McElroy, Pender R.

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Labor Law -- Extension of the Discretionary Jurisdiction of the National Labor Relations Board

University of North Carolina School of Law

NORTH CAROLINA LAW REVIEWVolume 46 | Number 4 Article 206-1-1968Labor Law -- Extension of the DiscretionaryJurisdiction of the National Labor Relations BoardPender R. McElroyFollow this and additional works at: http://scholarship.law.unc.edu/nclrPart of the Law CommonsThis Note is brought to you for free and open access by Carolina Law Scholarship Repository. It has been accepted for inclusion in North Carolina LawReview by an authorized editor of Carolina Law Scholarship Repository. For more information, please contact law_repository@unc.edu.Recommended CitationPender R. McElroy, Labor Law -- Extension of the Discretionary Jurisdiction of the National Labor Relations Board, 46 N.C. L. Rev. 981(1968).Available at: http://scholarship.law.unc.edu/nclr/vol46/iss4/20NLRBLabor Law-Extension of the Discretionary Jurisdictionof the National Labor Relations BoardThe Labor Management Relations Act of 1947 gives to theNational Labor Relations Board power to assert jurisdiction overany question of representation or any unfair labor practice "af-fecting [interstate] commerce."' The Act further provides:[t]he Board, in its discretion, may . .. decline to assert juris-diction over any labor dispute involving any class or categoryof employers, where, in the opinion of the Board, the effect ofsuch labor dispute on commerce is not sufficiently substantialto warrant the exercise of its jurisdiction .... 2The Board in Flatbush General Hospital,3 decided in 1960, de-clined to assert jurisdiction over private hospitals. Had it been soinclined the Board could have properly done so, but it felt that theoperation was "essentially local in nature and therefore, the effecton commerce ... is not substantial enough to warrant the exerciseof . . . jurisdiction."4 The Board also felt that if labor disputesarose in private hospitals the states would step in and regulate suchdisputes.In Butte Medical Properties5 the Board reexamined its positionwith respect to private hospitals and overruled Flatbush. It adopteda new standard by which jurisdiction will be asserted over privatehospitals which receive at least 250,000 dollars in annual grossrevenue. The Board foundthat the considerations bearing on . . . the jurisdictional deter-mination in this industry have markedly changed since the Flat-'Labor Management Relations Act §§ 9(c) (1) (B), 10(a), 29 U.S.C.§§ 159(c)(1)(B), 160(a) (1964) [hereinafter cited as Taft-Hartley].'Taft-Hartley § 14(c)(1), 29 U.S.C. § 164(c)(1) (1964) (emphasisadded). The term "labor dispute" includes questions of representation aswell as unfair labor practices. Aaron, The Labor-Management Reportingand Disclosure Act of 1959, 73 HARV. L. REv. 1086, 1093 (1960).* 126 N.L.R.B. 144 (1960)."Id. at 145. Until 1960 the Board had asserted jurisdiction over privatehospitals in only three situations:where the hospital was located in the District of Columbia, wherethe operations of the hospital vitally affected national defense, andwhere the hospital was an integral part of the establishment whoseoperations met the Board's jurisdictional standards.Id. , 168 N.L.R.B. No. 52, 66 L.R.R.M. 1259 (1967).1968]NORTH CAROLINA LAW REVIEWbush decision and that it will effect the policies of the Act toassert . .. discretionary jurisdiction over . . . [this] Employeras well as over proprietary hospitals generally. 6In refusing to follow Flatbush the Board considered severalfactors which indicate the impact of the operation of private hos-pitals on interstate commerce. The Board pointed out that thereare about 970 private hospitals in 44 states in the United Statesand they constitute one of the country's largest industries; that per-sonnel such as nurses, dieticians and therapists often must be re-cruited from other areas; that "there has been a substantial in-crease in the number of beds, admissions, census, personnel, pay-roll, assets and gross revenues . . . ." The Board enumerated thepurchase of supplies and equipment by all private hospitals andnoted the resulting significant effect on commerce. Impressive alsowere the billions of dollars spent by 79.2 percent of Americans forhealth insurance which results in substantial payments to hospitals,as well as expenditures by the federal government on behalf of re-cipients of public health and welfare benefits. Similar factors wereinvolved in the simultaneous assertion of jurisdiction by the Boardover private nursing homes where the employer receives at least100,000 dollars in annual gross revenue. 8While the effect of an employer's operations on interstate com-merce is a prime consideration in deciding whether or not to assertjurisdiction in most cases, there is an area of the Board's discre-tionary jurisdiction where it is apparently of no consequence. Eventhough an employer's operations may affect commerce and maymeasure up to the Board's applicable jurisdictional dollar stan-dards,9 the Board has not taken jurisdiction over nonprofit educa-tional, research and charitable organizations "where the activitiesinvolved are non-commercial in nature and intimately connectedwith the . . . purposes and . . . activities of the institution." 10This idea is conceptually known as the Columbia University doc-trine'1 and has been applied in a long line of cases.12 However, if the666 L.RR.M. at 1261.* Id. at 1260.8 University Nursing Home, Inc., 168 N.L.R.B. No. 53, 66 L.R.R.M.1263 (1967).9 The standards can be found in 23 NLRB ANN. REP. 8 (1958)."0 Trustees of Columbia Univ., 97 N.L.R.B. 424, 427 (1951).2 29 NLRB ANN. RE'. 34 (1964)." Horn & Hardart Co., 154 N.L.R.B. 1368 (1965) (employer was cor-[Vol. 46enterprise, even though a nonprofit educational, charitable or re-search organization, has activities commercial in nature jurisdic-tion will be asserted.13There is a considerable doubt as to the propriety of the Board'sview in this matter. In so holding, the Board very early in the courseof its opinions in this area pointed to the Conference Report on theLabor Management Relations Act of 1947 wherein it is stated:[t]he nonprofit organizations [other than nonprofit hospitals]excluded under the House bill are not specifically excluded inthe conference agreement, for only in exceptional circumstancesand in connection with purely commercial activities of suchorganizations have any of the activities of such organizationsporation operating food service facilities in a hospital); MassachusettsInstitute of Tech., 152 N.L.R.B. 598 (1965) (employer was data processingresearch laboratory operated by a university); Prophet Co., 150 N.L.R.B.1559 (1965) (employer was nationwide food service enterprise operatingUniversity dining facilities); Iowa State Memorial Union, N.L.R.B. Admin.Decis., 1964, 55 L.R.R.M. 1362 (1964) (employer was student union at acollege); University of Miami, 146 N.L.R.B. 1448 (1964) (employer wasa university division operating three ocean-going vessels for courses andresearch); Crotty Bros., N.Y., Inc., 146 N.L.R.B. 755 (1964) (employermanaged food service facilities on a college campus); Young Men's Chris-tian Ass'n, 146 N.L.R.B. 20 (1964) (employer was community service or-ganization); Sheltered Workshops, 126 N.L.R.B. 961 (1960) (employerprovided work rehabilitation for handicapped persons); Lutheran Church,Mo. Synod, 109 N.L.R.B. 859 (1954) (employer was a radio station operatedby religious organization); Armour Research Foundation, 107 N.L.R.B. 1052(1954) (employer was engaged in research in conjunction with a univer-sity); Trustees of Columbia Univ., 97 N.L.R.B. 424 (1952) (employer wasuniversity; union was seeking to represent clerical employees in library).'" Bay Ran Maint. Corp., 161 N.L.R.B. No. 74, 63 L.R.R.M. 1345 (1966)(employer provided cleaning and maintenance services for hospital); Mari-time Advancement Programs, 152 N.L.R.B. 348 (1965) (employer createdto administer trust fund for training unlicensed seamen); Woods HoleOceanographic Inst., 143 N.L.R.B. 568 (1963) (employer operated ocean-going vessels to conduct marine research and teach oceanography); SouthBend Broadcasting Corp., 116 N.L.R.B. 1166 (1956) (employer a univer-sity-owned corporation operating a radio and television station); Massa-chusetts Institute of Tech. (Lincoln Laboratory), 110 N.L.R.B. 1611 (1954)(employer operated research facility in connection with university andfederal government); California Institute of Tech., 102 N.L.R.B. 1402(1953) (employer operated research facilities under university auspicesin conjunction with private industries); Kennecott Copper Corp., 99N.L.R.B. 748 (1952) (employer was hospital and dispensary maintained bycopper company for employees); Sunday School Board of S. Baptist Cony.,92 N.L.R.B. 801 (1950) (employer published and distributed religiousliterature); Port Arthur College, 92 N.L.R.B. 152 (1950) (employer wasa radio station operated by a college); General Elec. Co., 89 N.L.R.B. 1247(1950) (employer was hospital operated by G.E. for employees and families) ;Illinois Institute of Tech., 81 N.L.R.B. 201 (1949) (employer was college-operated research foundation for industry and government).19681 NLRBNORTH CAROLINA LAW REVIEWor their employees been considered as affecting commerce soas to bring them within the scope of the National Labor RelationsAct.'4The Board takes this language as providing a "guide," if not a"mandate," and as approval of the Board's practice prior to thelegislation in 1947." The language of the Conference Report seemsonly to indicate approval of the Board's practice of not taking juris-diction when the activities of the organization are not consideredto affect commerce. It is not at all clear from the language that theBoard should refuse to assert jurisdiction if the activities of educa-tional, charitable and research organizations do in fact affect com-merce. Whether or not the Board has properly interpreted the Con-ference Report, the questionability as to the nonassertion of juris-diction over these organizations remains.It is freely admitted by the Board that activities of educational,charitable or research organizations may and do affect commerce.1 0This being so, it is difficult to ascertain why jurisdiction should notbe asserted in light of the purpose and policy of the Act "to promotethe full flow of commerce, to prescribe the legitimate rights of bothemployees and employers in their relations affecting commerce,... and to protect the rights of the public in connection with labordisputes affecting commerce.' 7 These organizations buy goods andservices and often sell services ;:" they hire employees as well. Anyof these would be difficult to accomplish today without affectinginterstate commerce. The sheer number of cases where the Boardrefused to assert jurisdiction indicates the substantial impact on com-merce resulting from the activities over which the Board will notassert jurisdiction.'""I H. R. REP. No. 510, 80th Cong., 1st Sess. 32 (1947), cited in 1N.L.R.B., LEGISLATIVE HISTORY OF THE LABOR MANAGEMENT RELATIONSAcT, 1947, at 505, 536 (1948).1 Trustees of Columbia Univ., 97 N.L.R.B. 424, 427 (1951).26University of Miami, 146 N.L.R.B. 1448, 1450 (1964).'7Taft-Hartley § 1(b), 29 U.S.C. § 141(b) (1964)." Crotty Bros., N.Y., Inc., 146 N.L.R.B. 755 (1964). In this case a non-profit educational institution hired a corporation to manage its food servicefacilities. The corporation was in the business of providing food servicemanagement for educational, hospital and business establishments in severalstates. Jurisdiction was not taken. The case was followed in Prophet Co.,150 N.L.R.B. 1559 (1965).1 Note 12 supra. Twelve cases are cited. Further implications as to theeffect on interstate commerce can be drawn from the application of thesecases to organizations similar to those in the cited cases. For instance thereare many organizations in the United States associated with the Young[Vol. 46LIMITATIONS ON THE REPLYIt might be argued that these nonprofit charitable, educationaland research organizations with primarily noncommercial activi-ties perform functions that may otherwise have to be performed bythe government, either local, state or national, and that, therefore,they should not be subjected to the regulation in labor disputessince government activities are not. However, recent labor strifeconcerning teachers, nurses and sanitation workers illustrate thevery definite need in these areas for regulation of labor disputes.Work stoppages in the governmental sector jumped from 42 in-volving 12,000 workers in 1965 to 142 involving 105,000 workersin 1966.20 Further, there is some question as to whether the gov-ernments should or even would operate some of the activities en-gaged in by some of the organizations over which the Board refusedto assert jurisdiction.It is submitted that the Board should take jurisdiction over theseorganizations, and, that, despite the Board's interpretation of theConference Report, it is perfectly free to do so. If necessary theCongress should consider empowering the Board to do so.PENDER R. McEELROYPleadings-Limitations on the ReplyIn Davis v. North Carolina State Highway Commission,1 theNorth Carolina Supreme Court echoed a long standing notion aboutthe nature of the reply, which merits examination in light of theproposed changes in the state's rules of civil procedure, as well aspresent practice. The complaint in Davis stated that the state high-way commission had taken plaintiff's property on January 14, 1965,when in fact it was not needed at that time. It was further allegedthat the taking was accomplished by means of false representations,with intent to deceive plaintiffs and force them out before theirdeparture was necessary. Included was a prayer for 50,000 dollarsactual and 1,000,000 dollars punitive damages.2Defendants moved to strike the portions of the complaint alleg-Men's Christian Association; there are many nonprofit research foundationsassociated with colleges and universities.1o U.S. BUREAU OF THE CENSUS, STATISTICAL ABSTRACT OF THE UNITEDSTATES 249 (88th Ed. 1967).-271 N.C. 405, 156 S.E.2d 685 (1967).2 Id. at 406-07, 156 S.E.2d at 686-87.19681

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Labor Law -- Extension of the Discretionary Jurisdiction of the National Labor Relations Board

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