Posey v. Industrial Commission

• Decision Date: 16 March 1960
• Docket Number: No. 6660,6660
• Citation: 87 Ariz. 245,350 P.2d 659
• Parties: Charles W. POSEY, Petitioner, v. INDUSTRIAL COMMISSION of Arizona and Jack Cummard, H. R. Larson and A. R. Kleindienst, as members of said Commission, and Merritt-Chapman & Scott Corporation, Respondents.
• Court: Arizona Supreme Court

Page 659

350 P.2d 659

87 Ariz. 245

Charles W. POSEY, Petitioner, v. INDUSTRIAL COMMISSION of Arizona and Jack Cummard, H. R. Larson and A. R. Kleindienst, as members of said Commission, and Merritt-Chapman & Scott Corporation, Respondents.

No. 6660.

Supreme Court of Arizona.

March 16, 1960.

Minne & Sorenson and Ben C. Pearson, Phoenix, for petitioner.

John R. Franks, Phoenix, for respondent Industrial Commission of Arizona.

Shimmel, Hill & Kleindienst, Phoenix, for respondent Merritt-Chapman & Scott Corporation.

BERNSTEIN, Justice.

Petitioner seeks by certiorari to review an award of The Industrial Commission of Arizona (hereinafter called the 'Commission') which denied his claim for workmen's compensation on the ground that petitioner 'was not under a contract of hire, either express or implied * * * at the time of his injury by accident on October 18, 1957' and, further, that petitioner 'did not sustain injury by accident arising out of and in the course of his employment * * *.'

At the date of the accident petitioner was a member of Construction, Production and Maintenance Laborers' Local Union No. 383 (hereinafter called the 'Union'), which was one of the parties, together with other unions and various contractors, including Merritt-Chapman & Scott Corporation (hereinafter called 'Merritt-Chapman'), to the Arizona Master Labor Agreement and Wage Scales (hereinafter called the 'Master Agreement'). On October 17, 1957, the personnel director of Merritt-Chapman telephoned the dispatcher of the Union at Phoenix to place an order for a member of the Union to fill the job classification of watchman for Merritt-Chapman at the Glen Canyon Damsite. That same day the Union dispatcher filled out and gave to petitioner a slip entitled 'Work Clearance,' which, under the heading of the Union, named Merritt-Chapman and its personnel director, set forth the classification of work as watchman, specified the wage per hour, and contained the clause: 'In response to your request we are referring Mr. Chas. Posey.' The Union dispatcher testified that reference to 'a half day's travel time plus transportation expense of $5' was noted in writing on the reverse side of the work clearance slip. The next day petitioner left Phoneix by automobile to drive to the Glen Canyon Damsite, but before reaching his destination he became involved in an accident as a result of which he sustained the injuries for which he is claiming compensation.

The initial question presented is whether the finding of the Commission that petitioner at the time of the accident was not under a contract of hire with Merritt-Chapman is supported by competent evidence. All parties, in effect, concede the materiality of that finding and agree that petitioner is not entitled to compensation unless a contract of employment between petitioner and Merritt-Chapman was in existence on October 18, 1957.

Petitioner claims that the request made by Merritt-Chapman to the Union for a watchman constituted an offer on the terms and conditions set forth in the Master Agreement and that petitioner duly accepted that offer when he received the work clearance slip and proceeded directly to the jobsite. Merritt-Chapman's denial of these conclusions makes it clear that the disagreement between the parties is not over the applicable rules of law but over the proper inferences to be drawn from the evidence.

Neither party disputes that the events which led to petitioner's ill-fated trip to the Merritt-Chapman jobsite conformed to the procedure contemplated in the Master Agreement and customarily followed by the parties. The stated purposes of the Master Agreement are to assure the contractors, such as Merritt-Chapman, who 'are engaged in contract construction work in Arizona' and who 'employ large numbers of members of the various Unions,' including the Union here involved, 'of their ability to procure employees * * * in sufficient numbers and skill to assure continuity of work in the completion of their construction contracts' and 'to establish uniform rates of pay, hours of employment and working conditions which shall be applicable to all employees performing any work for the contractors * * *.'

Paragraph B of Article II of the Master Agreement provides:

'The Unions agree to furnish such employees as may be requisitioned by the Contractors within forty-eight (48) hours; but in the event the Unions are unable to furnish such requisitioned employees within forty-eight (48) hours, the Contractor may secure such employees from any other sources available. The Contractor shall notify the Union immediately when such employees are hired.'

The above paragraph presupposes at least three distinct steps in the employment of union members: requisition by the contractor, furnishing by the union, and hiring by the contractor. The reasonable purport of this paragraph is that a contract of employment results not from the first two steps alone, but from a separate act of hiring in addition. The distinction between the referral of members by the union and the hiring of them by the contractor is clear also from paragraph B of Article XI, which provides:

'Unions may furnish forms when referring employees for hiring, such forms providing space for the Contractors to complete by checking reason for termination of the employees bearing the form.'

None of the other provisions of the Master Agreement offers any guide on the issue of the time of commencement of employment. It is significant, however, that although the Agreement in paragraph A of Article XI, which is headed 'Unjust Discharge,' permits the contractor to 'discharge any employee for any cause which he may deem sufficient,' with limited exceptions, there is no provision which in any way restricts the contractor from refusing to hire a particular member referred by the union.

There is some dispute over the significance of paragraph 23(b), Section 1, of Appendix A to the Master Agreement, which provides that 'transportation and travel allowance in each instance is to be paid for initial travel to a job with the employee's first pay check.' It is clear, as noted on the reverse side of the work clearance slip, that petitioner would have been entitled to a transportation and travel allowance for his initial travel if he had arrived at the jobsite and performed work. Petitioner urges that the above-quoted paragraph implies that he was an employee of Merritt-Chapman's during the course of such travel. Merritt-Chapman argues that its liability for travel allowance does not accrue until the hiring takes place at the jobsite. At the hearing the personnel director of Merritt-Chapman testified that although his company would not pay such travel allowance to member who was referred by the Union but was refused employment by Merritt-Chapman, it would make payment under protest to the Union.

We need not here decide whether Merritt-Chapman is obligated under the Master Agreement to pay a travel allowance to petitioner. The imposition of such liability does not necessarily imply that petitioner was an employee of Merritt-Chapman during the period of travel. If the referred union member and the contractor are not contractually committed to an employment until a contract of hire is entered into at the jobsite, the obligation of the contractor under the Master Agreement to compensate the union member for his transportation expenses does not by itself accelerate the time of commencement of employment or create a contract of hire where one is otherwise not intended by the parties.

The significant point is that the Master Agreement is a contract between the union and the contractor and does not even purport to be a contract of employment between the contractor and the individual union member. It establishes standards of wages and working conditions which apply to persons who are employed by the contractor but it does not originate the employment. In so far as the Master Agreement does deal with the time of commencement of employment, it recognizes that the act of hiring by the contractor is a distinct act which takes place at a time subsequent to the union's referral of one of its members.

The evidence in the record, other than that which relates to the Master Agreement, does not require a reversal of the Commission's finding that no contract of hire was entered into between petitioner and Merritt-Chapman. Petitioner testified that he had intended, prior to the accident, to work for Merritt-Chapman; Merritt-Chapman's personnel director, on the other hand, testified that petitioner was never placed on the company's payroll and, in effect, that if petitioner had arrived at the jobsite, he would have been interviewed in accordance with the regular procedure to determine whether he was a fit and suitable person for the position. None of this testimony was impeached or contradicted.

The Union dispatcher did testify, however, that he and not an official of Meritt-Chapman selected petitioner as the person to be referred to the company for the position of watchman; that on past occasions union members referred to a contractor under the Master Agreement sometimes failed to arrive at the jobsite or refused to work, particularly at the Glen Canyon Damsite, because they disliked the living facilities or for some other reason; that union members who are referred to the Glen Canyon Damsite are generally interviewed by a company official and are sometimes found to be unacceptable; and that the referred union member goes on the payroll of the contractor when he reports at the jobsite and turns in his work clearance slip, assuming that he and the employer want him to go to work. ¹

This testimony of the Union dispatcher certainly warrants the conclusion that under the requisition procedure adopted by the Union and Merritt-Chapman, neither the referred Union member nor the company considers himself or itself bound to an employment until some time after...