United Insurance Co. of America

National Labor Relations Board - Board Decisions

Jul 28, 1965

154 N.L.R.B. 38 (N.L.R.B. 1965)

38 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
United Insurance Company of America and Insurance Workers
International Union , AFL-CIO. Case No. 5-CA-2930. July 08,
1965
DECISION AND ORDER
On May 13, 1965, Trial Examiner Lloyd Buchanan issued his De-
cision in the above-entitled proceeding, finding that Respondent had
engaged in and was engaging in certain unfair labor practices within
the meaning of the National Labor Relations Act, as amended, and
recommending that it cease and desist therefrom and take certain af-
firmative action, as set forth in the attached Trial Examiner's De-
cision. Thereafter, the Respondent and the Charging Party filed
exceptions to the Decision and supporting briefs.'
Pursuant to the provisions of Section 3(b) of the Act, the National
Labor Relations Board has delegated its powers in connection with
this case to a three-member panel [Members Fanning, Brown, and
Jenkins].
The Board has reviewed the rulings of the Trial Examiner made at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Trial Ex-
aminer's Decision, the exceptions and briefs, and the entire record in
this case, and hereby adopts the findings, conclusions, and recom-
mendations of the Trial Examiner.'
ORDER
Pursuant to Section 10(c) of the National Labor Relations Act, as
amended, the National Labor Relations Board hereby adopts as its
Order, the Order recommended by the Trial Examiner and orders
that United Insurance Company of America, Baltimore, Maryland,
its officers, agents, successors, and assigns, shall take the action set forth
in the Trial Examiner's Recommended Order.
1 The Respondent has requested oral argument Because, in our opinion, the record
and briefs adequately set forth the issues and position of the parties, this request is hereby
denied
2 In adopting the Trial Examiner's ultimate conclusion, we do not rely on his observa-
tion, as set out in footnote 26 of his Decision that the demeanor of the debit agents to-
ward admitted supervisors during the hearing was one indicating an employer-employee
relationship.
TRIAL EXAMINER'S DECISION
The complaint herein (issued October 16, 1964; charge filed September 14, 1964),
as amended, alleges that the Company has violated Section 8(a)(5) and (1) of the
National Labor Relations Act, as amended, 73 Stat. 519, by refusing to bargain
with the Union as the representative of the Company's employees in an appropriate
unit i Averring that the debit agents referred to as employees are independent
1 The Union's motion to amend the complaint to include alleged violation of Section-
8 (a) (3) and independent violation of Section 8(a)(1) was denied
154 NLRB No. 9.
UNITED INSURANCE COMPANY OF AMERICA 39
contractors, this issue having been reserved by stipulation entered into in the prior
representation proceeding, the answer admits a request and refusal to bargain but
denies that the unit is appropriate and further denies the allegations of violation.
A hearing was held before Trial Examiner Lloyd Buchanan in Washington, D.C.,
on various dates between December 16 and 31, 1964. At the close of the hearing,
counsel were heard in detailed oral argument. Briefs have been filed by the General
Counsel, the Union, and the Company, the time to do so having been extended.
It was agreed that the only substantive issue before us is whether the debit agents
in the area described are employees or independent contractors .2 While the General
Counsel made reference to the "tone" of the Company's letter of September 1, 1964,
which was based on the issue of the status of debit agents, he agreed that there is
no question of bad faith or refusal to bargain beyond that issue concerning the debit
agents. Refusing to join in this agreement, counsel for the Union claimed that bad
faith would further be shown in "a course of dealing and a pattern of resistance"
by the Company. While we would in any event rely on the General Counsel's
position rather than the Union's, it may be noted that the record on the issue of
refusal to bargain is devoid of the course or pattern suggested.
The Trial Examiner is concerned with the receipt of all available and relevant
facts, letting the chips fall where they may (to coin a phrase). As for the role of
counsel, I distinguish between an advocate arguing on the basis of the truth and
available evidence, and a propagandist who limits the truth and would in his efforts
intentionally seek to exclude relevant aspects This distinction is here noted, not
to characterize counsel, but to indicate a need to supplement their efforts. If
counsel for one party or another may feel aggrieved or adversely affected by receipt
of such evidence, the Trial Examiner has here questioned witnesses or requested
that counsel do so to elicit information which whether it favored one side or the other,
appeared to be relevant. If the principles of full and fair inquiry are to be praised,
let us practice them. I should be less than fair, however, if noting this I did not
commend counsel on their evident preparation and able presentation.
My early impression and throughout the hearing is supported by review after all
of the evidence was in that there are some significant yet relatively few differences
among the parties concerning the facts, and that, while there are some factual differ-
ences to be resolved, our problem in the main is to decide what the facts adduced
indicate as to the relationship between the Company and its debit agents. It is
unfortunate that stipulations were not available to the extent that the facts as they
now exist are not in dispute; much time and many pages of testimony could have
been saved
The issue of the relationship between the Company and its debit agents was tried
in 1957 and thereafter before a Trial Examiner of the Board. The Board's Deci-
sions 3 were thereafter respectively remanded and denied enforcement by the United
States Court of Appeals for the Seventh Circuit.4
In its later opinion, listing some items to be considered, the court declared at
page 89 that "the critical distinction between employees and independent contractors
under the Act is the right to control the manner and means by which the agent
conducts his business." 5 The Board has expressed itself similarly: "It is the right
to control, rather than the exercise thereof, that determines the nature of the rela-
tionship." 6 The court at the point noted continued with a reference to "the requisite
control of manner or means." If not heretofore so fully emphasized although de-
clared, it would appear that exercise of control is not necessary to a finding of
einployer-employee status if the right to control be shown; and that the exercise of
control is itself evidence that the right exists. Conversely, evidence of the Company's
right and exercise of control is not minimized by other instances, where the Com-
pany merely offers suggestions to the agent, or where use of a form is optional.
2As will be noted especially in connection with reference to various equivocal items,
infra, and particularly to the group insurance plan, my concern is with evidence which
tends to support one position or the other; not with circumstances which are consistent
with both positions and therefore prove neither My duty to follow Board Decisions with
respect to law and policy does not extend to acceptance as probative of an item which we
can see is not probative.
3 United Insurance Company, 122 NLRB 911 ; 132 NLRB 885
* United Insurance Company of America, 272 F. 2d 446; 304 F. 2d 86.
r, Such terminology as the reference to the agent's or "his" business is not determinative.
'Farmers Insurance Group, et al, 143 NLRB 240, 244, citing United Insurance Com-
pany, 108 NLRB 843, 847.
40 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The decision herein is based on consideration of those facts which are indicia of
an independent status and those which suggest an employer-employee relationship;
and on a determination of which are "more controlling "'I
Upon the entire record in the case and from my observation of the witnesses,
I make the following:
FINDINGS OF FACT (WITH REASONS THEREFOR)
1. THE COMPANY 'S BUSINESS AND THE LABOR ORGANIZATION INVOLVED
It was admitted and I find that the Company, an Illinois corporation with prin-
cipal office in Chicago , Illinois , and branch offices in various States , including the
State of Maryland, is engaged in the business of writing and selling insurance; that
during a representative 12-month period it received more than $ 1,000,000 from its
business operations , of which more than $50,000 in premiums was received at its
principal office directly from points outside the State of Illinois; and that it is
engaged in commerce within the meaning of the Act.
It was admitted and I find that the Union is a labor organization within the
meaning of the Act.
II. THE ALLEGED VIOLATION OF SECTION 8 (a) (5) AND (1)
However much we would avoid statement of the obvious , it must be said that
there does not appear to be any decided case in which the facts are identical with
those here ; and that the decision whether debit agents are employees or independent
contractors depends on the evidence received , pro and con , and the reasonable in-
ferences to be drawn therefrom , as to all of which there may be different opinions
and conclusions.
While the Board remanded the prior case with instructions 8 that the Trial Ex-
aminer make findings "without regard to the findings made by the Board" previously,
I could not here disregard prior findings were they based on the same evidence as
that here adduced. On the other hand, whatever the burden of analyzing the testi-
mony here received , it would be far greater were we to attempt a complete (no
other would be adequate or fair ) analysis of the evidence in the earlier case and a
comparison of the facts in each. Not only are admittedly different facts before us
than were presented in the prior case, but counsel for the Company has pointed out
as we shall note, infra , that there are differences as between the Franklin Street
office and the St. Paul Street office according to the testimony within this proceed-
ing. While I recognize the earlier decisions and the facts as therein described and
as they then existed,9 I shall here , with full regard for the law as heretofore enunci-
ated, attempt to decide on the basis of the facts before us Were comparisons to be
made, two pages from the Board 's 1954 decision could readily be followed ; without
comparison , we have here covered the items noted there, and more.
The findings and decision will be made with full realization that the substantive
issue is one which , if involved , is nevertheless of the kind which is usually deter-
mined in a representation proceeding I was unable to obtain from counsel agree-
ment that the record be submitted to the Board without a Trial Examiner 's Decision,
a procedure which would avoid duplication of effort in this type of issue.
A lengthy and detailed offer of proof concerning a group of corporations and
partnerships referred to as the Garfinkel enterprise was made on behalf of the
Company and rejected. While I am in any event constrained to follow the Board's
Decisions , rather than different rulings by the various circuit courts of appeals, no
more than does the Board do I ignore rulings and reasons declared by the courts.
Both sides have properly been concerned with similarities and differences between
the facts before us and those in the prior case . The court in the earlier proceeding
referred to the offer of proof concerning an enterprise operated by one, Borman.
But whatever was pointed out and whatever the analysis or evaluation of the offer
in the prior case, if Borman be considered the counterpart of the Garfinkel enter-
prise concerning which our offer was made, there is no question but that in the
instant case "no one contended ," to support a comparison with agents on this basis,
that Garfinkel is an employee of United although it was claimed that the enterprise
is controlled by United to the same extent as are the debit agents.
7Id at 243
8 132 NLRB 885, 888.
° The respondent there urged limitation to the date of hearing rather than the date of
decision 7 months later. 122 NLRB 911, 916.
UNITED INSURANCE COMPANY OF AMERICA 41
If the Garfinkel enterprise is to be compared with a debit agent to show that its
independence and the fact that it is not an employee are to be applied to debit agents,
the attempted comparison is seriously distorted by reference to Garfinkel 's staff of
agents. It could hardly be claimed and certainly not found that the Garfinkel enter-
prise, qua enterprise , would be included in a group of debit agents . Even treated as
evidentiary , the testimony offered indicates that the enterprise 's salespeople , who hold
Maryland licenses to sell for United , are counterparts of or more nearly like United's
debit agents than is the enterprise itself although there are some elements of admix-
ture, e .g., the fact that some officers and stockholders of the enterprise participate, as
do some United agents, in the Company 's group insurance plan. From memorandums
included in the offer of proof, none of which is addressed or appears to be for the
use of debit agents, the Garfinkel enterprise is an "agency office," "agency," or
"general agency."
The testimony received properly pertains to the relationship between United and
and each of its agents . Each is an employee or an independent contractor. Only
after the individual relationship is determined do we consider the propriety of the
unit as found; the group is collective . On the other hand , the Garfinkel enterprise in
Silver Spring , Maryland, is itself a collective entity. Whatever comparison might
be made between Garfinkel's many agents , who are "working for" it, and the debit
agents here, the enterprise itself is not a debit agent and its independence would not
prove similar status among the agents.
Beyond this and differences 10 as they appear in exhibits which were rejected with
the offer of proof and need not be cited , differences between the Garfinkel enterprise
and United debit agents were noted on the record . While comparisons can be made
where the facts are similar , as Respondent 's counsel argued , Garfinkel's corporations
and partnerships are not a debit agent ; they do not occupy the status of any of the
debit agents who testified or whose work was described . There is no contention
here that the Garfinkel enterprise is an employee of United : we do not reach, be-
cause it is not a similar issue, the relationship between the enterprise and United
beyond the apparent fact that it is different from that of the debit agents and United.
Even were there valid basis for comparison between the functions of the Garfinkel
enterprise and the debit agents here , such comparison would be pointless and un-
necessary as noted elsewhere herein in connection with the facts in the prior case and
in the Quaker City operation ; it would but serve to swell this case and decision herein
to the proportions of a magnum opus. Finally in this limited connection , remem-
bering that we are here concerned with debit agents, but out of regard for the
vehemence and zeal with which the offer of proof was argued and which reflected
the time spent in its preparation , I have done more than merely note that the statu-
tory definition of an agent as an individual 11 would further bar the Garfinkel
enterprise and make comparison with it as a debit agent quite irrelevant.
When it was pointed out at the hearing that the Garfinkel enterprise is not simi-
lar to a debit agent , counsel for the Company did not appear to agree that this is
a valid distinction 12 But the Company does appear to agree in its brief where the
point is made that "an independent general agency files virtually identical reports
on forms provided by the Respondent ." On the other hand, the intent may be not
to show that the Garfinkel enterprise is in effect another debit agent yet that it func-
tions independently; but rather to show that , although independent, it is not but func-
tions and is controlled like the debit agents so that the latter, although not general
agencies , are independent like a general agency.
10 Such as Garfinkel 's signature as "State Manager ," and other letter forms signed by
his office employee as "Branch Secretary " Both letterheads carry United 's name but list
it at Garfinkel 's Silver Spring, Maryland , address. Some of the forms included in the
offer of proof, we were told , are not identical but similar to those used by the debit agents
before us.
u Maryland Insurance Code , 1963 , Section 166 (a).
12 Since the Company's position is that the debit agents are independent contractors, it
appeared that in attempting a comparison the Company was declaring that, like the agents,
Garfinkel is independent Declaring that his position is "just the opposite ," counsel for
the Company argued that Garfinkel is controlled by United but added the important
qualification , "to the same extent as the agents." This brings us full circle, No one
here has considered a position of complete independence That all of the persons and
entities are engaged in the same business and related activities is clear The issue
throughout is the extent of control or of independence so that a decision could be made
whether the debit agents are in fact independent contractors or employees
42 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
We can overlook the need to show that Garfinkel is itself independent; this could
presumably be done (within the limits which we here recognize). But, whatever is
or was earlier intended, the filing of certain common reports, which are herein rec-
ognized as attributes of the business regardless of relationship, does not overcome
the evidence of supervision and control credibly testified to and which we shall see
are exercised by the Company over the debit agents, some of which is similar to the
dealings between Garfinkel and its employees.
That the enterprise and the debit agents here follow some identical procedures may
indicate that such procedures are themselves not probative of status, but are con-
sonant with either, as we shall further consider. It is rather the differences which
indicate their different status. Thus while the enterprise may or may not hold
weekly meetings with its own agents, it need not attend such meetings called by
United. Nor, to cite some other factors 13 which we shall note, do United assistant
managers check, accompany, and advise the Garfinkel enterprise as they do the debit
agents 14 with whom we are concerned Again, the debit agents may be better
compared with Garfinkel's employees Whatever similarities there may be between
the debit agents here and Garfinkel,15 their functions and their status, including the
element of control, are so dissimilar as to make comparison irrelevant and, in the
Trial Examiner's discretion, unnecessary in the light of the mass of testimony received.
Aside from the issue concerning the status of debit agents, there is no question
concerning the geographic extent or other allegations that the following unit is an
appropriate unit within the meaning of Section 9(b) of the Act; that after a Board-
conducted election on August 6, 1964, in Case No 5-RC-4722, the Union on Au-
gust 14 was certified by the Board as the representative of the employees in the unit
for the purposes of collective bargaining; that on August 20, the Union requested
the Company to bargain collectively with it as such representative; and that the
Company on September 1 refused so to bargain, maintaining throughout that the
debit agents are independent contractors and not employees:
All debit agents in Districts in Baltimore City and Anne Arundel County, Mary-
land (Districts presently numbered 153, 159, 160, 161, 162, 164, 167, 168, and
174), but excluding all office clerical employees, guards, professional employees,
managers, assistant managers, special agents, inspectors and supervisors as de-
fined in the Act.
A merger of United and Quaker City Life Insurance Company had been effected
on March 16, 1964. Of the nine districts embraced in the unit as described, those
now numbered 153, 159, 160, and 167 were former Quaker districts; all of these
except 159, which is now in Severna Park, are in United's (formerly Quaker City's)
Franklin Street office. The five other districts were United districts prior to the
merger, and have been and are located at the St. Paul Street office It appears that
Quaker City debit agents had been told by Quaker that they would not continue to
serve that company. They submitted applications to United and were assigned to
their former districts, but with the latter company. (The testimony concerning the
transition and continuance or changes is scattered and not very clear. The parties
do not appear to be in dispute concerning these historical items, which could better
and more clearly have been presented in a brief summary statement.)
After the merger, some former Quaker agents had the same manager and assist-
ant manager as before, some did not. Scott, who represented the agents favoring
the Union and was the General Counsel's principal witness, was given the same
debit, only its number being changed. On the other hand, Agent Jenkins, who was
the only other witness called by the General Counsel and who had also been em-
ployed by Quaker, testified that on a Friday (the day on which he had customarily
reported at Quaker) about a week after March 16, most of the district staffs were
reshuffled, and he was assigned to a new district at the Franklin Street office under
a different manager, and was notified that his reporting day was now Thursday.
We have been told that prior to the merger there was a collective-bargaining agree-
ment between Quaker City and its debit agents; that the issue was not there raised
and no determination made by the Board concerning the agents' status as employees
or as independent contractors; and that whether the agreement remained in effect at
the merger is now being litigated elsewhere.
One could check the similarity or difference as the various items are noted, infra
14 We shall note other communications from higher officials of United to Garfinkel and
other agency offices
is Although both Garfinkel and its own agents must follow certain regulations, their
status is not to he equated.
UNITED INSURANCE COMPANY OF AMERICA 43
No more than with the relationship between United and another entity, supra,
which is not to be equated with a debit agent, are we here concerned with the status
of Quaker City's debit agents vis-a-vis Quaker City. The primigenial relationship
may or may not be continued on merger of the companies. To determine (in the
absence of an admission against interest) whether it has been continued calls for
examination of the later status and its creation; and once that is done, there is neither
need nor advantage in considering the earlier. As much may be said with respect
to comparison of the facts before me and those in the prior United case. While
citing and relying on the facts in the prior case, the Company in its brief notes that
some are "non-existent" in the instant case. For the same reason that their facts
are quite different, the cases cited by the General Counsel or the Union are no more
helpful and certainly not determinative although all have been considered 16 In
this connection we must not overlook the Company's testimony and argument that
it made changes to meet the earlier findings and that it advertently set about to create
or maintain an independent contractor status. Our concern is not whether this
could be accomplished within the scope of duties which the debit agents are re-
quired to perform, but whether it has in fact been accomplished. The Company's
intent and attempts to attain such a relationship are not themselves fell or improper.
But whatever significance attaches to evidence of intent, our problem is whether the
intent was incarnated and what actual status existed in relation to the refusal to
bargain. Thus whatever anyone sought to bring about, we must find what was in
fact brought about and what the Company's rights or authority have been over its
debit agents. The difference is one between policy declaration and intention on one
hand, and actual relationship as established, including the rights of the parties, noted
supra. It may even be said that where the right to control is actually shown, a
contrary policy or intent is irrelevant.
Because policy declarations may be communicated to employees or may explain
action taken, I received evidence of such declarations, leaving for later determination
whether the policy was effectuated. Thus, for example, the Company's general
counsel testified to its legal department's objective in changing the wording of the
Company's ratebook so that it would more fully comply with the independent con-
tractor theory. But beyond this statement of objective, he was not familiar with
the day-to-day operations of these offices and did not know how the Baltimore man-
agers carry out the intended policies.
Concerning the relationship here existing, we can quickly pass over Scott's testi-
mony that he was told that, while his duties would be the same as they had been with
United, he was now an independent contractor. Depending on whether emphasis
be given to the first part and Scott's statement that supervision thereafter actually
increased, or the latter declaration that he was an independent contractor, such testi-
mony would support either side in this dispute. Our concern still is with the proof
of actual duties and relationship.
Scott 17 also testified that he "had no say" in any change of status: he accepted
United's terms or he would have had no job. Once again, we do not rely on a
declaration of terms by United or, on the other hand, Scott's reason for continuing
as a debit agent. These and other nondeterminative aspects of the testimony are
mentioned lest it be claimed that they were overlooked. Reliance will be placed
on functions and requirements as carried out in actual performance, whatever title
was employed at or about the time of the merger.
Every item of the evidence and the various implications and nuances have been
considered and weighed. It will serve no useful purpose to repeat in detail the
various elements cited as they appear in the record. The major ones and those
especially relied on by the respective parties will be cited here; the nugatory, al-
though heard and considered, need not be mentioned. "The duty to discuss evidence
is a matter of degree." 18 To paraphrase Milton, the law delights not to make a
1e We are thus rejecting comparison, which one side urges, with the Garfinkel enter-
prise with Quaker City, urged by the other side; and with the prior proceeding, the parties
arguing for and against comparison, depending on whether it be with the Board's or the
court's decisions.
171 have not overlooked Scott's evident partisanship and his attempts to "strengthen"
the General Counsel's case, as when he testified that the Company "requires" another
trip to the office to pick up a new policy. It developed that this is only a suggestion
although "the right way to do it " He was a reliable witness, however, and I credit his
testimony generally. He did not evidence the patently unreliable aspects which some of
the other witnesses displayed
ii N L R B. v. Cook h Jones, Inc, 339 F. 2d 580 "It is not meet that every nice
offense should bear his comment." Julius Caesar, act IV, scene 3, line 7.
44 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
drudge of virtue. The nature of the issue and of the proof offered calls for a process
of balancing by comparison , however, and warrants the detailed consideration herein
to explain the comprehensive view taken and the findings made Whatever is omitted
we shall herein consider , trusting that none are overlooked , at least all of the items
mentioned by the circuit court in its 1962 opinion and all considered by the Board
in an early representation proceeding involving this company in 1954,19 as well as
those items urged by the parties in their briefs, except perhaps where the analysis
and ruling at the hearing and in the record appear to be adequate.
Use of the term "debit" offers a prime example of metonymy as it is used variously
to refer to the holders collectively of insurance from whom the agent collects and
whom he serves, the main or concentrated area which he serves , and the book of
policyholders which the Company turns over to him and which he maintains for
collection and general servicing. The book is also referred to as the debit book.
The agent may commonly be said to service the policyholders on his debit or area
assigned to him. On such contacts he collects premiums and tries to write new
policies, as he does by interviewing prospects generally on referrals or even by door-
to-door canvassing . He submits to the Company notices of lapsed policies and
regular reports on company forms, attends meetings , and turns in his collections less
earnings which he may withhold according to contract Each agent is licensed 20
by the State to sell for United , and may be similarly licensed for other insurance
companies . While they have made sales of policies issued by other companies,21
it does not appear that any agent does or could simultaneously work another debit.
Of the two agents called by the General Counsel, one testified that he did not
pay the license fee. Of the four called by the Company ,22 two testified that they
paid their own license fees and were not reimbursed by the Company . But one
of these latter two thereafter told us that he paid only for his examination and
original license ; the Company has since paid for and renewed his license each year
Unless I have overlooked it in the transcript , the other three agent witnesses were not
asked about this. Company control might be indicated by its payment of agents'
license fees ; independent status by agents' payment of their own fees. We need
not speculate whether it is more likely that agents might make voluntary payments
(were they urged or compelled to pay, this might suggest company control) than
that the Company did as an accommodation (considering accounting requirements
and the necessity to explain ). If of all of the agents who testified , one paid for his
first license only and one other likewise paid for his examination and first license
(he was not asked about renewal licenses ), we can make the understatement that
the record does not show that debit agents are required to or do in fact pay for their
licenses as company agents.
Von Saleski, a debit agent called by the Company, testified that while he was
employed elsewhere he learned that a United debit agent was earning considerably
more, and decided that it "wouldn 't hurt" to inquire about a debit at United. On
inquiry, he was told by a manager that several debits would be "open." Asked
whether he was hired the first time he spoke with the manager , Von Saleski testi-
fied that he "filled out an application" at that time , and was told that the Company
had "other applicants ." This is the terminology of employment , not of independent
contracting , and at least indicates the witness ' impression of his status 23 As he
detailed it , he changed from one employment to a better one. Von Saleski , who was
one of the two agents who testified that they paid their own license fee, further
testified that 2 or 3 weeks after he was "hired ," it was indicated on the abstract of
his weekly report that the Company had "taken out for the license" the fee which
he thus testified he paid. Although he paid for the license after he was hired, the
matter was handled by the Company without evidence that he had been consulted;
he was now charged with the expense.
There are individual variations among the debit agents with respect to practice,
which are reflected in their relations with the Company . Thus for example, one
agent purchases gifts for his policyholders or some of them, while another does not;
of those who do, some purchase items which the Company makes available while
others purchase elsewhere. Here again is an equivocal factor. An agent's inde-
10 United Insurance Company, 108 NLRB 843 , 844-846
20 Although the agent is thus licensed and presumptively qualified, the Company further
controls his activities by requiring that during his first year his manager or assistant
manager must recommend an applicant for insurance and countersign the application.
21 The Company does not and perhaps could not legally prevent this
22 The testimony of these four was by stipulation endorsed by six other debit agents
23 While this occurred 6 years ago, Von Saleski did not indicate that there had been
any change in status or in his recognition of it.
UNITED INSURANCE COMPANY OF AMERICA 45
pendent right to decide whether and where to purchase gifts is quite consonant with
employee status; if such status otherwise appear, it would not be contradicted or
diminished by this item.
Similarly, Agent Rock testified that at each of three locations he has a number of
policyholders whose employer's office girl maintains a "payroll deduction plan"
whereby she withholds from the policyholders' pay the premiums due on those
policies, and turns the amounts over to Rock For this he compensates her by
gifts. Rock in advance leaves the receipts with the girl, who places them in the
employees' pay envelopes. These arrangements are apparently not common, and
Rock did not know whether United had knowledge of them. (Von Saleski offered
similar testimony. These instances are in marked contrast to agents working for
Garfinkel.) Whatever Rock's opinion, I find no support here for the claim of in-
dependent status. Scott testified without contradiction that, while company rules
permit agents to make calls and collections for one another, Vice President Rose
had said that it was against the rules for an agent to hire an unlicensed person to
make collections for him. Scott's testimony in this connection is quite definite even
if he was later asked whether he had "concluded" and was so "led . .. to believe"
by a statement which Rose had made and "despite" Rose's statement.
Other atypical practices or variations in the agents' procedures will be noted infra.
On the other hand, various procedures are, with understandable exceptions, typical
of the agents' practice and indicative of their relationship with the Company.
While an agent's work on collections and servicing his debit provides contacts and
opportunities to sell additional policies, his debit service work is quite different from
that as salesman.24 Whatever their relationship, the Company benefits by and has
an understandable interest in successful efforts by its debit agents in addition to its
indicated control over their procedures. But it cannot, beyond advice and limited
assistance and supervision, inject itself into the agents' efforts to obtain new business.
Provided that he satisfies the Company with the amount of new business which he
obtains, an agent is truly on his own with respect to the amount of time which he
devotes to seeking new business, any connections which he seeks to develop, and
the technique which be employs. In this phase of his work, his duties and perform-
ance and the measure of company control come closer than in debit work to reflect-
ing independent contractor status. Yet even here exists a considerable degree of
company control, as he can be called in for group and individual meetings, and he
can be discharged should his business be insufficient or his efforts otherwise displease.
Different factors in other situations might be totalled for a different result.
Although Rose testified that to his knowledge no agents were "encouraged to
leave" by managers or assistant managers, and that he did not think that any man
had been asked to leave unless there had been something akin to a violation of law
(he testified that he would be informed only where there had been an actual termina-
tion), two debit agents were in fact asked by their district manager, Kropf, to resign
because of poor work and the poor condition of their accounts. Kropf had dis-
cussed these cases with Foimwalt, the division manager. Thereafter he told Form-
wall that the other agents would refuse to settle their accounts if one of these two
were terminated. The two men's books were later checked and in the case of one,
at least, his account was found to be as nearly correct "as could be possible." Both
men have remained with the Company. Formwalt mentioned two other agents
whose termination because of poor work he had discussed with their managers
These two have resigned. The status of debit agents and Von Saleski's impression
thereof are indicated by his testimony that poor producers have "of course" been
cautioned, in the first place by the assistant manager. Whether the terminology be
of discharge, encouragement to leave, or resignation, control and employees status
are clear: the agent is effectively "dead" in any event.
As company counsel recognizes, a request to resign "normally is the same as a
dismissal." The authority and control are no less such because the Company, after
further check and discussion in some instances, did not insist on the resignations.
We must bear in mind that the issue here is whether the Company's rights are those
of an employer or of a nonemploying contracting party. To deny its power to
terminate the relationship is ludicrous and certainly more than the Company intends.
24 It is unnecessary to go beyond the facts in this case and to rely on the broader rulings
concerning insurance agents who have no debits While the a fortiori argument might
be used because of the additional elements of control in the case of debit agents , we would
again face the problem of comparison and differentiation of facts , noted supra , in con-
nection with the Quaker City situation and in connection with an offer of proof by the
Company.
46 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Returning to the item of time spent by the agents at work, the fact that they are
to an extent free to make their own time arrangements except for the requirement
that they appear at the district office reflects not independence but the further fact
that theirs is potentially a day-and-night job, especially for the ambitious man.
Independence is quite limited as they are required to cover their debits or area of
accounts.
While the Company does not fix an agent's hours for debit collections and other
services on his debit, this work must generally be fully attended to each week; the
agent must periodically reach his policyholders (some pay their premiums in ad-
vance for longer periods than 1 week, some mail premiums to the company office),
see that the payments which they owe to the Company are maintained, and turn
in to the Company each week the money which he has thus collected or otherwise
received, less any sums due him by the Company or to be credited to him. Clearly
by agreement and practice he is a collection agent to receive and transmit to the
Company the sums thus collected, these being "trust funds" as the rate book declares.
While the agent is permitted to retain his share of such moneys according to the
Agent's Commission Plan, the contract between himself and the Company, the
money collected, from the moment he receives it, belongs to the Company, and he is
required to turn it in at times fixed by the Company.
In fact, when some agents absented themselves to attend a meeting of their own
at the time which the Company had fixed for them to turn in their money, a com-
pany representative threatened to charge them with embezzlement if they did not
turn their money in that very day and within a few hours In connection with
premiums thus collected by the agents, employee status is further suggested by the
tact that the premium receipt books are issued by the Company and the agents or
the assistant managers who relieve them sign for payments not on their own behalf
but on the Company's. The point is not merely that the money belongs to the
Company, but that the debit agent is functioning as its direct and immediate agent
and on its behalf rather than on his own. The Company is not itself obtaining
these moneys by supervisors or any who it admits are employees, but is utilizing, as
completely as it could any employees, the services of its debit agents.
Much time was spent at the hearing on the question whether agents are required
to report to the office weekly, at which time they meet with company supervisors.
In connection with other items, we have noted and shall note several incidental
references to such meetings and to turning in collections at that time. Repeated
attempts which elicited unreliable and, as indicated, contradictory testimony pro-
longed attention to this question. Having considered the various denials, explana-
tions, and contradictions, I find that the debit agents are required to appear at their
district office one morning each week; that there are usually sales meetings with
the manager and then the assistant manager (sometimes also with higher company
officials), followed by individual meetings and discussions between the agents in
turn and their assistant manager; and that the agents on that morning turn in their
weekly reports and collections. Formwalt testified that it is his "policy" that the
men report by Thursday or Friday, and he explained further that in two of three
districts referred to the men have been settling on Thursday, and in the other on
Friday. The portions of the record cited in the Company's brief do not support the
argument therein made that "the agents are requested to submit their weekly re-
ports by Thursday morning," instead of on Thursday morning. Nor do I credit
Von Saleski's explanation that he attends because the meetings are "for [his] own
benefit."
The regularity of the exhortation and advice at meetings and as directed in com-
pany memorandums, and the frequency of special contests and awards belie what-
ever minimum of independence and arm's length dealing might be deemed necessary
to characterize independent contractor status; although I would regard occasional
prizes alone as consonant with either employee or independent contractor status.
Significance can be found in Formwalt's testimony, as he referred to agents, assistant
managers, and himself as district manager at the time, that "all of us working to-
gether were responsible for" the greatest increase during a certain 1-week contest.
It should be noted that, testifying concerning new business contests conducted by
the Company to stimulate sales by the agents, Formwalt declared that the Company
"would assume" that all agents would be present at the sales meeting. This pro-
cedure of regular weekly meetings is observed although agents sometimes ask to be
excused from reporting.
There is also testimony that agents are sometimes absent without being first ex-
cused, and that part of the week's collections is sometimes turned in earlier. Agent
Spalding told us that he misses some meetings for personal or business reasons; that
UNITED INSURANCE COMPANY OF AMERICA 47
he usually turns in an account before the meeting if he has one to be turned in, tells
his assistant manager he is leaving, and asks if the assistant has anything for him.
Von Saleski similarly testified that during the past year he had gone in four or five
times on Wednesday or Friday when he did not go in on Thursday. One occasion
was Thanksgiving Day. Once he had a prospect lined up and asked the office
whether it would be all right to come in on Wednesday or whether to wait until
Friday; yet he was never told that he must attend the meetings on Thursday That
Von Saleski and the other agents in his district report on Thursday is hardly co-
incidence. It is understandable as a company requirement; otherwise it stands un-
explained in the record. Even Rock, who testified that he decides whether or not
to stay for sales meetings, depending on whether he has time, had not missed any
meetings during the 3 months preceding the hearing; the meetings are usually held
on Thursday (he settled his account on another day during Thanksgiving week),
and he missed "maybe two or three or more" during the past year. He attends;
more reliable testimony indicates that attendance is required. (The agent decides
whether to come in at any other time, in addition to Thursday morning, to turn
something in, pick up a policy, etc.)
The requirement to report and to attend weekly meetings is recognized even if
it can be stretched or waived. While Formwalt denied that he told Scott that the
reporting day is Thursday, it stands uncontradicted that the latter as spokesman
asked about the possibility of reporting on other days. Formwalt's reply was that
as far as he knew they had to report only on Thursday morning. Recognizing the
confusion which he admitted, I do not credit Formwalt's denial, and it is clear from
the other testimony that the men were required to and did report on Thursday morn-
ing, as we have seen. In fact although counsel repeatedly asked about a require-
ment that the men report by Thursday or Friday, Formwalt himself thereafter
testified that two of the three districts settle on Thursday, and the third on Friday.
In addition, in special situations and further bearing on the larger issue of company
control, Formwalt "let the man settle" a day earlier. Whatever Formwalt's knowl-
edge concerning the number of times agents are required to report each week, his
instruction, the requirement, and the Company's control are evident. It is to be
noted that the Company did not call managers or assistant managers who, agents
testified, conduct the weekly meetings. The occasional and excused absences re-
ferred to can explain Rose's testimony that there are regular meetings on Thursday
morning but that the agents do not have to attend.
Going beyond his testimony that he was told by Formwalt that Thursday is the
reporting day, Jenkins testified that his manager called him at home about 2 weeks
before the hearing, said that they needed more business that week, and arranged to
and did meet him on his debit the following day, when Jenkins turned over the new
applications which he had.
Finally, while I do not overlook the possibility of self-serving action taken with
an eye to this proceeding, Scott explained that he was late at the hearing on Thursday,
December 17, because he had to turn in his collections. No one on behalf of the
Company contradicted him or otherwise testified that his presence at the office was
not required that morning. It is of course necessary that the agents turn in their
collections. But the Company fixes the period at 1 week and requires the agents to
report on Thursday morning (or on Friday in one district as noted).
Bearing on the agents' weekly attendance and use of company forms, which we
shall further consider, it can reasonably be assumed that the cashier or company
clerks check the agents' arithmetic on their collection and other reports. I do not
believe that, when the assistant manager and the manager successively review the
report forms, admittedly required weekly, "the main purpose is to check the figures."
Such review ties in closely and naturally with the encouragement and assistance
lent to the agents by the supervisors. Aside from the required use of company
forms by agents in submitting information, the Company's right to check each
policyholder's account and the breakdown as well as the sum total of the agent's
collections, together with the detailed oversight by the assistant manager, reflects a
degree of supervision which negates independent contractor status.
On the other hand, the Company's right to reject risks or to call for medical exami-
nations is a necessary attribute of the business and does not indicate an employer-
employee relationship. Neither would a rule (concerning which there was conflicting
testimony) not to accept agents' personal checks without the manager's permission,
or statutory requirements as with respect to rates and lapses.
The Company prepares and provides a variety of forms (some have been noted
supra) for use by its debit agents Some of the forms, like some of the other evi-
dence received, are to an extent consonant with either status claimed and to such
48 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
extent are therefore not themselves determinative . These no more need to be de-
tailed here than they are in the parties' briefs . But to the extent that the Company
requires their use, as it does , it exercises control and limits the independence of its
agents. Granted the Company's right to check all collections made against the
money turned in, the use of certain collection forms as tools for bookkeeping pur-
poses is understandable regardless of the relationship . Yet even here the require-
ment that its forms be used rather than possibly less efficient compilations which
individual agents might submit indicates an element of company control.
In the same category might be placed a letter from the chairman of the Company's
board of directors to various company officials on September 16, 1964 This was
intended to be and was read to the debit agents . To the extent that the letter main-
tains the validity and need to follow the Company 's system of handling accounts
and records and to meet insurance department requirements , it may be regarded
as referring to procedures which would be followed regardless of the relationship
between Company and agents . But the writer of the letter , suspecting Scott as
"the ringleader ," suggests that Scott "turn in his resignation ." ( Elsewhere , Scott is
referred to as an "outsider ") If procedures must be followed regardless of the
relationship , the tone of the letter and the term "resignation" applied again and
suggested for agents who might seek to "make their own rules" suggest employee
rather than independent contractor status . ( I have not overlooked the closing refer-
ence to "United Independent , Successful Salesmen.")
One form, the collection route schedule, is provided solely for the convenience of
the agents and is not usually used . Some forms or brochures illustrating types of
company policies and other possible aids in selling and maintaining policies may or
may not be used, as the agent chooses. Others must be used . On the issue whether
the Company requires use of some of its forms , even agent Kirson, who testified
that he was never told that he was required to use the agent's weekly account form
to settle his account, told us that he does use the form once a week and only once
a week although he turns money in several times a week I credit the testimony
that the Company requires weekly use of the form . The requirement explains
Kirson 's otherwise unexplained practice.
Of the forms received and not noted specifically or referred to generally else-
where herein , some refer to United Fire Insurance Company. The limited refer-
ences to this company do not go beyond or illuminate the proof received concern-
ing the Respondent Supervisors function with respect to the work done by the
agents for either company. There is no demarcation between the functions of agents
and supervisors with respect to policies of the Respondent Company and policies
of the related United Fire Insurance Company. Testimony with respect to the latter
is relevant to the extent that it bears on such functions and the relationship in issue;
but it is slight and quite unnecessary for any decision herein. There is no issue here
and no findings need be made concerning integration of operations of these com-
panies or their relationship.
We have noted the Company 's right to all premiums collected, the agents ' function
in this connection being routine and clerical . Further, the premium receipt book
gives notice to policyholders that the agent's failure to collect does not lessen their
obligation to make payment to a company branch office or the home office. Leav-
ing room for different emphasis although I regard it as significant , I merely mention
that the arrears notice sent to policyholders is sent not by the agent but by the
Company and is signed by the assistant manager.
Among other exhibits received , of the weekly reports 25 filed by the eight district
managers for the week of November 30, 1964, the following extracts bear on the
issue here : In one the manager reports that he has talked to two agents concerning
their letdown and that they "promise to try and do better ..."; and that a third
agent was "talked to" by the manager and assistant manager. In the second, the
manager declares , "We are all emphasizing the absolute necessity" to increase busi-
ness. By itself, this latter statement is not inconsistent with status as independent
contractor. But the first of these particularly voices an employer-employee relation-
ship. The tone is in harmony with the demeanor of the parties ' representatives and
their witnesses , which I observed during the 8 days of hearing and which I cite in
addition to the other and themselves sufficient bases for my findings.
The printed headings , which include "Assignment This Week," with the subhead
"Agent 's Name," and "Assignment Next Week ," indicate that close supervision is exercised
and expected.
UNITED INSURANCE COMPANY OF AMERICA 49
To the extent if any that I may rely on demeanor 26 in the hearing room, I would
now report that without exception the agents did not display or appear to have
attributes of independence (not even when the "ringleader" appeared to assert him-
self as he testified), but acted and appeared to be regarded as rank-and-file em-
ployees, not of high rank either in fact or in regard. The existing relationship was
pictured by Jenkins' testimony on cross-examination that he keeps lapsed policy
pages in his book although he has no reason to keep them but only because the
Company has told him to do that. He did not ask why: "It was not [his] business
to ask." The control if Jenkins was so told is not contradicted by Rose's testimony
that the Company has no such policy.
Further on the exhibits received in evidence, a series of memorandums and in-
structions from the Company to its district managers, emphasizes the close super-
vision over agents and the direct relations with policyholders which are maintained
by company supervisors. As we shall see, infra, supervisors are required to call on
policyholders in connection with lapsed policies, with the stated objects of conserving
business and directly obtaining new business. This supports the General Counsel's
proof of supervisors' efforts on behalf of agents, and contradicts the Company's
testimony that such assistance is available to the agent "at his request " (Rose was
here stressing that the agents are "in business for themselves," and meant that the
assistance is available only on request by the agent.) Indeed we here note that the
relationship is such that supervisors are urged to supplement the agents' efforts and
to some extent even to supersede the agents
The Company's control and direction of procedure with respect to work on the
debits indicates that in this connection at least the agents are employees of the
Company, not independent contractors. This is reflected in the status of assistant
ianagers as representatives of the Company rather than as independent contractors
as they relieve agents on the debits. (We are here considering the element of com-
pany control over the managers, who are admittedly company supervisors.) Com-
mission on new business which the 'assistant managers sometimes write for the agents
is credited to the latter, the Company thus allowing and making payment to the
agents for the time and efforts expended and the results achieved by its supervisors.
Although Formwalt testified to an impression or general recollection that while
he was district manager he wrote new business for agents when they were away in
an amount roughly within the range of that which agents themselves write, I find
that testimony (which, in the absence of indication that more dependable in this
respect would be available, I myself drew from the witness) less reliable than other
testimony received on this point. In fact it appears from witnesses on both sides
that assistant managers, not managers, generally substitute for absent agents. Von
Saleski testified without any suggestion that this was not typical, that the amount of
new business which is written for him in his absence is one-third that which he
averages.
- See Wigmore, Evidence, § 946 (3 ed ), which, after ambiguously declaring the admis-
sibility of the witness' demeanor "when exhibited in the courtroom and on the stand,"
emphasizes the "demeanor of the witness on the stand " Were presence on the stand
a sine qua non rather than one of two alternatives, the phrase "in the courtroom" would
be tautological It could be urged conversely that reliance on the broader first phrase
would make the second unnecessary, but In such a case the latter might be deemed
descriptive of the more common situation. In section 1395, reference is made to the
"elusive and incommunicable evidence of a witness' deportment while testifying . . .
While this reference in the Instant case can but support the findings made on the basis
of the testimony received, there appears to be no good reason for excluding demeanor in
the courtroom when the witness is not on the stand and where it is clearly observable
as in this case ; and aside from any attempt to probe "the subjective moral effect" upon
the witness.
There is no greater danger that the Trial Examiner will be misled by play-acting in the
courtroom than if it be indulged in on the stand To the extent that circumstances maize
possible and warrant demeanor findings in the latter situation, they may warrant such
findings on the basis of courtroom demeanor which can be cited Without attempting
to detail the basis for this necessarily subjective finding, and allowing for an independent
contractor's possible concern over renewal or termination of his contract, I can here
declare that I observed a uniform and marked deference by agents toward supervisors
and company officials which, without obsequiousness but beyond the sometimes elusive
requirements of courtesy, Is decently characteristic of common attitudes between em-
ployees and supervisors ; and which in such uniformity differs from the normally observable
attitudes between independent contracting parties
206-446-66-vol 1545
50 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
It further appears that the employer -employee relationship which exists in debit
work pervades more than one-half 27 of the normal workweek , the agents being free
to devote a smaller if substantial portion of time to the more independent aspect
of their work ( if not independent , more so than are their duties with respect to
the debit ) of soliciting new business . The importance to the Company of regular
receipt of premiums and of current records concerning the status of each policy
determines the extent of its control over these functions and the agents ' status as
employees.
This element of control over the agents ' debits and the Company 's discretion with
respect to assignment of debits explains the 1 percent allowance of total collections
which the Company grants as travel expenses to an agent whose debit is in an out-
lying area and a greater distance than most from the office.
Whatever the element of control were these agents engaged in selling ordinary
insurance , the debit collection and servicing requirements and the limitations im-
posed pro tanto on debit agents more clearly point to employee status . That the
agent is dealing with company property is indicated not only by his handling of
collections , but by the fact that when his relationship with the Company is terminated,
he is required to turn in his debit book. This is quite different from making the
book available for checking purposes ; it does not belong to him , but must "be re-
turned promptly to the Company upon termination of service " even if, as an im-
portant tool 28 provided by the Company , its details could be valuable to the agent
if be undertook to sell for another company.
Further, the business done by the agents belongs to the Company . Although the
debit agent is charged with lapses , managers are instructed 29 that they or assistant
managers are "to help the agent in the conservation of business ." If it still be main-
tained that the business being conserved belongs to the agent , such close supervision
and assistance are attributes of an employer -employee relationship . With respect to
policyholders ( most fall within this description ) who are included by the Company
in the debit assigned to an agent , the latter 's activity is not only supervised but it
stems from the Company 's assignment , which thus largely determines the major por-
tion of the agent's activity . Thus the activity originates with and continues to be
controlled by the Company.
If control is, or from the nature of the work must be, less extensive with respect
to selling methods and opportunities ; if, without minimizing collection skills, greater
virtuosity can be exerted in sales work , the element of company control nevertheless
exists and is expressed in various ways and in different degrees. Nor, since the
proof of the pudding is in the eating and "all [the Company is] interested in is re-
sults," is it surprising that agents are permitted latitude in their methods . We have
noted that the Company does take steps to improve the agents ' work or to remove
them where it is dissatisfied with their results.
Rose testified that agents may take holiday vacations without notice to the Com-
pany but that, if an agent is absent for a period of time and notifies the Company,
an assistant manager if one is available will take over for him . How long an agent
may thus be absent and the question of availability of an assistant manager were not
explored fully. As for the condition that the agent let the Company know, Rose
could say only that he knew of no instances where a debit was not serviced when
the agent was away for a week or more . But significant is the statement by this com-
n Von Saleski testified that on the average he spends twice as much time collecting
his debit as he does soliciting and selling new business We recognize , of course, an ele-
ment of solicitation and possible sale when collections are made or other srevices rendered
The relative importance of the debit is further indicated in Von Saleski 's testimony that
his earnings on industrial insurance exclusive of fire insurance are approximately four
times his earnings on ordinary life insurance , and that his new business draw on indus-
trial is two and a half times that on ordinary . Also in this connection , Von Saleski earns
more from his debit collections than from commissions on new industrial insurance. How-
ever these amounts and proportions be analyzed , it is clear from the testimony of several
witnesses that work on the debit consumes a major portion of the debit agents ' workweek.
28 With respect to " tools ," personal qualities are little more determinative of the present
issue than they are in the case of admitted employees whose value and services depend
on such qualities . Unless it be assumed that insurance agents cannot be employees or
that they cannot be independent contractors , it must be recognized that in either clas-
sification personal qualities are important tools Whatever the extent of such qualities,
the issue here is to what extent the Company can control agents ' activities
29 While it was pointed out that this instruction was issued in January 1964 and Form-
wait "would say that is not being done at the Franklin Street office ," it does not appear
that concepts concerning the business have changed
UNITED INSURANCE COMPANY OF AMERICA 51
pany official that an assistant manager would thus act "for the conservation of com-
pany business ." Clearly, the business is the Company 's directly ; it does not belong
to the debit agent The agent is not an independent contractor handling a debit over
which he has sole control and from which he can exclude close supervision; he is
an employee of the Company.
Rose, who several times reversed himself, indicated a limitation on the Com-
pany's control as he testified that, while the Company initially assigns an agent to a
particular manager and assistant manager, it may not transfer him to another assist-
ant manager without the agent's consent ; it transfers at the agent 's request and if
an opening is available . But he later "qualified" this by stating the contrary; i.e ,
that the Company has initiated transfer of agents to other supervisors . Thereafter
he also told us that the Company had merged one district into the other four dis-
tricts at the St. Paul's Street office in 1964, and had assigned some agents to new
assistant managers . ( Rose made other categorical assertions which he later qualified
as hearsay , and he injected repeated reminders that "it is up to the individual agent,"
"they are in business for themselves ," and the Company is "interested in the results
of these men , not in how they accomplish them " These are no more impressive
than Scott 's efforts "beyond the call of duty." We look to the witnesses , not for
conclusions , but for the facts concerning the agents ' authority and the Company's
control.)
We have an interesting dichotomy as the General Counsel emphasized conditions
in the Franklin Street office while the Company called St. Paul Street agents. But
company supervisors and officials testified to conditions and relationship without
any claim of existing difference in status at one office or the other.
The Company argues that there has been a distinction between the two offices with
respect to the status of agents . But a finding of company control is not affected by
any temporary delay as the Company found it difficult through a transitional period,
which lasted approximately through the month of March , to effectuate its intent at
the Franklin Street office among the agents newly acquired from Quaker City.
Whatever differences are claimed with respect to procedures at the two offices at one
time, there is no claim that the respective rights, duties and relationship were in
August different as between the two. The relationship between the Company and its
debit agents was by that time established and apparently the same for both offices.
Company supervisors testified to relationship , company authority , and agents ' status
without distinction among various offices. There was no suggestion in any of the
testimony that the unit should be split because of alleged differences , nor evidence
to support such a suggestion . The problem here has been to determine what that
relationship is and was at the time of the election and certification.
Were there credible indication of exercise of greater independence in one office
than in the other , we would perforce rely on the latter conditions since, as we have
seen, the test is the right to control ; and when that right is shown, the failure to
exercise it with respect to some agents or in some places is not determinative.
Even if, as St. Paul Street agents called by the Company testified , a lesser amount
of control is exercised over them ,30 this does not indicate that control or right to
exercise it is lacking. Since control is exercised over the agents at the Franklin
Street office, the right to control has been proved , and generally so in the absence
as noted of any claim that , whatever the status of agents vis-a-vis the Company, the
relationship and the respective rights differ between the two offices. Even during
the brief transitional period, any difference lay in the establishment and recognition
of routines , not in the Company's right to control . If that right were exercised to a
lesser degree at St. Paul Street (we recall that the Company merged districts and
changed assignments there ), this might be an incident of the personalities involved
or the requirements of the various debit areas , or both. But whatever the reason
for difference in practice, the authority remains, and beyond a doubt to the extent
that it is exercised . Kirson in particular went beyond the Company 's position as he
attempted to create an impression of greater independence among the St. Paul Street
agents. He testified that his practice of making settlement weekly was quite vol-
untary; while he normally settled on Thursday , he has without reprimand come in
on Friday instead when he had personal business to take care of (he sometimes turns
his collections in twice or three times a week ); also, that he would not say that he
has a manager although there is a manager in the district.
With respect to transfer of policies and policyholders from one agent to another
(the occasion most frequently arises when a policyholder moves ), while an agent
may and does service policyholders outside of his debit or "concentrated " area, it is
"We were told that assistant managers there do not initiate joint activity with respect
to accounts , and that one or two agents spend relatively little time on the job.
52 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
generally more convenient to transfer the account to the agent who serves the loca-
tion. It does not appear that the Company initiates such transfers. But were the
agents independent, such transfers could be arranged by the transferring and receiving
agents alone. (In those cases where the identity of the receiving agent is not known
to the transferror, the Company could provide the information.)
Even if instances can be cited of transfer of a policyholder from one agent to
another without approval by the company supervisor (particular reference was
made to business written for Scott by other union members, infra), many approvals
and some disapprovals, in other instances indicate the Company's right to exercise
authority. Despite the efforts to show independence in connection with transfers,
the Company's control and the agents' lack of authority are clear: Company ap-
proval must be obtained, and the transfer forms so indicate. Rose offiered a contrary
conclusion without referring to or explaining the procedure followed. Von Saleski
testified that before a transfer the transferring agent speaks to the receiving agent
when that is possible, but does not at that time effect the transfer: "The managers will
on one day a week sit together and exchange the transfers and the transfers will
then be given out at a later date to the receiving agent "
In fact, agents can and are permitted to sell policies and to serve policyholders
outside their debit area; and of course they are able to serve those in their area.
There is neither evidentiary nor argumentative explanation, beyond the control which
the Company maintains, for approval when an agent seeks to transfer an account
to another agent and particularly to one who serves the area involved. Nor does
ready approval by the Company overcome the evidence that approval is necessary.
I do not credit Formwalt's explanation that the supervisor's approval is merely a
notation for the Company's home office to the effect that the transfer has been
accepted by the receiving agent. The plain language and concept of approval stated
on the form support the testimony that this was no mere transmittal procedure.
With respect to instances of disapprovals of transfers, which we shall next consider,
Formwalt could only say that each of these was "definitely a mistake of judgment"
on the part of both the manager and the assistant manager; the alleged company
policy, contrary to appearance and the form used, had not been communicated to
company supervisors, much less to the agents, who recognized and submitted, as we
shall see, to the Company's control. I do not credit Formwalt's testimony, "That
the agent has free control to transfer in and out of his debit as long as the receiv-
ing agent is willing to accept."
Reference was made to two instances in which the agents involved had agreed to
a transfer (in one the assistant manager had approved) but the receiving assistant
manager disapproved and the transfers were not made. Jenkins testified that he had
agreed with another agent to receive from the latter a transfer of a group of policies
paid by a policyholder, but that the transfer was made to still another agent Jenkins
was uncertain in his recollection of the transferring agent although he recalled the
name of the agent who did receive the transfer, and he was definite about his pro-
test, which he repeated on cross-examination and which was not denied, made to
the manager when the policies were later transferred to the other agent; the man-
ager's reply being that he had given it to the other agent because the latter had a
smaller debit and the manager was trying to build it up If the Company generally
approves transfers proposed, this indicates its opinion that the transfers should be
made; it does not weaken the proof of the Company's authority and control. While
the Company thus insists on its right to control, Scott testified that "union procedure"
is different from the Company's rule that the receiving agent must accept a transfer
if it is otherwise approved: the Union's position is that there be no transfer if the
receiving agent refuses to accept it.31
Scott testified that he has no right to decide whether to accept or reject a trans-
fer from another agent. Because of the receiving agent's liability should a trans-
ferred policy lapse, this company-imposed requirement of transfers is a significant
element of control. Von Saleski testified that the receiving agent is asked whether
he will accept a transfer, and Scott testified that he had very recently been told by
other agents, not by the Company, that in the future there would be no transfer of
policies on which less than 13 weeks' premium had been paid.
31 The testimony covers several attempts by the Union to control procedures, including
letters written by it to the Company. These are not admissions of the Union's or the
agents' authority but positions taken on behalf of the agents as employees. As such they
are but declarations, which no more establish employee status than does the Company's
rejection establish either independent contractor status or recognition of the agents as
employees
UNITED INSURANCE COMPANY OF AMERICA 53
It further appears that agents in four of the districts who are union members have
agreed among themselves that the transferring agent, rather than the receiving agent,
is responsible for lapses within certain periods. This agreement entered into by
some of the agents calls but for mutual indemnification under the liability imposed
by the Company. It does not negate their liability or employee status. Although
counsel for the Company has claimed that the arrangement is very imporant on the
issues before us, the Company's control has been shown even if the agents agree to
share burdens. It does not appear that the liability of an agent who is charged by
the Company with a lapsed policy is modified under company procedures whether
or not he is indemnified by another agent. The Company's discretion and authority
with respect to each transfer are underscored by the absence of a rule which, al-
though an agent is assigned to his debit area, enables and compels him to handle all
policies in that area.
Except for such transfers, the agent remains with his debit and policyholders once
these have been assigned to him. Even when, in appreciation for his organizational
efforts, various agents wrote new business for Scott's account, such business was
credited to him ab initio and in that manner approved by the Company. This special
arrangement was quite different from the transfers otherwise described; there was
no suggestion of transfer of these policies in the usual sense by the agents themselves
after they were credited to another agent. As counsel for the Company expressed
it, "the writing agent was one person," while another, Scott, received credit.
Nor is the Company's control of the agent's operations otherwise remote. Each
assistant manager checks the weekly account sheets and other forms required of
his debit agents by the Company, offers advice, periodically offers assistance in mak-
ing calls, actually does assist the five agents under him, and prepares a weekly re-
port with the agents' assistance. We have seen that the assistant manager is required
by the Company to assist the agent even to the extent of making calls on policy-
holders. This, I find, is not dependent on the agent's request. In fact this became
an issue between the Company and Scott as union representative, the latter advising
the Company that he would permit an assistant manager who had not been with
Quaker to go out with an agent if the agent permitted it. This is an example of a
union's attempt to negotiate an employer's control over its employees after the union
had earlier objected to such assignments of assistance by the company.
It does not appear that the assistant manager busies himself with matters other
than those which relate to his agents. He announces at weekly meetings which
agent he will accompany the following week, and he covers the agents' debits when
they are on vacation, the agent receiving his regular commission on the premiums
collected and new business written by the assistant manager. With the assistant
thus relieving his agents, it is understandable that they choose their vacation periods
seriatim. But the employee status is further suggested as they make their selections
according to seniority after the assistant manager has made his choice. The assistant
manager also services the debit during the week or two when an agent is receiving
a service award bonus.32 Through all of this the assistant manager who replaces the
agent remains an employee of the Company; he is not an independent contractor.
While fully paid vacations, holidays, sick leave, etc., are subject to agreement and
attributes of an employment relationship, their absence would be an equivocal factor
since it might indicate no more than failure to obtain concessions or a strict reliance
on an employee commission plan.
That assistant managers asssist and have under review only five agents indicates
the closeness, immediacy, and personal nature of such review, and close review itself
suggests and indeed would be meaningless without supervision and control since it
does not appear that the Company engages in such close and continuous review
merely out of curiosity. In the checking of records of the few agents under him,
the assistant manager is joined by the manager. Such supervision and assistance
indicates employee rather than independent contractor status.33 Of further signifi-
32 According to Formwalt, assistant managers are not under instructions to collect for
an agent who is sick or is taking his service bonus awaid• "it is more or less taken for
granted " The agent does not receive collection commissions for the period of a service
award bonus, unlike vacation periods. It would appear that, in the latter connection,
agents do receive full vacation benefits
33 The Company's brief erroneously computes "the assistant managers' help" It applies
Formwalt's approximation of 155 man-weeks spent by assistant managers for 67 agents
to the total of 160 agents in the region The brief further overlooks its own recognition
that the figures were limited to premium collections and did not include the day-to-day
supervision
54 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cance is the fact that, when new business is written by an agent in the company of
an assistant manager, the former signs as writing agent and the latter as having
assisted, this we recall whether or not the agent requested the manager's company
or assistance.
In fact the assistant manager is an important part of the assistance which Von
Saleski testified he was promised when he was "hired." The furnishing of tools,
such as the debit book and forms, office space for periodic meetings and services,
an instructor while the agent is acquainting himself with the area, accounts, and
work, with full earnings accruing to the agent since the assistant manager who in-
structs is otherwise compensated, is an element of employer-employee relationship.
The agent, typically an employee, at his point invests only his time. The Company
alone makes the investment in office space, materials, and instruction facilities as it
trains him and supervises his work.
In connection with the element of close assistance and intimate association with
the agent in his work, which continues after the initial training period, reference
may be made to special writers, employed by the Company to go from district to
district to assist debit agents. The special writer is assigned to an agent at the regu-
lar meetings held between the assistant manager and his staff, supra. While the
Company's ultimate interest is in the agents' results, it closely supervises his efforts
toward such results.
We recall that moneys collected are weekly turned in to the Respondent, the
Company providing a form entitled agent's weekly account. If a policyholder pays
premiums in advance, such moneys are not retained by the agent and used by him.
They are shown in his debit book and turned in to the Company, which alone has
custody of them and has the benefit of their use. Nor is the agent given additional
credit or discount for such premiums prepaid, as he might be given or might nor-
mally claim were they his to turn in at a later date.
Although receipt and payment of claims are company functions, it is considered
good business for an agent to handle claims since this creates goodwill. Rose told
us that the Company does not object when an agent asks 34 to do this, the request
being made to and granted by the claims man, the manager, or the assistant man-
ager. From the moment of request for permission to handle a claim until he delivers
payment and transmits to the Company the acknowledgment therefor, the debit agent
is performing the functions of the claim agent, who is a company representative
and employee.
In any event Rock does collect his debit. His attempt to show independence in
the latter connection is less than reliable as he testified that the Company does not
expect him to collect, it is his "own doing" to collect; then, that he is expected to
collect his debit, that being one of his functions, but that there is no certain time
element as he makes his own arrangements for collecting the debit; he would not
be permitted to cover his debit only once a year, and while he does collect weekly,
there is no time requirement as far as the Company is concerned: The Company's
main interest is that the policies be serviced, but that it does and then that it does
not require that the debit be collected! Later Rock told us that he collects his "own
way," and that the Company does not tell him anything about that, whether to
collect weekly, monthly, or once a year; but finally in this connection that he is
supposed to collect from each policyholder as the premium is due, the holder is not
to fall 4 weeks in arrears, and the agent is to avoid policy lapses for nonpayment of
premiums 35 Despite Rock's claims that he collects his own way, whether weekly,
monthly, or annually, and that he determines this himself with the policyholders
(the latter make the decision), it is clear from the testimony of this witness, who
displayed partisanship to the point of giving patently misleading testimony, that so
far from making independent decisions with respect to collections, he does what
he is supposed to do and what the Company requires and expects.36 There is no
34 After testifying that the Company has never told him whether he "could or could
not" handle claims-he "just did it and that is the way it has been going"-Rock told
us that when a claim comes into the office, the manager gives it to him and asks him
to verify it.
35 Such testimony readily lends itself to distortion by one side or the other, which needs
only to quote one of several versions by the same witness. I have considered all versions
and rely on those portions which are consistent with other evidence or which I deem
credible
26 The improbability of absence of company requirement concerning collections is under-
scored by Rose's testimony that, of the many company agents throughout the country,
he does not know of anyone who does not go out on his debit every week
UNITED INSURANCE COMPANY OF AMERICA 55
departure from company requirements when the policyholder prepays his premiums
so that a longer time will elapse before collection is again necessary.
A comedy plot can be found in Kirson's testimony that his parlor of entrapment
is a friend's drugstore, where he plays pinochle with the owner and awaits prescrip-
tion customers, to whom he tries to sell insurance while they wait for their drugs.
If Kirson's practice be cited as evidence of an agent's independence, there is no
evidence that the Company has known of this and had opportunity to disapprove.
Nor is it suggested that such methods are typical even if successful. (We need not
concern ourselves with any possible reflection on the quality of risk as a class when
prospects or contacts purchase prescription drugs for themselves or others )
However independent Kirson may claim to be, and unique in his sales methods,
he did testify that he spends approximately 40 hours per week collecting and other-
wise servicing his debit and that he spends a little additional time for new business.
From all of his testimony, it appears that his imaginative approach with respect to
new business is limited while the bulk of his efforts are expended in the closely
controlled work on his debit
As for turning in his collections, Kirson testified that he turns in to the Company
more or less than he collects; his deposits depend on his own cash position and his
personal inclination. Such an alleged practice, which indicates chaos as far as the
Company is concerned as much as independence, is inconsistent with the Company's
requirements that debit books be kept current and accurate and that reliable col-
lection records be filed, and with the periodic checks which the Company makes.
Whether or not various company forms and the instructions to new agents constitute
a statutory "demand" to pay over his collections, I do not imply that Kirson has
violated the State's insurance code.
The elements of unreliability in the testimony of various witnesses need not be
detailed. (Rock's was merely the most obvious in this respect.) The specific
facts found necessarily depend on the testimony and resolution of conflicts where
they exist; but the overall findings and conclusions can nevertheless be made on the
basis of the entire record despite the variations from the truth and among the
witnesses.
We have noted supra several instances and different degrees of attitudes contrary
to declared company requirement. In no way can absence of employees as they
engage in concerted activities, or union demands or defiance of an employer's regu-
lations be construed as evidence of independent contractor status. In this, we must
distinguish between a show of independence (as in the case of a strike), even dis-
obedience of lawful regulations, and the independent status here in issue. (Such
questions as partial strike, right to discharge, insubordination, etc , are not before
us.) The actions described do not reflect on the status of the persons involved if
it otherwise appears that they are employees. If, as the Company now argues,
Scott "has obviously been conducting a vendetta against United" and has issued
orders and directives contrary to company regulations and suggestions, failure to
take action against him may suggest that in the Company's opinion these may be
employees' protected concerted activities; or that, as in the reference, supra, to
refusal by the agents to settle their accounts if one of them were discharged, com-
pany action against Scott might be followed by reprisals by the agents, whether
protected or not, and practical difficulties for the Company 37 Termination of rela-
tions with an independent contrartor could be effected at least without penalty under
the Act, whatever the reason.
Further on the issue of independence of debit agents, testimony was received con-
cerning several holdups in which money collected was taken from agents. If, as
we have seen, collections belong to the Company and must be regularly turned in,
it is not clear that even agent responsibility for moneys which were stolen while in
their possession would show independent status or agents' control over such moneys.
On the other hand, this is not a reciprocal situation and company assumption of
losses by theft would further suggest its direct interest even while the money is in
the hands of the agents.
Agent Chiodi was robbed while on the debit in September 1964. Scott testified
that Chiodi's weekly account sheet and abstract showed full credit for the money
thus lost, with a miscellaneous credit notation by the manager or assistant manager
to the effect that the money was lost in a robbery. This was clarified when the
Company produced the documents. Chiodi's abstract for the week of September 14
lists the item of $74.01 as "Account Short, Holdup Shortage"; and that amount is
circled and included in the total collections credited to him in his agent's account
37 Cf. Teschke's testimony concerning "uproar" from the agents in connection with income
tax withholding, infra
56 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
form for the same date, with the notation "Holdup Shortage" next to it. The words
herein quoted from the abstract and the account are not in the handwriting of Chiodi
or of the person who filled out those forms if Chiodi did not.
On September 16, Rose wrote to Formwalt that the Company holds agents respon-
sible in case of holdup and that the agent must repay the amount lost. Rose testi-
fied that the agent is responsible in such cases, but that he did not know what had
been done about the sums involved in the holdups concerning which he testified.
Again, such testimony describes hope or intent, not a relationship which was main-
tained. While Rose also declared that some agents carry burglary insurance, he
named none; and none of the agents called by either side testified concerning this.
Another agent, Graham, had been robbed of approximately $150 in June. Form-
walt testified that he told Graham, "When collections are made I will be glad to
help you out"; but that he told Graham that the Company would not "be responsible
for this holdup"; and Graham paid the amount the following Thursday. To stave
off a "crisis" which was developing and to get the men to settle on the following
Thursday, Formwalt had given $150 to Scott, who turned it over to Graham, the
Company receiving first Scott's 1 0 U and then returning it after Graham signed
a receipt for that amount and turned it in with his collections on Thursday. Allow-
ing for Formwalt's failure to distinguish between an I 0 U and a receipt signed by
Graham, we note that he testified positively but incorrectly that Scott brought the
paper back from Graham. Later he correctly testified that the paper, which Graham
had signed, was turned in by Graham with his collections on the following Thursday.
It appears that the $150 was first handled as a loan when it was given to Scott,
as indicated by the latter's receipt. Whether Graham regarded it as such is not
so clear: He then told Formwalt that he thought he should get the money from the
Company; and the latter has at least temporized in providing the money and in not
pressing Graham for it since, or at least during the 6 months up to the hearing.
A third holdup occurred about the month of October, and we are told that when
the agent, McQuage, turned in his reports for the period, notations similar to those
on Chiodi's appeared on his weekly account and abstract.
With various documents before us, including weekly reports, receipts, and Rose's
letter of September 16, which may be weighed as expressions of company intent,
the practice in such instances and the indicated relationship are reflected in the fact
that there is no evidence that the Company or the agents have handled these items
as obligations and debts to be repaid. If the Company's records after the respective
holdups in June, September, and October show the amounts as debts owed by these
agents, evidence thereof would be in the Company's possession. Formwalt testi-
fied, in response to my own questions, that the manager has asked Chiodi "to reim-
burse," and that the Company has asked the other two agents "to pay it back."
The matter was not pursued and we have no details of these requests, when they
were made, or what if anything else was said. There is no evidence of any effort to
deduct even minimal sums from the amounts credited to Graham (or the others)
as weekly earnings; despite Rose's declaration in his September letter that it was
Formwalt's responsibility to arrange for repayment to the Company, and Rose's re-
quest that Formwalt report to him concerning both the action taken on the 3-month
old payment made for Graham and "the type of payment plan . . . entered into
with Agent Chiodi."
Whether the Company has or will write these holdup losses off is not for us to
speculate. But were it necessary to evaluate these incidents and the nature and
extent of the action taken, I should find that the procedure followed more nearly
suggests an employer-employee relationship than that of independent contractor and
responsibility.
Related to this is Rock's testimony that he bore the loss when collected premiums
were lost in a fire at one of the three places where an office girl collected for him.
We have already noted that it does not appear that the Company knew of the col-
lection arrangement. Neither does it appear that the Company knew of this loss
I have not overlooked the element of independence as Scott testified that he him-
self chooses or decides what he tries to sell; he evaluates prospects' needs and makes
his decision accordingly; he tries to sell all of the Company's lines, and in the words
of counsel for the Company which he adopted, he exercises his own initiative, ability,
and experience. Similarly, the agent's analysis, the prospect's preference, and dif-
ferences in the available insurance contracts may lead to sale of policies for other
companies. From the testimony, this does not appear to be extensive. Scott testi-
fied that, in the 9 months that he had been employed by United, he had sold 8 or
10 policies for other companies although not employed by such companies; he
reported to them only when he sold one of their policies; he collects premiums with
the applications, personally turns them over to the respective other companies, delivers
UNITED INSURANCE COMPANY OF AMERICA 57
the policies to the insured, and then is paid by the other companies by check. He
has no debit with such other companies nor any agent's commission plan comparable
with that with United, and differences between his duties and relationship with them
as well as mode of payment are clear.
Exclusive service is characteristic of many independent contractors, including
franchise holders, and many employees. On the other hand, many independent
contractors serve more than one contracting party; while moonlighting among em-
ployees is so frequent that it has become a common term. Nor is there any bar either
in experience or in reason to employment by one company during part of one's time
and independent status vis-a-vis another company. Whatever Scott's and other
agents' relationship with other companies, the facts as testified to are not the same
as those with respect to United. With the flexibility of hours which this work per-
mits on the debit as well as on new business, it would even be difficult to fix the hour
when moonlighting may begin.
Called by the Company, Spalding testified that, although he has been licensed to
sell and has sold for other companies while also licensed for United, he had sold "not
too much" or none for another company during the past year. From his testimony
it appears that the agents are not limited by United in such matters but that the
limits are, as we have seen, self-imposed and quite understandable; and that they
depend on prospects and policies available to the agents.
The Company prepares and at times revises the agent's commission plan, to which
reference has been made, supra. Were employee status otherwise shown to exist in
a situation where the employer requires acceptance and observance of its commission
plan without signature by the agent, such status would not be affected by the fact
that, as here the Company and each agent sign the plan. Von Saleski, who had
worked under an earlier commission plan, testified that when the new earnings
schedule was prepared and issued, he was permitted to choose whether to go under
it or to remain under the former plan; he decided on the new one because "it made
[him] more money." The agents were thus given a choice in mode of compensation.
The Board, finding employee status in Farmers Insurance Group,38 cited various
factors which as they appear in the instant case, might be deemed equivocal; i.e ,
characteristic of either employee or independent contractor. The Company's power
to terminate an agent's earnings on business written by him in view of the right
given to either party to terminate the relationship and the provision that renewal
commissions are payable to the collecting agent is sweeping and very important;
but whatever the effect, even such a provision might be written into and agreed upon
in an arrangement with an independent contractor. Without attempting to cite all
such, benefits or grants offered by the Company and cited by counsel for the Union
as evidence of employee status, such as travel expense for agents who serve in out-
lying districts, supra, commission increases, and vacation bonus awards, are quite
consonant with the concept of better terms granted to independent contractors and
therefore not determinative of our issue. A unilateral right to give, whatever else
it may suggest, does not establish or exclusively characterize an employer-employee
relationship. Despite the presence of equivocal factors, other factors cited more
definitely indicate here the findings to be made, and I find it unnecessary to rely on
items which have a less certain sound.
Among such latter items is a group insurance plan, which may be operated where
an employer-employee relationship exists but, as the court of appeals pointed out in
the earlier proceeding, 39 is also consonant with independent status. More significant
is the existence of Company's saving and profit sharing pension fund, which includes
employee deposits and company contributions. Such a plan does not suggest an
independent contractor relationship. Indeed, the booklet describing it declares its
coverage of eligible employees, and thereafter includes among such any industrial
agent "for the purposes of this plan only." Whatever the attempt to limit this in-
clusion of agents among employees, their coverage is that of the typical employee.
In view of the other evidence which indicates employer-employee relationship, and
whatever additional import may attach to company compliance with social security
requirements that payments be made for the account of debit agents, I find it un-
necessary to rely on this latter. I would not presume to make an incidental decision
on an issue which might itself be the subject of considerable litigation before another
agency or the courts. It was explained that the Company, while questioning such
requirements, complied therewith because it sought to avoid possible "terrific" penal-
ties. Conversely, company withholding of earnings for income tax purposes only
JS 143 NLRB 240, 243.
8D 304 F . 2d 80, 90.
58 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to the extent that an agent indicates might itself be no more than a failure to abide
by the law and regulations in that respect . But the evidence concerning this falls
short of showing any deviation from withholding requirements in connection with
employee earnings . Neither the Company nor its agents contribute to any other
unemployment compensation fund.
While maintaining that the Company does not withhold sums each week for his
Federal income tax , Rock testified that he knows from Federal tax forms how much
he should deduct from his earnings , and indicates to the Company on his weekly
abstract how much the Company should withhold or hold. (Kirson testified that
be turns in more than is required by the Internal Revenue chart , but some weeks
"might skip entirely." ) It is thus a fact, even if Rock would picture these payments
as his voluntary compliance with Federal withholding figures, that regular deductions
are made as required for employees . There is no evidence of exceptions , and in-
clusion of withholding tax as one of the items on the weekly abstract suggests that, if
voluntary , it is quite regular . If this does not prove employee status , it follows the
pattern of such status ; it is hardly typical of an independent contractor relationship.
Thereafter Vice President Teschke testified that the Company in 1955 refused to
accept such payments or deposits from the agents , but with an "uproar" from the
agents and many requests , it again agreed to act as a "voluntary depository for such
taxes"; and that it is company policy for the agents themselves to turn in such sums
at the end of the year although he does not know whether the Baltimore offices com-
ply with such policy.
Further and to the extent that the Court relied on its finding that agents retain
their own commissions from collected premiums ,40 we can note that the amount of
an agent's draw or receipts against earnings is limited ( even if eventually received)
as the Company protects itself against lapses which may occur . While this may to
an extent neutralize the basis for the earlier decision , I do not rely on company desire
and action taken to protect itself against ultimate overpayment as proof of employ
status. While an agent's total or ultimate earnings may increase as he sells more
policies, the Company places a limit on maximum weekly commissions on new in-
dustrial business (as distinguished from commissions on collections ). There may
later be another form of compensation ; i.e., when an agent sells some of his reserve.
With respect to rent, postage , and telephone , these are provided by the Company
as well as office space for the agents ' use when they come in to attend meetings,
settle their accounts weekly, receive mail or request that the office mail something
for them, and pick up telephone messages. Provision of such facilities by the Com-
pany and use by the agents must be recognized although agents also use their home
telephone and some of them maintain an office or workspace with a desk , etc., in
their home . While some agents may claim and take a business expense deduction
for income tax purposes ,41 it appears from the testimony that the investiment in
such cases is slight. Any finding that furniture is provided for the agents would be
merged in the finding that they are required to report and attend meetings each week.
Attendance being required , facilities are provided for all. To the extent that com-
parison is attempted with franchise holders and other independent parties, important
differences can be cited including separate investment and control over it, supervision
of day-to-day operations , and summary termination and replacement , even if some
items are common to employment and so-called independent relationship. While
opinions may differ with respect to the weight to be given to the various factors
individually and to their collective significance , and an ad hoc decision with respect
to both significance and weight must be made in each case , consideration of the en-
tire testimony leads to a certain and definite conclusion The significance of factors
which suggest an independent contractor relationship is blunted and outweighed by
the substantial evidence on the record as a whole, which persuasively indicates that
the debit agents are employees of United , and I so find. From this finding it follows
that the Company unlawfully refused to bargain , as alleged.
Upon the basis of the above findings of fact and upon the entire record in the case,
I make the following:
CONCLUSIONS OF LAW
1 Insurance Workers International Union, AFL-CIO, is a labor organization
within the meaning of Section 2 ( 5) of the Act.
40 Ibid
41 Scott testified that he did this while at Quaker City, where employee status was
recognized
UNITED INSURANCE COMPANY OF AMERICA 59
2. All debit agents of the Company in districts in Baltimore City and Anne
Arundel County, Maryland (districts presently numbered 153, 159, 160, 161, 162,
164, 167, 168, and 174), but excluding all office clerical employees, guards, pro-
fessional employees, managers, assistant managers, special agents, inspectors, and
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 National Labor
Relations Act, as amended.
3. The Union was on August 14, 1964, and at all times since has been the exclu-
sive bargaining representative within the meaning of Section 9(a) of the Act, of all
employees in the aforesaid unit for the purposes of collective bargaining.
4. By refusing, since September 1, 1964, to bargain collectively with the Union
as the exclusive representative of the employees in the appropriate unit, the Com-
pany, United Insurance Company of America, has engaged in and is engaging in
unfair labor practices within the meaning of Section 8(a)(5) of the Act.
5. By such refusal to bargain, thereby interfering with, restraining, and coercing
its employees in the exercise of rights guaranteed in Section 7 of the Act, the Com-
pany has engaged in and is engaging in unfair labor practices within the meaning
of Section 8(a)(1) of the Act.
6. The aforesaid unfair labor practices are unfair labor practices affecting com-
merce, within the meaning of Section 2(6) and (7) of the Act.
RECOMMENDED ORDER
Upon the basis of the foregoing findings of fact and conclusions of law, and upon
the entire record in the case, and pursuant to Section 10(c) of the National Labor
Relations Act, as amended, it is hereby recommended that the Respondent, United
Insurance Company of America, Chicago, Illinois, its officers, agents, successors, and
assigns, shall:
1. Cease and desist from:
(a) Refusing to bargain collectively with Insurance Workers International Union,
AFL-CIO, as the exclusive representative of its employees in the following appro-
priate unit: All debit agents in districts in Baltimore City and Anne Arundel
County, Maryland (districts presently numbered 153, 159, 160, 161, 162, 164, 167,
168, and 174), but excluding all office clerical employees, guards, professional em-
ployees, managers, assistant managers, special agents, inspectors, and supervisors as
defined in the Act.
(b) In any like or related manner interfering with, restraining, or coercing its
employees in the exercise of the right to self-organization, to bargain collectively
through representatives of their own choosing, and to engage in other concerted
activities for the purpose of collective bargaining or other mutual aid or protection.
2. Take the following affirmative action, which the Board finds will effectuate the
policies of the Act:
(a) Upon request, bargain collectively with the Union as the exclusive representa-
tive of the employees in the appropriate unit, and embody in a signed agreement
any understanding reached.
(b) Post at its offices in Baltimore City and Anne Arundel County, Maryland,
copies of the attached notice marked "Appendix " 42 Copies of said notice, to be
furnished by the Regional Director for Region 5, shall, after being duly signed by the
Company's representative, be posted by the Company immediately upon receipt
thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous
places, including all places where notices to its employees are customarily posted.
Reasonable steps shall be taken by the Company to insure that said notices are not
altered, defaced, or covered by any other material.
(c) Notify the Regional Director for Region 5, in writing, within 20 days from the
receipt of this Decision, what steps have been taken to comply herewith.43
'= In the event that this Recommended Order be adopted by the Board, the words "a
Decision and Order" shall be substituted for the words "the Recommended Order of a
Trial Examiner" in the notice In the further event that the Board's order be enforced
by a decree of a United States Court of Appeals, the words "a Decree of the United States
Court of Appeals, Enforcing an Order" shall be substituted for the words "a Decision
and Order"
13 In the event that this Recommended Order be adopted by the Board, this provision
shall be modified to read "Notify said Regional Director, in writing, within 10 days from
the date of this order, what steps the Respondent has taken to comply herewith 11
60 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX
NOTICE TO ALL EMPLOYEES
Pursuant to the Recommended Order of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor Rela-
tions Act, as amended, we hereby notify our employees that:
WE WILL bargain upon request with Insurance Workers International Union,
AFL-CIO, as the exclusive representative of all employees in the bargaining
unit described herein with respect to rates of pay, hours of employment, or
other conditions of employment, and embody in a signed agreement any under-
standing reached. The bargaining unit is:
All our debit agents in Districts in Baltimore City and Anne Arundel
County, Maryland (Districts presently numbered 153, 159, 160, 161, 162,
164, 167, 168, and 174), but excluding all office clerical employees, guards,
professional employees, managers , assistant managers , special agents, in-
spectors and supervisors as defined in the Act.
WE WILL NOT refuse to bargain collectively with Insurance Workers Inter-
national Union, AFL-CIO, as the exclusive representative of our employees in
the unit described herein.
WE WILL NOT in any like or related manner interfere with, restrain, or co-
erce our employees in the exercise of the right to self-organization, to form
labor organizations, to join or assist Insurance Workers International Union,
AFL-CIO, or any other labor organization, to bargain collectively through
representatives of their own choosing, and to engage in other concerted activities
for the purpose of collective bargaining or other mutual aid or protection.
UNITED INSURANCE COMPANY OF AMERICA,
Employer.
Dated------------------- By-------------------------------------------
(Representative) (Title)
This notice must remain posted for 60 consecutive days from the date of posting,
and must not be altered, defaced, or covered by any other material.
If employees have any question concerning this notice or compliance with its pro-
visions, they may communicate directly with the Board's Regional Office, Sixth
Floor, 707 North Calvert Street, Baltimore , Maryland, Telephone No. 752-8460,
Extension 2100.
Formold Plastics , Inc. and District No. 8, International Associa-
tion of Machinists, AFL-CIO. Case No. 13-CA-6641. July 30,
1965
DECISION AND ORDER
On May 11, 1965, Trial Examiner Stanley Gilbert issued his Deci-
sion in the above-entitled proceeding, finding that the Respondent had
not engaged in the unfair labor practices alleged in the complaint and
recommending that the complaint be dismissed in its entirety, as set
forth in the attached Trial Examiner's Decision. Thereafter, the
General Counsel filed exceptions to the Decision and a supporting
brief, and the Respondent filed a brief in support of the Trial Exam-
iner's Decision and in opposition to the General Counsel's exceptions.
Pursuant to the provisions of Section 3(b) of the National Labor
Relations Act, as amended, the National Labor Relations Board has
delegated its powers in connection with this case to a three-member
panel [Chairman McCulloch and Members Brown and Zagoria].
154 NLRB No. 16.