Frito Company, Western Division v. NLRB

• Decision Date: 07 April 1964
• Docket Number: 18400.,No. 18350,18350
• Citation: 330 F.2d 458
• Parties: The FRITO COMPANY, WESTERN DIVISION, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. NATIONAL LABOR RELATIONS BOARD, Petitioner, v. RETAIL CLERKS UNION LOCAL 770 et al., Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

330 F.2d 458 (1964)

The FRITO COMPANY, WESTERN DIVISION, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. RETAIL CLERKS UNION LOCAL 770 et al., Respondents.

Nos. 18350, 18400.

United States Court of Appeals Ninth Circuit.

April 7, 1964.

Hill, Farrer & Burrill and Ray L. Johnson, Jr., Los Angeles, Cal., for petitioner Frito Co.

Daniel R. Thompson, Washington, D. C., for amicus curiae American Bottlers of Carbonated Beverages (No. 18350).

Hill, Farrer & Burrill, Carl M. Gould, and Stanley E. Tobin, Los Angeles, Cal., for amicus curiae American Research Merchandising Institute (No. 18350).

Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Melvin J. Welles, Lee Modjeska, and Harvey Letter, Attys., N. L. R. B., Washington, D. C., for National Labor Relations Board.

Gilbert, Nissen & Irvin, Robert W. Gilbert and William B. Irvin, Beverly Hills, Cal., for respondent and intervenor Retail Clerks Union Locals 889, 1167, 1428 and 1442.

Arnold, Smith & Schwartz, George Arnold and Kenneth M. Schwartz, Los Angeles, Cal., for respondent and intervenor Retail Clerks Union Local 770.

McLaughlin & McLaughlin, Joseph M. McLaughlin, and Frederick A. Morgan, Los Angeles, Cal., for intervenor respondents Alpha Beta Food Markets, Inc., etc.

Before BARNES and JERTBERG, Circuit Judges, and STEPHENS, District Judge.

ALBERT LEE STEPHENS, Jr., District Judge:

Two cases have been consolidated, both arise from a decision and order of the National Labor Relations Board (hereinafter called the Board) issued against respondent Employers¹ and Unions² on August 24, 1962 and reported at 138 NLRB 27. One case, No. 18350, is before the Court on the petition of Frito Company, Western Division (hereinafter called Frito) for a review and modification of the Board's order insofar as it denies certain relief requested by Frito. The other case, No. 18400, is a petition by the Board for enforcement of its order. The respondent Employers and Unions in case No. 18400 have been permitted to intervene in case No. 18350. In addition to the parties named, briefs have been received from American Bottlers of Carbonated Beverages and the American Research Merchandising Institute as amicus curiae. This Court has jurisdiction under Sections 10(e) and (f) of the National Labor Relations Act, as amended (61 Stat. 136, 73 Stat. 519, 29 U.S.C. § 151 et seq.)

For many years a dispute has existed between the respondent Unions and respondent Employers as to the latter's right to permit the driver-salesmen of market suppliers to perform certain functions on the store premises which they have been performing for over fifty years. The driver-salesmen service the supplier's product by stocking shelves, rotating merchandise and arranging advertising displays. It is the Unions' contention that these duties are the proper function of the retail clerks and that driver-salesmen should be restricted to delivery of the supplier's goods to the back door of the store. Many suppliers, including Frito, have traditionally employed driver-salesmen to perform these "on the premises" services.

The persistent efforts of the respondent Unions to establish their position culminated in the inclusion of certain terms in the collective bargaining contracts entered into with the respondent Employers in 1959 (and effective until March 31, 1964) which were designed to fulfill the objective stated above. Article 1 of the contracts contains the following terms:

"I B. Work Performed

"All work performed on the premises in the nature of work generally performed by retail clerks shall only be performed by employees of the bargaining unit as herein defined.

"C. Subcontracting and Assignment of Work

"1. The Employers shall not subcontract any work ordinarily performed by retail clerks in the stores or markets of the Employer\'s, and, further, any future work created by the Employer within the Employer\'s stores or markets which would ordinarily be performed by retail clerks, shall be performed only by members of the bargaining unit as herein set forth, except that such work may be subcontracted to an employer who is signatory to an agreement with the Union.

"2. Employer agrees not to assign or contract with any other union or person for work which is presently being performed by members of the bargaining unit represented by the Union.

"3. Any other work which is presently under specific contracts with the Teamsters, Culinary Workers, and Building Service Employees Unions shall not be affected by this Agreement, except as to any change which may result from an agreement of the Unions involved and the signatory Union and upon presentation to the Employer of bona fide proof thereof."

At various times between April 12 and September 7, 1960, representatives of the respondent Unions demanded that the Employers comply with the terms of the contracts. The Employers complied. As a result the Frito driver-salesmen were prohibited from performing any service in the selling area and their activity was restricted to delivery of merchandise to the market.

On October 12, 1960, Frito filed a charge with the Regional Director of the Board complaining that by requiring the Employers to enforce the terms of the contract, the respondent Unions had violated the National Labor Relations Act (hereinafter called the Act). The Board's General Counsel issued a complaint against the respondent Employers and Unions on December 16, 1960, Case No. 21-CE-11, alleging that the exclusion of Frito driver-salesmen pursuant to Sections B and C of Article I of the contract violated Section 8(e) of the Act.

Various locals of the Retail Clerks Union on March 28, 1961 brought charges against the Employers alleging corresponding violations of the Act. These cases were identified as Nos. 21-CE-16-1 and 21-CE-16-2 and were later consolidated with Case No. 21-CE-11.

The General Counsel then issued a Consolidated Amended Complaint which was subsequently amended on June 7, 1961, the final complaint alleging that the violation of Section 8(e) of the Act was accomplished pursuant only to the "except" clauses of Sections C(1) and (3) of Article I of the contract. The Answer of the respondent Unions contained an offer to stipulate to an order prohibiting them from enforcing Sections C(1) and (3).

The respondent Employers in their Answer maintained that when excluding Frito driver-salesmen, they were enforcing Section B and all of Section C of Article I of the contract. It has consistently been the contention of the Employers and Frito that the validity of Section B and Section C(2) should be determined as well as C(1) and C(3), the sections whose validity had been put in issue by the complaint.

The trial examiner noted in his Report and Recommended Order of December 29, 1961 that the General Counsel called no witnesses at the hearing and rested his case on the pleadings. The only testimony presented consisted of that given by the manager or supervisor of three of the markets and this testimony was presented by Frito after the General Counsel had rested his case. The testimony was that no distinction was made between the various sections of Article I by either the Union business agents in requesting the Employers to enforce the contract, or by the managers of the Employers when giving notice to Frito driver-salesmen of their exclusion from the selling area. No more was said than that "the contract" did not permit Frito personnel in the selling area. Indeed, the only instance testified to in which a particular section of Article I was identified was one where Section B was stated to be the basis for excluding Frito employees.

The trial examiner concluded that the evidence did not support the complaint and recommended that the complaint be dismissed. He reasoned that nothing to the contrary appearing, it was consistent with the evidence to infer that Frito personnel were excluded pursuant to Section B, and that since the General Counsel expressly refused to deny the validity of Section B, the acts of respondent Employers and Unions were not in violation of Section 8(e) of the Act. On February 12, 1962, all parties filed exceptions to the trial examiner's recommendation and his finding that respondents had not engaged in unfair labor practices.

The Board reviewed the record and briefs and reached a decision contrary to the trial examiner's recommendation. The Board found Sections C(1) and (3) to be invalid. Furthermore, the Board held that the fact that respondent Unions referred to "the contract" rather than a specific clause and that the Employers may have intended to enforce Section B as well as C(1) and (3) does not warrant the conclusion that the allegations of the complaint have not been sustained. The Board held it unnecessary to prove that Frito employees were excluded solely pursuant to Sections C(1) and (3) and immaterial that a valid agreement may have been enforced if the parties were also enforcing an invalid agreement. Accordingly, a Decision and Order was published on August 24, 1962, directing respondents to cease and desist from maintaining, enforcing and giving effect to Sections C(1) and (3) of the collective bargaining contracts signed by them.

The result reached by the Board is not satisfactory to Frito or the Employers. Frito's employees can be excluded pursuant to Sections B and C(2) of the contract. Therefore, the Board's determination that Sections C(1) and (3) violate Section 8(e) of the Act is of no practical benefit to Frito or in solving the real issue.

The trial examiner held, and the Board agreed, that inasmuch as the General Counsel refused to place in issue the validity of Sections B and C(2), the trial examiner and the Board were precluded from considering that issue. To support this position, the Board cites Section 3(d) of the Act which provides in pertinent part:

"There

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