing and food services to students
14 Subsequently, the Board promulgated Sec 103 l of the National Labor
Relations Board Rules and Regulations, Series 8, as amended, which erect-
ed a $1 million annual gross income standard for the assertion of jurisdic-
tion over private colleges and universities The Board has also applied the
same standard to other types of private schools Shattuck School, 189 NLRB
886 (1971), The Windsor School, Inc, 200 NLRB 991 (1972), The Judson
School, 209 NLRB 677 (1974)
would be asserted over any particular institution
within such a class if that employer's activities have a
"substantial" impact on commerce.
Thus, because Cornell and Ming Quong simply
enunciated a Board policy of exercising its discre-
tionary jurisdiction so as to give effect to the ex-
pressed will of Congress in this area, the only other
question is whether the 1974 health care amendments
indicated a change in the legislative attitude toward
assertion of jurisdiction over nonprofit eleemosynary
institutions. Initially, we note that Congress, during
the debates and in the committee reports on these
amendments, failed even to consider whether to
amend the statute to require us to take jurisdiction
over such employers. If Congress had intended that
we assert jurisdiction over all nonprofit organiza-
tions, it could easily have instructed us to do so.
More directly to the point, however, the majority's
argument that the 1974 amendments undermined the
validity of the Ming Quong doctrine is best answered
by two statements made during the congressional de-
bate on the subject. First, Senator Harrison A. Wil-
liams, sponsor of the legislation in the Senate and
Chairman of the Senate Committee on Labor and
Public Welfare, declared:
[T]his legislation is the product of intensive ef-
forts over a long period of time by the Congress
and the parties to focus upon adapting general
principles of the Taft-Hartley Act to the con-
crete problems that are encountered on a day-
to-day basis in the health care industry. The
Senate Committee strove for a balanced solu-
tion, and the language of its bill and its report
and the explanations thereon by its managers,
reflect the precise results of its studied effort to
deal specifically and in an even handed manner
with these problems. This legislation is the prod-
uct of compromise, and the National Labor Re-
lations Board in administering the act should
understand specifically that this committee un-
derstood the issues confronting it, and went as
far as it decided to go and no further and the
Labor Board should use extreme caution not to
read into this act by implication-or general log-
ical reasoning-something that is not contained
in the bill, its report and the explanation there-
of.15
Similarly, Representative John M. Ashbrook, co-
sponsor of the legislation in the House, made the fol-
lowing statement, which had also been approved by
Representative Frank Thompson, Chairman of the
House Committee on Education and Labor:
15 Legislative History of the Coverage of Nonprofit Hospitals Under the
National Labor Relations Act, 1974 (Senate Committee print), p 361
1348 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
[T]he specific intent of the House Education and
Labor Committee was to extend the NLRA to
non-public institutions involved in patient care,
as reflected in the Committee Report and as ex-
plained in the House debate . . . . Furthermore,
the Committee was fully aware of the National
Labor Relations Board's present monetary juris-
dictional standards for assertion of jurisdiction
and in no way meant to disturb those standards
or limit the Board's discretion for changing them
or issuing new standards if it so chose.16
For purposes of this discussion, the only conclu-
sion which can be drawn from these comments is the
obvious one: the 1974 amendments to the Act were
intended to bring nonprofit health care institutions
within our jurisdiction, period. The majority's effort
to read into these amendments a mandate for over-
turning Ming Quong is demonstrably contrary to the
legislative history recited above."
We find curious the majority's speculation that the
1947 legislative history referred to above does not
mean what it says. The Supreme Court had no such
difficulty in understanding its significance in Office
Employes International Union, Local No. 11 v.
N.L.R.B., 353 U.S. 313, 318-319 (1957), wherein it
stated, "When the Act was amended in 1947 the
Congress was aware of the Board's general practice
of excluding nonprofit organizations from the cover-
age of the Act when these organizations were en-
gaged in noncommercial activities. . . . The joint
committee report on which the final enactment was
based recited that the activities of nonprofit employ-
1b Id at 409
17 We do not share the majority 's view , expressed in fn 4 , supra, that the
cases cited therein represent a "steady and broad erosion of the nonprofit
charitable basis for refusing to assert the Board 's jurisdiction " We have
fully explained the reasons for the assertion of jurisdiction in Cornell Univer-
sity and in Shattuck School, supra The Board assumed jurisdiction over
nonprofit nursing homes and homes for the aged in Drexel Home, Inc, 182
NLRB 1045 (1970), and Bethany Home for the Aged, 185 NLRB 191 (1970),
respectively , in recognition of its responsibility to take jurisdiction over the
nonprofit counterparts of profit -making employers over which it has assert-
ed jurisdiction In the remaining cases cited , the Board would have refused
to assert jurisdiction based upon Ming Quong except for the fact that a
Board majority determined that each of these employers fell within the
statutory definition of a "health care institution ," and thus that the Board
was required to take jurisdiction under the 1974 amendments to the Act
ers or their employees had been considered as com-
ing within the Act only `in exceptional circumstances
and in connection with purely commercial activi-
ties.' " It is clear that the exclusion of charitable en-
terprises from the jurisdiction of this Agency since
that time has been based on this interpretation of the
legislative history and, contrary to our colleagues'
statement, has not been grounded on the statutory
exemption of nonprofit hospitals. Hence, the amend-
ment of the Act to delete that specific exemption has
no impact on our jurisdiction over charitable activi-
ties such as are involved herein.
Naturally, we agree with the majority' s statement
that the legislative history of the 1974 amendments
was "directed solely to health care institutions and
not to the issue involved here." For precisely that
reason, we cannot accept the conclusion, which the
majority draws, that congressional deleticn of the
nonprofit hospital exemption in any way affects what
the majority itself admits is a separate issue.
Turning specifically to the instant case , the record
discloses only that St. Aloysius Home had total in-
come of approximately $459,000 in 1974, and that
about $128,000 of this income was used to purchase
goods, most of which were received directly or indi-
rectly from out-of-state sources. There is no evidence
concerning the effect on interstate commerce of St.
Aloysius and other operations like it. Thus, the rec-
ord does not demonstrate the "massive" impact on
commerce required under Cornell and Ming Quong to
assert jurisdiction over a certain category of nonpro-
fit organizations. Neither does the evidence present-
ed at the hearing show that St. Aloysius' activities in
particular have a "substantial" influence on com-
merce, the other requirement in those cases for asser-
tion of jurisdiction over ar individual institution, be-
cause we have previously concluded that $1 million
in gross annual revenue is necessary to meet this test.
Therefore, because we believe that Cornell and
Ming Quong were correctly decided, and because St.
Aloysius Home does not meet the criteria set forth in
those cases for the assertion of jurisdiction over non-
profit eleemosynary employers, we would dismiss the
petition herein.