Truman Medical Center

National Labor Relations Board - Board Decisions

Dec 27, 1978

234 N.L.R.B. 1067 (N.L.R.B. 1978)

TRUMAN MEDICAL CENTER
Truman Medical Center Incorporated and Service
Employees International Union, Local No. 96,
AFL-CIO/CLC, Petitioner. Case 17-RC-8486
December 27, 1978
DECISION AND DIRECTION OF ELECTION
By CHAIRMAN FANNING AND MEMBERS JENKINS
AND PENELLO
Under a petition duly filed under Section 9(c) of
the National Labor Relations Act, as amended, a
hearing was held before Hearing Officer Jeffrey H.
Lerer of the National Labor Relations Board on
April 4, 1978. Following the hearing and pursuant to
Section 102.67 of the National Labor Relations
Board Rules and Regulations, Series 8, as amended,
and by direction of the Regional Director for Region
17, this proceeding was transferred to the Board for
Decision. Thereafter, the Employer and the Peti-
tioner filed briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has reviewed the Hearing Officer's rul-
ings made at the hearing and finds that they are free
from prejudicial error. They are hereby affirmed.
Upon the entire record in this proceeding :he
Board finds:
1. A question is presented whether Truman Medi-
cal Center Incorporated, herein called the Employer,
is an "employer" within the meaning of Section 2(2)
of the Act.' The Employer is a Missouri corporation
operating several hospital facilities in and around
Kansas City, Missouri.
The Employer contends that it is exempt from cov-
erage of the Act because: (1) the Medical Center is a
political subdivision, funded and controlled by Kan-
sas City and Jackson County, Missouri: 2 (2) the
Medical Center is a joint employer with the Univer-
sity of Missouri, a political subdivision of the State;
or (3) the Medical Center at least shares the exemp-
tion enjoyed by the city and the county in part by
I The Board has previously been confronted with the question of junsdic.
tion over this Employer. In Kansas City General Hospital and Medical Cen-
ter, Incorporated 225 NLRB 108 (1976), were the petitioner was a housestaff
association of interns and residents, we declined junsdiction, over Member
Fanning's dissent, on the basis that house officers were not employees under
Sec. 2(3). Cedars-Sinai Medical Center, 223 NLRB 251 (1976). The 2(2) issue
with respect to Kansas City General Hospital and Medical Center, whose
name has since been changed to Truman Medical Center, was expressly
reserved, and we now address it for the first time.
2 Sec. 2(2) of the Act excludes from the definition of "employer" "any
wholly owned Government corporation ... or any State or political subdi-
vision thereof.... "
virtue of a unique subcontracting relationship in re-
spect for which the Board, assuming it had technical
jurisdiction, ought to exercise its discretionary au-
thority to refuse to assert jurisdiction.
Until 1962 the Employer was a division of Kansas
City's Department of Health. At that time, Kansas
City General Hospital and Medical Center (hereinaf-
ter Truman Medical Center) was incorporated under
the general not-for-profit statute of the State of Mis-
souri. The city's intent in divesting itself of the hospi-
tal was to relieve a heavy financial burden and then
to contract with Truman Medical Center, which was
now eligible for private funding grants and Federal
aid. The initial contract, renewed in 1968 and again
in 1972, provided that Truman Medical Center
would operate the city's hospital facilities and as-
sume responsibility for the care of the city's indigent
residents. The amount of the city's payments to Tru-
man Medical Center for these services has been ar-
rived at through the city's normal budgetary pro-
cesses after receiving Truman Medical
Center's budgetary projections for each year. In 1974
Kansas City contributed approximately 40 percent of
the Employer's $20 million total budget. Kansas City
also provides certain services to Truman Medical
Center, such as building maintenance, water and
sewer service, and some insurance.
In 1973 Truman Medical Center entered into a
similar contractual relationship with Jackson Coun-
ty, Missouri. It took over operation of the Jackson
County Hospital, the Mission East Nursing Home,
the County Health Department, and the medical-
dental facility at the county jail. In 1974 the county's
contribution of $3.8 million represented 65 percent of
the funds required to operate the county's facilities.
The contracts with both the city and the county pro-
vide that either party may terminate the contract on
12 months' notice.
Both the articles of incorporation of Truman Med-
ical Center and its bylaws provide that it shall be
managed by a board of directors. The bylaws current-
ly provide for 49 directors, divided into 5 classes:
public directors, city directors, county directors, rep-
resentative directors, and university directors. There
are 7 directors who are either officials of Kansas City
or selected by it; 7 county directors from or ap-
proved by the Jackson County legislature; 4 Univer-
sity of Missouri directors, including the provost for
health services and deans of the Schools of Medicine,
Dentistry, and Pharmacy; 6 directors representing 3
different health institutions in the community; and
25 public directors. The bylaws provide that no pub-
lic director may be an officer, director, elected offi-
cial, employee, consultant, or staff member of any of
the political subdivisions or organizations repre-
1067
DECISIONS OF NArTIONAL LABOR RELATIONS BOARD
sented by the other classes of directors. Thus, 31 of
the 49 directors, a clear majority, are not connected
in any way with any political subdivision of the State
of Missouri. When conducting business, the board
votes as a single class. The city, county, and univer-
sity directors are not polled separately and their sup-
port is not required to carry any motion. Assuming a
quorum of one-third of the board, a simple majority
vote is valid as an act of the board. There is no for-
mal method by which decisions reached in board
meetings are communicated to city, county, or uni-
versity officials other than those on the board itself.
In light of the above evidence and the record as a
whole, we conclude that Truman Medical Center
does not qualify for exemption from coverage under
the Act as a governmental subdivision, since it is nei-
ther (I) directly created by the State, so as to consti-
tute a department or administrative arm of the state
government, nor (2) administered by individuals who
are responsible to public officials or to the general
electorate.3
No special act of the state legislature was required
to organize Truman Medical Center as a not-for-
profit corporation. The parties contracting with Tru-
man Medical Center are political subdivisions of the
State of Missouri whose interests are well represented
on the board of directors. However, the representa-
tion accorded the city, the county, and the university,
both individually and collectively, is less than the
majority required for effective action. Further, the
contractual relationships are subject to termination
by any party with notice.
The Employer also contends that it is at least a
joint employer with the University of Missouri.
While that may be true with respect to the adminis-
tration of educational programs and the appointment
of academic and professional staff, there is no evi-
dence in the record that the University exercises any
control at all over the employment of the employees
sought to be represented by the Petitioner in this pro-
ceeding.
We also find no merit in the Employer's further
contention that it shares Kansas City's and Jackson
County's exemptions due to a substantial nexus be-
tween them and Truman Medical Center, a nexus
which includes public control over labor relations
policies. The fact that city and county representatives
are members of the board of directors committee
charged with labor relations responsibility is not it-
self indicative of public control, since the full board
must vote to implement committee recommenda-
tions. Likewise, Truman Medical Center's contractu-
3See N L.RB. v. The Natural Gas Utility District of Hawkins Couniy.
Tennessee, 402 US. 600, 604 (1971).
al obligation to provide pension, seniority, and other
fringe benefits at least equal to those provided to city
and county employees is not evidence of control by
the political subdivisions.
The Employer cites Temple University4 for the
proposition that the assertion of jurisdiction here
would encroach on governmental relations. How-
ever, the Board's position on exemption with respect
to the provision of health care is set forth in Bishop
Randall Hospital 5 and reaffirmed in Grey Nuns of the
Sacred Heart.6 In those cases the Board found, as it
does here, that the operation of a hospital is not nec-
essarily so basic or traditional a governmental func-
tion as to warrant our declining to assert jurisdiction.
The record shows that, while the hospital which is
at the core of the Truman Medical Center complex
was once an integral component of Kansas City's
governmental services, it is no longer. The severance
from city and the incorporation as a not-for-profit
institution were initiated by the city itself to improve
its own fiscal situation. The Employer then contract-
ed with it and other political subdivisions to provide
medical services. Although the appointment of the
Employer's executive director is subject to approval
by the university, ultimate supervision of Truman
Medical Center's operations is in the hands of an
independent board of directors, a majority of whom
are private citizens with no relationship to the city,
county, or state governments. Thus, we conclude that
the Employer is neither a political subdivision nor a
joint employer with one nor a provider of essential
services to one and, since the Employer otherwise
meets the Board's jurisdictional standards,7 we find it
will effectuate the purposes of the Act to assert juris-
diction herein.
2. The labor organization involved claims to rep-
resent certain employees of the Employer.
3. A question affecting commerce exists concern-
ing the representation of certain employees of the
Employer within the meaning of Section 9(cXl1) and
Section 2(6) and (7) of the Act.
4. As to the appropriate unit, there is a history of
collective bargaining for the employees sought to be
represented. In 1973 the Petitioner asked Truman
Medical Center for recognition in a nonprofessional
unit. The Employer denied the request and a private
election was conducted, with the employees choosing
the Petitioner over the American Federation of State,
County, and Municipal Employees. The Employer
4Temple Universityv. 194 NLRB 1160 (1972).
Bishop Randall Hospital, 217 NLRB 1129 (1975).
Grev Nuns of the Sacred Heart, 221 NLRB 1215 (1975).
7 The parties stipulated that Truman Medical Center's gross revenue for
the past year has exceeded $250.000 and that, during the same period, it
received goods and services directly from out of State valued in excess of
$50,000
1068
TRUMAN MEDICAL CENTER
recognized the Petitioner and two collective-bargain-
ing agreements have since been negotiated covering
the same unit sought in this proceeding. The current
contract has an expiration date of April 30, 1979.
The parties have stipulated that the unit covered by
the contract is an appropriate one for bargaining un-
der the Act. Accordingly, we find that the following
employees of the Employer constitute a unit appro-
priate for the purpose of collective gargaining within
the meaning of Section 9(b) of the Act:
All Nursing Assistants, Senior Nursing Assis-
tants, Principal Nursing Assistants, Custodial
Workers, Senior Custodial Workers, Dietary
Aides, Multilith Operators, Store Clerks, Trans-
portation Assistants, Automotive Drivers, Main-
tenance Workers, Laundry Workers, Senior
Laundry Workers, Seamstresses, Cook Helpers,
Cooks, Senior Cooks, Bakers, Senior Bakers.
Laboratory Aides, Respiratory Therapy Assis-
tants, Pharmacy Assistants, Physical Therapy
Aides, Occupational Therapy Aides, Central
Supply Specialists, Senior Central Supply Spe-
cialists, and Laboratory Assistants, but not in-
cluding professional employees, licensed em-
ployees, office clerical employees, clerical
employees, employees currently represented by
a labor organization in another bargaining unit,
guards and supervisors as defined in the Act,
and all other employees.
We shall therefore direct an election.
[Direction of Election and Excelsior footnote omit-
ted from publication.]
1069