May v. Southland Corp.

• Decision Date: 31 December 1976
• Docket Number: No. 5682,5682
• Citation: 341 So.2d 421
• Parties: 94 L.R.R.M. (BNA) 3028, 82 Lab.Cas. P 55,106 Benny MAY, Plaintiff and Appellant, v. The SOUTHLAND CORPORATION et al., Defendants and Appellees.
• Court: Court of Appeal of Louisiana — District of US

Page 421

341 So.2d 421

94 L.R.R.M. (BNA) 3028, 82 Lab.Cas. P 55,106

Benny MAY, Plaintiff and Appellant, v. The SOUTHLAND CORPORATION et al., Defendants and Appellees.

No. 5682.

Court of Appeal of Louisiana, Third Circuit.

Dec. 31, 1976.

Rehearing Denied Jan. 26, 1977.

Writ Refused March 11, 1977.

Stafford, Randow, O'Neal & Scott by Hodge O'Neal, III, Alexandria, for plaintiff and appellant.

Booth, Lockard, Jack, Pleasant & LeSage by Joe LeSage, Jr., Shreveport, for defendants and appellees.

Before CULPEPPER, WATSON and HUMPHRIES, JJ.

CULPEPPER, Judge.

Plaintiff filed this suit alleging that as a route salesman for the defendant corporations he is entitled to recover compensation under the terms of a collective bargaining agreement between the corporations and a Teamster's Union. After defendants denied plaintiff was their employee, but was instead an employee of their route salesman, James E. Martin, plaintiff named Martin as an additional defendant. The trial judge held that although plaintiff was an employee of defendant corporations, and not of Martin, his demands must be rejected because he was not a member of the union which entered into the collective bargaining agreement. Plaintiff appealed.

The issues are: (1) Does this Court have jurisdiction over the subject matter of this lawsuit, or is exclusive jurisdiction vested in the National Labor Relations Board? (2) Was plaintiff an employee of defendant corporations or was he instead an employee of defendant, James E. Martin? (3) What law (State Contract Law, Federal Labor Law, or a combination of the two), should be applied to determine plaintiff's rights under the subject collective bargaining agreement? (4) Does plaintiff, who was not a member of the contracting union, have a cause of action against his employer for the difference between the 5% Commission he was actually paid and the 8% Commission stipulated in the collective bargaining agreement? (5) May plaintiff's alleged failure to invoke the compulsory arbitration procedure of the collective bargaining agreement be raised on appeal, or did defendants waive this objection by their failure to timely file the dilatory exception of prematurity? Plaintiff does not on appeal seek judgment against James E. Martin.

FACTS

Defendants, Midwest Farms, Inc., and Midwest Dairy Products, Inc., both subsidiaries of defendant Southland Corporation (collectively referred to as 'the Company'), are engaged in the production, processing and sale of dairy products. The Company employs route salesmen to service its wholesale dairy products customers. From an office in Shreveport, the Company supervises wholesale activities in surrounding parishes, including Sabine Parish.

A collective bargaining agreement between the Company and the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Local Union No. 568 (the Union), was in effect from April 16, 1972 to April 15, 1975. This agreement provides in Article 18.1: 'Wholesale milk route salesmen shall receive a commission of 8% On all gross sales except schools, hospitals and government bid business which shall be paid at 8% On net sales.' Article 1.4 of the contract embodies a union security agreement commonly referred to as a 'Union Shop' clause. This union shop clause requires that all employees of the Company became union members within one month of the date they are employed.

Defendant, James E. Martin, is a member of the union. He is classified as a 'route salesman'. He began working for the Company over 25 years ago under the terms of an oral contract providing that he would receive a commission of 8% Of wholesale dairy product sales in Sabine Parish. When he first started working for the Company, he was apparently the only route salesman in Sabine Parish. His base of operation was Many, Louisiana.

In the beginning, Martin serviced his Sabine Parish territory with only one truck, which he drove himself. Business flourished, and in 1960 a second delivery truck was added to the Sabine Parish operation. In 1963 a third truck was added. The Company owned these trucks.

With the addition of two trucks, Martin's duties changed from those of a route salesman to those of a supervisor of route salesmen . He no longer drove a delivery truck himself but instead directed the activities of three route salesmen. The record is unclear as to the exact date that Martin quit driving a delivery truck and personally servicing his customers, but it appears that this event took place in 1963. Despite the change in his duties from route salesman to supervisor, Martin remained a union member classified as a 'route salesman'.

In his supervisory capacity, Martin selected and trained the route salesmen who drove the additional delivery trucks. Plaintiff, Benny May, was hired by Martin on July 29, of 1972. Plaintiff's job classification, his union membership status, and the question of whether he was the employee of defendant corporations or of defendant, James Martin, are discussed in detail later in this opinion. For the present, however, we can say that Benny May was hired as a 'route salesman'. During the first four months of his employment, May was paid $2 per hour. Thereafter, and until his dismissal on September 20, 1974, the hourly rate was discontinued and May was paid a commission of 5% Of his sales. May was apparently satisfied with his 5% Commission arrangement until a transport driver delivering company products to Many told him of the existence of the union and of the provisions of the union contract setting route salesmen's commissions at 8%. The collective bargaining agreement was in effect during the entire period of May's employment.

Plaintiff's fellow Sabine Parish route salesmen, Koss and Knowles, also received a commission of 5%. They, too, were supervised by James Martin. After learning the union contract sets commissions for route salesmen at 8%, Koss and Knowles shared plaintiff's discontent. May, Koss and Knowles discussed their commission arrangement and decided to travel to Shreveport to explain their situation to officials of Teamsters Local 568. In Shreveport, May and the others met with the union steward and told him of their desire to join the union. The union steward made no determination concerning their eligibility for union membership, but he did supply the three men with union application forms which were subsequently completed and returned to the Union. With the exception of May, none of the three testified that the Union acted favorably on his application. May testified that he received a Union card but did not produce the card for introduction into evidence at trial. The trial judge held May did not prove he was a union member. We find no manifest error in this factual conclusion.

On May 25, 1975, plaintiff filed a petition praying that The Southland Corporation, Midwest Farms, Inc. and Midwest Dairy Products, Inc. be ordered to pay him the sum of $12,525.40, the alleged difference between the 5% Commission rate actually paid plaintiff during the term of his employment and the 8% Rate which plaintiff claims he is entitled to under the provisions of the collective bargaining agreement.

JURISDICTION

Defendants do not concede that Louisiana courts have jurisdiction to hear this suit. The argument is that since the National Labor Relations Act endows the National Labor Relations Board with exclusive jurisdiction over certain labor disputes affecting interstate commerce, our state courts have no jurisdiction in the present case. We do not agree.

Apparently, defendants' argument is based upon the fact that this suit arises under Section 301 of the Labor Management Relations Act, 29 U.S.C.A., Section 185, which provides:

(a) Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

From the above, we conclude that the present case does arise within the purview of Section 301. This is a suit for an alleged violation or breach of a contract between a defendant employer and the Union. Defendants state in their brief before this Court: 'Midwest and Southland Corporation are of course actively involved in interstate commerce. Midwest distributes ice cream products in Texas and Wisconsin.'

Although we have concluded that this action does arise within the purview of Section 301, we cannot agree that the NLRB and the Federal courts are endowed with exclusive jurisdiction over this type of suit.

In Rust Engineering Company v. United Brotherhood of Carpenters and Joiners of America, 210 So.2d 154 (La.App.3rd Cir. 1968), this Court entertained a jurisdictional challenge similar to the present one. The defendant-employer in Rust contended that the breach or violation of the collective bargaining agreement alleged by plaintiff was arguably an unfair labor practice which came under the exclusive jurisdiction of the NLRB, thereby pre-empting any state or federal court from hearing the action. We rejected defendant's argument holding:

'It appears well settled . . . that state courts possess jurisdiction concurrent with that of federal courts in regard to suits to enforce labor contracts. Charles Dowd Box Company v. Courtney, 368 U.S. 502, 82 S.Ct. 519, 7 L.Ed. 483 (1962). While Section 301 of the Labor Management Relations Act (29 USCA, Section 185) gave federal courts jurisdiction to hear cases involving a breach of a labor contract, that act nowise limited the pre-existing jurisdiction of state courts to enforce labor contracts.' 210 So.2d 154, 156.

The Courtney case was our primary authority for upholding state court jurisdiction in the Rust Engineering case. Recently, in William E....