July 27, 2001
Richard A. Siegel, Esq.
Associate General Counsel
National Labor Relations Board
1099 14th Street, NW
Washington, DC 20570-0001
Re: NMB File No. CJ-6721
NLRB Cases 20-CA-30010-1
Trux Transportation, Inc.
(d/b/a Trux Airline Cargo Services)
Dear Mr. Siegel:
This responds to your May 7, 2001, request for the National Mediation Board's (NMB) opinion regarding whether Trux Transportation, Inc. (d/b/a Trux Airline Cargo Services) (Trux) is subject to the Railway Labor Act (RLA), 45 U.S.C. §§ 151-181.
For the reasons discussed below, the NMB's opinion is that Trux and its employees are subject to the RLA.
I. PROCEDURAL BACKGROUND
This case arose as a result of unfair labor practice charges filed by the International Brotherhood of Teamsters, Local 85 (Local 85 or Organization), with the National Labor Relations Board (NLRB) in February, 2001. Local 85 seeks to represent a bargaining unit of drivers, warehouse workers, and customer service agents employed by Trux at the San Francisco International Airport (SFO).
During the NLRB investigation, Trux asserted that it was subject to the RLA. The Organization took the position that Trux was subject to the National Labor Relations Act (NLRA).
The NMB's opinion in this case is based on the request and record provided by the NLRB, position statements submitted at the NMB's request by Trux and the Organization on June 5, 2001, and documents submitted by Trux at the NMB's request.
II. CONTENTIONS OF THE ORGANIZATION
The contentions of Local 85 are as follows:
Trux is not subject to the RLA. Trux is neither an air carrier nor directly or indirectly controlled by an air carrier. Trux does not meet either part of the NMB's two-part jurisdictional test. Trux warehouses and provides ground transportation of freight for several airlines at the SFO. The Organization asserts that any cargo handling duties performed by Trux are incidental to its warehousing and trucking operations. Therefore, Trux does not provide services traditionally performed by an air carrier.
The Organization also argues that even if the NMB finds that Trux performs work traditionally performed by a carrier, Trux is not directly or indirectly controlled by a carrier. In support of its position, Local 85 submitted affidavits from two individuals.
III. CONTENTIONS OF TRUX
The contentions of Trux are as follows:
It provides cargo handling services for international carriers at SFO, the only airport where it conducts business. These services include receiving and discharging cargo; preparing cargo documentation; preparing cargo for loading; and directing the loading and unloading of cargo. Since Trux employees perform work traditionally performed by air carrier employees and its services are directly controlled by two international carriers, the NMB should assert jurisdiction.
Approximately 94% of its business is with two Carriers, Korean Airlines (KAL) and Phillipine Airlines (PAL). In addition, Trux contends that since KAL provides 81% of its business, KAL is an integral part of Trux's existence. Therefore, KAL uses its position to exert control over Trux's operations.
IV. FINDINGS OF FACT
Trux has an employee handbook which addresses appearance, overtime, hiring, pay increases, benefits, discharge, and uniforms for Trux employees.
KAL and PAL lease the buildings where Trux employees work, and own or control the telephones, computers and all of the software used by Trux employees. In addition, KAL and PAL own or lease most of the cargo handling equipment used by Trux employees, including cargo pallets, containers, nets, and locks. The only exception is that Trux owns the warehouse forklifts and the trucks used to transport cargo from one warehouse to another. Trux employees must complete a training program designed and conducted by the Carriers. In addition, the Carriers require that all candidates for employment pass background and security checks, including fingerprinting and drug testing, prior to being hired. The Carriers periodically inspect Trux's training records and background checks. "All Trux supervisory and managerial personnel responsible for KAL or PAL cargo operations are interviewed, tested, and approved for hire either by KAL or PAL . . . ." The Carriers also set the shipping rates Trux charges.
Trux employees answer the telephone in the Carriers' names and the telephone listing for each warehouse is under the name of either KAL or PAL. A sign outside each warehouse identifies the building as either KAL or PAL cargo facilities. KAL and PAL management officials maintain direct supervision over Trux employees. While these managers do not issue written discipline to the employees, they "directly admonish employees concerning their behavior or performance and will tell Trux managers and supervisors when they believe the employees should be disciplined or terminated. While Trux may disagree with the airline in particular cases, it defers to their wishes when they are insistent."
Local 85 submitted two affidavits from Trux employees. In one affidavit, the individual stated that "Trux employees only handled cargo within the warehouses or to transfer cargo from one warehouse to another." This individual also stated that "Cargo customers do not have direct dealings with Trux . . . . We were not supervised or directed by airlines people." This individual further stated that Trux employees wear Trux uniforms. In the second affidavit, the individual stated that a KAL supervisor had authority over Trux employees and exercised that authority. However, this individual also stated that KAL supervisors "did not have any involvement in employee discipline or other supervisory type matters."
A. Applicable Legal Standard
When an employer does not fly aircraft for the transportation of freight or passengers, the NMB applies a two-part test in determining whether an employer and its employees are subject to the RLA. Federal Express Corp., 23 NMB 32 (1995). First, the NMB determines whether the nature of the work is that traditionally performed by employees of rail or air carriers -- the "function" test. Second, the NMB determines whether the employer is directly or indirectly owned or controlled by, or under common control with, a carrier or carriers -- the "control" test. Both parts of the test must be satisfied for the NMB to assert jurisdiction. Ogden Aviation Services, 23 NMB 98 (1996).
Trux does not fly aircraft and is not directly or indirectly owned by an air carrier. Therefore, to determine if Trux is subject to the RLA, the NMB must consider both the work performed for, and the degree of control exercised by, its air carrier customers, KAL and PAL.
B. Trux's Employees Perform Work
Traditionally Performed by Employees of Air Carriers
Trux employees assemble cargo pallets inside the Trux warehouse and then load the pallets onto dollies. The dollies are then pulled by tractor to cargo planes located immediately outside the warehouse. The tractor and dollies are owned by a company called Evergreen. Evergreen employs the driver of the tractor. Once outside, the dollies are mechanically unloaded using a loader, which then conveys the pallets onto the plane. Once inside the plane, the pallets are moved around using a hydraulic system operated by an Evergreen employee. A Trux employee, called a load master, then enters the plane to oversee the loading process. If there is a problem, Trux employees board the plane to address the issue. The loading is carried out according to loading plans prepared jointly by a Trux loadmaster and carrier officials. The process for unloading incoming cargo is the reverse of the outgoing process.
Trux provides all labor associated with the assembling and loading of cargo. Evergreen provides some loading equipment and operators for the equipment.
Trux provides cargo handling services to KAL and PAL at SFO. It is well established that cargo handling is work traditionally performed by air carrier employees. North American Aviation Service, PHL, Inc., 28 NMB 155 (2000); Evergreen Aviation Ground Logistics Enterprises, Inc., 25 NMB 460 (1998); Federal Express, above; Ground Handling, Inc., 13 NMB 116 (1986).
Therefore, the NMB concludes that Trux employees perform functions traditionally performed by air carrier employees.
C. The Carriers Exercise Substantial Control Over Trux
In examining control, the NMB focuses on, inter alia, the Carriers' role in the entity's daily operations, and the entity's employees' performance of services for the Carrier. LSG Sky Chefs, Inc., 27 NMB 55 (1999); Sky Valet, Commercial Aviation Services of Boston, Inc. and C and H Air Corporation, 22 NMB 230 (1995). The NMB also examines the carriers' role in employing and terminating employees, the degree to which the carrier supervise the entity's employees, the degree to which the employees are held out to the public as carrier employees, and the degree of Carrier control over employees' training. SAPADO I (Dobbs International Services, Inc.), 18 NMB 525, 530.
Trux provides cargo handling services to KAL and PAL under a Standard Ground Handling Agreement designed by the International Air Transportation Association (IATA). Although the IATA Agreement (Agreement) dictates how Trux handles cargo for KAL and PAL, each Carrier modifies the Agreement to suit its needs. The Agreement sets forth detailed specifications for all services provided by Trux, including: instructions for handling "outbound" and "inbound" products; customers' requirements; hours of operation; forms to be used; specifications for handling cargo; and specifications on accounting procedures and freight charges.
The Carriers submitted a declaration from Robert E. Simms, President and Owner of Trux, to the NLRB in support of its contentions. Simms stated that the Carriers provide the telephones and pay for telephone service at each warehouse. The telephone number for the cargo handling facility is listed as either "KAL" or "PAL" in the telephone directory and Trux employees answer the telephone in either KAL's name or PAL's name. Simms also stated that signs outside each warehouse identify the building as either a "KAL" or "PAL" facility.
Simms stated that Trux must "notify each Carrier of any complaints and or claims made by the Carriers' clients and . . . follow the procedures for claims as outlined in each Carrier's Cargo Manual." In addition, KAL and PAL set the cargo pricing requirements for Trux.
KAL and PAL lease the warehouses used by Trux. In addition, the Carriers own or control the telephones, computers, and all software used by Trux employees. The Carriers provide Trux with all the necessary cargo handling equipment, including airline pallets, containers, nets and locks. Trux owns the forklifts and some trucks used to transport cargo between the Carriers' facilities.
All Trux employees involved in cargo handling must complete the Carriers' training program. This training program is designed and conducted by Carrier personnel. In addition, the Agreement requires background and security checks, including finger printing and drug screening, for all candidates for employment. Periodically, the Carriers inspect the training records and background checks.
Simms stated that while Trux hires, fires, disciplines, and supervises its employees, the Carriers influence Trux's employment decisions. According to Simms, KAL and PAL supervise and control Trux employees. Simms stated that all Trux supervisors or managers responsible for KAL and PAL cargo operations are "interviewed, tested, and approved for hire by either KAL or PAL for their respective operations." KAL and PAL employees work in the Trux operations facility. Simms also stated that "While neither KAL nor PAL officials will issue any written discipline to our employees, they will directly admonish employees concerning their behavior or performance and will tell our managers and supervisors when they believe employees should be disciplined or terminated." Four Trux employees report directly to KAL management. According to Simms, "they direct our operations and tell our employees and supervisors how KAL wants the work to be performed."
The record establishes that KAL and PAL exercise substantial control over Trux and its employees.
Based on the record in this case, and for the reasons discussed herein, the NMB's opinion is that Trux's operations and employees at SFO are subject to the RLA. This decision may be cited as Trux Transportation, Inc. (d/b/a Trux Airline Cargo Services), 28 NMB 518 (2001).
By direction of the NATIONAL MEDIATION BOARD.
Stephen E. Crable
Chief of Staff
Douglas H. Barton, Esq.
Robert E. Simms, Esq.
Mr. Ray Benning
Roland Wilder, Esq.
Andrew H. Baker, Esq.