NLRB v. North Arkansas Electric Cooperative, Inc.

• Citation: 412 F.2d 324
• Decision Date: 17 June 1969
• Docket Number: No. 19437.,19437.
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. NORTH ARKANSAS ELECTRIC COOPERATIVE, INC., Respondent.
• Court: U.S. Court of Appeals — Eighth Circuit

412 F.2d 324 (1969)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. NORTH ARKANSAS ELECTRIC COOPERATIVE, INC., Respondent.

No. 19437.

United States Court of Appeals Eighth Circuit.

June 17, 1969.

Charles R. Both, Atty., N.L.R.B., Washington, D. C., for petitioner, Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Assoc. Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, and Richard S. Rodin and William J. Avrutis, Attys., N.L.R.B., filed brief for petitioner.

Gaines N. Houston, Little Rock, Ark., for respondent and filed brief.

Before VAN OOSTERHOUT, Chief Judge, and MATTHES and HEANEY, Circuit Judges.

HEANEY, Circuit Judge.

The National Labor Relations Board seeks enforcement of its order requiring reinstatement of a North Arkansas Electric Cooperative, Inc., employee. The Board adopted the findings and conclusion of the Trial Examiner who had found that North Arkansas had violated §§ 8(a) (1) and (3) of the National Labor Relations Act by discharging an employee, Jack Lenox. North Arkansas admits that it discharged Lenox because of his failure to remain "neutral" during a union organizational campaign,¹ but contends that since Lenox was not a "managerial employee," the discharge was not violative of the Act. The sole issue on this appeal is whether the Board's conclusion that Lenox was not a "managerial employee" can be sustained. We hold that it cannot. We leave open the question of whether an employer has a right to discharge a "managerial employee" for expressing favorable opinions of a union during the course of a representation election. We remand that issue to the Board for its determination.²

The term "managerial employee" is not used in the National Labor Relations Act, nor is provision made in the Act for the inclusion or exclusion of such employees in bargaining units. The Act is silent as to whether this type of employee is entitled to the protection of the Act for union activities or membership.³ The Board, however, has long followed the practice of excluding employees, designated as "managerial," from bargaining units in representation elections.⁴ It does so on the premise that certain non-supervisory employees are so closely allied with management that they should be excluded from employee bargaining units. The right to exclude "managerial employees" from bargaining units has been recognized by the Courts. See, Continental Insurance Co. v. N.L.R.B., 409 F.2d 727 (2d Cir. 1969), 70 L.R.R. M. 3407; Retail Clerks International Ass'n v. N.L.R.B., 366 F.2d 642 (D.C. Cir. 1966); International Ladies' Garment Workers' Union v. N.L.R.B., 339 F.2d 116 (2d Cir. 1964).

The Board expanded its definition of "managerial employees" in Ford Motor Company, 66 N.L.R.B. No. 1317, 17 L.R. R.M. 394 (1946). In discussing whether time study employees of an automobile manufacturing company should be excluded because their interest and duties were closely related to management, the Board stated:

"We have customarily excluded from bargaining units from rank-and-file workers, executive employees who are in position to formulate and effectuate management policies. These employees we have considered and still deem managerial in that they express and make operative the decisions of management."

The Board held that the employees in question "could not be regarded as formulating, determining and effectuating managerial policies for they merely supply information which may be used by the employer in establishing labor relation policies."

The Board restated its definition of managerial employees in Eastern Camera & Photo Corp., 140 N.L.R.B. No. 58, 52 L.R.R.M. 1068 (1963). In holding that an assistant store manger was not a "managerial employee," the Board stated:

"`The Board has defined managerial employees as those who formulate, determine and effectuate an Employer\'s policies. * * * The determination of an employee\'s "managerial" status depends upon the extent of his discretion, although even the authority to exercise considerable discretion does not render an employee managerial where his decision must conform to the employer\'s established policy.\'" (Footnotes omitted.)

52 L.R.R.M. at 1069.

The only extensive Court discussions as to the standard to be followed in determining whether an employee is a manager are found in Retail Clerks International Ass'n v. N.L.R.B., supra, and International Ladies' Garment Workers' Union v. N.L.R.B., supra. Both cases involved the question of whether union business agents or organizers were "managerial employees" and, thus, are only helpful insofar as they discuss the problem generally. The Court said in Retail Clerks:

"The Board has not developed clear standards for determining who is a managerial employee; there seem, however, to be two tests. The first is whether, even if they do not supervise other workers, their position with the employer presents a potential conflict of interest between the employer and the workers, * * *. * * *, i.e., that the employee is closely related to or aligned with the management; such a determination, however, also seems to turn on the possibility of a conflict of interest arising, * * *.

"The Board also excludes * * *, as managerial employees, `those who formulate, determine and effectuate an employer\'s policies,\' * * *, and those who have discretion in the performance of their jobs, but not if the discretion must conform to an employer\'s established policy, * * *"

366 F.2d at 644-45.

The Trial Examiner found that Lenox was not a "managerial employee" because: (1) there was no evidence in the record that he exercised discretion in the performance of his duties; (2) the description covering the job he filled specifically provided that he was to work "within the limits of established policies, budget, legal requirements and authority delegated by the Manager;" (3) he did not exercise management prerogatives marking him as being allied with management; (4) his duties were not such as to present an area of potential conflict between the interest of the company and its employees. The Examiner added that a construction denying an individual the protection of the Act ought to be avoided unless compelled by the language of the statute, the legislative history of the Act or well-established precedent.

A determination by the Board that an individual is an employee within the meaning of the Act should be affirmed by this Court if it is warranted by the record and has a reasonable basis in law. See, N.L.R.B. v. United Ins. Co., 390 U.S. 254, 260, 88 S.Ct. 988, 19 L.Ed.2d 1083 (1968); N.L.R.B. v. Hearst Publications, 322 U.S. 111, 131, 64 S.Ct. 851, 88 L.Ed. 1170 (1944); Jas. E. Matthews & Co., v. N.L.R.B., 354 F. 2d 432, 435 (8th Cir.), cert. denied, 384 U.S. 1002, 86 S.Ct. 1924, 16 L.Ed.2d 1015 (1966). In our view, the determination that Lenox was not a "managerial employee" is neither warranted by the record nor supported in law.

Lenox was one of two electrification advisors employed by this rural electrification cooperative. He scheduled his own time and activities. He was treated as part of management as far as wages and benefits. He was paid on a monthly basis like other management personnel; he received no extra pay for overtime; and, he was carried on the insurance program of management. He actively participated with other management personnel in semi-annual meetings; the purpose of which was to plan new programs and secure new customers. He assisted in conducting employee training sessions.

Lenox served as a spokesman for the cooperative in the rural communities within the district in which he was stationed. He attended numerous meetings and made frequent speeches on behalf of it. He prepared and placed advertising material on the radio, in newspapers and other publications....