National Labor Relations Board v. Hearst Publications, Inc.
Opinion of the Court
delivered the opinion of the Court.
These cases arise from the refusal of respondents, publishers of four Los Angeles daily newspapers, to bargain collectively with a union representing newsboys who distribute their papers on the streets of that city. Respondents’ contention that they were not required to bargain because the newsboys are not their “employees” within the meaning of that term in the National Labor Relations Act, 49 Stat. 450,29 U. S. C. § 152,
Upon respondents’ petitions for review and the Board’s petitions for enforcement, the Circuit Court of Appeals, one judge dissenting, set aside the Board’s orders. Re
The findings of the Board disclose that the Los Angeles Times and the Los Angeles Examiner, published daily and Sunday,
The papers are distributed to the ultimate consumer through a variety of channels, including independent dealers and newsstands often attached to drug, grocery or confectionery stores, carriers who make home deliveries, and newsboys who sell on the streets of the city and its suburbs. Only the last of these are involved in this case.
The newsboys work under varying terms and conditions. They may be “bootjackers,” selling to the general public at places other than established corners, or they may sell
Over-all circulation and distribution of the papers are under the general supervision of circulation managers. But for purposes of street distribution each paper has divided metropolitan Los Angeles into geographic districts. Each district is under the direct and close supervision of a district manager. His function in the mechanics of distribution is to supply the newsboys in his district with papers which he obtains from the publisher and to turn over to the publisher the receipts which he collects from their sales, either directly or with the assistance of “checkmen” or “main spot” boys.
The newsboys’ compensation consists in the difference between the prices at which they sell the papers and the prices they pay for them. The former are fixed by the publishers and the latter are fixed either by the publishers or, in the case of the News, by the district manager.
In addition to effectively fixing the compensation, respondents in a variety of ways prescribe, if not the
In addition to questioning the sufficiency of the evidence to sustain these findings, respondents point to a number of other attributes characterizing their relationship with the newsboys
I.
The principal question is whether the newsboys are “employees.” Because Congress did not explicitly define the term, respondents say its meaning must be determined by reference to common-law standards. In their view “common-law standards” are those the courts have applied in distinguishing between “employees” and “independent contractors” when working out various problems unrelated to the Wagner Act’s purposes and provisions.
The argument assumes that there is some simple, Uniform and easily applicable test which the courts have used, in dealing with such problems, to determine whether persons doing work for others fall in one class or the other. Unfortunately this is not true. Only by a long and tortuous history was the simple formulation worked out which has been stated most frequently as “the test” for deciding whether one who hires another is responsible in tort for his wrongdoing.
It is hardly necessary to stress particular instances of these variations or to emphasize that they have arisen principally, first, in the struggle of the courts to work out common-law liabilities where the legislature has given no guides for judgment,
Mere reference to these possible variations as characterizing the application of the Wagner Act in the treatment of persons identically situated in the facts surrounding their employment and in the influences tending to disrupt it, would be enough to require pause before accepting a thesis which would introduce them into its administration. This would be true, even if the statute itself had indicated less clearly than it does the intent they should not apply.
Two possible consequences could follow. One would be to refer the decision of who are employees to local state law. The alternative would be to make it turn on a sort of pervading general essence distilled from state law. Congress obviously did not intend the former result. It
Both the terms and the purposes of the statute, as well as the legislative history, show that Congress had in mind no such patchwork plan for securing freedom of employees’ organization and of collective bargaining. The Wagner Act is federal legislation, administered by a national agency, intended to solve a national problem on a national scale. Cf. e. g., Sen. Rep. No. 573, 74th Cong., 1st Sess. 2-4. It is an Act, therefore, in reference to which it is not only proper but necessary for us to assume, “in the absence of a plain indication to the contrary, that Congress . . . is not making the application of the federal act dependent on state law.” Jerome v. United States, 318 U. S. 101, 104. Nothing in the statute’s background, history, terms or purposes indicates its scope is to be limited by such varying local conceptions, either statutory or judicial, or that it is to be administered in accordance with whatever different standards the respective states may see fit to adopt for the disposition of unrelated, local problems. Consequently, so far as the meaning of “employee” in this statute is concerned, “the federal law must prevail no matter what name is given to the interest or
II.
Whether, given the intended national uniformity, the term “employee” includes such workers as these newsboys must be answered primarily from the history, terms and purposes of the legislation. The word “is not treated by Congress as a word of art having a definite meaning. . . .” Rather “it takes color from its surroundings . . . [in] the statute where it appears,” United States v. American Trucking Assns., 310 U. S. 534, 545, and derives meaning from the context of that statute, which “must be read in the light of the mischief to be corrected and the end to be attained.” South Chicago Coal & Dock Co. v. Bassett, 309 U. S. 251, 259; cf. New Negro Alliance v. Sanitary Grocery Co., 303 U. S. 552; Drivers’ Union v. Lake Valley Co., 311 U. S. 91.
Congress, on the one hand, was not thinking solely of the immediate technical relation of employer and employee. It had in mind at least some other persons than those standing in the proximate legal relation of employee to the particular employer involved in the labor dispute.
It will not do, for deciding this question as one of uniform national application, to import wholesale the traditional common-law conceptions or some distilled essence of their local variations as exclusively controlling limitations upon the scope of the statute’s effectiveness. To do this would be merely to select some of the local, hairline variations for nation-wide application and thus to reject others for coverage under the Act. That result hardly would be consistent with the statute’s broad terms and purposes.
Congress was not seeking to solve the nationally harassing problems with which the statute deals by solutions only partially effective. It rather sought to find a broad solution, one that would bring industrial peace by substituting, so far as its power could reach, the rights of workers to self-organization and collective bargaining for the industrial strife which prevails where these rights are not effectively established. Yet only partial solutions would be provided if large segments of workers about whose technical legal position such local differences exist should be wholly excluded from coverage by reason of such differences. Yet that result could not be avoided, if choice must be made among them and controlled by them in deciding who are “employees” within the Act’s meaning. Enmeshed in such distinctions, the administration of the statute soon might become encumbered by the same sort of technical legal refinement as has characterized the long evolution of the employee - independent contractor dichotomy in the courts for other purposes. The consequences would be ultimately to defeat, in part at least, the achievement of the statute’s objectives. Congress no more intended to
The Act, as its first section states, was designed to avert the “substantial obstructions to the free flow of commerce” which result from “strikes and other forms of industrial strife or unrest” by eliminating the causes of that unrest. It is premised on explicit findings that strikes and industrial strife themselves result in large measure from the refusal of employers to bargain collectively and the inability of individual workers to bargain successfully for improvements in their “wages, hours or other working conditions” with employers who are “organized in the corporate or other forms of ownership association.” Hence the avowed and interrelated purposes of the Act are to encourage collective bargaining and to remedy the individual worker’s inequality of bargaining power by “protecting the exercise ... of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.” 49 Stat. 449, 450.
The mischief at which the Act is aimed and the remedies it offers are not confined exclusively to “employees” within the traditional legal distinctions separating them from “independent contractors.” Myriad forms of service relationship, with infinite and subtle variations in the terms of employment, blanket the nation’s economy. Some are within this Act, others beyond its coverage. Large numbers will fall clearly on one side or on the other, by whatever test may be applied. But intermediate there will be many, the incidents of whose employment partake in part of the one group, in part of the other, in varying proportions of weight. And consequently the legal pendulum, for purposes of applying the statute, may swing one way
Unless the common-law tests are to be imported and made exclusively controlling, without regard to the statute’s purposes, it cannot be irrelevant that the particular workers in these cases are subject, as a matter of economic fact, to the evils the statute was designed to eradicate and that the remedies it affords are appropriate for preventing them or curing their harmful effects in the special situation. Interruption of commerce through strikes and unrest may stem as well from labor disputes between some who, for other purposes, are technically “independent contractors” and their employers as from disputes between persons who, for those purposes, are “employees” and their employers. Cf. Drivers’ Union v. Lake Valley Co., 311 U. S. 91. Inequality of bargaining power in controversies over wages, hours and working conditions may as well characterize the status of the one group as of the other. The former, when acting alone, may be as “helpless in dealing with an employer,” as “dependent ... on his daily wage” and as “unable to leave the employ and to resist arbitrary and unfair treatment” as the latter. For each, “union . . . [may be] essential to give . . . opportunity to deal on equality with their employer.”
To eliminate the causes of labor disputes and industrial strife, Congress thought it necessary to create a balance of forces in certain types of economic relationships. These do not embrace simply employment associations in which controversies could be limited to disputes over proper “physical conduct in the performance of the service.”
Hence “technical concepts pertinent to an employer’s legal responsibility to third persons for acts of his servants” have been rejected in various applications of this Act both here (International Association of Machinists v. Labor Board, 311 U. S. 72, 80-81; H. J. Heinz Co. v. Labor Board, 311 U. S. 514, 520-521)
In making that body’s determinations as to the facts in these matters conclusive, if supported by evidence, Congress entrusted to it primarily the decision whether the evidence establishes the material facts. Hence in reviewing the Board’s ultimate conclusions, it is not the court’s function to substitute its own inferences of fact for the Board’s, when the latter have support in the record. Labor Board v. Nevada Copper Corp., 316 U. S. 105; cf. Walker v. Altmeyer, 137 F. 2d 531 (C. C. A.). Undoubtedly questions of statutory interpretation, especially when arising in the first instance in judicial proceedings, are for
In this case the Board found that the designated newsboys work continuously and regularly, rely upon their earnings for the support of themselves and their families, and have their total wages influenced in large measure by the publishers, who dictate their buying and selling prices, fix their markets and control their supply of papers. Their hours of work and their efforts on the job are supervised and to some extent prescribed by the publishers or their agents. Much of their sales equipment and advertising materials is furnished by the publishers with the intention that it be used for the publisher’s benefit. Stating that “the primary consideration in the determination of the applicability of the statutory definition is whether
III.
The Board’s selection of the collective bargaining units also must be upheld. The units chosen for the News and the Herald consist of all full-time
The Board predicated its designations in part upon the finding that the units included, in general, men who were responsible workers, continuously and regularly employed as vendors and dependent upon their sales for their liveli
Nor is there substance in the objection that the Board’s designations on the one hand fail to embrace all workers who in fact come within the responsible or stable full-time category generically stated, and on the other hand fail to exclude all who in fact come within the schoolboy or more volatile part-time category. The record does not suggest that the units designated, at least so far as Los Angeles newsboys are concerned, do not substantially effectuate the Board’s theory or embrace a large portion of those who would make up a stable bargaining group based on responsible tenure and full-time work. In these matters the Board cannot be held to mathematical precision. If it chooses to couch its orders in terms which for good reasons it regards effective to accomplish its stated ends, peripheral or hypothetical deviations will not defeat an otherwise appropriate order.
Another objection urged by the Times, the Herald and the Examiner is to the Board’s exclusion of suburban newsboys
■ Wide variations in the forms of employee self-organization and the complexities of modern industrial organization make difficult the use of inflexible rules as the test of an appropriate unit. Congress was informed of the need for flexibility in shaping the unit to the particular case
The judgments are reversed and the causes are remanded for further proceedings not inconsistent with this opinion.
Reversed.
Section 2 (3) of the Act provides that “The term 'employee’ shall include any employee, and shall not be limited to the employees of a particular employer, unless the Act explicitly states otherwise, and shall include any individual whose work has ceased as a consequence of, or in connection with, any current labor dispute or because of any unfair labor practice, and who has not obtained any other regular and substantially equivalent employment, but shall not include any individual
320 U. S. 728.
Pursuant to § 9 (b) and (c) of the Act; 49 Stat. 453, 29 U. S. C. § 159 (b) and (c)..
Although it treated the four representation petitions in one consolidated proceeding and disposed of them in one opinion, the Board did not consider evidence with respect to one publisher as applicable to any of the others.
Subsequently those orders were amended in various details. 29 N. L. R. B. 94, 95; 30 N. L. R. B. 696, 697; 31 N. L. R. B. 697.
The record in the representation proceeding was in effect incorporated in the complaint proceeding.
The Times’ daily circulation is about 220,000 and its Sunday circulation is about 368,000. The Examiner’s daily circulation is about 214,000 and its Sunday circulation is about 566,000.
The Herald has a circulation of about 243,000. Both it and the Examiner are owned by Hearst Publications, Inc.
The News has a circulation of about 195,000. Its first three and seventh editions are consigned for the most part to route delivery or suburban dealers. Its fourth edition, which goes to press at 2:45 a. m., is sold in the city during the mornings. The remaining editions, which go to press at regular intervals between 9:50 a. m. and 5:00 p. m., are sold in the city during the afternoons.
The Examiner, the Herald, and the News all employ “main spot” boys or checkmen; the Times does not.
The Times district managers deliver the papers directly to the newsboys and collect directly from them. On the other papers district managers may deliver bundles of papers to the checkmen or directly to the newsboys themselves. The Times customarily transports its newsboys to their “spots” from the Times building, where they first report and pick up their papers. The other respondents offer similar transportation to those of their newsboys who desire it.
In the ease of the Examiner these “main spot” boys, although performing services similar to those of eheekmen, are less closely knit to the publisher and sometimes receive no compensation for their services.
See infra, note 15.
Newsboys selling the Herald in one residential area do not receive credit for all unsold papers.
Admittedly the Times, Examiner, and Herald district managers are employees of their respective papers. While the News urged earnestly that its managers are not its employees, the Board found otherwise. They do not operate on a formal salary basis but they receive guaranteed minimum payments which the Board found are "no more than a fixed salary bearing another label.” And while they, rather than the publisher, fix the price of the paper to the newsboy, the Board found, on substantial evidence, that they function for the News in specified districts, distribute racks, aprons, advertising placards from the News to the newsboys, give instructions as to their use, supervise the redistributing activities of the checkmen (themselves clearly employees of the News), and hand out News cheeks to the checkmen for their services. On this and other evidence suggesting that however different may be their formal arrangements, News district managers bear substantially the same relation to the publisher on one hand and the newsboys on the other as do the other district managers, the Board concluded that they were employees of the paper.
Although from time to time these “spots” are bought and sold among the vendors themselves, without objection by district managers and publishers, this in no way negates the need for the district managers’ implicit approval of a spotholder or their authority to remove vendors from their “spots” for reasons of discipline or efficiency.
E. g., that there is either no evidence in the record to show, or the record explicitly negatives, that respondents carry the newsboys on their payrolls, pay “salaries” to them, keep records of their sales or locations, or register them as “employees” with the Social Security Board, or that the newsboys are covered by workmen’s compensation insurance or the California Compensation Act. Furthermore, it is urged the record shows that the newsboys all sell newspapers, periodicals and other items not furnished to them by their respective publishers, assume the risk for papers lost, stolen or destroyed, purchase and sell their “spots,” hire assistants and relief men and make arrangements among themselves for the sale of competing or leftover papers.
They have abandoned here the contention, made in the circuit court, that the Act does not reach their controversies with the newsboys because they do not affect commerce.
The so-called “control test” with which common-law judges have wrestled to secure precise and ready applications did not escape the difficulties encountered in borderland eases by its reformulation in the Restatement of the Law of Agency § 220. That even at the common law the control test and the complex of incidents evolved in
See, e. g., Stevens, The Test of the Employment Relation (1939) 38 Mich. L. Rev. 188; Steffen, Independent Contractor and the Good Life (1935) 2 U. of Chi. L. Rev. 501; Leidy, Salesmen as Independent Contractors (1938) 28 Mich. L. Rev. 365; N. Y. Law Revision Commission Report, 1939 (1939) Legislative Document No. 65 (K).
See note 20 supra.
Compare, e. g., McKinley v. Payne Lumber Co., 200 Ark. 1114, 143 S. W. 2d 38; Industrial Comm’n v. Northwestern Ins. Co., 103 Colo. 550, 88 P. 2d 560; Schomp v. Fuller Brush Co., 124 N. J. L. 487, 12 A. 2d 702; 126 N. J. L. 368, 19 A.2d 780; Unemployment Compensation Comm’n v. Jefferson Ins. Co., 215 N. C. 479, 2 S. E. 2d 584; Singer Sewing Machine Co. v. Unemployment Compensation Comm’n, 167 Ore. 142, 103 P. 2d 708, with McCain v. Crossett Lumber Co., 174 S. W. 2d 114 (Ark.); Hill Hotel Co. v. Kinney, 138 Neb. 760, 295
Compare Stockwell v. Morris, 46 Wyo. 1, with Auer v. Sinclair Refining Co., 103 N. J. L. 372; Schomp v. Fuller Brush Co., 124 N. J. L. 487, 126 N. J. L. 368, with Fuller Brush Co. v. Industrial Comm’n, 99 Utah 97; Stover Bedding Co. v. Industrial Comm’n, 99 Utah 423, with Maltz v. Jackoway-Katz Cap Co., 336 Mo. 1000.
Cf. notes 28-30 infra and text.
American Steel Foundries Co. v. Tri-City Council, 257 U. S. 184, 209, cited in H. R. Rep. No. 1147, 74th Cong., 1st Sess. 10; cf. Bakery & Pastry Drivers v. Wohl, 315 U. S. 769.
The practice of self-organization and collective bargaining to resolve labor disputes has for some time been common among such varied types of “independent contractors” as musicians (How Collective Bargaining Works (20th Century Fund, 1942) 848-866; Proceedings of the 47th Annual Convention of the American Federation
Control of “physical conduct in the performance of the service” is the traditional test of the “employee relationship” at common law. Cf., e. g., Restatement of the Law of Agency § 220 (1).
Sen. Rep. No. 573, 74th Cong., 1st Sess. 7.
Sen. Rep. No. 573,74th Cong., 1st Sess. 6.
Cf. Phelps-Dodge Corp. v. Labor Board, 313 U. S. 177; and compare Driver's Union v. Lake Valley Co., 311 U. S. 91, with Sen. Rep. No. 573, 74th Cong., 1st Sess. 7.
Compare Labor Board v. Waterman S. S. Corp., 309 U. S. 206; Phelps-Dodge Corp. v. Labor Board, 313 U. S. 177.
Cf. South Chicago Coal & Dock Co. v. Bassett, 309 U. S. 251; Lehigh Valley Coal Co. v. Yensavage, 218 F. 547, 552 (C. C. A.).
Lehigh Valley Coal Co. v. Yensavage, 218 F. 547, 552 (C. C. A.).
E. g., Matter of Metro-Goldwyn-Mayer Studios, 7 N. L. R. B. 662, 686-690; Matter of KMOX Broadcasting Station, 10 N. L. R. B. 479; Matter of Interstate Granite Corp., 11 N. L. R. B. 1046; Matter of Sun Life Ins. Co., 15 N. L. R. B. 817; Matter of Kelly Cb., 34 N. L. R. B. 325; Matter of John Yasek, 37 N. L. R. B. 156.
44 Stat. 1424, 33 U. S. C. § 901 et seq.
Under §2 (b) of the Communications Act of 1934, 48 Stat. 1064,1065,47 U. S. C. § 152 (b).
Full-time newsboys for the Herald includes those who regularly sell to the public five or more editions five or more days per week. Full-time newsboys for the News includes those who regularly sell to the general public the fifth, sixth, eighth, ninth and tenth, or the sixth, eighth, ninth and tenth editions five or more days per week, or the fourth and earlier editions for at least four hours daily between 4:00 a. m. and 10:00 a. m. five days per week.
Part-time newsboys for the Herald means those selling less than five editions daily or for less than five days per week.
Established spots are corners at which newsboys sold those papers for at least five or more days per week during at least six consecutive months.
Glendale is included in the Times unit.
Temporary newsboys are those selling for less than thirty-one consecutive days.
Except newsboys selling tbe Times in Glendale.
Hearings before Committee on Education and Labor on S. 1958, 74th Cong., 1st Sess. 83.
E. g., see First Annual Report of the National Labor Relations Board 112-120; Second Annual Report of the National Labor Relations Board 122-140; Third Annual Report of the National Labor Relations Board 156-197; Fourth Annual Report of the National Labor Relations Board 82-97; Fifth Annual Report of the National Labor Relations Board 63-72; Sixth Annual Report of the National Labor Relations Board 63-71.
Matter of Gulf Oil Corp., 4 N. L. R. B. 133.
Concurring Opinion
concurs in the result. He is of the opinion that the test of coverage for employees is that announced by the Board in the matter of Stockholders Publishing Company, Inc., and Los Angeles Newsboys Local Industrial Union No. 75, C. I. 0., and other similar cases, decided January 9, 1941, 28 N. L. R. B. 1006, 1022-23.
Concurring Opinion
I think the judgment of the Circuit Court of Appeals should be affirmed. The opinion of that court reported in 136 P. 2d 608, seems to me adequately to state the controlling facts and correctly to deal with the question of law presented for decision. I should not add anything were it not for certain arguments presented here and apparently accepted by the court.
I think it plain that newsbojrs are not “employees” of the respondents within the meaning and intent of the National Labor Relations Act. When Congress, in § 2 (3), said “The term ‘employee’ shall include any employee, . . .” it stated as clearly as language could do it that the provisions of the Act were to extend to those who, as a result of decades of tradition which had become part of the common understanding of our people, bear the named relationship. Clearly also Congress did not dele
I do not think that the court below suggested that the federal courts sitting in the various states must determine whether a given person is an employee by application of either the local statutes or local state decisions. Quite the contrary. As a result of common law development, many prescriptions of federal statutes "take on meaning which is uniformly ascribed to them by the federal courts, irrespective of local variance. Funk v. United States, 290 U. S. 371. This court has repeatedly resorted to just such considerations in defining the very term “employee” as used in other federal statutes, as the opinion of the court below shows. There is a general and prevailing rule throughout the Union as to the indicia of employment and the criteria of one’s status as employee. Unquestionably it was to this common, general, and prevailing understanding that Congress referred in the statute and, according to that understanding, the facts stated in the opinion below, and in that of this court, in my judgment, demonstrate that the newsboys were not employees of the newspapers.
It is urged that the Act uses the term in some loose and unusual sense such as justifies the Board’s decision because Congress added to the definition of employee above quoted these further words: “and shall not be limited to the employees of a particular employer, unless the Act explicitly states otherwise, . . .” The suggestion seems to be that Congress intended that the term employee should mean those who were not in fact employees, but it
Reference
- Cited By
- 1072 cases
- Status
- Published