Ace Doran Hauling & Rigging Company v. NLRB

• Decision Date: 14 June 1972
• Docket Number: No. 71-1566.,71-1566.
• Parties: ACE DORAN HAULING & RIGGING COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Sixth Circuit

462 F.2d 190 (1972)

ACE DORAN HAULING & RIGGING COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 71-1566.

United States Court of Appeals, Sixth Circuit.

June 14, 1972.

Richard D. Zaiger, Atty., N.L.R.B., Washington, D. C., for respondent; Peter G. Nash, Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Charles N. Steele, Atty., N.L.R.B., on brief.

Charles E. Shanklin, Columbus, Ohio, for petitioner, George W. Hairston, George, Greek, King, McMahon & McConnaughey, Columbus, Ohio, on brief.

Thomas F. Phalen, Jr., Dayton, Ohio, for intervenors; Knee, Snyder & Parks, Dayton, Ohio, on brief.

Before WEICK, EDWARDS and CELEBREZZE, Circuit Judges.

WEICK, Circuit Judge.

Ace Doran Hauling & Rigging Company (Ace), the employer, has petitioned to review an order of the National Labor Relations Board, reported at 191 NLRB No. 63, finding that it had violated Section 8(a) (5) and (1) of the National Labor Relations Act, as amended (29 U.S.C. § 151 et seq.), by refusing to bargain with the Teamsters Union which had been certified as the exclusive bargaining representative of Ace's employees in an appropriate unit following representation proceedings. Chairman Miller dissented. The Board filed a cross-application for enforcement of its order and the Union was granted leave to intervene.

The principal issue before us is the appropriateness of the bargaining unit as determined by the Regional Director and approved by the Board, Ace contending that the unit inappropriately included single truck owner-drivers and non-owner drivers employed by multiple truck owners, and operating equipment leased to Ace, and that said single-owner drivers and multiple truck owners are independent contractors and are not Ace's employees. They operate out of two different terminals.

The Board also held that the multiple truck owner nondrivers were supervisors.

Ace is an interstate carrier of freight, operating in twelve states, transporting steel, machinery, and heavy articles. Its main office is located at the Blue Rock Road terminal in Cincinnati; it has twenty-three other terminals throughout the twelve states, including the Kellogg Avenue terminal in Cincinnati, all of which terminals are operated by commission agents.

Ace itself owns four tractors and trailers; it leases from single owner-drivers approximately fifteen tractors and trailers. These tractors and trailers operate only out of the Blue Rock Road terminal and are used to haul machinery. Three tractors and six trailers are leased from Clarence Schneider, a commission agent, who operates the Kellogg Avenue terminal. Two additional tractors and trailers are leased from Schneider and Gardner Truck Company, which also operates out of the Kellogg Avenue terminal. The tractors and trailers operating out of Kellogg Avenue terminal haul only steel.

Schneider has authority to solicit orders for hauling steel to be transported out of Cincinnati. He receives revenue from Ace for his equipment and drivers amounting to a percentage of the freight charges therefor, and he receives a commission for soliciting orders and operating the Kellogg Avenue terminal. At this same terminal Clarence Schneider also conducts a steel hauling operation for Besl Transfer Company and operates a garage, a service station, and wrecker business.

The representation issue here involved concerns only truck drivers operating out of the two Cincinnati terminals.

Four drivers are carried on Ace's payroll and operate its own equipment out of the Blue Rock Road terminal. Ten of the single owner-drivers operate out of this same terminal, and five of them operate out of the Kellogg Avenue terminal.

Ace is authorized to operate under a certificate issued by the ICC. It must, therefore, abide by extensive ICC regulations designed for the protection of the public. Under these regulations a carrier may augment its equipment by leases, but must have "full direction and control of such vehicles," and be "fully responsible of the operations thereof . . as if the carrier was the owner of such vehicles." One part of the lease agreement between Ace and the lessors provides:

"The relationship between the Carrier and Owner shall be that of Independent Contractor . . . ."

In order to obtain a lease, an equipment owner must have his equipment pass a safety check by Ace, and any prospective driver must pass a physical examination and a check of his driving and safety records. These three procedures are required by ICC regulations. All drivers of leased vehicles must be approved by Ace.

The lease between the owner and Ace, in conformity with ICC regulations, places the equipment under exclusive possession, control, use and responsibility of Ace. Ace may sublease the equipment. The truck owner agrees to be compensated according to a rental percentage which is unilaterally determined by Ace on the basis of a predetermined revenue schedule. The owner agrees to furnish, and to pay the wages of, a qualified driver, to withhold his income and Social Security taxes, to cover him for Workmen's Compensation, and to pay for "bob-tail" insurance. Ace, however, pays for all public liability, property damage, and cargo insurance. Further, the truck owner must pay all operational expenses of the vehicle, and must pay certain damages if caused by his own fault or carelessness; and he must maintain insurance coverage for collision, fire, theft, or other catastrophe. The owner must also pay maintenance expenses for the equipment and must conform the equipment according to all laws and regulations.

Occasionally Ace advances money for travel expenses of single owner-drivers and for repair of equipment, and then deducts the amount thereof upon payment for loads. Ace requires 30-day periodic inspections, and Ace's safety director conducts road checks.

Ace's central dispatcher works at the Blue Rock Road terminal, and he both controls and coordinates movement of freight from all Ace terminals, with assistance of local dispatchers at each terminal. This central dispatcher provides backhaul information for drivers operating out of the two Cincinnati terminals. Upon delivery of a load all drivers are instructed to call the central dispatcher in Cincinnati on the company WATTS line, concerning backhauls. Equipment owners or drivers may arrange backhaul loads with another carrier, but they are required to pay to Ace ten percent of the gross revenue derived therefrom, and they must take their trip lease insurance from Ace. In a few cases backhauls with certain companies are prohibited.

Drivers are required by ICC to keep a log book for each trip, and are required by Ace to file with it physical examination reports, accident reports, and some other documents. Drivers are free to select their own trip routes, except when carrying over-weight or over-size loads.

Owner-drivers can refuse trips offered to them, but if they do not appear at terminals and take hauls for a period of time, their leases are terminated. Owner-drivers have no regular schedule, are not required to call in at any specific time, and Ace has no right to call them in. Owner-drivers may take time off at their discretion. Ace may cause the discipline or discharge of single owner-drivers or nonowner-drivers only for being involved in an accident or for violation of ICC rules.

Multiple owner-nondrivers have and do exercise power to hire and fire their drivers; they also assign, transfer and direct their drivers. Single owner-drivers have the right to hire substitute drivers, and some have done so, although only sporadically.

Under the National Labor Relations Act an employer may not obtain judicial review of a Board decision establishing a bargaining unit, absent an order in an unfair labor practice proceeding. A.F.L. v. N.L.R.B., 308 U.S. 401, 60 S. Ct. 300, 84 L.Ed. 347 (1940); N.L.R.B. v. Checker Cab Co., 367 F.2d 692 (6th Cir. 1967); N.L.R.B. v. KVP Southerland Paper Co., 356 F.2d 671 (6th Cir. 1966). Here, Ace, having been found to have committed an unfair labor practice, may obtain a review in this Court of the propriety of the designated bargaining unit.

The Board, however, has wide discretion in determining the appropriate bargaining unit. Packard Motor Car Co. v. N.L.R.B., 330 U.S. 485, 67 S.Ct. 789, 91 L.Ed. 1040 (1947); N.L.R.B. v. Lund, 103 F.2d 815 (8th Cir. 1939).

The controversy here involves a determination of whether certain drivers of trucks leased to Ace are "employees" or "independent contractors" within the meaning of the Act. In 1947 Congress amended the Act to read:

"The term `employee\' shall include any employee, . . . but shall not include . . . any individual having the status of an independent contractor . . . ." (29 U.S.C. § 152 (3)).

This amendment was generated by an expansion of the Act's concept of "employee" beyond traditional limits by the Board and the courts. In ...