Southwestern Bell Telephone Co.

National Labor Relations Board - Board Decisions

Jun 17, 1943

50 N.L.R.B. 702 (N.L.R.B. 1943)

11
In the Matter of SOUTHWESTERN BELL TELEPHONE COMPANY, OR MRS.
VIOLA BERTHOLD , AGENT and BuiLDING SERVICE EMPLOYEES LOCAL
203, AFL
Case No. R-5346.Decided June 17,1943
Mr. John Mohler, of St. Louis, Mo., for the Company.
Mrs. Viola Berthold, of New Athens, Ill., pro se.
Mr. T. J. Dwyer and Mr. J. 7'. Latham, of St. Louis, Mo., for the
A. F. of L.
Mr. Mont F. Highley, Jr., of Oklahoma City, Okla, for the Tele-
phone Workers.
Miss Melvern R. Krelow, of counsel to the Board.
DECISION
AND -
DIRECTION OF ELECTION
STATEMENT OF THE CASE
Upon petition duly filed by Building Service Employees, Local 203,
AFL, herein called the A. F. of L., alleging that a question affecting
commerce had arisen concerning the representation of employees of
Southwestern Bell Telephone Company, St. Louis, Missouri, herein,
called the Company, or Mrs. Viola Berthold, Agent, New Athens, Illi-
nois, herein called the Agent,' at the New Athens, Illinois, Exchange,
herein called the Exchange, the National Labor Relations Board pro-
vided for an appropriate hearing upon due notice before Eugene M.
Purver, Trial Examiner. Said hearing was held at St. Louis,' Mis-
souri, on May 13, 1943. The Company, the Agent, the A. F. of L., and
Southwestern Telephone Workers Union, Eastern Missouri and Ar-
kansas Traffic Area,'herein called the Telephone Workers, appeared,
participated, and were afforded full opportunity to be heard, to ex-
amine and cross-examine witnesses, and to introduce evidence bearing
upon the issues. The Trial Examiner's rulings made at the hearing
are free from prejudicial error and are hereby affirmed.
At the commencement of the hearing, the Company moved to dis-
miss the petition as to it on the grounds that the persons employed at
i At the hearing , the A . F. of L moved to amend its petition in order to direct it to the
Company or the Agent , instead of to the Company and the Agent . The Trial Examiner
granted the motion.
50 N. L. R B., No. 96.
702
SOUTHWESTERN BELL TELEPHONE COMPANY 703
the Exchange are not employees of the Company, but are employees
of the Agent, and that the A. F. of L.'s claim to represent a majority
of the-employees at the Exchange is not supported by the evidence
submitted by the A. F. of L. The Trial Examiner reserved ruling.
For reasons hereinafter set forth, the motion is hereby denied.
On May 27 and 29, 1943, the Company and the Telephone Workers,
respectively, filed briefs which the Board has considered.
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF THE COMPANY
Southwestern Bell Telephone Company, is Missouri corporation,
is one of the associated companies of the American Telephone and
Telegraph Company which, except for qualifying shares, owns all the
capital stock of the Company. The Company conducts a general tele-
phone business in Missouri; Kansas, Oklahoma, Arkansas, Texas, and
a small area of Illinois. It furnishes both local and long distance
telephonic communication, and its lines connect directly with those
of the American Telephone and Telegraph Company and associated
companies; and indirectly with those of practically. every commercial
telephone company in the United States, and with those in foreign
countries to which telephone service from the United States is ordi-
narily available.
The Company serves approximately 44,300 telephones in the State'
of Illinois, and its telephone plant in Illinois represents an investment
of approximately $6,000,000. The Company serves approximately
425 telephones in New Athens, Illinois, and the Exchange represents
an investment of approximately $25;000. During 1942, the Company
purchased materials, primarily consisting of telephone materials, for
use in its operations in Illinois valued at approximately $325,000,
$245,000 thereof from outside the State of Illinois. The correspond-
ing amount of materials purchased for use at the Exchange was
approximately, $500. During the, same period, the Company's total
operating revenues was approximately $1,900,000, approximately 20
percent thereof representing revenues from interstate toll calls. Dur-
ing the same period, the gross operating, revenues for the Exchange
were approximately $10,000, approximately 8 percent thereof repre
seating revenues from interstate toll calls.
The Company operates approximately 248 agency exchanges similar
to the Exchange involved herein. As heretofore stated, the Company
contends that the Agent is an independent contractor. All the agency
exchanges serve their customers with telephonic communication, and
the service conducted at these agency exchanges is similar -to that at
the salaried exchanges, which are operated by the Company directly.
704 DECISIONS OF NATIONAL LAB,OR ' RE'LATIONS BOARD
The agency exchanges are in charge of agents who enter into an ar-
rangement with the Company, involving in part the making of certain
indentures, in form agency agreements, with the Company. The
Agent's agreement, dated January 1, 1942, provides for the operation
of the Company's switchboard and, central office equipment and all
lines connected therewith at the Exchange; for the collection of all
'sums of- money due the Company, and for the making of all
necessary reports, upon the terms and conditions stated-in the agree-
ment. The Company agreed to pay the Agent the sum of $200 month-
ly. Of this sum, $59.70 is considered, compensation for the personal
services of the Agent, plus $10.00 agreed rental value of living quar-
ters furnished the Agent. The remaining $130.30 paid by the Com-
pany to the Agent is used for the Exchange's pay roll and other ex-
penses. The agreement was, made for a period of 3 months from the
date of execution and thereafter to be terminated by sixty (60) days'
notice in writing given by either party to the other, unless terminated
upon 1 day's notice by the Company to the Agent if the Agent's opera-
tion, supervision, or work at any time proves unsatisfactory to the,
Company.
The Company owns all of the equipment at the Exchange, pays the
taxes on the equipment, provides space for the switchboard and office,
maintains and repairs the equipment, establishes policy and instruc-
tions which the Agent is responsible for carrying 'out, and issues all
bills to the subscribers in the area served by the Exchange.
We are, satisfied, and we find, that the business of serving subscrib-
ers in the Exchange area with telephonic communication is, despite
the execution of the agency agreement, the business of the Company
and not that of the Agent.
The Company admits that it is engaged in commerce within 'the
meaning of the National Labor Relations Act.
II. THE ORGANIZATIONS INVOLVED
Building Service Employees, Local 203, is a labor organization
affiliated with the American Federation of Labor, admitting to mem-
bership employees 2 of the Company.
Southwestern Telephone Workers Union, Eastern Missouri and
Arkansas Traffic Area, is a labor organization affiliated with the Na-,
tional Federation of Telephone Workers, admitting to 'membership
employees of the Company.
III. THE QUESTION CONCERNING REPRESENTATION
On February 16, 1943, the A. F. of L., which had previously been
informed by the Agent that her contract with the Company precluded
2 For reasons appearing under Section III, below , we find that the persons working under
the Agent are employees of the Company within the meaning,of the Act.
SOUTHWESTERN BELL TELEIPHONE COMPANY 705
any wage adjustments, wrote the Company requesting recognition
as the exclusive bargaining representative of the employees at the
Exchange. The Company has refused to recognize the A. F. of L.
As previously set forth, the Company maintains that the Agent
under the existing arrangement is-an independent contractor; that
there is consequently no employer-employee relationship existing be-
tween the persons working under her and' the Company, and that
those persons are the Agent's employees. The Agent works at the
switchboard as an operator, collects bills, and keeps accounts, and
is in direct charge of the Exchange. The two regular full-time op-
erators handle local 'and long distance telephone calls, prepare the
tickets for the long distance calls for forwarding to the Company,
and handle collection of bills. These employees have been employed
in the Exchange for several years.
In contending that the relationship established constitutes the
Agent an independent contractor, the Company urges our considera-
tion of certain presently existing facts : that the Agent has sole au-
thority to hire and discharge the persons working under her; that
prior to approxilnately 6 months ago, the Company had no knowledge
of the number or names of such persons, having since acquired such
knowledge only for the purpose of filing Social Security and Illinois
unemployment compensation tax returns.
We are required in administering the Act and in effectuating its
policies to inquire into the substance of relationships,' and we are
satisfied that regardless of the execution of the agency agreement the
Agent did not by virtue of that fact become an independent contractor.
The term employee, as used in the statute, embraces "any employee,"
that is, all employees in the legal and conventional sense except those
by express provision excluded.4 The primary consideration is whether
effectuation of the declared policy and purposes of the Act comprehend
securing to the individual the rights guaranteed and the protection
afforded by the Act. The matter is not conclusively settled by a con-
tract which adverts to and purports to establish the status of such
person other than as an employee. Here the Agent is required to
operate the Company's switchboard, to collect all moneys due the Com-
pany, and to make all Necessary reports to the Company.' Moreover,
the Agent is 'subject to extensive control by the Company over the
manner and mode of her work. Indeed, the agency agreement is con-
ditioned upon the Agent's agreement to operate the Exchange in a
manner at all times satisfactory to the Company. Discharge by the
8 See Matter of The Park Floral Company and United Greenhouse and Floral Workers
Union No. 510, etc, 19 N L R. B. 403, 409.
4 Section 2 (3) of the Act provides in part :
The term "employee" shall include any employee, but shall not include any
individual employed as in agricultural laborer,'. . .
706 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Agent of her duties under the.agency'agreement and otherwise in con-
nection with the Exchange concerns, not so much the accomplishment of
any specified result as a continuing operation in close association with
-the whole of the Company's enterprise. In brief, the work of the
.Agent is one stage in and an integral part of the Company's entire
business. ' We are of the opinion and find that the relationship be-
tween the Company and the Agent has been in fact, and within the
contemplation of the parties, that of employer-employee. This con-
clusion becomes enforced when it is considered that the agency agree-
ment exists only by will and not for any specified period of time. Thus
the Company's right to terminate summarily the Agent's agreement
rests in the Company, a power of control similar to and not less than
its right to control the activities of any employee by threatened or
actual discharge.5
We find that the Agent and the persons working under her supervi-
sion are employees of the Company Within the meaning of Section 2
,(3) of the Acts ,
A statement of the Trial Examiner,' read into the record, indicates
that the A. F. of L. represents a substantial number of employees in
the unit claimed by it to be appropriate.?
We find that a question' affecting commerce has arisen concerning
the representation of employees of'the Company within the meaning
of Section 9 (c) and Section . 2,(6) and (7) of the Act.
IV. THE APPROPRIATE UNIT; THE DETERMINATION OF REPRESENTATIVES
The A. F. of L. contends that all full-time regular telephone opera-
tors 8 of the Company,at the New Athens Exchange, excluding all
other employees of the Company, constitute an appropriate unit.
The Telephone Workers maintain that in view of the collective bar-
gaining relationship which has existed between the Company and
the Telephone Workers since 1937, and its contract dated March 17,
1942, now in effect, covering non-supervisory employees of the Com-
5 See Matter of H. F. Wilcox Oil and Gas Company; Wilcox Refining Division and/or
W. M. Fraser, 28 N. L. R. B 79
° The Company, contends that it lacks the control over the employees working under the
Agent which is a necessary requisite to an employer relationship . We have before held and
now hold that where persons are found to be employees of a company , their subordinates,
even though hired by them , are employees of the Company . Matter of The Park Floral
Company, stpra The Company, if for no other reason than the fact that it has, as
above pointed out, the power summarily to dismiss the Agent from its employment, is
vested with the ultimate control over the actions of the employees working under her.
That the Company 's power of control may not in fact have been exercised is immaterial,
since the right to control rather than the actual exercise of that right is the touchstone
of the employer -employee relationship.
"TheThe Trial Examiner reported tbat the A F. of L. submitted two membership cards,
dated November 30, 1942, bearing apparently genuine signatures of persons 'whose names
appear on the pay roll orally submitted at the hearing by the Agent. There are three em-
ployees in the unit claimed appropriate' by the A. F. of L. There are two additional em-
ployees at the Exchange who will be discussed under Section IV, below.
° The A F of L amended its petition at the hearing with respect to the unit.
SOUTHWESTERN BELL TELEPHONE COMPANY 707
pany in the 'traffic, plant, commercial, and accounting departments
in all of the Company's operating areas, namely, Eastern Missouri and
Arkansas,' Western Missouri and Kansas, Oklahoma, and, Texas, the
employees in the Exchange come under that contract, and should be
a part of that unit. The Company agrees with the position of the
Telephone Workers, subject to its contention that the persons here
involved are not its employees.
Since 1937, the Telephone Workers has executed collective bar-
gaining contracts with the Company covering various classifications
of employees, until March 1942, when the above-mentioned contract
was executed for a period of 1 year, to continue thereafter'unless ter-
minated upon 90 days' notice by either party to the other. The traffic
department includes employees engaged in duties similar to those
of the employees of the Exchange.
Since the Telephone Workers is 'at the present time recognized by the
Company in its contract as the exclusive representative of employees
of the Company engaged in duties similar to those of the employees
at the Exchange, and in view of the nature of collective bargaining
between the Company and the Telephone Workers, we find that the
New Athens Exchange may properly be considered as a separate unit
or may be included with the employees now represented by the Tele-
phone Workers for the purposes of collective bargaining.
The A. F. of L. desires the exclusion of the two relief operators
employed at the Exchange. These employees are paid at the same rate
as are the full-time regular operators; they engage in the same duties,
with the exception that they do not handle money, nor do they prepare
the long distance tickets. One works approximately 9 hours a week;
the other approximately 21 hours a week, but both have regular sched-
ules: Under the circumstances we find that these employees are`
regular,part-time • employees and, according to our usual practice, we
shall include them.
Although the Agent would come under the A. F. of L.'s definition of
an appropriate unit, as a regular full-time operator, we shall exclude
her since she has the authority to hire and 'discharge the employees
under her supervision, a power normally associated with supervisory
employees.
• In view of the absence of any question concerning representation
among the employees covered by the collective bargaining -contract
between the Telephone Workers and the Company, we shall, accord
ingly, direct that the question concerning representation which has
arisen be resolved by an election among the employees of the Company
at the New Athens, Illinois, Exchange, including the 'relief opera-.
tors, but excluding the Agent and all other employees of the Company,
to determine whether they desire to be represented by the A. F. of L.
The Exchange is part of this area.
708 DEO S%NiS OF NATIONAL LABOR , REiLAT 'IONSi B,OAR;D
or by the Telephone Workers, or by neither. * If the majority selects
the A. F. of L:, they will constitute a separate appropriate unit; if,
however, the majority selects the Telephone Workers, they will thereby
have indicated their desire to be included in the unit covered by the
Telephone Workers' contract, and will be a part of-such unit and
contract.
The Telephone Workers submitted no evidence in support of its
claim to represent the employees of the Exchange, relying upon its
contract withq the Company, which will. also be discussed under
Section IV, below.
DIRECTION OF ELECTION
By virtue of and pursuant to the power vested in the National
Labor Relations Board by Section 9 (c) of the National Labor Re-
lations Act, and pursuant to Article III, Section 9, of National Labor
Relations Board Rules and Regulations-Series 2, as amended, it is
hereby , '
DIRECTED that, as part of the, investigation to ascertain representa-
tives for the purposes of collective bargaining with Southwestern Bell
Telephone Company, St. Louis, Missouri, an election by secret ballot
shall be conducted as early as possible, but,not later than thirty (30)
days from the date of this Direction, under the direction and super-
vision of the Regional Director for the Fourteenth Region, acting in
this matter as agent for the National Labor Relations Board, and
subject to Article III, Section 10, of said Rules and Regulations,
among the employees of the Company at the New Athens, Illinois,
Exchange, including the relief operators, who were employed during
the pay-roll period immediately preceding the date of this Direction,
employees who did not work during said pay-roll period because they
were ill or on vacation or temporarily laid off, and employees in the
armed forces of the United States who present themselves in person at
the polls, but excluding the Agent and all other employees of the Com-
pany and any who have since quit or been discharged for cause, to
determine, whether they desire to be represented by Building Service
Employees, Local 203, AFL, or by the Southwestern Telephone Work-
ers Union, Eastern Missouri and Arkansas Traffic Area, for the
purposes of collective bargaining, or by neither.