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United Insurance Co. v. National Labor Relations Board

December 21, 1966

UNITED INSURANCE COMPANY OF AMERICA, PETITIONER,
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT. INSURANCE WORKERS INTERNATIONAL UNION, AFL-CIO, INTERVENOR. INSURANCE WORKERS INTERNATIONAL UNION, AFL-CIO, PETITIONER, V. NATIONAL LABOR RELATIONS BOARD, RESPONDENT. UNITED INSURANCE COMPANY OF AMERICA, INTERVENOR



Knoch, Castle, and Swygert, Circuit Judges.

Author: Castle

CASTLE, C.J.:

These cases are before the Court upon the petition of United Insurance Company of America (Company) to review and set aside an order of the National Labor Relations Board issued against the Company July 28, 1965, a petition of Insurance Workers International Union, AFL-CIO, (Union) to review the Board's order to the extent the order denied the Union the full relief it requested, and upon the cross-petition of the Board to enforce its order.*fn1 A motion of the Company to dismiss the Union's petition was taken with the case on the merits.

The Board found that the Company violated Section 8(a) (5) and (1) of the National Labor Relations Act, as amended, by its admitted refusal to bargain with the Union, the certified representative of the Company's debit agents in Baltimore City and Anne Arundel County, Maryland.

The Company is engaged primarily in selling industrial life insurance, a form of ordinary life insurance in which the policies are written in amounts of less than $1,000 and the premiums are payable weekly, and for that purpose maintains district offices throughout the country. Each district office has a manager and several assistant managers, and each assistant manager heads a group of four or five debit agents. These debit agents, so-called for the reason that "debit" describes the agent's book listing the policyholders from whom the agent collects premiums, spend most of their time in the collection of premiums from policy-holders residing in a given area. They also solicit applications for new insurance and for fire insurance written by another insurer whose business is also handled by the management and supervisors of the Company.

On June 4, 1964, the Union filed a petition with the Board seeking certification as the collective bargaining representative of the Company's debit agents in Baltimore City and Anne Arundel County, Maryland. On March 16, 1964, the Company had entered into a reinsurance agreement with Quaker City Life Insurance Company, a Philadelphia, Pennsylvania corporation, under which, among other things not here pertinent, the Company reinsured the industrial life insurance policies issued by Quaker in a number of states, including those in force in Baltimore City and Anne Arundel County, Maryland. Quaker had chosen to maintain an employer-employee relationship with its debit agents, and its agents in Baltimore City and Anne Arundel County were represented by the Union. Upon the effective date of the reinsurance agreement (March 16, 1964) Quaker terminated all of its employees. Some of Quaker's former agents in Baltimore City and Anne Arundel County became agents of the Company. The policies they serviced, and the business they generated, were handled from the Company's Franklin Street district office in Baltimore, a location formerly utilized by Quaker. The debit agents here involved were about equally divided between that office and the company's St. Paul Street district office from which the Company had handled its policies in Baltimore prior to its reinsurance of Quaker's policies and continued to maintain.

On July 6, 1964, the Company and the Union entered into a stipulation for certification upon consent election which by its terms provided that the Company did not waive its contention that the debit agents in the unit were independent contractors and not employees within the meaning of the Act, and that the failure of the Company to contest that issue was limited solely to the representation proceeding. The Union won the election and was certified on August 14, 1964. On August 20, 1964, the Union requested recognition. On September 1, 1964, the Company denied that request. It based its refusal to bargain with the Union on the ground that the debit agents involved are independent contractors and not employees.

The Board ordered the Company to cease and desist from its refusal to bargain, to bargain with the Union upon request, and to post designated notices.

The Board's conclusion that the Company violated Section 8(a) (5) and (1) of the Act is predicated upon the Trial Examiner's findings and conclusions to the effect that the Company's debit agents in the Baltimore City and Anne Arundel County area unit here involved are employees within the meaning of the Act, which findings and conclusions the Board adopted.

The Company contends that the Board's order is not supported by substantial evidence on the record considered as a whole; that the findings and conclusions adopted by the Board are, in material part, the product of subjective conclusions drawn from the trial examiner's personal observations rather than from the evidence; that material comparative testimony, proffered by the Company, was erroneously excluded; and that at the most the testimony of the two witnesses credited and relied upon by the examiner can be regarded as establishing only that the unit was half "employee" and half "independent contractor ".

The Union's contentions*fn2 are limited to its assertions that the Board erred in denying its requests that there be included in the Board's order a specific direction that the Company bargain concerning the fire insurance aspects of the debit agents' activities and a requirement that the Company, from the date of its refusal to bargain until the discharge of its bargaining obligations, apply to all of the debit agents in the unit the terms of a contract which allegedly had existed between Quaker and its former debit agents; and that the Union is entitled to challenge these aspects of the Board's order as a "person aggrieved ". The Company's motion to dismiss the Union's petition in No. 15589 challenged the Union's status as an aggrieved person. The Board takes the position that while the Union is an aggrieved person in so far as jurisdictional purposes are concerned, and therefore this Court has jurisdiction of the Union's petition for review, the contentions of the Union with respect to the scope of the Board's order are wholly without merit.*fn3

Two years prior to the Union's petition for certification in the instant matter the issue whether the Company's debit agents in Pennsylvania were Company employees or independent contractors was before this Court in United Insurance Company of America v. NLRB, 7 Cir., 304 F.2d 86. This Court there observed:

"In the instant case, United has chosen to operate its business on the basis that its agents are independent contractors and, of course, it had the complete legal right so to do."

And citing NLRB v. Phoenix Mutual Life Insurance Company, 7 Cir., 167 F.2d 983, and National Van Lines, Inc. v. NLRB, 7 Cir., 273 F.2d 402, ...


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