Southern Shellfish Co., Inc.

National Labor Relations Board - Board Decisions

Aug 3, 1951

95 N.L.R.B. 957 (N.L.R.B. 1951)

SOUTHERN SHELLFISH CO., INC. 957
absent 30 days' notice. Since that date, neither of the contracting
parties has served notice to change, modify, or terminate the contract.
While the employees covered by the contract enjoy various vacation
and insurance benefits, none of these benefits has ever been the sub-
ject of negotiations between the Employer and the Intervenor. It
appears that no representative of the Local has ever met with the
Employer or requested negotiations regarding any term or condition
of employment contained in the contract; no grievance committee has
ever been established pursuant to the contract, and no grievances have
been processed; no union dues have ever been checked off; nor has the
Local ever utilized the bulletin board which the Employer made
available for the posting of union notices. Furthermore, there is no
evidence that the employees at the Employer's plant were aware of
the existence of a contract covering them, nor is there evidence as to
what number of employees are members of the Local; as to when, if
ever, meetings were held ; or as to whether or not any dues have been
paid by the employees directly to the Local.
Thus, it appears that the Local has abandoned the administration of
its contract with the Employer, and has ceased actively to represent
the Employer's employees since the execution of that contract 7 years
ago. Under all the circumstances, we find that it will best effectuate
the purposes of the Act to direct an election at the Employer's plant
at this time.3 Accordingly, we find that the contract between the Em-
ployer and the Local is not a bar to this proceeding.
4. The parties have stipulated, and we find, that all employees of the
Employer at its Grand Rapids, Michigan, plant, excluding all office
and clerical employees, truck drivers, service truck salesmen, salesmen,
professional employees, guards, foremen, and all other 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 Act.
[Text of Direction of Election omitted from publication in this
volume.]
8 Cf. American Manufacturing Company, 91 NLRB No . 171; Reynolds & Manley Lumber
Company, 88 NLRB 1300.
SOUTHERN SHELLFISH CO., INC. and INTERNATIONAL FUR AND LEATHER
WORRIERS UNION OF THE UNITED STATES AND CANADA, PETITIONER.
Case No. 15-RC-474. August 3, 1951.
Decision and Direction of Election
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing was held before John W. Irving, hearing offi-
95 NLRB No. 114.
958 DECISIONS OF NATIONAL,, LABOR RELATIONS. BOARD
cer. The hearing officer's rulings made at the hearing are free from
prejudicial error and are hereby affirmed.
Pursuant to the provisions of Section 3 (b) of the Act, the Board
has delegated its powers in connection with this case to a three-member
panel [Chairman Herzog and Members Reynolds and Murdock].
Upon the entire record I in this case, the Board finds :
1. The Employer is engaged in commerce within the meaning of-the
Act.
2. The labor organization involved claims to represent certain em-
ployees of the Employer.
3. The Petitioner seeks to represent the captains and the crews of
certain fishing boats which the Employer either owns -or on which it
has a mortgage or lien.2 The Employer contends, inter alia,, that the
captains are independent contractors within the meaning of Section
2 (3) of the Act and,. hence, that neither the captains nor the crews
are its employees. We agree with the Employer's contention only
with respect to the captains and the crews of the "lien boats."
As `stated by the Court of Appeals for the Fifth Circuit in
N. L. R. B. v. Steinberg d Co., on which'the Employer relies, the
.determination of whether an individual is an employee or an inde-
pendent contractor, ".... in each case, must depend largely upon
'its own peculiar facts. The usual test employed for determining the
distinction between an independent contractor and an employee is
found in the nature and the amount of control reserved by the person
for whom the work is done, and the employer-employee relationship
exists only where the employer has the right to control and direct
work not only as to the result to be accomplished by the work, but also
as to the manner and means by which that result is accomplished. It
is the right and not the exercise of control which is the determining
element." [Emphasis supplied.]
As we find below, the evidence establishes that the relationship
between the Employer and the captains and the crews on the boats
owned by the Employer is that of employer and employee. It is not
the same as that which exists between the Employer and the crews on
the "lien boats." Although there are some similarities in the opera-
tions performed by the captains and the crews on both categories of
the boats, the material difference in the relationship arises from the
I The Employer filed a motion for permission to file a reply brief, copies of which were
attached to its motion. The motion is hereby granted. The reply brief has been
considered along with the Employer's brief and the Petitioner' s brief.
1 The boats on which the Employer has a mortgage or lien are hereafter referred to
as the "lien boat's."
8182 F. 2d 850, 857 (C. A. 5, 1950). Accord, N. L. R. B. v. Nu-Car Carriers, Inc.;
189 F. 2d 756, 28 LRRM, 2160 (C. A. 3, 1951) ; N. L. R. B. v. Phoenix Mutual Life Insurance
Co., 167 F. 2d 983, cert. denied 335 U. S. 845; Restatement , Agency, Section 226; 56 C. J. S.,
pp. 4 .1-_62; 27 Am . Jur. 479-540.
SOUTHERN SHELLFISH CO., INC. 959
facts disclosing, as we hereafter find, that the Employer has reserved
the right to control both the work result and the manner and means
by which the work is performed on the Employer-owned boats. The
Employer does not possess the same right of control in the case of the
captains and crews on the "lien boats." The record upon which we
base our findings and conclusions discloses the following :
The Employer is engaged in the operation of a seafood cannery and
ice plant at Harvey, Louisiana. All of the persons sought to be repre-
sented by the Petitioner are engaged primarily in catching fish. Their
"catch," which is turned over to the Employer under certain condi-
tions described below, represents approximately 20 percent of the total
seafood used by the Employer in the course of its cannery operations.
The Employer-Owned Boats
The Employer owns about 12 fishing boats, each of which is manned
by a captain and 1 or 2, boatmen or fishermen. With respect to these
boats, it is the practice of the Employer in each case to enter into an
oral agreement with an experienced fisherman, who is designated as a
captain, and to whom the boat is assigned for purposes of operation.
This agreement, which. is terminable at will, provides for the captain's
undertaking to fish with the boat, his undertaking to deliver all of his
catch to the Employer (even. though higher prices may be obtainable
elsewhere) ,4 and the terms on which the shares, discussed below, will
be divided. As a part of the agreement, anct in accordance with the
custom prevailing in maritime operations, the Employer authorizes
the captain to hire and fire the boatmen who make up the crew 5 How:-
ever, the record shows that the Employer has, not considered the grant
of such authority to the captain as precluding an exercise of over-all
control in this respect .6 The Employer also carries public liability
insurance on the boats to protect itself from claims arising from the
negligence of the captains or the boatmen.
It also appears that, under the oral agreement between the Employer
and the captain, the manner and method of the acquisition' and main-
tenance of the equipment, or "tools," and the supplies essential to the
performance of the fishing operations are substantially under the
Employer's control. Thus, the Employer determines whether and
when repairs shall be made on its boats and has such repairs made
In those cases in which a shortage of fee or a small - catch makes return to the
Employer 's docks inadvisable , the captains telephone the.`Employer : for authority tp sell
the shrimp elsewhere . Checks in payment , for such shrimp are sent to . the Employer,
are made payable to the boat, and are endorsed by the captain of the boat. The proceeds
are applied to the captain 's account in the Employer 's books in the usual fashion.
5 The Employer also ' authorizes the captain to determine the size of • the crew. As a
practical matter , however , the size of the crew is actually determined by the size of the
boat assigned to the captain.
e Thus, at the Employer's direction , a boatman was fired for damaging a boat while drunk,
. _'960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
at its own repair yard at. Biloxi, Mississippi. The captain obtains
the rig 7 with which the boat is fitted out from the Employer's store-
room, and the Employer charges the cost of the rig to a special account
opened on its book in the name of the captain. With regard to con-
sumable supplies, the Employer requires the captain to obtain ice
from its ice plant and fuel oil and groceries from suppliers designated
by the Employer. The Employer pays for these items initially and
charges them to an account also kept in the name of the captain, but
separate from that used for the rig. The, Employer deducts the cost
of the rig and the consumable supplies, as described below, from the
money which the Employer pays.to the captain for the catches of the
boat.
When the boats return from a fishing trip, the Employer unloads
them at its docks, throws out the spoiled shrimp,8 grades the accept-
able shrimp by size, and weighs them. The Employer .then deter-
mines the value of the catch from its own price lists. From the total
-value of the catch, the Employer. first deducts the cost of the fuel
oil, ice, and groceries, and divides the balance into five or five and
one-half shares. The Employer withholds one share for upkeep of
the boat and one or one and one-half shares for application to the
.captain's account for the rig, and delivers the -remaining three shares
to the captain, who, in accordance with the prevailing custom, divides
the amount equally among the crew members and himself. In addi-
tion, the Employer pays the captain a bonus of $1 for each barrel of
shrimp delivered .9
In addition to the catching of shrimp, the Employer's boats are
also engaged in'what is called freighting. Freighting involves pur-
chasing shrimp at sea from another boat. This is usually done when,
the seller has a small catch or a depleted supply of ice. The price
paid for the shrimp is determined from the Employer's price list,
from which a standard deduction for transportation is made. Ordi-
narily, the purchasing captain gives the seller a printed receipt form
'bearing the name of the Employer. On this form the amount and
grade of the purchased shrimp are noted. The Employer makes pay-
ment to the seller, or, if the seller has so requested, the Employer gives
the 'cash to the purchasing captain for delivery to the seller. The
' The rig consists of nets, cables , boards, and kitchen utensils. The Employer allows
the captain to designate the net maker from whom he desires to obtain the fishing net.
However, the Employer actually purchases the net and charges it to the account of the
captain * for whom it is 'purchased , as described below.
. s The captains receive no payment for the spoiled shrimp, which the Employer utilizes
in making fertilizer . However, the Employer makes no profit from the operation of its
fertilizer plant, which it maintains merely . to have a means of disposing of waste products.
9,A]1 of the bookkeeping with regard to the operation of the boats and the determination
of the value of the shares is performed by the Employer.
SOUTHERN SHELLFISH CO.., INC . 961
from the Employer in the usual fashion.
ed shrimp
It appears that the Employer has power to control the type of fish-
ing to be done by determining the type of rigging and fixtures that
is- put on the boats. At the time of the hearing, the captains were
required to fish for shrimp. The Employer has also been able to con-
trol the use of its • boats in fishing and freighting operations by.
unilaterally changing the number of shares which it withholds on
freighted shrimp. Furthermore, although the Employer hires the
captains for an indefinite period, apparently as long as their services
are satisfactory,1° it may terminate the agreements for use of the boats
at will and without cause."
Under the circumstances described above, in which the Employer
furnishes and maintains not only all of the "basic tools" essential
for performance of the work result,12 either directly or through the
lending of its capital, but all the consumable supplies used in the
fishing operations, the fact that the agreements for the "tools" most
essential to the performance of the work-namely the boats-are
terminable at will assumes great significance and permeates the re-
lationship between the Employer and the captains. Through its
option to terminate the agreement for use of the boat, the Employer
has the right to control the length of the lay-overs, the hiring and
firing of boatmen, the type of fishing done, the quantity of produc
tion required,,and the manner in which the fishing is done. Regard-
less of whether or not it has found it necessary to exercise such con-
trol, the existence of this right of control negates the contention that
the relationship between the Employer and the captains on the Em-
ployer-owned boats is that of independent contractors.
We are mindful that the above facts do disclose the existence of
some elements in the relationship of the captains to the Employer
similar to those in Alaska Salmon Industrj, Ine.,13 and J. Howard
S ri, th; Inc;,14 recently decided by the Board, in which we found that
the captains there involved were independent contractors. Like-
10 The permanence of a relationship is indicative of an employer -employee relationship.
Restatement , Agency, Section, 220 (2) (f).
It has been said by some courts that no other single fact is so conclusive in showing
that the relationship Is not that of an independent contractor as that the employer has,
the right to terminate the particular service whenever he chooses . . See, for example,,'
Rislain v. Industrial Accident 'Commission, 23 Cal . 2d 248, 144 F. 2d 16 ( 1943) and
Clausen v., Dept. of Labor and Industries , 15 Wash. 2d 62, 129 F. 2d 777. (1942). See
also, Vaughn Brothers , et al., 94 NLRB 382; J . G . Howard Lumber Company,
93 NLRB 1230. .
It Is noted that the rigging and the nets, which , like the boats, (all into the category
of the "tools" basic to performance of the fishing operations , are usually worn out before
they have been paid for by the shares deducted and applied to the accounts for the rig.
1a 81-NLRB 1335.
14 95 NLRB 21.
962 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
wise,, there are similarities with some of the elements in the relation-
ship at issue in N. L. R. B.; v. Steinberg d Co., supra. An over-all
consideration of the factors involved here persuades us, . however,
that there are important distinctions between the facts involved in
those .cases and those in the instant case; compelling the finding .we
here make that the relationship between the Employer and the cap=
'thins and crews which operate its . boats, is that of employer and
employees.
Thus, in both the Alaska Salmon case and the J. Howard Smith
case, the agreements- established the duration of the fishing season
as the period during which the relationship, between the parties
would exist, whereas in this case, the Employer, hires the captain
for an indefinite period. In both of the cases mentioned above, the
price to be paid for the fish was established by a bilateral agreement
for the duration of the fishing season, whereas in this case the Em-
ployer unilaterally determines and changes the price it will pay for
the shrimp. In the Alaska Salmon case 85 percent of the "skippers"
involved owned, or were in the process of purchasing, their boats,
and, in the J. Howard Smith case the charter agreements gave the
captains "full and exclusive possession, management, navigation con-
trol and operation" of the fishing vessels for the duration of the
fishing season 15 In this. case, as previously mentioned, the agree-
merits for use of the boats are terminable at will and without cause.
Because the Employer deducts the expenses of the trip from the
value of the catch before it determines the value of the shares (in-
eluding the share for use and upkeep of the boat), the Employer;
unlike the employers in the J. Howard Smith case and the Alaska
Salmon case, in fact shares the expenses of the trip with the captains
and the crews. Whereas the boats in the J. Howard Smith were
manned by 24 fishermen, the Employer's boats are small. and are
manned by a captain and 1 or 2 boatmen. Thus, the possibility of a
captain realizing profit through economical management in operat-
ing the boat and directing the crew is much less than it was in the
J.. Howard Smith case. The situation here more nearly approaches
that of a group incentive pay system.
The existence of an employer-employee relationship. is not rebutted
by the fact that here, as in the Alaska Salmon "case and the J. Howard
Smith case , the captains decide where and when to fish. The exist-'
ence of an area in which judgment may. be exercised by 'a-skilled
°6 Compare with N. L.. R.. B.. V. Steinberg Co., supra, in which the Court-of Appeals
for the Fifth Circuit found that'the'fur-trapping, leases there involved were terminable,
only upon breach of the terms of the agreement or' violations of law.. We also note that,
in the Alaska Salmon case, the 'fishing' areas had been flaed by custom among the
fishermen themselves and were subject to sale and transfer.
SOUTHERN SHELLFISH CO., INC. 963',
worker is not inconsistent, or incompatible, with the existence of an.
employer-employee relationship.16 Nor is the existence of such a
relationship rebutted by the fact that the captains and their crews.
bear the risk of loss through spoilage of freighted shrimp and may
profit or suffer losses through fluctuations in the price of the shrimp.
they purchase for freighting. The record contains no indication.
that such profits and losses appreciably affect the income of the cap--
tams and their crews. The Employer's price lists, which the captains.
use to determine the prices they will give for such shrimp, are issued.
several.times a year, and it does not appear that the prices thereafter
paid by the Employer to the captains vary significantly from the
prices set in the price lists. Although the Employer does not with-
hold taxes from the income received by the captains and the boatmen,
nothing appears in the record to indicate that the captains withhold.
such taxes, or that they have been informed that it is their duty to do.
so. -
In conclusion, we note that, as described above, the captains and
boatmen are independent of the Employer in the conduct of the fish-
ing operations only insofar as their skill and value as workmen give
them freedom in the labor market. In effect, the captains and boat-
men bring to the fishing operations only their labor, and do not, in
the language of the House Committee Report on the Labor-Manage-
ment Relations Act of 1947, "depend for their income ... upon,
the difference between what they pay for goods, materials, and labor
and what they receive for the end result." 17
Accordingly, we find that. the captains and boatmen of the Em-
ployer-owned boats are employees of. the Employer.
"Lien Boats"
The Petitioner also seeks to represent the captains and boatmen on
the,"lien boats." 1s These are boats owned by the captains who op-
erate them, but on which the Employer holds liens or mortgages ac-
quired as a part of the agreement for sale of the boats or the rigging
to the captains. The record indicates that, although the Employer
expects the "lien boat" captains to deliver. their catches to. the Em-
ployer in return for the favor of the credit advance, it has not ob-
jected when "lien boat" captains `have made sales of their catches to.
16 Cf. United States v. Vogue, Inc., 145 F.'2d 609, 611 (C. A. 4, 1944). Such a.determinn-
tion appears to be based, largely upon the season , the weather , and the captain's
knowledge of, the fishing graunds . • Likewise, ithe length of the fishing. trips depends upon
how soon 'a full catch is made or how long the supply of ice and groceries lasts.
"H. Rep..*1245 , 80th Cong . 1st Sess., p. 18, Vol . 1, Legislative History of the Labor
I elatlons Act; 1947 , page 309.
1 There are two or three boats in this category.
961974-52-vol. 95-62
964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
other companies. Nothing appears in the record to negate the in-
ference which thus arises that here, unlike the situation with regard to
the Employer-owned boats, the Employer does not require the "lien
boat" captains to deliver all their catches to it. Nor does the Em-
ployer generally deduct any fixed share of the catch of a "lien boat"
for application to the debt, but accepts such payments as the "lien
boat" owners desire to make. Furthermore, since the boats are in-
dependently owned, the Employer does not have the right to control,
and cannot control, the type of fishing done, the layovers between
fishing trips, or the hiring and firing of the boatmen. Accordingly,
we find that the captains of the "lien boats" are independent con-
tractors and that they and their boatmen are not employees of the
Employer. The petition is therefore dismissed as to those individuals.
In view of our conclusion that there is an employer-employee re-
lationship between the Employer and the captains and boatmen on the
Employer-owned -boats, we find that a. question affecting commerce
exists concerning the representation of employees of the Employer
within the meaning of Section 9 (c) (1) and Section 2 (6) and (7)
of the Act.
4. The appropriate unit : Although the parties are in general agree-
ment as to the appropriate unit, the Petitioner would include the cap-
tains while the Employer would exclude them on the basis of their
supervisory duties. As the record clearly establishes that the cap-
tains have the power to hire and discharge employees, and are there-
fore -supervisors within the meaning of Section 2 (11) of the Act, we
shall exclude them from the unit.
We find that all fishermen or boatmen on the Employer-owned
boats, excluding the captains and all or any other employees, con-
stitute an appropriate unit for the purposes of collective bargaining
within the meaning of the Section 9 (b) of the Act.
[Text of Direction of Election omitted from publication" ii :this
volume.]
EMERSON & STEVENS MFG. CO., INC., AND SPILLER AXE AND TOOL COM-
PANY and TEXTILE WORKERS UNION OF AMERICA, CIO, PETITIONER.
.Case No. 1-RC-2226.. August 3,1951
Decision and Direction of Election
Upon a petition duly filed under Section 9 (c) of the National-
.Labor Relations Act, a hearing was held before Robert_,,S.Fuchs,
hearing officer. The hearing officer's rulings made at the hearing
are free from prejudicial error ' and are hereby affirmed.
95 NLRB No. 109.