NATIONAL RAILROAD ADJUSTMENT BOARD
Third Division
"Claim of the General Committee of The Order of Railroad Telegraphers, Southern Pacific Company (Pacific Lines), drat employes within the scope of their agreement with the blanagement, who were paid commissions on shipments of mills, cream, and related commodities handled by express, shall be paid commissions for handling like shipments by baggage."
FINDINGS.-The Third Division of the Adjustment Board upon the whole record and all the evidence, finds that:
The carrier and the employees involved in this dispute are, respectively, carrier find employees within the meaning of the Railway Labor Act, as approved June 21, 1934
This Division of the Adjustment Board has jurisdiction over the dispute involved herein.
The parties to .said dispute were given due notice of hearing thereon.AS result of a deadlock, Willard E. Flotchkiss was called in as Referee and upon request of the Carrier a second hearing lens held on July 1, 1936, at which the parties argued tire case before the Division with the Referee sitting as a member thereof.
An agreement bearing date of September 1, 1927, as to rules and August I, 193'2, as to rates of pay is in effect between the parties.
This case involves among other things, the application of Rule 33 (a) of tire agreement.
"F,mpr-c" and telegraph commiasioons: (a) When express or Western Union commissions are discontinued or created at any office, thereby reducing or increasing flip average monthly compensation paid to any position, prompt adjustment of the salary affected will be made conforming to rates paid for similar positions."
The dispute arose in June 7930 in respect to clrangoe which occurred at that time in the transport of milk and related products. The occasion of the claim is the loss of express commissioua as result of handling by baggage intrastate traffic in these commodities in Arizona, New Mexico, Oregon, Utah, and California, and brterahnte traffic !it them between Arizona. California. Nevada, New Mexico, Oregon, and Texas. which had previously been handled by the Railway Express Agency. Incorporated.
The ruslnrte was handled in confererce and correspondence botween the nnrt4s. No[ haiug diapnsrd o£ it wa,a submitted by The Order of Railroad Teleeranherv to the system Adjuptment Board. That Board, composed of an equal nnnber of ropn·.-entativ,·s of the respective parties, was upable to agree nnen the right of flip Poard to take jurisdiction. The dispute was then submjtted to the Vnitod stales Board of lilecMrtion. ex Parts. hr The Order of Railrond Telegra1ohPrC. October 28, 1931. It was handled by n medintor for the Board. bill wos not disposed of.
17vhibl 9 following Commdtteo's rejoinder to Carrier's Rebuttal (Record, p. 941 is a 1"tter from General Chairman N. D. Pritchett to Supervisor of Wnge Senles R. El. Beach, dated August 28, 1924, to-wit:
"Please he referred to item covering matter of compensation for handling of mill:, erealn, and kindred products by baggage by employes
covered by tile Telegraphers' current agreement, your file on this subject 50-159.
"The case has been handled up to and including mediation under the Railway Labor Act prior to its amendments on July 21st, 1934.
"Since this Act has been amended, the Chairman of the newly created National Mediation Board has suggested to the President of this Organfzatioll that the case be withdrawn from mediation and again handled with the carrier with view of making settlement through agreement in conference and, if this faiis, to submit to the National Adjustment Board as the amended Railway Labor Act provides.
"This case has been withdrawn by the President of this Organization and remanded to tile for further handling with tile 'Management with a view of reaching a settlement.
On October 1, 1934, the Secretary of tile National Mediation Board, Mr. George A. Cook, addressed this advice to Air. J. R. Dyer, Vice President in charge of Operation, Southern Pacific Company (Pacific Lines)
"This Board is in receipt of a letter from the Order of Railroad Telegraphers requesting withdrawal from further consideration of our Board of the grievance disputes between your carrier and that organization covered by our case file Nos. GC-795 and GC-1186, and advising that any further handling given these eases will be in accordance with the Railway Labor Act as amended.
The record indicates that tile subject was handled fn conference between the parties on Novembor 5, 1034, and that thereafter Carrier's representative served notice of refusal to give consideration to the claim. (Record, p. 97.)
POSITION OF PDTITTONERS.-Petitioners base their claim primarily on Bole :33, whi<·Il, they point out. was carried over into the current agreement from Decision 757 of the United States Railroad Labor Board. They also cite other decisions of tile United States Railroad Labor Board, particularly Decision 2417. In its opinion fn that case, the Board said that evidence submitted in mlmerons eases showed that express commissions have always been a cmvsideralion in fixing wages of agents who receive them and then stated than this faet was recognized fit promulgating Rule 20 of Decision 757 (Rule 33 (a) of current agreement). The Roard then uses this language:
"hl this case it appears that the employees received a commission of 10 percent of the express revelmo oil shipments of milk and cream, The carrier, commencing with April 1, 1921, handled these shipments by baggage, requiring the. agents to perform practically the same service in conncclion with the shipments as was performed while they were handled by express, but discontinued tile payment of a commission. This is unquestionably a reduction in the earnings of the agents involved with I)ractiealty no change in duties.
"DocWon.-The Railroad Labor Board decides that the payment of a empmi-lion oil express shipments of milk and eream was a part of the agent's emnpensation. and that when the practice of handling these ship mexlfs by express was discontinued the employees were entitled to an adjnstmont in eompensation. The Railroad Labor Board remands this dispute to the employees and tile carrier for conference and negotiation in accordance with the principle established fu role 20 of Decision No. 757."
Petitioners cite in connoetion with Decision No. 2830 of United States Railroad L:,lm!· Bo9rd. a letter dated If;oeh 19. 1(x26. addressed by order of tile Board, by Secretary L. Rf. Parker jointly to Vice President Nicholson of the Chicago and Easlern Illinois Railroad Company and President Manion of the (l. Ii. T., to-wit:
"Referring to bar. Dfandou's letter of .January 26th and fir. Nicholson's letter of rebrnary 12, 1926, in reference to Decision No. 2830 (Docket 3102).
"It was the intention of the Board that any inequalities created as a result of the discontinuance of shipping milk and cream by express should be the subject of negotiation under rule reading:
"'Should commissions be discontinued causing loss in compensation, adjustment in salaries will be made.'
and in the event agreement could not be reached the matter should be resubmitted to this Board in accordance with the Transportation Act, 1920. It is suggested that the matter be handled accordingly."
Petitioners contend that carrier reached an agreement with the Railway Express Agency, Ins., whereby the latter abandoned handling the commodities involved in this dispute in favor of the carrier.
In support of this contention petitioners point out that the Express Agency instructed its agents (in many cases joint agents with the Southern Pacific Company) to decline shipments of milk and cream and refer shippers to baggage department of the carrier. As proof of this, petitioners quote from Circular 18. issued Los Angeles, May 31, 1930, by Superintendent M. Thompson, of the Railway Express Agency, Inc. The quotation contains this language:
"Southern Pacific Company has arranged to carry less carload cream, mill:, etc., between stations local to their line-Pacific System-on interstate traffic beginning June 1st, 1930, and ml intrastate traffic in California beginning June 16th, 1930. * * *
"On and after dates mentioned in the first paragraph of thus circular, if any of this traffic is offered us between local stations on Vie Southern Pacific Company (Pacific Lines) the shipper should be referred to the Baggage Department of the rail line."
Petitioners also quote circular dated Sacramento, May 19, 1930, issued by Superintendent E. E. McMichael of the Railway Express Agency, Ins.. which is somewhat more explicit, but to the same efect as Circular issued by Superintendent Thompson.
In further support of their contention, petitioners point out that the Southern Pacific Company (Pacific Lines) issued formal instruction to their agents (in many cases joint agents with the Railway Express Company, Inc.) to the same effect as instructions issued by the Railway Express Agency, Inc., and they quote circular addressed to agent, Pacific Lines, 'Crain Baggage men on trains, Pacific Lines, from C. J. McDooald, Mail and Express Traffic Manager, and dated San Francisco, May 23, 1930, and circular issued by 0. E. Giffin, Auditor of Passenger Accounts, addressed to all ticket and baggage agents, dated San Francisco, May 5, 1930, as proof. Contents of those quotations are substantially the same as circulars of the Railway Express Agency, Inc., which were quoted.
Petitioners contend that circulars they have quoted establish an agreement to substitute the service of the Southern Pacific Company for the service of the Railway Express Agency, In(-., in handling milk and cream and related commodities for all shipments except milk and cream in bottles which they say are infinitesimal.
Resting their legal rights upon Rule 33 (a) and the decisions and interpretations by the United States Railroad Labor Board as above cited, petitioners further develop the factual basis of their claim as follows:
"Prior to the effective date designated in the Statement of Pacts covering this case, the handling of milk, cream, and related commodities by the Railway Express Agency had been a regular procedure over an extended period of years and fur the services Performed is connection with the handling of these commodities the employcs received compensation. After the change in the method of handling from express to baggage, the emploves are still performing the duties and bearing the responsibilities, but with a loss in compensation.
"In arriving at a proper rate of pay- for the positions covered by the Telegraphers' Agreement on this property, the amount of express commie sion received has been taken into consideration. Thus has been the custom since the establishment of contraetual relationship between the management of the Southern Pacific Company and employes represented by The Order of Railroad Telegraphers.
"Incorporated in that express commission heretofore there has been figured the commissions accruing because of the handling of the commodities mentioned in our Statement of Facts on this ease. With the removal of the commodities designated in our Statement of Pacts, the loss
Petitioners then cite practice oil other Western railroads developed by questioning representatives of employees oil 22 railroads. They submit that replies to their inquiry show that where baggage service has been substituted for express service for the commodities involved in this case, commissions are being paid for handling them oil the following 14 roads: Atlantic Lines of the Southern Pacific; Kansas City Southern; Union Pacific; M. K. & T.; Missouri Pacific Lines in Texas; Missouri Pacific; St. Louis .& San Francisco; Chicago, Rock Island & Pacific; Colorado & Southern; Los Angeles & Suit Lake; Oregon, Washington Railroad Rc Navigation Company; Oregon Short Line; Denver & Rio Grande, mul Western Pacific. Petitioners point out that 11 of the above lines have a rule identical to Rule 33 (a), one has a slightly different rule, and two have no rule at all. 'they also submit that in each of the above cases the change from express service to baggage service was made subsequent to Decision 7:,7 of the United States Railroad Labor Board, and that adjustment was made iii accord with the intent of the rule as defined by the Board.
Further, petitioners submit that on the Soo Line to which Decision 2417, above mentioned, pertained, the question was settled in conference by carrier paying commissions. Petitioners say that the issue of commissions was settled oil the Northern Pacific and Great Northern prior to Decision 757 by paymcut of a lump sum distributed by mutual agreement; oil the C. & N. W. in 1906, when the method of handling the commodities was changed, by adding $5.00 per month in lien of commissions, and that on the Great Western, the Burlington, and the Milwaukee roads these commodities have not been handled by express since cmldnycec were organized rind no rules have been involved and no controversies ])live arisen. They say that on the A. T. & S. F. Lines all conunissions were discontinued prior to organization of employees. and prior to Deeisinn 757 and converted into a wage increase of about 5%`7o. On the S. P. & S. petitioners nuderstand that a dispute sindlar to this one is pending.
Petitioners submit that. the above facts indicate:"° ' ' that where this cmotroversy has arisen subsequent to the organization of employes, by far the greater preponderance of Carriers have recognize(1 the justice of the stand taken by the Employes and in settlement of this question are paying their agents commission for the handling of milk, cream, and related commodities by baggage."
Summing up their view of the essence of the transaction by which the shipment of the commodities in question was transferred from Express to baggage. petitioners use this language.
"Prior to the effective (late mentioned in the Statement of Facts, the revenue received through the handling of the commodities referred to herein was collected by and in the name of the Railway Express Agency, Ins., and nvade a part of the common sum, from which all Carriers in a set territory received an allocution at stated periods. The sum of money placed in the conunon sum was, of course, less the commissions paid the joint agent for handling the business.
"After the effective date pamed in the Statement of Facts, the revenue received from shipments of milk and cream ncerued solely to the Southern Pacific Company. It was not placed in a common sum for other Carriers to share in. The Carrier absorbed the commissions formerly paid to the employes of the Carrier who acted as joint agent with the Carrier and the Railway Express Agency, Ills."
nb~pqnent briefs filed by petitioners in response to carrier's briefs and material and argument used in hearings develop further the petitioners' position on numerous factual and jurisdictional contentions, but petitioners' case rests essentially on the facts, statements, and eitatio>.s above outlined.
POSITION OF THE CARRIER.-Carrier challenges the claim, first, oil the ground thqt this Board has uo right to take jurisdiction, and second, oil its merits. The nature of the controversy makes it impractical to disentangle its jurisdictional and its fnetual aspects except on the basis of a complete statement of the carrier's case.
Carrier places great emphasis on the contention that carrying the products involved in this case by passenger trains is not an innovation, but has been done for 36 years and that agents have never received commissions for handling these products as railroad business. During thus time the carrier points out the railroad company and the Express Company operating over carrier's lines have been competitors for the business and it has been optional with the shipper whether he used express service or the railroad service to points on the carrier's lines and a few interline points. 11: was further pointed out that from 1908 to 1921 carrier operated passenger inilk train between San Francisco and San Jose, and between Oakland quit San Jose, and that during these 13 years employees under telegraphers' agreement received no commissions, nor were they allowed additional compensation. Carrier stresses the point that it has always zealously reserved to itself the right to handle the products involved in this case, and that it was actively engaged in handling them from 1899 to 1921.
Carrier also submits that during till that time flip Express Company handled n substantial volume of said business oil flip passenger trains of the carrier. The carrier explains that (hiring the period from 1916 to 1922 both the carrier and the Express Company lost et considerable part of the business to motor trucks, with the result that it became unprofitable for the carrier actively to solicit the business, as it could not eotnpete with the door to door pick-up and delivery service of trucks. A further result was that from 1922 to 1930 carrier bandied very little of the business in question, though it continued to publish commodity rates for it.
In Section 8 of carrier's brief the argrtinent is developed that though the substance of Rule 33 was contained oil :ill telegraphers' agreements, beginning with November 1, 190'7., carrier has never contracted to make any adjustment unless commissions are entirely discontinued. Carrier then stresses the iuevitable fluctuation in flip, amount of commissions earned by agents both on the commodities involved in this case and other emnnudities.
Numbered Section 9 of carrier's original brief contains carrier's interpretation of the claim. Inasmuch as this interpretation has important bearing on both the jurisdictional and the merit phases of (lie controversy, it is quoted i77 fall, to-wil
"The Carrier understands the plaint, as reflected by the ex parts submission, is for recovery of nn amount alleged to have been lost by employes as a result of the Carrier regaining business which it previously lost to either the Express Company or the motor trucks, also oil new business acquired, irrespective of whether such new business was at any previous date handled by the Express Comlamy. The Carrier further understands that the claim is for payment of comntissious oil milk and cream and related products hereinafter handled by the Carrier, irrespective of whether the stations involved, at any lane ill the past, have received commissions on such business when it may have been handled as an express shipment. If the claim is as herein described and innlcrstood by the Carrier, it demonstrates beyond :any doubt that the rinim is, in effect, a request for a new role, a change in rate of pay, likewise a change in working conditions, without compliance with Section 6 of the Railway Labor Act oft the part of the Order of Railroad Telegraphers, and that it is a request which cannot be legally granted mnler section 3 of the Railway Lnbor Act as amended June 21, 193-1. 11-a submit the following facts Is eonchisive proof that the Order of Railroad Telegraphers are requesting a new rule and a change in working conditions, to-wit:
"Prior to June 1930 milk, cream, and related products were shipped to and/or front approximately 4.50 stations oil the Carrier's lines: at approximately 25 per cent, one fourth, or 114 of said stations, the Express Company maintained separate agencies, that is, the railroad (Carrier's) agent was not joint agent for the Express Company, and, therefore, said railroad (Carrier's) agent, did not receive commissions oil said business; but notwithstanding, the Order of Railroad Telegraphers claim that said :agent should now receive commissions on the business and should be compensated in the amount lost, nevertheless and notwithstanding said agents could not lose that which they never had.
"Carrying the above illustration :t step further: As of February 198.5, mills, cream, and related products were shipped as a railroad commodity
Numbered section (10) of carrier's original brief is a summary of carrier's grounds for asking that tile claim be denied, to-wit:
"1. That the claim is, in effect, a request for a change in rates of pay, rules, and working conditions, and therefore, Section 3 of the Railway Labor Act, as amended June 21, 1934, is not applicable.
2. That the National Railroad Adjustment Board, Third Division, cannot legally assume jurisdiction of the dispute.
"3. That the Petitioner has not complied with Section 6 of the Railway Labor Act as amended June 21, 1934.
°4. That the Carrier has not contracted with the Order of Railroad Telegraphers to pay tiny commissions ml tiny business of either the Carrier and/or any other companies or corporations which its employes may serve.
"5. That there is no rule of ill,, Telegraphers' entreat Agreement which requires the Carrier to pay commissions to employees working under that Agreement.
'8. That under 31 years' practice, that is, from 18'99 to 1930, employes within the scope of the Telegraphers' Agreement handled mills and cream as a railroad commodity, and were not paid, neither did they claim Commissions, nor additional compensation therefor."
Carrier's subsequent briefs and arguments in answer to petitioners' arguments go into further details in reference to some of the points at issue and submit some supplementary materials, including a list of eastern roads where practice corresponds to that oil Carrier's lines. However, the Carrier's case is substantially as above stated.
DOCUMENTATION AND CHECKING.-The submissions of both the potitimters and the carrier are extensively documented. Exhibits on both sides have been accepted as presented. Aside from documentary material some of the statements made by each side are contradicted or questioned by the other side. It was not deemed necessary to cheek or reconcile all conflicting statements, inasnuich as the documents available were considered strtficient to establish the merits of the rospe'tive contentions by the parties.
OPINION Oh' IiEI'EItTa~:: ,luriadirtiona2 Zssue.-In numbered section (1) of carrier's brief, jurisdiction of this Board over claim is challenged on the following grounds:
A. It is a request for a change in agreement alTecting rates of pay, rules, slid working conditions.
B. It is a request for payment of commissions to Agents and/or Agent Telegraphers. employed by (ho Southern Pacific Company (Pacific Lines) for handling Southern Pacific shipments.
C. Rates of pay fur ennployecs coming within the scope of the Telegraphers' current agreement were established by U. S Govermnent I\lediatimr Agreement efl':,etive \lay 1, 19'37, and are maintained in accordance with same except where shice changed in aeeordance with provisions of said agreement and/or by mutual agrocment; therefore Section 3 of the Railway Labor Act as amended June 21, 1934 is not applicable and Section 6 of the same act has not been complied with.
These contentions appear to be related to, if not based oil, carrier's lnterpretatimr of the claim ns set forth in numbered section (9) of carriers brief,
above quoted. While this interpretation of the claim is not necessarily crucial in respect to the jurisdictional issue, it is at least worthy of note because it gives the claim an extraordinary sweeping character.
First in the list of jurisdictional arguments advanced by the carrier is the contention that the claim is a request for a change in the agreement affecting rates of pay, rules, and working conditions. In the judgment of the Referee, the issue upon this point is not primarily jurisdictional but factual. In other words, the crux of the dispute is whether in fact the carrier has wrongfully changed the basis of commissions upon which the rates of pay in the agreement were predicated, and which under applicable rules and decisions would entitle petitioners to redress. Petitioners claim that this has been done and that they are entitled to redress. Carrier claims that petitioners are in error as to their claim and therefore entitled to no redress.
No way appears by which this Board can deal with that kind of factual issue without taking jurisdiction of a case (Cf. opinion on carrier's jurisdictional objection 4 Award 292, Docket CI-r238).
The Carrier's second objection to the Board taking jurisdiction, namely, that the claim is a request for the payment of commission to agents for handling the Carrier's shipments, appears to be merely a more specific way of stating the first objection and, 0.s such, is subject to the same line of reasoning applied to objection one.
The third ground on which jurisdiction is challenged, insofar as it assumes that the claim is a request for change in rates of pay, is subject to the same qualifications as objections one and two. Together with this assumption the objection embodies the. carrier's interpretation of presumably pertinent sections of the Amended Railway Labor Act. Parties appearing before this Board are fully within their rights in urging airy interpretations of laws and rules which they deem applicable to a particular case. But. of course, it rests with the Board to make the decision as to whether interpretations advanced by partios are or arc not sound.
Apropos of decisions by the United States Railroad Labor Board elicit by petitioners, argument in behalf of carrier was advanced that, inasmuch as giving petitioners redress claimed would involve changing rates of pay, arguments drawn from these decisions are not applicable, since that Board had jurisdiction to change rates of pay which this Board lacks. This argument, in the opinion of the referee, begs the question. since the issue in the instant case is precisely whether the claim is a request for a change in rates of pay or a. claim for redress because of misinterpretation and misapplication of an agreement.
Original argument of this case was heard by the Third Division on October 31, 7935. On November 5, 193..), the Division handed down Award 119, Docket CL-135, in Appendix A. of which Referee Samuell rendered an opinion sapporting refusal of the Division to take jurisdiction in that case. Referring to Awards iii TD-...)5, 56, and 57 and OL-Cr3, Referee Samuell used this language:
"I held in the cases above referred to that the 'Mediation Board should take over all cases referred to tile Board of Mediation which remain unsettled, white the Adjustment Board shall take over and settle those cases which arc pending and unadjusted on the date of the approval of the Act.' The word 'shall' was uscd advisedly and in the compulsory sense. To hold that this Board and the Mediation Board have concurrent jurisdiction in this case would open the door to perplexities and confusion which could not be unravelled. With all due deference to the recommendations or suggestions of the Mediation Board, I am of the firm conviction that the recommendation of withdrawal of the case from its jurisdiction was inadvisable. In order to enforce its rights the Petitioner should have insisted that the Mediation Board proceed, and in the event of advice from that Board that all practical remedies had been exhausted in an effort to adjust the difference without effecting a settlement, then, in my opinion, this Board could have assumed jurisdiction, supporting its authority on the hypothesis that the case was still pending and unadjusted. It follows, therefore, that this case or dispute should be dismissed for want of jurisdiction."
The circumstance as to withdrawal of the case from mediation was, it seems, practically identical in Award 119 and the instant case. However ,the specific circumstance upon which the language of the opinion supporting Award 119
shows it to be based is interwoven in the instant case with other factors which, in the judgment of the referee. should be considered.
Considering the jurisdictional issue in its entirety, the Referee is impressed with the fact that the Amended Railway Labor Act is an outgrowth of legislation and public policy which have been evolving for more than a generation, and it applies to relationships which have undergone a similar process of evolution. The obvious purpose of tile Act, as of its predecessor acts, is to prolnole and facilitate effective and reasonable adjustment of disputes and causes of disputes on American Railways. To that end machinery has been finally set up in which are included tile Mediation Board and the National Railroad Adjustment Board.
The Mediation Board may be utilized, under the conditions and procedures prescribed, for dealing with questions involving changes in agreements ire respect to rates of pay and working conditions. The National Railroad Adjustment Board has jurisdiction over, questions ehich involve interpretation and ap~llication of agreements. Careful study of the Act indicates that neither Board has any general power to pass on the jurisdiction of the other Board. III Award 119, by using tile word "inadvisable" instead of a stronger e-ord to characterize the action of the Mediation Board in recommending withdrawal from that Board of the case to which Award 119 pertained, Referee Snanttell avoided any jurisdictional issue between the two Boards. ht border line cases which come before this Board it is for the Board to determine whether a case is within its jurisdiction. Aside from case, pending before the Board of Mediation when the amended Railway Labor Act became effective, the Mediatiou Board is presumably free to judge whether a case brought before it is one which it should handle or late which should be referred to this Board, always with the possibility that this Board may decline jurisdiction.
The instant case, like the case to which Award 111) pertained, was before the Board of Mediation when the amended Railway Labor Act, became effective. The language of the opinion in Award 119 appears to mean that the Mediation Board should have exhausted all practical remedies before turning the case back as pending and unadjusted. In respect to the instant case. it: would be helpful to know whether 'lie 'Mediation Board turned the case back as one in which its practical remedies had been exhausted or as a. ease considered to involve au interpretation or application of all agreement.
The reasoning by which eminent legal talcut lens bell that the jurisdiction of the two Boards is exclusive unit not concurrent, and that cases before the Board of Mediation elicit the amended Raibvav Labor Act became effective should be handled to a conelusiou by the Mediation Board, appears- to real on sound logic. However, the fact rcmalus that this Board now has before it a debated question as to whether on the one hand the claim amounts to a request for a change in rules, rates of pay, and working conditions, or whether on the other hand it is a claim for redress because of misinterpretation and misapplication of are agreement. Either type of case could be handled by the old Board of Mediation, where tile instant case reposed when the nnecetded Railway Labor Act beennle effective. 'rhe new Mediation Board, on the other hand, except for clearing its calendar as the law prescribed, deals only with cases which involve changes in agreements, while this Board deals with cases which involve interpretation and application of agreements. The crucial issue in the instant case is precisely the question what kind of a case it is, and the only way to avoid stalemate and futility is for one Board or the other to handle it. As a mutter of reason and common sense, it cannot conceivably advance the purposes for which the Amended Railway Labor Act of June 21, 1934, was enacted to leave that question banging in midair.
Mindful of the fact that the issue in the instant case calls for a decision; that the National Railroad Adjustment Board has power to decide issues. that the Mediation Board has deliberately relinquished jurisdiction, flint disagreement in judicial bodies is not ant ltnusunl phenomenon, that decisions of such bodies are frequently modified by later decisions, the Referee, notwithstanding Award 119, holds that this Division should take jurisdiction and decide whether the instant case involves a claim based upon a misinterpretation and misapplication of tile agreement or a Plaint which amounts to a request for change in rates of pay and working conditions.
OPINION ON AAIERITS.-In awards 297 and 298, Dockets TIr 271 and"+ * > the practice by which railway agents are paid commissions for services performed for companies other than their principal employer, the particular railroad company, is sutticieutty general to be regarded as part and parcel of the system under which industrial relations on American railways are conducted. The recipient of commissions under such a system is in an entirely different status. both as regards his primary employer, the railway company, and as regards his secondary employer, in this ease the Railway Express Agency, Inc., from a person who has occasional or fortuitous opportunity to increase his regular wages by supplementary earnings.
"From whatever point of view regarded, the relationship between any given Railway, 'file Railway Express Agency, Inc., and the joint agent who works on that railway, is a triangle no side of which can be removed or weakened without considering wlmt the result will be to tine other two sides."
"Pile Referee finds, therefore, in this, as in any other case in which express commissions were considered in establishing the wage scale for agents on any railway, an obligation exists either to maintain the rate of commissions intact or adjust the wage scale to compensate for changes in the rate of commissions until such time as the wage rates or the commissions, or both, are changed in accordance with Section f of the Amended Railway Labor Act"
"In considering the essence of these triangular relationships, the Referee cannot fail to note the close connection between the railways of the United States and the Railway Express Agency, Inc. Although the Express agency is a separate corporation, it is owned and controlled by the carriers over whose lines express business is carried. Ambiguity concerning the status of employees who serve both the railways and the Railway Express Agency, Inc., and whose total compensation is made up of regular wages-hourly, daily, or monthly, as the case may be-paid by the railway, and of commissions paid by the Railway Express Agency, Inc., must inevitably make for confusion and discord instead of the prompt and orderly settlement of disputes which it was the purpose of tire Amended Railway Labor Act, and substantially of earlier legislation, to promote."
"* * * the railway company and the Railway Express Agency, Inc., jointly have undertaken to revise commissions in a manner which constitutes in essence denial oil tho part of both the railway and the Express Agency of contractual obligation to the agents concerned, for the maintetmnce of the rate of commissions which obtained before the revisions were made."
"* * * there is ample precedent to establish the obligation either to continue paying commissions when such camnissions were in force at the line wage schedules were adopted, or to adjust wage schedules when payment of commissions ceases. However, in response to citation of eases which have enforced this obligation, argument is advanced that no such obligation exists when merely the amount of commissions is altered. In
support of this position, it is argued that express commissions vary widely from month to month, season to season. and from year to year and that such variations greatly affect the total compensation of the railway employees involved. In further support of this view, it is pointed out that the `wage fabric' of these employees is subject to change, and when such clmnges occur either one of the parties desiring the change in wage rates nmct serve notice of this desire and call for conference.
"The Referee is of the opinion that nornuil fluctuations in commissions, due to factors other than the willful acts of either the railway or the Express Acency. mast stand in (little a different light from fluctuations occasioned by a defitdte change in the basis upon which express commissions are figured. It would appear to he a highly technical argument that abolition of commissions which is the equivalent of a reduction of 100 per cent would require a revision of the wage rates; whereas, a reduction of
ninety per cent, seventy-five per cent, fifty per cent, or any other material amount would not require such revision."
"As long as a railway company or the Railway Express Agency, Inc., is in a position to shift responsibilities back and forth, the purposes of the Amended Railway Labor Act in respect to this three-cornered relationship are bound to be impeded."
"The railways of the country and the Railway Express Agency, Inc.. are both covered by this law. There can be no doubt that Congress intended that employer-employee relationships involving express business, as well as relationships involving railway business direct, should be amicably, efficiently, and promptly adjusted under the provisions of the law."
"The salient fact is that express commissions are inextricably interwoven with the wages which the R:xilway contracts to pay agents. It must, therefore, be held especially fit view of the close property relationships between the railways and the Railway Express Agency, Inc., that the Railway by which an agent is primarily employed and the Railway Express Agency, tile., by which lie is secondarily employed, are jointly and severally obligated to maintain the wage structure of agreements, insofar as express commissions are found to be :in essential factor fu determining the wages to be paid by the railway. In the judgment of the Referee, this ruling would be sound even though the railways and the Railway Express Agency, tile., were not fn these corporate relationships as closely interwoven as they are. With them so interwoven, such a realistic approach becomes inescapable."
In Award 297, as above noted, it was held "that normal fluctuations in commissions due to factors other than the willful acts of either the railway or the Express Agency must stand in quite a different light from fluctuations occasioned by a definite change in the basis upon which express commissions are figured."
in the instant case there has been no change in the basis upon which express commissions are figured as regards the rate of those commissions, but tile reasonable conclusion to be drawn from the record as documented is that the railway and the express agency have reached a meeting of minds as to an act, the result of which must inevitably be to reduce the amount of traffic upon which commissions are paid by switching traffic from the category of express business which pays conanissions to the category of baggage which pays no commissions.
The word "wilful" as used in Award 297 carries no implication other than that the act was done on purpose in order to reduce the burden of commission payments. In the instant case, it is clear that similarly the act was done on purpose for the same object.
When a triangular arrangement is entered into by which agents accept a certain basis of compensation for work performed for n railway company in contemplation of receiving in addition commissions at a given rate on express business, he naturally assumes the risks involved fit fluctuations from seasonal, cyclical, industrial, climatic, and other natural and impersonal causes over which none of the parties to the three cornered arrangement has control. When, however, one or two of the three parties takes deliberate action the inevitable effect of lvbich must be to impair the benefits that constituted the consideration upon which the contract was based, then clearly the party whose benefits are impaired is entitled to redress.
Rule 33 supplies complete proof that express commissions constituted one of the considerations in the agreement of September 1, 1927, between this carrier and The Order of Railroad Telegraphers. By its specific terms the agreement obligates the carrier to make good, to the agents covered, loss suffered as result of commissions being discontinued. In till reason and equity the agreement by necessary implication likewise obligates the carrier to make good to agents loss resulting from actions which carrier takes or participates in, the natural and inevitable result of which must be to impair the benefits to agents (wages plus commissions) which constituted the consideration upon which the contract was based-
The fact that the above line of reasoning leads to the same conclusions reached by the United States Railroad Labor Board gives it the support of precedent. The fact that the principles laid down are in accord with the practice of many carriers fortifies those principles as embodying a realistic approach to a definite operating problem.
Pursuant to the principles herein and previously laid down, the Third Division finds that petitioners are entitled to redress for whatever loss of comcnissions is attributable to the action of the carrier and the Railway Express Agency, Ins., in shifting traffic in the commodities involved in this case from express to baggage.
Specifically the claim is that employees within the scope of the agreement "shall be paid commissions for handling like shipments by baggage." The record appears to be silent concerning the amount of the loss attributable to the joint action of the carrier and the Railway Express Agency of which complaint is made. In this connection, reference was made above to the sweeping nature of the complaint as interpreted by the carrier. Although the language of the claim may be susceptible of such interpretation, the Referee holds the claim to be one for redress for loss suffered because of misinterpretation and misapplication of the agreement. That is the redress to which petitioners are entitled under this ruling.
Neither the agreement nor the interpretation of the agreement by the United States Railroad Labor Board specifies the form which adjustment for loss of commissions shall take. Moreover, it cannot be held that either the rule or the interpretation contemplate any change in the compensation of agents who suffer loss through changes in commissions due to action of carrier other than that specified in the agreement. What the agreement specifies is that "prompt adjustment of the salary affected will be made conforming to rates paid for similar positions." Prom the practice of other carriers, as cited by petitioners, it appears that adjustments to compensate agents on account of loss suffered by shifting traffic in the commodities involved in this case from express to baggage has taken several different forms.
In these circumstances the Referee is of the opinion that the correct procedure for further handling of the instant case is indicated in the letter of March 19, 1926, quoted above, which Mr. Parker, Secretary of the United States Railroad Labor Beard, sent, by order of the Board jointly to Mr. Manion, President of The Order of Railroad Telegraphers, and Mr. Nicholson, Vice President of the Chicago and Eastern Illinois Railroad Company.
1. This claim involves an interpretation and application of Rule 33 (a) of the current agreement between the carrier and The Order of Railroad Telegraphers and is within the jurisdiction of this Board.
2. Rule 33 (a) by its language and necessary implication supported by authoritative decision and precedent entitle agents covered by the agreement and affected by the acts complained of to demand that a "prompt adjustment of the salary affected will be made conforming to rates paid for similar positions."
3. Defect in the form of the claim in that it erroneously stipulates that the employees involved "shall be paid commissions for handling like shipments by baggage," is not material and does not impair the right of the employees in question to compensation for loss suffered since June 1, 1930, and in the future on account of the action of the carrier and the Railway Express Agency, Inc., in shifting shipments of the commodities involved in the case from express to baggage, which right is hereby confirmed.
4. Rule 33 (a) does not specify the form in which "adjustment of the salary affected will be made," but merely specifies that it shall conform "to rates paid for similar positions." The form of adjustment in the first instance is a matter of negotiation, and if possible of agreement between the parties.
6. The record does not contain the information requisite to determine the extent of the loss suffered. This item is likewise in the first instance, a matter of conference between the parties with all necessary records made mutually available.
6. In order to determine the amount of adjustment retroactive to June 1, 1930, to which the employees involved are entitled, and the form it shall take, the case