No. 95-210 In the Supreme Court of the United States OCTOBER TERM, 1995 HOLLY FARMS, CORPORATION, ET AL., PETITIONERS v. NATIONAL LABOR RELATIONS BOARD, ET AL. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD IN OPPOSITION FREDERICK L. FEINSTEIN General Counsel LINDA SHER Associate General Counsel NORTON J. COME Deputy Associate General Counsel JOHN EMAD ARBAB Attorney National Labor Relations Board Washington, D.C. 20570 DREW S. DAYS, III Solicitor General Department of Justice Washington, D.C. 20530 (202)514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTIONS PRESENTED 1. Whether substantial evidence supports the Na- tional Labor Relations Board's finding that petitioner Tyson Foods, Inc., became a successor to petitioner Holly Farms Corporation on the date upon which Tyson bought all of the stock of Holly Farms, 2. Whether the Board reasonably concluded that petitioners violated Section 8(a)(5) of the National Labor Relations Act (the Act), 29 U.S.C. 158(a)(5), by refusing to bargain with the union about the terms and conditions of employment of Holly Farms' drivers, as an effect of petitioners' decision to integrate Holly Farms' transportation operation into Tyson's trans- portation system. 3. Whether the Board properly ordered petitioners to reinstate with backpay 47 Holly Farms drivers who were unlawfully discharged for declining employment under terms and conditions unilaterally imposed by petitioners. 4. Whether the Board reasonably found that peti- tioners' "live haul" employees were not "agricultural laborer[s]," which are excluded from the Act's cov- erage under Section 2(3) of the Act, 29 U.S.C. 152(3). (I) ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS Page Opinions below . . . . 1 Jurisdiction . . . . 2 Statement . . . . 2 Argument . . . . 12 Conclusion . . . . 26 Appendix . . . . 1a TABLE OF AUTHORITIES Cases: ABF Freight System, Inc. v. NLRB, 114 S. Ct. 835 (1994) . . . . 21 Bayside Enterprises, Inc. v. NLRB, 429 U. S. 298 (1977) . . . . 11, 21, 22, 23, 24, 25 Coleman v. Sanderson Fares, Inc., 629 F.2d 1077 (5th Cir. 1980) . . . . 24 Drug Package Co., 228 N.L.R.B. 108 (1977), modified, 570 F.2d 1340 (8th Cir. 1978) . . . . 20 EPE, Inc. v. NLRB, 845 F.2d 483 (4th Cir. 1988) . . . . 13 Esmark, Inc. v. NLRB, 887 F.2d 739 (7th Cir. 1989) . . . . 13, 16 Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27 (1987) . . . . 6, 13 Farmers Reservoir & Irrigation Co. v. McComb, 337 U.S. 755 (1949) . . . . 24 First National Maintenance Corp. v. NLRB, 452 U.S. 666 (1981) . . . . 8, 18 Hendricks-Miller Typographic Co., 240 N.L.R.B. 1082 (1979) . . . . 13 Imco Poultry, 202 N.L.R.B. 259 (1973) . . . . 25-26 Miami Foundry Corp. v. NLRB, 682 F.2d 587 (6th Cir. 1982 . . . . 16 NLRB v. Burns Int'l Security Services, Inc., 406 U.S. 272 (1972) . . . . 6, 12-13, 17 (III) ---------------------------------------- Page Break ---------------------------------------- IV Cases-Continued: Page NLRB v. Dent, 534 F.2d 844 (9th Cir. 1976) . . . . 17 NLRB v. Gissel Packing Co., 395 U.S. 575 (1969) . . . . 7 NLRB v. Miller Trucking Service, Inc., 445 F.2d 927 (l0th Cir. 1971) . . . . 15, 16 NLRB v. Strain Poultry Farms, Inc., 405 F.2d 1025 (5th Cir. 1969) . . . . 25 NLRB v. Victor Ryckebosch, Inc., 471 F.2d 20 (9th Cir. 1972) . . . . 25 S &F Enterprises, Inc., 312 N.L.R.B. 770 (1993) . . . . 20 Spencer Foods, Inc., 268 N.L.R.B. 1483 (1984), aff'd sub nom. United Food & Commercial Workers, Local 152 v. NLRB, 768 F.2d 1463 (D.C. Cir. 1985) . . . . 13 Tuskegee Area Transportation System. 308 N.L.R.B. 251 (1992), enforced mem., 5 F.3d 1499 (11th Cir. 1993), cert. denied, 114 S. Ct. 1834 (1994) . . . . 20 United Food & Commercial Workers, Local 152 v. NLRB, 768 F.2d 1463 (D.C. Cir. 1985) . . . . 15 Universal Camera Corp. v. NLRB, 340 U.S. 474 (1951) . . . . 18 Statutes: Fair Labor Standards Act 3(f), 29 U.S.C. 203(f) . . . . 21, 22, 23 National Labor Relations Act, 29 U.S.C. 151 et seq . . . . 12 2(3), 29 U.S.C. 152(3) . . . . 21 8(a)(1), 29 U.S.C. 158(a)(1) . . . . 2-3 8(a)(3), 29 U.S.C. 158(a)(3) . . . . 2-3 8(a)(5), 29 U.S.C. 158(a)(5) . . . . 5, 6, 8, 10 ---------------------------------------- Page Break ---------------------------------------- No. 95-210 HOLLY FARMS CORPORATION, ET AL., PETITIONERS v. NATIONAL LABOR RELATIONS BOARD, ET AL. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD IN OPPOSITION OPINIONS BELOW The opinion of the court of appeals (Pet. A1-A78) is reported at 48 F.3d 1360. The decision and order of the National Labor Relations Board (Pet. App. A79- A205) and the decision of the administrative law judge (Pet. App. A206-A935) are reported at 311 N.L.R.B. 273. The Board's decision in the representation pro- ceeding (App., infra, 1a-6a) is unreported. (1) ---------------------------------------- Page Break ---------------------------------------- 2 JURISDICTION The judgment of the court of appeals was entered on March 10, 1995. A petition for rehearing was denied on May 9, 1995. Pet. App. A936-A938. The petition for a writ of certiorari was filed on August 4, 1995. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). STATEMENT 1. a. In October 1988, petitioner Holly Farms Corp. (Holly Farms) was engaged in the production, pro- cessing, and transportation of poultry. Pet. App. A5. At that time, petitioner Tyson Foods, Inc. (Tyson), a firm engaged in similar operations offered to buy the stock of Holly Farms. Id. at A4-A5. In anticipation that its offer would be accepted, Tyson officials drafted a plan, dated January 24, 1989, to merge the two companies' transportation divisions. Id. at A600. In December 1988, an organizing campaign was begun by respondent Chauffeurs, Teamsters and Helpers Local Unions Nos. 29, 71, 355, 391, 592, 567, and 988, all affiliated with the International Brother- hood of Teamsters, AFL-CIO (the Union), among a unit of drivers and yardmen at Holly Farms' plants in North Carolina, Virginia, and Texas. Pet. App. A6, A81 n.8, A210-A211, A232. 1. In March 1989, the Union ___________________(footnotes) 1 The Union also began organizing campaigns among units of production employees and "live haul" employees at Holly Farms. "Live haul" employees were responsible for catching, caging, and transporting petitioners' chickens from the farms of independent contract growers to petitioners' processing plant in Wilkesboro, North Carolina, See Pet. App. A40-A41, A787-A788 n.268; see also n.4, infra. The National Labor Rela- tions Board found that, in connection with those campaigns, petitioners committed numerous violations of Section 8(a)(3) ---------------------------------------- Page Break ---------------------------------------- 3 was elected and certified as the collective-bargaining representative for the drivers-yardmen unit. Id. at A11, A233. In April 1989, the Union and Holly Farms began negotiating a labor agreement for that unit. Id. at A11, A597. The negotiations were suspended in July 1989, however, when Holly Farms decided to accept Tyson's bid. Id. at A598 & n.195. On July 18, 1989, Tyson acquired 100% of the stock of Holly Farms, making it a wholly owned subsidiary of Tyson. Pet. App. A11, A61, A715. In a meeting with the Union in August 1989, Tyson announced that it had taken "full control" of Holly Farms' operations and that it planned to integrate Holly Farms' western transportation division into Tyson's transportation department. Id. at A95-A96, A602-A603, A607 n.199. In September 1989, however, Tyson decided instead to integrate Holly Farms' entire transportation system, both its western and eastern divisions, into Tyson's transportation system. Id, at A617 see also id. at A96, A97 n.16, A615-A616, A773, A775-A776. Tyson announced its full-integration decision in a meeting with the Union on September 12, 1989. Pet. App. A620. At that meeting, Tyson also expressed its view that, after integration, Holly Farms' trans- portation divisions would cease to exist, and that the Union would not have majority support among the combined group of transportation employees. Id. at A98, A626. Immediately after the meeting, Tyson wrote all 209 of Holly Farms' drivers, offering to hire ___________________(footnotes) and (1) of the National Labor Relations Act, 29 U.S.C. 158(a)(3) and (1), by, inter alia, discharging employees for engaging in union activity. Pet. App. A157-A163. The court of appeals upheld those findings (id. at A8), and petitioners do not chal- lenge them here. ---------------------------------------- Page Break ---------------------------------------- 4 them, on different terms, as employees of Tyson. Forty-seven drivers failed to accept the offer by Sep- tember 22, 1989, and were thereby deemed to have quit. Id. at A12-A13, A739. Petitioners refused the Union's later written re- quests to bargain over (1) a labor agreement for the Holly Farms drivers-yardman unit; (2) the decision to integrate the Holly Farms transportation system into that of Tyson; and (3) the effects of that decision upon the Holly Farms drivers and yardmen. On September 22, 1989, petitioners withdrew recognition from the Union. Pet. App. A100-A101, A637, A638- A639, A640-A642, A643-A646, A651-A653. On October 1, 1989, the Union called a strike against petitioners on behalf of the Holly Farms drivers and yardmen. Id. at A241, A779-A780. b. In late December 1988, Union Local 391 launched an organizing campaign in a unit consisting of Holly Farms' "live haul" employees. Pet. App. A211 n.49, A233. In a representation proceeding, the Board found that two groups of "live haul" employees together constituted an appropriate bargaining unit: (1) truck drivers, fork lift operators, and chicken catchers" at petitioners' plant in Wilkesboro, North Carolina; and (2) feed haul, feed mill, and service center employees at petitioners' plant in Roaring River, North Carolina. Id. at A211-A212, A233-A235. The Board rejected Holly Farms' contention that the live haul employees were "agricultural laborer[s]," which are excluded from the Act's coverage. App., infra, 1a-6a; see also 29 U.S.C. 152(3) ("The term 'employee' * * * shall not include any individual employed as an agricultural laborer."). On July 27, 1989, the Board held an election among the live haul ---------------------------------------- Page Break ---------------------------------------- 5 unit, resulting in a tie vote with one challenged ballot. Pet. App. A235. 2. The Union filed unfair labor practice charges against Tyson and Holly Farms. The Board's Gen- eral Counsel issued consolidated complaints alleging that Tyson became Holly Farms' successor on July 18, 1989, when it acquired the stock of Holly Farms, and that Tyson thereafter violated Section 8(a)(5) of the Act, 29 U.S.C. 158(a)(5), by refusing to bargain with, and withdrawing recognition from, the Union. Pet. App. A208 n.48, A209-A210. a. After a hearing, the administrative law judge (ALJ) determined that, as of July 18, 1989, Tyson became the legal successor to Holly Farms and, as such, became obligated to bargain with the Union concerning a labor agreement for the drivers-yard- men unit. Pet. App. A716, A875. The ALJ found the requisite continuity of operations to hold that Tyson was a successor employer because, for about two months after the July 1989 acquisition, there were no significant changes in operations "from the stand- point of [the drivers-yardmen] unit employees" that would have "affect[ed] their desire for continued representation by the Unions." Id. at A716; see also id. at A713-A715. On the other hand, the ALJ rejected petitioners' contention that only a stock transfer, without any significant internal changes, took place during that period. The ALJ found, instead, that, "upon Tyson's assumption of control, key Holly Farms executives almost immediately were absorbed into the Tyson organization" and were required to act "in accordance with Tyson's dictates," including "what to tell the Unions" about the "major [proposed] ---------------------------------------- Page Break ---------------------------------------- 6 changes affecting the drivers-yardmen unit." Id. at A717-A718. The ALJ observed that, although Tyson was obli- gated to bargain with the Union as of July 18, 1989, Tyson was "free to set initial terms" for the drivers- yardmen unit. Pet. App. A719 (quoting Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 40 (1987), quoting NLRB v. Burns Int'l Security Servs., Inc., 406 U.S. 272, 294 (1972)). Because Tyson failed to change the existing terms and conditions of employment of that unit for two months, however, those terms "became * * * not subject to unilateral changes." Pet. App. A721. The ALJ rejected peti- tioners' contention that the unit ceased to exist when Tyson's full-integration decision took effect on September 22, 1989. The ALJ found that Holly Farms' transportation divisions retained separate identities after the integration. Id. at A735. Accordingly, the ALJ concluded that petitioners violated Section 8(a)(5) of the Act by, inter alia, unilaterally announcing the full-integration decision to the Union and dealing directly with the drivers- yardmen unit employees on September 12, 1989 (Pet. App. A748, A885); unilaterally changing the terms and conditions of employment of unit employees on September 22, 1989 (id. at A756-A757); and with- drawing recognition from the Union (id. at A756). In addition, the ALJ found that the 47 Holly Farms drivers who declined employment under Tyson's unilaterally imposed terms had been constructively discharged, and that the work stoppage called by the Union on October 1, 1989, was an unfair labor practice strike. Id. at A888-A889. ---------------------------------------- Page Break ---------------------------------------- 7 As a remedy, the ALJ ordered petitioners to re- cognize and bargain with the Union concerning the drivers-yardmen unit; to rescind the unilateral changes to the unit employees' terms and conditions of employment, retroactive to September 22, 1989; to make the unit employees whole for any losses sustained as a result of the unlawful unilateral changes; to reinstate and make whole the 47 con- structively discharged drivers; and, upon receipt of an unconditional offer to return to work, to reinstate to his or her former position any employee who par- ticipated in the October 1, 1989, strike. Pet. App. A914-A915, A918-A919, A921. b. The ALJ sustained the challenge to the determinative ballot cast in the July 27, 1989, election in the live haul unit; that election thus ended in a tie. Pet. App. A818-A819, A856-A857. Finding that peti- tioners' unfair labor practices precluded the holding of a fair rerun election, the ALJ ordered petitioners to recognize and bargain with the Union as the representative of the live haul employees, pursuant to NLRB v. Gissel Packing Co., 395 U.S. 575 (1969). Pet. App. A794, A817, A919. Relying on the Board's deter- mination in the representation proceeding, the ALJ rejected petitioners' contention that the live haul employees were "agricultural laborer[s]" excluded from the Act's coverage. Id. at A786-A787; see p. 4, supra. 3. In all relevant respects, the Board affirmed the ALJ's decision and adopted his remedial order. Pet. App. A79-A205. The Board found that "Tyson became a successor of Holly Farms when it purchased a controlling interest in the corporation on July 18, [1989]." Pet. App. A110-A111. The Board observed ---------------------------------------- Page Break ---------------------------------------- 8 that "Tyson's purchase of Holly Farms stock involved at the outset a broader form of reorganization than a mere stock transfer." Id. at A111. The Board also found that Tyson lost its right to set the initial terms on which it would hire Holly Farms' drivers when it failed to change the existing terms of their employ- ment for two months after it became a successor; Tyson therefore "could not unilaterally change those terms on September 12, [1989]," when it offered to hire the drivers cm different terms. Id. at A114. The Board further found that petitioners violated Section 8(a)(5) of the Act by refusing to bargain with the Union "about the September 12 offer of employ- ment to the Holly Farms unit employees as an effect of the integration decision." Pet. App. A124-A125. 2. The Board explained that "employers may be obli- gated to bargain over the effects on unit employees of management decisions that are not themselves subject to the obligation to bargain." Id. at A 121. That principle applied here, the Board found, because "the terms at which the Holly Farms drivers were offered employment were not an inevitable conse- quence of the functional integration of the transpor- tation departments, but were only one of a number of ___________________(footnotes) 2 The Board reversed the ALJ's finding that petitioners violated Section 8(a)(5) by refusing to bargain with the Union about the integration decision itself. Pet. App. A120-A121. Relying on First National Maintenance Corp. v. NLRB, 452 U.S. 666 (1981), the Board concluded that the decision to integrate was not a mandatory subject of bargaining. Pet. App, A116-A121. That ruling is not at issue in this Court. ---------------------------------------- Page Break ---------------------------------------- 9 responses to changed circumstances." Id. at A122 (internal quotation marks omitted). 3. The Board concluded that a Gissel bargaining order covering the live haul unit was appropriate. Pet. App. A156. In rejecting petitioners' challenge to the Gissel order, the Board relied on its prior determination in the representation proceeding that the live haul workers were not "agricultural laborers]" within the meaning of the Act. Id. at A83 n.8. 4. The court of appeals enforced the Board's order. Pet. App. A1-A53. The court held, first, that "substantial evidence and the policies of the labor laws support the Board's finding here that Tyson came under a duty to bargain with the Union when it purchased Holly Farms." Pet. App. A21. The court explained that "[t]he policy underlying the National Labor Relations Act is to promote industrial peace," and that "[t]he suc- cessorship doctrine * * * seeks to promote this policy by forestalling the employee frustration that could result if employees found themselves in substantially the same job, but deprived of the representation of their union." Id. at A21-A22 (citations and internal quotation marks omitted). The court observed that, for two months after purchasing Holly Farms, Tyson made no changes in operations ___________________(footnotes) 3 The Board further found that petitioners unlawfully discharged the 47 drivers who declined Tyson's September 12, 1989, job offers. Pet. App. A125. The Board rejected peti- tioners' contention that they were free to withdraw recognition from the Union because the Holly Farms drivers-yardmen unit ceased to exist after integration. Id. at A127-A131. The Board accordingly concluded that the strike called on October 1, 1989, was an unfair labor practice strike. Id. at A167. ---------------------------------------- Page Break ---------------------------------------- 10 that would have caused Holly Farms' employees to believe that their job situations had essentially altered (id. at A25); those employees therefore "could reasonably be expected to continue their support for the Union" (id. at A26). The court held, next, that substantial evidence supported the Board's finding that Tyson violated Section 8(a)(5) of the Act by unilaterally changing the terms and conditions of employment of the members of the drivers-yardmen unit in September 1989. Pet. App. A28. The court observed that, even if an em- ployer need not bargain over an " economically- motivated' management decision]," it must bargain over "effects" that "are not the inevitable con- sequence of the underlying management decision itself." Id. at A32-A34 (internal quotation marks and emphasis omitted). The court found that "it was not inevitable for the Company to impose Tyson's pay plan and working conditions upon Holly Farms' drivers" (id. at A34); instead, "there was room for bargaining," as shown by, inter alia, Tyson's efforts "to accommodate the drivers' individual preferences as to the duration and mileage of their hauls" (id. at A35). Finally, the court upheld the Board's determination that the employees in the live haul unit were not "agricultural laborers]" excluded from the Act's pro- tection under Section 2(3) of the Act. Pet. App. A52. On appeal, petitioners challenged the Board's deter- mination only with respect to the truck drivers, forklift operators, and chicken catchers at the ---------------------------------------- Page Break ---------------------------------------- 11 Wilkesboro plant. Id. at A39. 4. Relying on Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298 (1977), the court explained that, under the Act, "agriculture is defined in both a primary and a secondary sense": "[t]he primary meaning encompasses farming in all its branches, including the raising of poultry," while "the secondary meaning includes any practices, whether or not themselves farming practices, which are performed either by a farmer or on a farm, incidental] to or in conjunction with primary farming operations." Pet. App. A44-A45 (internal quotation marks omitted). The court observed that petitioners conceded that the Wilkesboro workers were not engaged in "primary" farming activities. Id. at A46. The court upheld the Board's determination that they also were not engaged in "secondary" farming activi- ties. Id. at A52. The court reasoned that the live haul workers' activities occurred after "the Company has turned the broiler chicks over to independent con- tract growers and the Company's status as a farmer engaged in raising poultry (a primary agricultural activity) has ended." Id. at A48. The court held that those activities thus were not incidental to any ___________________(footnotes) 4 The court described the duties of those employees as follows (Pet. App. A40-A41 (footnote omitted)): A crew consists of a live-haul truck driver, a forklift operator, and about nine "chicken catchers." The live-haul driver drives a flat-bed truck, which carries the entire crew to the farms of the independent contract growers who raise the broiler chickens. Under cover of darkness, the chicken catchers manually catch and cage the chickens, the forklift operator places the steel cages on the flat-bed truck, and the truck delivers the chickens to a storage area * * *. ---------------------------------------- Page Break ---------------------------------------- 12 primary farming operations on the part of petitioners. Id. at A48-A49. 5. Judge Niemeyer dissented from the holdings that Tyson became a successor employee upon the acqui- sition of Holly Farms' stock and that the live haul employer at the Wilkesboro plant were not exempt from the Act as "agricultural laborer[s]." Pet. App. A54-A55. 6. ARGUMENT 1. The first issue in this case is whether, as of July 18, 1989, the relationship between Tyson and Holly Farms was that of a "successor employer" to a "pre- decessor employer," or, rather, that of a "new stock- owner" to a "continuing employer." The Board found that, on the facts of this case, the relationship between Tyson and Holly Farms was a successorship. Pet. App. A110-A114. The court of appeals correctly held that the Board's finding was supported by substantial evidence. Id. at A13-A27. a. Under the National Labor Relations Act (NLRA or Act), 29 U.S.C. 151 et seq., a new employer is a "successor" to a predecessor employer if there is "substantial continuity" between the business enter- prise and work force of the two employers. NLRB v. Burns Int'l Security Services, Inc., 406 U.S. 272, 280- ___________________(footnotes) 5 The court of appeals rejected petitioners' other arguments concerning the entry of a Gissel order covering the live haul unit. See Pet. App. A37 n.2, A52. Petitioners do not renew those arguments in this Court. Instead, they challenge only the determination that the live haul employees covered by the Gissel order are statutory employees. See Pet. 57. 6 Judge Niemeyer did not, however, dissent from the sub- sequent denial of petitioners' petition for rehearing and sug- gestion of rehearing en banc. Pet, App. A936-A938. ---------------------------------------- Page Break ---------------------------------------- 13 281 & n.4 (1972); see also Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 43 (1987) (Burns "approved" the "substantial continuity" approach of the Board). A "successor" employer is not bound by the substantive terms of the pre- decessor's collective bargaining agreement, but it is obligated to bargain with the union representing the predecessor's workforce. Burns, 406 U.S. at 281-282. By contrast, a stock transfer "involves no break or hiatus between two legal entities, but is, rather, the continuing existence of a legal entity, albeit under new ownership." Hendricks-Miller Typographic Co., 240 N.L.R.B. 1082, 1083 n.4 (1979). A "continuing em- ployer" must continue to honor a preexisting collec- tive bargaining agreement, notwithstanding the transfer of its stock. See Esmark, Inc. v. NLRB, 887 F.2d 739, 751 & n.20 (7th Cir. 1989); EPE, Inc. v. NLRB, 845 F.2d 483,487 (4th Cir. 1988). The determination whether a given case involves a successorship or a mere stock transfer is highly factbound. Cf. Burns, 406 U.S. at 274 ("Resolution [of a successorship issue] turns to a great extent on the precise facts involved here.") As the Board has explained, the relevant inquiry is whether the record demonstrates "more than the mere substitution of one owner for another through a stock transfer within the context of an ongoing enterprise." Spencer Foods, Inc., 268 N.L.R.B. 1483, 14841485 n.5 (1984), affirmed in relevant part sub nom. United Food & Commercial Workers, Local 152 v. NLRB, 768 F.2d 1463, 1471 (D.C. Cir. 1985). For where "a stock sale * * * serve[s] as a vehicle for acquisition of resources that will be used to operate a sub- stantially different enterprise from that conducted by ---------------------------------------- Page Break ---------------------------------------- 14 the original owners, * * * the corporation might not be fairly termed a 'continuing' employer in any practical sense," EPE, 845 F.2d at 490. Applying those principles, the Board reasonably found that, as of July 18, 1989, Tyson was a successor employer to Holly Farms. The Board observed that "Tyson's purchase of Holly Farms stock involved at the outset a broader form of reorganization than a mere stock transfer." Pet. App. A111. The Board explained that, "as early as January 1989, Tyson officials began formulating tentative plans for integrating the Holly Farms and Tyson trans- portation divisions." Id. at A111-A112. In addition, the Board found that, "at the time of the July 18 stock purchase, Tyson began to implement steps that would result in its substitution as the employing entity of the unit employees." Id. at A111. The Board found, in particular, that, "upon Tyson's assumption of control, key Holly Farms executives almost immediately were absorbed into the Tyson organization, and performed their duties as part of the Tyson management team and in accordance. with Tyson's dictates." Id. at A112 (internal quotation marks omitted). The Board further found that Tyson's assumption of control affected negotiations with the Union over the labor agreement for the drivers-yardmen unit. Id. at A112- A113. 7. Those findings amply supported the Board's ___________________(footnotes) 7 The Board found: "at the time of the stock purchase, negotiations between the Union[] and Holly Farms were suspended to enable * * * Holly Farms to clarify its status and bargaining position"; "to that end, on July 14 and 15, [1989,] management representatives from Holly Farms and Tyson met to discuss the status of the collective-bargaining negotiations, and also Tyson's corporate goals, which became ---------------------------------------- Page Break ---------------------------------------- 15 conclusion that "Tyson's involvement in the operation of the Holly Farms transportation division as of the time of its acquisition warrants the application of successorship principles as of that date." Id. at A113-A114. b. Petitioners' challenge to the Board's finding of a successorship does not raise any issue warranting further review. Petitioners contend (Pet. 39-40) that "a mere stock transfer, absent some accompanying substantial change in operations affecting the employees, does not make the new stockowner a successor to the existing employer's labor obligations." That con- tention, even if correct, is inapposite here. 8. The ___________________(footnotes) the basis for the subsequent integration plans"; Holly Farms President Lovette "consulted with Tyson officials before instructing [petitioners'] attorney, Hogg, on how to present information about integration to the Union[]"; and, "when collective-bargaining negotiations resumed on August 8, [1989,] Tyson officials were present to answer questions about the operational changes that Tyson planned to implement." Pet. App. A112-A113 (internal quotation marks omitted). Indeed, as the ALJ noted, when negotiations resumed on August 8, 1989, petitioners' spokesman told the Union that Tyson "had taken full control over the Holly Farms operations" and was going to partially integrate Holly Farms' transportation operation into its own (id. at A602-A603); over the next several weeks, Tyson reconsidered that decision and decided instead to fully integrate Holly Farms' transportation operation. Id. at A617. 8 The decisions cited by petitioners (Pet. 33-40) in support of their contention do not conflict with the Board's finding of a successorship in this case. In NLRB v. Miller Trucking Ser- vice, Inc., 445 F.2d 927 (lOth Cir. 1971), cited at Pet. 34, the court found on the facts presented that no successorship had occurred, because "[t]he transfer of the corporate stock from [the seller] to [the purchaser] did not change the corporate ---------------------------------------- Page Break ---------------------------------------- 16 Board did not base its conclusion of successorship on the existence of ''a mere stock transfer." Rather, the Board relied on its determination that "Tyson's purchase of Holly Farms stock involved * * * a broader form of reorganization than a mere stock transfer." Pet- App. A111. Furthermore, the Board cited evidence that that was true both "at the outset" of Tyson's plan to acquire Holly Farms, ibid., and in the wake of the -acquisition, id. at A111-A113. See also pp. 5-6, 14, supra (summarizing evidence). Petitioners nonetheless assert (Pet. 40) that, "for 2 months following the purchase, nothing changed for the former Holly Farms employees." That assertion ___________________(footnotes) entity." 445 F.2d at 930. In Esmark, Inc. v. NLRB, 887 F.2d 739 (7th Cir. 1989), cited at Pet. 38-39, the court held that, because"[t]he successorship doctrine is limited to situations in which the predecessor and successor are unrelated entities," 887 F.2d at 750, a company could not claim that it had become a "successor to itself" merely because of a public offering of a portion of the stock of its corporate parent. Id. at 749-750. While, in that context, the court stated that "[t]he succes- sorship doctrine is simply inapplicable to a stock sale trans- action" (id. at 751), the court affirmed that, as in this case, "[w]here the parent specifically directs the actions of its subsidiary, using its ownership interest to command rather than cajole, the possibility of its violating the federal labor laws is present." Id. at 757. The other cases cited by petitioners are also consistent with the Board's successorship finding in this case. See United Food & Commercial Workers v. NLRB, 768 F.2d 1463, 1471 (D.C. Cir. 1985) (agreeing with the Board that successorship principles were applicable because "the events at issue here plainly involved a broader form of business re- organization, and not a mere stock transfer"). cited at Pet. 36- 38; Miami Foundry Corp. v. NLRB, 682 F.2d 587, 588-589 (6th Cir. 1982) (where stock purchaser "became a "single employer" with acquired firm, stock purchaser was obligated to recognize the union and honor the labor agreement), cited at Pet. 35-36. ---------------------------------------- Page Break ---------------------------------------- 17 obscures the difference between operational changes perceptible to the employees and internal changes that, though not perceptible to the employees, were nonetheless of significance for their job situation. As the ALJ found, for two months after the acquisition, "there had been no significant occurrence from the standpoint of unit employees." Pet. App. A716 (emphasis added). The court of appeals similarly observed that "the employees [c]ould understandably [have] view[ed] their job situation as essentially unaltered." Id. at A25-A26. As the court explained, the employees' perception of no essential change "establish[ed] [the] substantial continuity between Holly Farms and Tyson" upon which a finding of successorship may be premised. Id. at A25; cf. Burns, 406 U.S. at 280 n.4. But the fact that the employees would not have perceived any changes in their job situation did not mean that no significant changes actually occurred. On the contrary, both the ALJ and the Board found that such changes did occur, as Tyson asserted dominion over Holly Farms' execu- tives and made plans to integrate Holly Farms' transportation system into that of Tyson. Id. at A111-A114, A717-A719. Those changes supported the Board's conclusion that, upon acquiring Holly Farms' stock, Tyson replaced Holly Farms as the employing entity. 9. ___________________(footnotes) 9 Because the Board correctly found that Tyson became a successor. employer in July 1989, it properly determined that Tyson was not entitled unilaterally to change the terms and conditions of employment of Holly Farms' drivers in Septem- ber 1989. See NLRB v. Dent, 534 F.2d 844, 846 n.2 (9th Cir. 1976); see also Burns, 406 U.S. at 294-295. Petitioners' challenge to the latter determination (Pet. 42-43) is based ---------------------------------------- Page Break ---------------------------------------- 18 2. Petitioners-contend (Pet. 44-51) that the court of appeals erred in holding that Tyson was obligated to bargain with the Union over the terms and conditions of employment of Holly Farms' drivers upon their integration into Tyson's transportation system. Petitioners also contend that the court of appeals' holding conflicts with First National Main- tenance Corp. v. NLRB, 452 U.S. 666 (1981). Those contentions are without merit. In First National Maintenance, this Court con- sidered the bargaining obligations of an employer that decided to close part of its business. 452 US. at 667. The Court held that, when such a decision has "as its focus only the economic profitability" of the business, it is a mandatory subject of bargaining "only if the benefit, for labor-management relations and the collective-bargaining process, outweighs the burden on the conduct of the business." Id. at 677, 679. At the same time, the Court reaffirmed the well-settled rule that the employer is obligated to bargain with the union regarding "the results or effects" on ___________________(footnotes) primarily on their erroneous contention that Tyson did not become a successor until that change occurred in September 1989-a contention contradicted by the Board's factual findings. Petitioners also contend (Pet. 43) that Tyson was free to withdraw recognition from the Union in September 1989 because "[t]he Holly employees were integrated into the much larger Tyson unit and lost any separate identity." See also Pet. ii (Question 2(b)). That contention, too, reflects merely a disagreement with the Board's specific finding that "the [Holly Farms] bargaining unit did not lose its separate identity" upon integration into Tyson's transportation system. Pet. App. A127. Such factbound disputes raise no issue warranting review by this Court. Universal Camera Corp. v. NLRB, 340 U.S. 474, 490-491 (1951). ---------------------------------------- Page Break ---------------------------------------- 19 employees of such non-bargainable decisions. Id. at 677 n.15; see also id. at 681 ("the union must be given a significant opportunity to bargain about these mat- ters of job security as part of the `effects' bargaining mandated by [Section] 8(a)(5)"). Consistent with those principles, the Board reasonably concluded that, while Tyson's decision to integrate Holly Farms' transportation operation into its own was not a mandatory subject of bargaining (Pet. App. A120), petitioners were obligated to bargain about "the various ways in which the integration might affect the employment status and wages and benefits of the former Holly Farms drivers" (id. at A122). Matters such as pay, work locations, and schedules were proper subjects for "effects" bargaining with the Union, the Board explained, because they "were not an inevitable consequence of the functional integration of the transportation departments, but were only one of a number of responses to changed circumstances." Ibid. (internal quotation marks omitted); see also id. at A131 n.29. The court of appeals agreed, finding that, although Tyson's integration decision was "non-bargainable" (id. at A36), "there was room for bargaining over the drivers' working conditions, had Tyson been willing to bargain." Id. at A35. That case-specific finding does not warrant further review. 10. __________________(footnotes) 10 petitioners argue that effects bargaining cannot include "bargaining over the terms and conditions of employment that apply after an employee accepts a transfer elsewhere." Pet. 51. Petitioners do not cite any authority to support that argument. Such a restriction on the scope of effects bargaining would allow an employer unilaterally to alter employees' terms ---------------------------------------- Page Break ---------------------------------------- 20 3. Petitioners contend (Pet. 52) that the Board lacked authority to award reinstatement and backpay to the 47 Holly Farms drivers who were illegally discharged because they refused to accept Tyson's unilateral terms and conditions of employment. According to petitioners, the drivers had only two options: (1) to accept employment under the unlaw- fully imposed terms and conditions while pursuing unfair labor practice charges; or (2) to go on strike. Pet. 53-54. Contrary to petitioners' view, the drivers had a third option-to refuse to work under what they regarded as unlawful terms and conditions of employ- ment, and to file unfair labor practice charges with the Board. Choosing that option did not require them to forgo a Board remedy for the unlawful activity. See Tuskegee Area Transportation System, 308 N.L.R.B. 251, 252-253 (1992), enforced mem., 5 F.3d 1499 (11th Cir. 1993), cert. denied, 114 S. Ct. 1834 (1994). Nor was it "illogical" (Pet. 56) for the Board to order the 47 drivers to be reinstated immediately and paid backpay retroactive to the date of their discharge (Pet. App. A178-A180), while conditioning the rein- statement and backpay of the strikers upon their making an unconditional offer to return to work (id. at 184). The Board has reasonably determined that a dischargee's situation typically differs from that of an unfair labor practice striker. 11. A discharge may be reluctant to apply for reinstatement, and such an ___________________(footnotes) and conditions of employment simply by changing their job location. 11 See S&F Enterprises, Inc., .312 N.L.R.B. 770, 770 & n.4 (1993); Drug Package Co., N.L.R.B. 108, 113-114 (1977), modified on other grounds, 570 F.2d 1340 (8th Cir. 1978). ---------------------------------------- Page Break ---------------------------------------- 21 application may well be futile, since the employer has made clear (by the discharge) that the employee's ser- vices are not wanted. Unfair labor practice strikers, on the other hand, leave their jobs voluntarily. More- over, an employer may need more time to reinstate unfair labor practice strikers because of the need to discharge replacement workers. Because the Board's views as to the appropriate remedy "merit the greatest deference," ABF Freight System, Inc. v. NLRB, 114 S. Ct. 835, 839 (1994), the court of appeals correctly enforced the Board's order. 12. 4. Finally, petitioners and their amicus contend that petitioners' live haul workers are "agricultural laborers]" excluded from the Act's coverage under Section 2(3) of the Act. Pet. 57-63; National Broiler Council Amicus Br. (NBC Br.) 10-11. They also contend that the court of appeals' decision upholding the Board's contrary conclusion conflicts with deci- sions in other circuits. Pet. 60-61; NBC Br. 6-8. There is no merit to either contention. a. Section 2(3) of the NLRA defines "employee" for purposes of the Act to exclude an "agricultural laborer." 29 U.S.C. 152(3). The meaning of "agricul- tural laborer" for purposes of Section 2(3) is governed by Section 3(f) of the Fair Labor Standards Act (FLSA), 29 U.S.C. 203(f). Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298, 300 n.6 (1977) ("Annually since ___________________(footnotes) 12 Contrary to petitioners' suggestion (Pet. 56), the Board's remedy for the 47 dischargees is not inconsistent with the principle of "work now, grieve later." The dischargees could not have filed grievances over petitioners' unilateral decision to change their terms and conditions of employment, since there was no labor contract in place at the time between petitioners and the Union. ---------------------------------------- Page Break ---------------------------------------- 22 1946, Congress, in riders to the Appropriations Acts for the Board, has tied the definition of `agricultural laborer' in 2(3) of the NLRA to 3(f) of the FLSA."). Section 3(f) of the FLSA, in turn, ties the definition of "agricultural laborer" to that of "[a]griculture," which it defines to mean "farming in all its branches" and to include the raising of * * * poultry, and any practices * * * performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for market, de- livery to storage or to market or to carriers for transportation to market. In Bayside, this Court stated that the term "agriculture" in the FLSA "includes farming in both a primary and secondary sense." 429 U.S. at 300. The Court explained that "[t]he raising of poultry is primary farming, but hauling products to or from a farm is not primary farming." Id. at 300-301. Such hauling may be "secondary farming," the Court observed, "if it is work performed `by a farmer or on a farm as an incident to or in conjunction with such farming operations.'" Id. at 301 (quoting 29 U.S.C. 203(f)). Applying those principles, the Court upheld the Board's determination that truck drivers who hauled poultry feed from their employer's feed mill to the farms on which independent contract growers raised the employer's chickens were not engaged in "secondary farming" and hence were not "agricul- tural laborers." Id. at 301-304. The Court accepted the Board's view that the drivers' activities were not work performed "by a farmer," because "their em- ployer's operation of the feedmill [was] a non- agricultural activity," and the farming activities of ---------------------------------------- Page Break ---------------------------------------- 23 the independent contract growers were not attribut- able to their employer, because its status as a farmer engaged in raising poultry ended when it contracted with the independent growers for the care and feeding of the chicks. Id. at 302-303. Petitioners argue that, unlike the truck drivers in Bayside, the live haul employees in this case work "on a farm." Pet. 60-61; see also NBC Br. 11. The fact- that an employee works on a farm, however, does not necessarily make the employee an "agricultural laborer." The employee's work must also be per- formed "as an incident to or in conjunction with [the] farming operations." 29 U.S.C. 203(f). That condition is not met here. The work of the live haul employees is not performed "incident to or in conjunction with" the farming operations of the independent growers. Those operations consist in the raising of chicks into full-grown chickens. That operation ends when the chicks have reached maturity, and it is only at that point that the work of the live haul employees begins. Thus, the activities of the live haul workers are incidental, not to the operations of the independent growers, but instead to petitioners' poultry slaugh- tering operation. The latter operation is not "farming" within the meaning of Section 3(f). See Bayside, 429 U.S. at 301. 13. ___________________(footnotes) 13 For the same reason, NBC errs in suggesting (Br. 10) that the live haul truck drivers, in particular, are "agricultural laborer[s]" because their work involves "delivery to storage or to market or to carriers for transportation to market" for pur- poses of Section 3(f) of the FLSA. Such delivery constitutes "agriculture" under Section 3(f) only if it is "incident to or in conjunction with" a "farming operation]." The work of the live haul drivers is not "incident to" the farming operations of ---------------------------------------- Page Break ---------------------------------------- 24 That conclusion accords with Congress's purpose for including the phrase "on a farm" in Section 3(f) of the FLSA. As this Court has explained, Congress included that phrase to exempt from FLSA coverage the employees of specialized independent contractors. such as an employee who hauls his threshing machine "from farm to farm" and who "makes a business of doing nothing but threshing." Farmers Reservoir & Irrigation Co. v. McComb, 337 U.S. 755, 766-767 & n.16 (1949) (internal quotation marks omitted). Petitioners' live haul employees do not fall into that category, because petitioners do not make a business of providing chicken-catching and hauling services to farmers for hire. b. Contrary to petitioners' contention (Pet. 58-60; see also NBC Br. 6-8), the decision below does not conflict with Coleman v. Sanderson Farms, Inc., 629 F.2d 1077 (5th Cir. 1980), or NLRB v. Victor Ryckebosch, Inc., 471 F.2d 20 (9th Cir. 1972). Sanderson Farms was an action by live haul em- ployees to recover overtime wages under the FLSA. The Fifth Circuit held that the employees were "agricultural laborers." 629 F.2d at 1080-1081. The court acknowledged that this Court had upheld the Board's contrary conclusion with respect to the live haul employees before the Court in Bayside. Id. at 1080. In reaching a different result, the Fifth Circuit emphasized the "different procedural posture" of the two cases. Id. at 1081 n.4. The court explained that Bayside applied a "policy of judicial deference" to the Board that was "inapplicable" in the case before it. ___________________(footnotes) the independent growers; rather, it is "incident to" petitioners' poultry slaughtering operation. ---------------------------------------- Page Break ---------------------------------------- 25 Ibid. The Fifth Circuit thus recognized that, in an enforcement proceeding under the NLRA (such as Bayside and the present case), considerable deference would be due to the Board's determination of whether a group of employees were agricultural laborers, "regardless of how [the court] might have resolved the question as an initial matter." Ibid. (quoting Bayside, 429 U.S. at 304). Accordingly, Sanderson Farms does not conflict with the Fourth Circuit's decision in the present case to sustain the Board's determination that petitioners' live haul workers are not "agricultural laborers." Nor does the decision below conflict with that of the Ninth Circuit in NLRB v. Victor Ryckebosch, Inc., 471 F.2d 20(1972). The Ninth Circuit's decision in Ryckebosch did not survive this Court's decision in Bayside. See Bayside, 429 U.S. at 299 & n.4 (noting "apparent conflict" between Ryckebosch and lower court decision affirmed in Bayside). In Ryckebosch, the court relied on NLRB v. Strain Poultry Farms, Inc. 405 F. 2d 1025 (5th Cir. 1969), to hold that drivers who transported the employer's chickens from the farms of independent contract growers to processing plants were "agricultural laborers." 471 F.2d at 21. Strain Poultry, in turn, had held that an employer is engaged in the "raising of poultry" even if its chickens are raised to maturity by independent growers. 405 F.2 d at 1032-1033. That holding cannot be squared with Bayside's approval of the Board's rule that, "when an employer contracts with inde- pendent growers for the care and feeding of the employer's chicks, the employer's status as a farmer engaged in raising poultry ends with respect to those chicks." 429 U.S. at 302 n.9 (quoting Imco Poultry, ---------------------------------------- Page Break ---------------------------------------- 26 202 N.L.R.B. 259, 260 (1973)). Accordingly, there is no reason to believe that the Ninth Circuit today would decide this case any differently than the court below did. CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. FREDERICK L. FEINSTEIN General Counsel LINDA SHER Associate General Counsel NORTON J. COME Deputy Associate General Counsel JOHN EMAD ARBAB Attorney National Labor Relations Board DREW S. DAYS, III Solicitor General OCTOBER 1995 ---------------------------------------- Page Break ---------------------------------------- APPENDIX UNITED STATES OF AMERICA BEFORE THE NATIONAL LABOR RELATIONS BOARD Case No. 11-RCA-5583 HOLLY FARMS FOOD, INC. 1., EMPLOYER and CHAUFFEURS, TEAMSTERS AND HELPERS LOCAL UNION NO. 391, AFFILIATED WITH INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AFL-CIO, PETITIONER DECISION AND ORDER Upon a petition duly filed under Section 9(c) of the National Labor Relations Act, as amended, a hearing was held before a hearing officer of the National Labor Relations Board. Pursuant to the provisions of Section 3(b) of the Act, the Board has delegated its authority in this proceeding to the undersigned. Upon the entire record in this proceeding, the undersigned finds: 1. The hearing officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. ___________________(footnotes) 1 The Employer's name appears as amended at the hearing. (1a) ---------------------------------------- Page Break ---------------------------------------- 2a 2. The Employer is engaged in Commerce within the meaning of the Act and it will effectuate the purposes of the Act to assert jurisdiction herein. 3. The labor organization(s) involved claim (s) to represent certain employees of the Employer. 4. No question affecting commerce exists concerning the representation of certain employees of the Employer with in the meaning of Section 9(c)(1) and Section 2(6)(7) of the Act, for the following reasons: (See Attached) 2. ___________________(footnotes) 2 The Employer is engaged in the operation of an integrated poultry business with hatcheries located in North Carolina at Wilkesboro, North Wilkesboro, Hayes, Seaford, Suncrest, Catawha and Fairplanes. In addition, the Employer has a feed manufacturing plant in Roaring River, North Carolina, and a processing plant which produces broilers for sale to retail stores. The Petitioner, in its petition, seeks a unit comprised of all hatchery, live haul and feed haul employees, including the following classifications: driving, maintenance, blood testers, quality control, injector, primary breeders, breeders, feather sexing, and chicken catchers at the Wilkesboro, North Wilkesboro, Hays [sic], Roaring River, Sea[ford], Suncrest, and Fairplanes, North Carolina facilities; but excluding all office employees, guards and supervisors as defined in the Act. At the hearing, the Petitioner asserted that an appropriate unit would in addition to the above classification, include all feed mill employees and feed mill mechanics at the Roaring River facility, plus the employees at the Employer's Catawba, North Carolina hatchery. The Employer takes the position that all petitioned-for employees are agricultural employees specifically exclude from the definition of "employee: in Section 2 (3) of the Act. It further asserts, in the alternative, that the petitioned-for employees fall into four separate categories: (a) hatchery employees, (b)live haul employees; (c) feed haul employees; and (d) blood test employees, which share a community of interest only within their separate groups. The Petitioner and the Employer each filed briefs which have been carefully considered. ---------------------------------------- Page Break ---------------------------------------- 3a ___________________(footnotes) The record indicates that chickens used for breeding purposes, called pullets or breeder chickens, and chickens destined for retail stores, called broilers, are both grown from the same process. Hatchery employees process eggs, which have been picked up and transported from breeder farms under contract with the Employer. The eggs are first put into setters and are then transferred to incubators. When the chicks hatch, they are vaccinated, de-beaked, sexed, boxed and shipped to the breeder farms where they are grown. Once grown, the chickens are separated into the categories of pullets and broilers. Chicken catchers, as part of live haul crews (which include, one truck driver, and one fork lift operator), catch the broilers, box them and transport them to the processing plant. Pullet movers catch the pullets, vaccinate them, box and then transport them to laying houses. The breeder chickens then lay eggs which are gathered by the contract farmer and hauled by the Employer's employees to the hatchery to start the process again. Additionally, about 80 percent of the breeder chickens are purchased as baby chicks from farms and are then combined with the hatchery-produced chickens at the laying house. The record reflect[s] that there is significant interchange among employees who are based at the hatchery locations. For example, hatchery employees are sent to gather eggs and to do the work of blood test depart- ment employees. The hatchery live haul drivers regularly perform hatchery and maintenance work. Also, blood test employees help hauling eggs, and help the pullet crews to catch chickens. The record indicates that live haul employees consist of two separate and distinct groups, broiler catchers and pullet catchers. The broiler catchers work out of the processing plant while the pullet catchers and egg haulers work in the hatchery operations. There is no interchange between these classifications. Broiler haulers do not haul pullets and pullet haulers do not haul broilers. The Employer's feed mill operation at Roaring River, North Carolina consists of a feed mill, where grain is processed into feed, and a truck service center. At this location, feed mill employees process the feed and feed haul drivers trans- port it to the contract farms. Mechanics at this location service ---------------------------------------- Page Break ---------------------------------------- 4a ___________________(footnotes) the trucks used to haul the feed. The record reflects that there is no interchange between the feed mill employees and any of the employees working in the hatcheries or the pro- cessing plant. Section 2(3) of the Act excludes agricultural laborers from the classification of employees covered under the Act. Since 1946, Congress has added riders to the Board's appropriation bill providing that no part of the appropriation shall be used in connection with bargaining units composed of agricultural laborers as set forth in Section 3(f) of the Fair Labor Standards Act. Section 3(f) defines agriculture as follows: Agriculture includes farming in all its branches and includes . . . the raising of poultry, and practices, . . . performed by a farmer [or] on a farm as an incident to, or in conjunction with such farming operations . . . . The hatchery employees, on the basis of the record herein, are clearly engaged in the raising of poultry within the meaning of Section 3(f) of the Fair Labor Standards Act. See, e.g. Arkansas Valley Industries, Inc., 167 NLRB 391 (1967); Lindstrom Hatchery and Poultry Farms, 49 NLRB 776 (1943); Bayside Enterprises, Inc. vs. N.L.R.B., 429 U.S. 298, 50 L. Ed. 2d. 494, 97 S. Ct[.] 576 (1977). As to the employees who engage in the pickup and delivery operations at the hatcheries (who also perform hatchery and maintenance duties), it is clear that their work in the hatchery is likewise agricultural in nature. Moreover, although hauling, generally, would appear to be a non-farm activity, the employees making pickups and deliveries in the circumstances presented here, particularly considering the process and functional integration in the hatchery, are similarly engaged in the exempt activity of raising poultry. Therefore, I conclude that the egg haulers and pullet haulers are also agricultural workers. Arkansas Valley Industries, Inc., 167 NLRB 391 (1967). As to the live haul employees, designated as chicken catchers, who work out of the processing plant, I conclude that their position is not included either in the primary or secondary definition of "agriculture" in Section 3(f) of the FLSA. In this connection, the Board has consistently held that when an employer contracts with farmers for the care and feeding of the employer's chicks, the employer's status as a ---------------------------------------- Page Break ---------------------------------------- 5a ORDER IT IS HEREBY ORDERED that the petition filed herein be, and it hereby is dismissed. ___________________(footnotes) farmer engaged in the raising of poultry ends with respect to those chicks. Impco [sic] Poultry, Division of International Multifolds Corporation, 202 NLRB 259 (1973). Thus addressing the unit placement of the chicken catching crews, the record contains sufficient evidence of their functional integration, with other processing plant employees to warrant their inclusion with those employees, and would not otherwise warrant their inclusion in a separate unit. Feed haul drivers do nothing but deliver grain to the contract farmers. These deliveries do not constitute work incident to the farmer's farm, but are, rather, work incident to the feed mill. By the same token, the feed mill employees and the mechanics are not involved in farming. Consequently, the feed mill employees, feed haul employees and the mechanics at the Employer's Roaring River, North Carolina facility [sic] are clearly non-agricultural employees. Bayside Enterprise, Inc., vs. N.L.R.B., 429 U.S. 298, 50 L. Ed. 2nd. 494, 97 S. Ct. 576 (1977). The Petitioner, however, seeks a multi-location unit including all of the Roaring River employees along with the employees at the seven other locations of the Employer whom I have found to be agricultural employees. Further, the Petitioner, who for the first time at hearing included the feed mill employees in its petition, has not expressed a desire to represent only the Roaring River employees as a separate single location unit. Accordingly, as to the groups of individuals whom I have found to be agricultural employees, I find that no question affecting commerce exists within the meaning of 9(c)(1) of the Act, concerning the representation of "employees" as defined in Section 2(3) of the Act. Moreover, as to those classification [sic] of employees whom I have concluded to be non-agricultural, and, therefore, subject to the coverage of the Act, I conclude that either the Petitioner has not sought their inclusion in an appropriate unit or as to the Roaring River employees has not expressed its desire to represent them as a single location unit. Therefore, I shall dismiss the petition in its entirety. ---------------------------------------- Page Break ---------------------------------------- 6a RIGHT TO REQUEST REVIEW Under the provisions of Section 102.67 of the Board's Rules and Regulations, a request for review of this Decision may be filed with the National Labor Relations Board, addressed to the Executive Secre- tary, 1717 Pennsylvania Avenue, N.W., Washington, D.C. 20570. This request must be received by the Board in Washington by April 10, 1989. Dated March 27,1989 /s/ Willie L. Clark, Jr. Regional Director, Region [11] at Winston-Salem, North Carolina ---------------------------------------- Page Break ---------------------------------------- No. 95-210 In the Supreme Court of the United States OCTOBER TERM, 1995 HOLLY FARMS CORPORATION, ET AL., PETITIONERS v. NATIONAL LABOR RELATIONS BOARD, ET AL. ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD FREDERICK L. FEINSTEIN General Counsel LINDA SHER Associate General Counsel NORTON J. COME Deputy Associate General Counsel JOHN EMAD ARBAB Attorney National Labor Relations Board Washington, D.C. 20570 DREW S. DAYS, III Solicitor General LAWRENCE G. WALLACE Deputy Solicitor General RICHARD H. SEAMON Assistant to the Solicitor General Department of Justice Washington, D.C. 20530 (202)514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTION PRESENTED Petitioners' "live haul" crews-which consist of chicken catchers, forklift operators, and live haul drivers-collect broiler chickens that have been raised by independent contract growers and transport them to petitioners' processing plant. The question pre- sented is whether the National Labor Relations Board reasonably concluded that those workers are not "agricultural laborer[s]" excluded from the cov- erage of the National Labor Relations Act. (I) ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS Page Opinions below . . . . 1 Jurisdiction . . . . 1 Statement . . . . 2 Summary of argument . . . . 8 Argument . . . . 12 The Board reasonably determined that petitioners' chicken catchers, forklift operators, and live haul drivers are "employee[s]," rather than "agricultural laborer[s]," under Section 2(3) of the National Labor Relations Act . . . . 12 I. To be an "agricultural laborer," a worker must engage in either "primary" or "secondary" farming . . . . 12 II. The Board reasonably concluded that petitioners' live haul crews do not engage in secondary farming . . . . 14 A. The Board conclusion is consistent with the text of Section 3(f) of the FLSA, as con- strued by this Court . . . . 14 B. The Board's conclusion is consistent with the legislative history of Section 3(f) of the FLSA . . . . 22 C. The Board's conclusion is consistent with the Department of Labor's regulations interpret- ing Section 3(f) of the FLSA . . . . 25 III. Petitioners' "primary farming" argument should not be considered because it was not raised below; in any event, it conflicts with the text of the statute and the Department of Labor's inter- pretive regulations . . . . 31 IV. The Board's determination that petitioner's live haul employees are not "agricultural laborer[s]" is entitled to deference . . . . 34 Conclusion . . . . 36 Appendix . . . . 1a ---------------------------------------- Page Break ---------------------------------------- IV TABLE OF AUTHORITIES Cases: Page A.H. Phillips, Inc. v. Walling, 324 U.S. 490 (1945) . . . . 36 Arnold v. Ben. Kanowsky, Inc., 361 U.S. 388 (1960) . . . . 36 Astoria Fed. Savings & Loan Ass'n v. Solimino, 501 U.S. 104 (1991) . . . . 33 Bayside Enterprises, Inc. v. NLRB: 429 U.S. 298 (1977) . . . . passim 216 N.L.R.B. 502 (1975) . . . . 29 Camsco Produce Co., 297 N.L.R.B. 905 (1990) . . . . 25 Domsea Farms, Inc., 211 N.L.R.B. 832 (1974) . . . .34 Draper Valley Fare, Inc., 307 N.L.R.B. 1440 (1992) . . . . 19, 33 Farmers Reservoir & Irrigation. Co. v. McComb, 337 U.S. 755 (1949) . . . . 13, 15, 23, 24, 35 Imco Poultry, 202 N.L.R.B. 259 (1973) . . . . 5, 16 Imperial Garden Growers, 91 N.L.R.B. 1034 (1950) . . . . 25 Johnston v. Cotton Producers Ass'n, 244 F.2d 553 (5th Cir. 1957) . . . . 30 Maneja v. Waialua Agricultural Co., 349 U.S. 254 (1955) . . . . 18, 19 Mitchell v. Budd, 350 U.S. 473 (1956) . . . . 17 NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775 (1990) . . . . 35 NLRB v. Gissel Packing Co., 395 U.S. 575 (1969 ) . . . . 6-7 NLRB v. Hendricks County Rural Electric Mem- bership Corp., 454 U.S. 170 (1981) . . . . 35 NLRB v. Samuel B. Gass, 377 F.2d 438 (1st Cir. 1967) . . . . 29 NLRB v. Town & Country Electric, Inc., 116 S. Ct. 450 (1995) . . . . 12, 35 NLRB v. Transportation Management Corp., 462 U.S. 393 (1983) . . . . 35 Skidmore v. Swift & Co., 323 U.S. 134 (1944) . . . . 25 Sure-Tan, Inc. v. NLRB, 467 U.S. 883 (1984) . . . . 11, 32, 34 Taylor v. Freeland & Kronz, 503 U.S. 638 (1992 ) . . . . 32 Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645 (1982) . . . . 11, 32 ---------------------------------------- Page Break ---------------------------------------- V Statutes, regulations and rule: Page Act of Sept. 30, 1994, pub. L. No. 103-333, Tit. IV, 108 Stat. 2570 . . . . 12 Fair Labor Standards Act, 29 U.S.C. 201 et seq.: 3(f), 29 U.S.C. 203 (f) . . . . passim 13(a) (6), 29 U.S.C. 213 (a) (6) . . . . 35 National Labor Relations Act, 29 U.S.C. 151 et seq.: 2(3),29 U.S.C. 152(3) . . . . 5, 8, 11, 12, 32, 34 8(a)(1),29 U.S.C. 158(a)(1) . . . .6 8(a)(3),29 U.S.C. 158 (a) (3) . . . . 6 10(e), 29 U.S.C. 160 (e) . . . . 11, 32 29 C.F.R.: Section 780.100 . . . . 35 Section 780.109 . . . . 34 Section 780.112 . . . . 33 Section 780.118 (a) . . . . 34 Section 780.118(b) . . . . 34 Section 780.125 (b) . . . . 21, 33 Section 780.126 . . . . 19, 21, 25, 26, 30 Section 780.129 . . . . 26 Section 780.134 . . . . . . 27 Section 780.136 . . . . 28 Section 780.141 . . . . 27 Section 780.143 . . . . 27 Section 780.144 . . . . 28 Section 780.150 . . . . 29 Section 780.151 (k) . . . . 29 Sup. Ct. R. 24 (a) . . . . 31 Miscellaneous: 81 Cong. Rec. 7653 (1937) . . . . 23, 24 ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1995 No. 95-210 HOLLY FARMS CORPORATION, ET AL., PETITIONERS v. NATIONAL LABOR RELATIONS BOARD, ET AL. ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD OPINIONS BELOW The opinion of the court of appeals (Pet. App. A1- A78) is reported at 48 F.3d 1360. The decision and order of the National Labor Relations Board (Pet. App. A79-A205) and the decision of the administra- tive law judge (Pet. App. A206-A935) are reported at 311 N.L.R.B. 273. The Board's decisions in the representation proceeding (J.A. 17a-23a, 33a-45a) are unreported. JURISDICTION The judgment of the court of appeals was entered on March 10, 1995. A petition for rehearing was denied on May 9, 1995. Pet. App. A936-A938. The (1) ---------------------------------------- Page Break ---------------------------------------- 2 petition for a writ of certiorari was filed on August 4, 1995, and was granted cm November 6, 1995, lim- ited to the fifth question presented by the petition. Joint Appendix (J.A.) 46a. The jurisdiction of this Court rests on 28 U.S.C. 1254(1). STATEMENT 1. Prior to July 1989, petitioner Holly Farms Corporation was engaged in the production, process- ing, and transportation of poultry. Pet. App. A5. On July 18, 1989, petitioner Tyson Foods, Inc. (Tyson), acquired 100 of the stock of Holly Farms, making it a wholly owned subsidiary of Tyson. Id. at A4, All, A61, A715. 1. The issue before this Court concerns employees at Holly Farms' facility in Wilkesboro, North Carolina, id. at A230-232, which is a "vertically integrated poultry operation." Id. at A39. Operations at the Wilkesboro facility involve two kinds of chickens: "pullets," which are used for breeding; and broiler chickens, which are destined for human consumption. J.A. 5a, 7a, 12a, 15a. Although the employees at issue here are involved only with broiler' chickens, some understanding of the processes involving each type of chicken is necessary. Holly Farms purchases about 80% of its baby pullets from breeder companies and hatches the other ___________________(footnotes) 1 In ruling that was upheld by the court of appeals and is no longer at issue, the National Labor Relations Board found that petitioner Tyson became a successor to petitioner Holly Farms as of July 18, 1989. Pet. App. A13-A27, A110- A114. For convenience, hereafter we sometimes refer to petitioners collectively as "Holly Farms," even when discuss- ing ongoing events that both precede and follow the date of successorship. ---------------------------------------- Page Break ---------------------------------------- 3 20% in its own hatchery. J.A. 7a-8a, 20a. The baby pullets (whatever their source) are taken, when one or two days old, to the farms of independent grow- ers, who raise them to 20 weeks of. age. J.A. 9a. When the pullets are 20 weeks old, they are taken from the growers' farms to "laying houses" also owned by independent farmers. J.A. 9a. The work- ers who catch the pullets and transport them from the growers' farms to the laying houses are called "pullet movers," J.A. 9a, 20a, or "pullet haulers," e.g., J.A. 43a. The farmers who own the laying houses collect the eggs from the pullets and put the eggs into cartons. J.A. 10a. The cartons of eggs are transported by "egg haulers" from the independent laying houses to Holly Farms' hatchery facility. Ibid. At Holly Farms' hatchery, the eggs are hatched and the new chicks are vaccinated and have their beaks trimmed. J.A. 11a-12a. Some of those chicks are designated as broilers. J.A. 12a. The broiler chicks are delivered, when newly born, to the fares of independent contract growers by "chick delivery boys." J.A. 12a-13a. The independent growers raise the broiler chicks to 49 days of age. J.A. 13a. 2. It is ___________________(footnotes) 2 The contract between Holly Farms and the independent growers provided in relevant part (App., infra, 2a-3a) : B. THE GROWER AGREES: 1. To furnish the necessary housing, equipment, fuel, water, shavings or litter, electricity, labor, and other facilities or items that are necessary in the opinion of the Producer to raise the birds to marketable weight. 2. To utilize his best skill, judgment, and knowledge in caring for and rearing the birds. * * * * * 4. To be present during the catching or removal of the broilers and to raise and move, prior to the arrival of ---------------------------------------- Page Break ---------------------------------------- 4 at that point that the employees at issue here, the live haul" crew, enter the picture. J.A. 28a, 32a. Holly Farms' live haul crews are made up of about 150 workers. J.A. 32a. Each crew consists of one live haul driver, one forklift operator, and several chicken catchers. J.A. 4a-7a, 13a, 28a, 36a. The live haul driver transports the crew on a fiat-bed truck to the independent growers' farms. There, the chicken catchers manually capture the broiler chicks and place them in steel cages; the forklift operator lifts the cages onto the truck; and the driver returns with the loaded cages and the crew to the processing plant. Pet. App. A41, A230 n.54, A831; J.A. 13a- 14a. At the processing plant, the driver drives the truck onto scales and then proceeds to an unloading clock, where other employees unload the cages. Pet. App. A820 n.285, A831 & n.291. In the course of a shift, each live haul crew typically makes several trips between the processing facility and the inde- pendent growers' farms. See id. at A831-A832. 2. On February 16, 1989, Chauffeurs, Teamsters and Helpers Local- Union No. 391, a/w International Brotherhood of Teamsters, AFL-CIO (the Union) filed a representation petition with the National Labor Relations Board (Board), seeking an election in a unit consisting of Holly Farms' hatchery em- ployees; the Wilkesboro live haul employees; and the service center mechanics, feed haul employees, and feed mill employees at a Holly Farms facility in ___________________(footnotes) live haul, the equipment to insure proper care of the equipment and facilities. Although this contract was not formally moved into evidence in the Board proceeding, it was the subject of testimony before the Board and was marked as an exhibit. ---------------------------------------- Page Break ---------------------------------------- 5 Roaring River, North Carolina. J.A. 19a, 22a-23a, 37a-38a; Pet. App. A211-A212, A233. 3 Holly Farms urged the Board's Regional Director to dismiss the Union's petition on the ground that all of the em- ployees in the proposed unit were "agricultural laborer[s]" excluded from the definition of "em- ployee" under Section 2(3 ) of the National Labor Relations Act (NLRA or Act), 29 U.S.C. 152(3). J.A. 19a. The Regional Director concluded that the Wilkes- boro live haul employees are not "agricultural labor- er[s]." J.A. 22a. He explained that "the Board has consistently held that when an employer contracts with farmers for the care and feeding of the em- ployer's chicks, the employer's status as a farmer engaged in the raising of poultry ends with respect to those chicks." Ibid. (citing Imco Poultry, 202 N.L.R.B. 259 (1973)). He dismissed the Union's petition, however, concluding for other reasons that the Union had not proposed an appropriate bargain- ing unit. J.A. 23a. On review of the Regional Director's decision, the Board found that the Wilkesboro live haul employees and the employees working at the Roaring River facility constituted an appropriate bargaining unit, and the Board directed an election in that unit. J.A. 44a; Pet. App. A211-A212, A233-A235. 4. ___________________(footnotes) 3 The Roaring River facility included a feed mill operation, at which feed mill employees produced feed that was delivered by feed haul drivers to the farms of independent growers where pullets, broilers, and hens were raised. J.A. 4a, 6a-7a. 4 The Board also held that Holly Farms' hatchery employees, including the egg haulers and pullet haulers, are agricultural laborers. J.A. 21a-22a, 43a. ---------------------------------------- Page Break ---------------------------------------- 6 3. On July 27, 1989, the Board conducted an elec- tion in the unit that it had determined in the repre- sentation proceeding was appropriate. The election resulted in a 95 to 95 tie, with one determinative challenged ballot. Pet. App. A235, A818-A819. The Union filed election objections and unfair labor prac- tice charges against petitioners. Id. at A208-A209 n.48, A213-A215. The Board's General Counsel is- sued complaints against petitioners, which were later consolidated with the Union's election objections and the ballot challenge. Id. at A208 n.48. After a hearing, an administrative law judge (ALJ) sustained the challenge to the determinative ballot cast in the July 27, 1989, election; the election thus ended in a tie. Pet. App. A818-A819, A856- A857. The ALJ found that petitioners had com- mitted "many serious violations" of the NLRA that precluded the holding of a fair rerun election. Id. at A816. 5. In addition, he found that the Union had achieved majority status in the unit, which it had demonstrated by signed authorization cards. See id. at A789. Based on those findings, the ALJ ordered petitioners to recognize and bargain with the Union as the representative of the Wilkesboro live haul and Roaring River employees, pursuant to NLRB v. ___________________(footnotes) 5 The ALJ found that petitioners' officials at the Wilkesboro facility had violated Section 8(a)(1) of the NLRA, 29 U.S.C. 158(a)(1), by, among other things, threatening employees with arrest for distributing union literature on company prop- erty in non-work areas during non-work time, repeatedly interrogating employees regarding their union sympathies, and threatening employees with retaliation for wearing union insignia; and had violated Section 8(a)(3), 29 U.S.C. 158(a)(3), by, among other things, discriminatorily granting a pay increase before the election. Pet. App. A795-A796, A876, A878, A880, A883. ---------------------------------------- Page Break ---------------------------------------- 7 Gissel Packing Co., 395 U.S. 575 (1969). Pet. App. A794, A919. Relying on the Board's determination in the representation proceeding, the ALJ rejected petitioners' renewed contention that the Wilkesboro live haul employees are "agricultural laborer[s]" ex- cluded from the NLRA's coverage. Id. at A786- A787. The Board upheld the ALJ's unfair labor practice findings and his entry of a Gissel bargaining order. Pet. App. A134-A163, A182-A183. In rejecting peti- tioners' challenge to the Gissel order, the Board (with one member dissenting) relied on its prior determina- tion in the representation proceeding that the Wilkes- boro live haul employees are not "agricultural labor- er[s]." Id. at A83 n.8. 4. The court of appeals (with one judge dissent- ing in part) enforced the Board's order. Pet. App. A1-A53. As relevant here, the court upheld the Board's determination that the Wilkesboro live haul employees are not "agricultural laborer[s] ," Id. at A52. Relying on Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298 (1977), the court of appeals explained that, under the NLRA, "agriculture is defined in both a primary and a secondary sense": "[t]he primary meaning encompasses" farming in all its branches, including the raising of poultry," while "the secondary meaning includes any practices, whether or not themselves farming practices, which are performed either by a farmer or on a farm, incidental [] to or in conjunction with primary farm- ing operations." Pet. App. A44-A45 (internal quota- tion marks omitted), The court remarked that peti- tioners conceded that the Wilkesboro live haul em- ployees do not engage in "primary" farming activi- ---------------------------------------- Page Break ---------------------------------------- 8 ties. Id. at A46. The court sustained the Board's determination that they also do not engage in "sec- ondary" farming activities. Id. at A52. The court reasoned that the live haul employees' activities occur after "the Company has turned the broiler chicks over to independent contract growers and the Com- pany's status as a farmer engaged in raising poultry (a primary agricultural activity) has ended." Id. at A48. The court held that those activities thus are not incidental to any primary farming operations on the part of petitioners. Id. at A48-A49. SUMMARY OF ARGUMENT I. The National Labor Relations Act (NLRA or Act) defines the term "employee" to exclude "agri- cultural laborer [s] ." 29 U.S.C. 152(3). To be an "agricultural laborer" for purposes of the Act, a worker must engage in "[a]griculture," as that term is defined in Section 3(f) of the Fair Labor Stan- dards Act (FLSA), 29 U.S.C. 203(f). See, e.g., Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298, 300 n.6 (1977). As this Court has explained, Section 3(f) of the FLSA defines "[a]griculture" to mean farming in a "primary" and a "secondary" sense. See, e.g., Bayside, 429 U.S. at 300. Petitioners did not argue before the National Labor Relations Board (Board) or the court of ap- peals that their "live haul" crews engage in primary farming. See Pet. App. 46a. Thus, the only question that this Court should address is whether the Board reasonably concluded that the live hard crews also do not engage in secondary farming. II. The Board reasonably concluded that petition- ers' live haul crews do not engage in secondary farming. ---------------------------------------- Page Break ---------------------------------------- 9 A. The text of Section 3(f) indicates that second- ary farming must meet three requirements: (1) it must be performed either "on a farm" or "by a farmer"; (2) it must be performed "as an incident to or in conjunction with" primary farming opera- tions; and (3) those primary farming activities must be ones that are performed either by the same farmer who undertakes the putative secondary farming ac- tivity or on the same farm where the putative second- ary activities occur. 29 U.S.C. 203(f). Petitioners' live haul drivers do not meet the first requirement. They do not work "on a farm"; they merely drive to and from the farm. Moreover, nei- ther their work nor that of the other members of the live haul crews (the chicken catchers and forklift operators) is performed "by a farmer." Under the Board's Imco Poultry rule, which this Court upheld in Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298, 302 n.9 (1977), Holly Farms ceases. to act as a farmer when it turns the broiler chicks over to the independent growers. It does not resume its fore- gone "farmer" status when, 49 days later, it dis- patches the live haul crews to the independent grow- ers' farms to collect the mature chickens. At that point, Holly Farms is engaged in chicken-processing, which is not primary farming. Even if we assume arguendo that the live haul crews meet the first requirement, they nonetheless do not engage in secondary farming because they do not meet the second and third requirements. If their work is deemed to be performed "by a farmer" (i.e., Holly Farms), their work must be incidental to some primary farming activity by Holly Farms. That con- dition is not satisfied. Moreover, if it is recognized (as is the case) that the chicken catchers and fork- ---------------------------------------- Page Break ---------------------------------------- 10 lift operators work "on a farm," their work may qualify as secondary farming only if it is incidental to the independent grower's poultry-raising opera- tions. The Board reasonably concluded that the work of the chicken catchers and forklift operators is not incidental to those operations, because the live haul crews' work begins only after the independent grow- ers' work ends. The live haul crews play no role in the growers' discharge of their contractual responsi- bilities, and the growers take no part in the work of the live haul crews. Petitioners argue that the chicken catchers and forklift operators engage in secondary farming be- cause they are involved in the "preparation for mar- et" of the chickens; and that the live haul drivers are involved in the "delivery to market" of the chickens. Those arguments ignore that, under Sec- tion 3(f), the practices of preparing a product and transporting it to market constitute secondary farm- ing only if they are performed "by a farmer or on a farm as an incident to or in conjunction with" the primary farming operations of that farmer or on that farm. 29 U.S.C. 203(f). B. Although petitioners rely on the legislative his- tory of the phrase "or on a farm" in Section 3(f), it sheds no light on the question presented here. C. The Department of Labor's regulations inter- preting Section 3(f) of the FLSA support the Board's conclusion in this case. Those regulations make clear that the proper analysis focuses on whether the work of petitioners' live haul crew is performed "as an incident to or in conjunction with" the primary farming operations of the independent growers. The regulations also make clear that it is more accurate to characterize the live haul crews' work as incidental ---------------------------------------- Page Break ---------------------------------------- 11 to Holly Farms'. chicken-processing operation ( which is not primary farming) than to the growers' farm- ing operations. III. Petitioners seek to argue for the first time in their opening brief on the merits that the chicken catchers and forklift operators are engaged in pri- mary agriculture. Petitioners' failure to advance that argument before the Board precludes its con- sideration in judicial proceedings to review the Board's decision. See 29 U.S.C. 160(e); Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645, 665- 666 (1982). In any event, petitioners' primary farm- ing argument is without merit. Petitioners argue that the work of the chicken catchers and the fork- lift operators is analogous to the "harvesting" (29 U.S.C. 203(f)) of a crop. The statutory definition of "[a]griculture," by its terms, precludes the anal- ogy. The statute sets forth "the raising of * * * poultry" and other animals in a separate clause from the one that includes the term "harvesting." Ibid. That structure indicates that the term "harvesting" refers to the process of collecting crops of plants, not animals. IV. The Board's conclusion that the workers on petitioners' live haul crews are "employee [s] ," rather than "agricultural laborer[s]," under Section 2(3) of. the NLRA is entitled to "considerable deference." Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 891 (1984); see Bayside, 429 U.S. at 302. ---------------------------------------- Page Break ---------------------------------------- 12 ARGUMENT THE BOARD REASONABLY DETERMINED THAT PETITIONERS' CHICKEN CATCHERS, FORKLIFT OPERATORS, AND LIVE HAUL DRIVERS ARE "EM- PLOYEE [S]," RATHER THAN "AGRICULTURAL LABORER[S]," UNDER SECTION 2(3) OF THE NATIONAL LABOR RELATIONS ACT The rights afforded to workers by the National Labor Relations Act (NLRA or Act) extend only to a worker who falls within the Act's definition of an "employee." See NLRB v. Town & Country Electric, Inc., 116 S. Ct. 450, 453 (1995). Section 2(3) of the Act provides that "[t] he term 'employee' * * * shall not include any individual employed as an agricul- tural laborer." 29 U.S.C. 152(3). The question be- fore this Court is whether the Board reasonably concluded that the workers in petitioners' "live haul" crews are "employee[s]," rather than "agricultural laborer[s]," under Section 2(3) of the Act and are therefore within the Act's coverage. I. TO BE AN "AGRICULTURAL LABORER," A WORKER MUST ENGAGE IN EITHER "PRIMARY" OR "SECONDARY" FARMING The NLRA itself does not define the term "agri- cultural laborer" for purposes of Section 2(3) of the Act. As this Court has observed, however, "[a]n- nually since 1946, Congress, in riders to the Appro- priations Acts for the [National Labor Relations] Board, has tied the definition of `agricultural laborer' in 2(3) of the NLRA to 3(f) of the [Fair Labor Standards Act (FLSA)]." Bayside Enterprises, Inc. v. NLRB, 429 U.S. 298, 300 n.6 (1977); see Pub. L. No. 103-333, Tit. IV, 108 Stat. 2570 (1994) (un- numbered section) ( Board's current appropriations Act) . ---------------------------------------- Page Break ---------------------------------------- 13 Section 3(f) of the FLSA ties the definition of "agricultural laborer" to that of "[a]griculture," which is defined as follows (29 U.S.C. 203(f)) : "Agriculture" includes farming in all its branches and among other things includes the cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricultural or horticultural commodities (including commodities defined as agricultural commodities in section 1141 j (g) of title 12), the raising of livestock, bees, fur-bearing animals, Or poultry, and any practices (including any for- estry or lumbering operations) performed by a farmer or on a farm as an incident to or in con- junction with such farming operations, including preparation for market, delivery to storage or to market or to carriers for transportation to market. As this Court has explained, the definition of "[ag- riculture" in Section 3 (f) of the FLSA "includes farming in both a primary and a secondary sense." Bayside, 429 U.S. at 300; accord Farmers Reservoir & Irrigation Co. v. McComb, 337 U.S. 755, 762-763 (1949). Farming in its primary sense is defined in the first part of Section 3(f), as including "the culti- vation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricul- tural or horticultural commodities * * * [and] the raising of livestock, bees, fur-bearing animals, or poultry." 29 U.S.C. 203(f). "[Secondary farm- ing" (Bayside, 429 U.S. at 301) is defined in the second part of Section 3(f), as including "any prac- tices * * * performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for market, deliv- ---------------------------------------- Page Break ---------------------------------------- 14 ery to storage or to market or to carriers for trans- portation to market." Thus, "[t]he raising of poultry is primary farming, but hauling products to or from a farm is not primary farming. Such hauling may, however, be secondary farming if it is work per- formed 'by a farmer or on a farm as an incident to or in conjunction with such farming opera- tions.'" Bayside, 429 U.S. at 301. Petitioners did not argue before the Board or the court of appeals that the live haul crews engage in primary farming. Pet. App. A46. The only ques- tion properly before this Court therefore is whether the Board reasonably concluded that the live haul crews also do not engage in secondary farming. We show in Point II, infra, that the Board's conclu- sion is reasonable. We show in Point III, infra, that petitioners' "primary farming" argument, if consid- ered, should be rejected. II. THE BOARD REASONABLY" CONCLUDED THAT PETITIONERS' LIVE HAUL CREWS DO NOT ENGAGE IN SECONDARY FARMING A. The Board's Conclusion Is Consistent With the Text of Section 3(f) of the FLSA, as Construed by This court 1. To constitute secondary farming under Section 3(f) of the FLSA, an activity must meet three con- ditions. First, the activity must be performed either "by a farmer" or "on a farm." 29 U.S.C. 203(f). Second, the activity must be performed "as an inci- dent to or in conjunction with" primary farming activities. Ibid. Third, those primary farming activ- ities must be ones that are performed either by the same farmer who undertakes the putative secondary ---------------------------------------- Page Break ---------------------------------------- 15 farming activity or on the same farm where the putative secondary activities occur. See ibid. As this Court has explained, the third requirement is imposed by the use of the word "such') in Section 3(f)'s definition of "[a]griculture." Farmers Reser- voir, 337 U.S. at 766 n.15. Secondary farming by a farmer or on a farm must be incidental to "such" primary farming activities as are undertaken by that farmer or on that farm, respectively. See ibid. For example, if a farmer processed not only com- modities produced on his or her own farm but also commodities produced by other farmers, the process- ing of the other farmers' commodities would not con- stitute secondary farming. Ibid. 2. Petitioners do not contend that the live haul drivers work "on a farm," nor could they do so; the live haul drivers merely drive to and from the farms of the independent growers. 6. Petitioners do contend (Pet. Br. 33; see also Amicus Br. of American Farm Bureau et al. (AFB Br.) 11-12) that the live haul drivers' work, as well as that of the chicken catchers and the forklift operators, is done "by a farmer." In support of that contention, petitioners argue that Holly Farms acts as a farmer when it dispatches the live haul crews to the farms of the independent growers. Pet. Br. 31. That argument cannot be squared with this Court's decision in Bayside. ___________________(footnotes) 6 In contrast to petitioners, amicus National Broiler Council (NBC) does assert (NBC Br. 9) that the live haul drivers "assist the chicken catchers" on the growers' farms. The rec- cord contains testimony by one live haul driver indicating that he assisted in chicken catching on occasion, but not as part of his regular job duties. That evidence does not support the broad conclusion that the live haul drivers work "on a farm." Cf. Pet. App. A58 (Niemeyer, J., dissenting). ---------------------------------------- Page Break ---------------------------------------- 16 Bayside was an integrated poultry operation that bred and hatched chicks on its own farms but con- tracted with independent growers to raise the chicks to maturity for slaughtering at Bayside's processing plant. Bayside, 429 U.S. at 299, 301-302. The ques- tion before the Court was whether the work of the truck drivers employed by Bayside who hauled poultry feed from. Bayside's feed mill to the farms of the independent" contract growers constituted work done "by a farmer" for purposes of Section 3(f) of the FLSA. Bayside, 429 U.S. at 301-304. The Court upheld the Board's determination that the drivers' work was not performed "by a farmer." Bayside, 429 U.S. at 302-304. The Court held that the Board had reasonably "rejected the argument that all of the activity on a contract farm should be re- garded as agricultural activity of an integrated farmer such as Bayside." Id. at 302. In doing so, the Court specifically sustained the Board's Imco Poultry rule, 202 N.L.R.B. 259, 260 (1973), which provides that, "when an employer contracts with in- dependent growers for the care and feeding of the employer's chicks, the employer's status as a farmer engaged in raising poultry ends with respect to those chicks." Bayside, 429 U.S. at 302 & n.9. In a straightforward application of the Imco Poultry rule here, the Board likewise concluded that Holly Farms' status as a farmer ends when its broiler chicks are delivered to the farms of the independent growers. The work of the live haul crew with respect to those chicks does not begin until after the growers have raised the chicks to maturity. At that point, Holly Farms has ceased to act as a farmer. Thus, none of the work of the live haul crews (including ---------------------------------------- Page Break ---------------------------------------- 17 that of the chicken catchers and forklift operators) is done "by a farmer." Petitioners argue (Pet. Br. 32) that Bayside "does not control" this case because petitioners' live haul crews "actually perform the agricultural tasks of catching, caging, loading and delivering to market." That argument falls short of the mark, however. Practices such as catching chickens and delivering them to market may constitute secondary farming if performed "by a farmer." But if such work is not performed "by a farmer" (or "on a farm"), it can- not constitute secondary farming. 7. 3. Whether or not this Court accepts our sub- mission that the work of the live haul crews is not done "by a farmer," their work does not meet the second and third requirements for secondary farming. a. If the Court agrees with our submission that the work of the live haul crews is not done "by a farmer," it is unnecessary to analyze the work of one component of the crew, the live haul drivers, because it is undisputed by the parties (see p. 15 and note 6, supra) that the live haul drivers also do not work "on a farm." The Board's conclusion that ___________________(footnotes) 7 Contrary to AFB's contention (AFB Br. 10-11), Mitchell v. Budd, 350 U.S. 473 (1956), does not require a contrary conclusion. See also NBC Br. 10. The Court in Mitchell held that, when a farmer grew tobacco on its own farm and processed that tobacco (and only that tobacco) in its off-farm bulking plant, "the agriculture operation * * * end[ed] * * * with the delivery of the tobacco at the receiving platform of the bulking plant." 350 U.S. at 481. The present case poses the analytically prior question of whether Holly Farms is properly regarded as a farmer at all when the mature chickens are collected, cooped, and delivered from growers' farms to petitioners' processing plant. ---------------------------------------- Page Break ---------------------------------------- 18 those drivers are not agricultural laborers would therefore have to be upheld. We do not dispute that the chicken catchers and forklift operators work "on a farm" (29 U.S.C. 203(f)): the farms of the independent growers. It is also undisputed that the independent growers' op- erations constitute primary farming: "the raising of * * * poultry" (29 U.S.C. 203(f)). However, for the work of the chicken catchers and forklift oper- ators to constitute secondary farming by virtue of its performance on a farm, it must meet the second and third requirements: namely, it must be per- formed "as an incident to or in conjunction with" the operations of the independent growers. 29 U.S.C. 203(f) ; see pp. 14-15, supra. The Board reasonably concluded that the work of the live haul crew is not incidental to the independent growers' operations. The growers conduct their oper- ations under contracts that require them to raise peti- tioners' chicks until they are 49 days old. At that point, the chicks are mature and ready for process- ing, and the growers' operations end. It is only at that point, however, that the live haul crew's work begins. The live haul crew thus plays no role in the growers' discharge of their contractual duties. Nor do the independent growers exercise any control over the live haul crew (who at all times remain peti- tioners' employees) or otherwise take any part in its work. 8. ___________________(footnotes) 8 Petitioners err in asserting (Pet. Br. 25-26) that the Board's construction of the phrase "incident to or in conjunc- tion with such farming operations" focuses on the ultimate motivation of Holly Farms to market processed chicken at a profit and is therefore inconsistent with Maneja v. Waialua Agricultural Co., 349 U.S. 254 (1955). Holly Farms' profit ---------------------------------------- Page Break ---------------------------------------- 19 Thus, although the live haul crews' work comes on the heels of the independent growers' operations, it is more accurately characterized as the first step of petitioners' chicken-processing operation, rather than. as the last step of the independent growers' primary farming operations. See Draper Valley Farms, Inc., 307 N.L.R.B. 1440 (1992). Accordingly, the Board reasonably concluded that the live haul crews' work is incidental to petitioners' processing operation, which, as explained below, is not primary farming. See p. 21, infra; see also Bayside, 429 U.S. at 301; 29 C.F.R. 780.126. 9. ___________________(footnotes) motive is not germane to the Board's construction of the statutory phrase. Moreover, Maneja is distinguishable from the present case. The Court in that case held that railroad workers who hauled farm implements and field laborers between their employer's sugar cane fields and its mill were. agricultural laborers. Maneja, 349 U.S. at 260-263. The hauling was plainly performed "on a farm as an incident to or in conjunction with such farming operations" under Section 3(f), because the employer's mill, railroad tracks, and fields were all located on the employer's sugar plantation, and only cane grown in those fields was processed at the mill. 349 U.S. at 256-257. 9 Amicus NBC argues (Br. 13 n.5) that it was irrational for the Board to classify pullet haulers, but not chicken catchers, as agricultural laborers. The Board could reasonably distinguish between those two categories of workers, however, on the ground that the chicken catchers' work was performed in conjunction with Holly Farms' processing operation, which was not primary farming activity, see Bayside, 429 U.S. at 301, whereas the pullet haulers' work was performed in con- junction with Holly Farms' poultry-raising operation, which was primary farming activity, see 29 U.S.C. 203 (f). See J.A. 22a (concluding that egg haulers and pullet haulers are agri- cultural laborers because, "[a]lthough hauling, generally, ---------------------------------------- Page Break ---------------------------------------- 20 b. If the Court rejects our submission that the work of the live haul crew is not performed "by a farmer," that determination would reflect acceptance of petitioners' contention (Pet. Br. 31) that Holly Farms acts as a farmer when it sends the live haul crews to the independent growers' farms. Even under that theory, however, to meet the second and third requirements for secondary farming, the crews' activities would have to be performed "as an incident to or in conjunction with" some primary farming operation conducted by Holly Farms. The crews' activities are not performed inciden- tally to any primary farming operation by Holly Farms. Although the independent growers' poultry- raising operations qualify as primary farming, under this Court's decision in Bayside the independent growers' operations cannot be attributed to Holly Farms. See 429 U.S. at 300-302 (upholding Board's view that the primary farming activities of inde- pendent growers are not attributable to integrated poultry company). Moreover, the crews' work could reasonably be characterized as incidental to Holly Farms' process- ing operation. Indeed, Holly Farms' "live produc- tion" manager testified that the crews' work is the first step of the processing operation, J.A. 29a. The Court in Bayside recognized, however, that poultry- processing is not primary farming. See 429 U.S. at ___________________(footnotes) would appear to be- a non-farming activity, the employees making pickups in the circumstances presented here, par- ticularly considering the process and functional integration in the hatchery, are similarly engaged in the exempt activity of raising poultry"). ---------------------------------------- Page Break ---------------------------------------- 21 301, The Department of Labor has similarly recog- nized that "[t] he activities of the * * * [poultry] processor are not `raising of poultry.' " 29 C.F.R. 780.126; see also 29 C.F.R. 780.125(b) ("Slaughter- ing, which is the antithesis of `raising,' is not in- cluded" in the "'raising of poultry.'"). Holly Farms does engage in primary farming operations when its employees hatch the eggs of the broiler chicks that are delivered to the independent growers' farms. See J.A. 10a-12a, 21a. But those operations end on the day that the chicks are hatched. J.A. 12a. The live haul crews' work does not begin until 49 days later, after the chicks have been raised to maturity by the independent growers. J.A. 13a. The work of the crew is too remote from the hatchery operations to be incidental to those primary farming operations. Hence, even if, contrary to our submission, the Court determines that Holy Farms was acting as a farmer when it sent the live haul crews to the inde- pendent growers' farms, the crews' work is not sec- ondary farming because it is not performed inciden- tally to any primary farming operation by Holly Farms. 4. Petitioners argue (Pet. Br. 19, 23) that the chicken catchers and forklift operators engage in secondary farming because they are involved in the "preparation for market" of petitioners' chickens; and (id. at 30) that the live haul drivers engage in secondary farming because they are involved in the "delivery * * * to market" of the chickens. See also NBC Br. 11-12; Amicus Br. of California Agricul- tural Labor Relations Board (CALRB Br.) 18. Those arguments ignore the text of Section 3(f) of ---------------------------------------- Page Break ---------------------------------------- 22 the FLSA. section 3(f) lists "preparation for mar- ket" and "delivery * * * to market" among the specific "practices" that constitute "[a]griculture" only if performed "by a farmer or on a farm as an incident to or in conjunction with" the primary farming operations conducted by the farmer or on the farm. 29 U.S.C. 203(f). As explained above, the live haul crew's work falls outside Section 3(f) because it is not performed incidentally either to any primary farming operation by Holly Farms, or to the independent growers' operations. 10. B. The Board's Conclusion Is Consistent With the Legislative History of section 3(f) of the FLSA Although petitioners rely heavily (Pet. Br. 15-19) on the legislative history of Section 3(f) of the FLSA, it does not support them. The legislative his- tory cited by petitioners explains the origin of the phrase "or on a farm" in Section 3(f). It does not cast doubt on the Board's conclusion, based on a dif- ferent portion of Section 3(f), that petitioners' live haul crews do not engage in secondary farming be- cause their work is not performed "as an incident to ___________________(footnotes) 10 Amicus NBC argues (Br. 12) that "catching chickens on a farm and delivering them for processing is unquestionably `incident to or in conjunction with' the raising of poultry, just as harvesting wheat * * * is incidental to the raising of that commodity." It is not enough, however, to be able to say in the abstract that a practice is "incident to" a primary farming activity. Rather, the practice must be "incident to" the primary farming operation of the farm on which the practice occurs, or, if performed by a farmer, "incident to" that farmer's primary farming operations. See pp. 14-15, supra, Neither condition is met in this case. ---------------------------------------- Page Break ---------------------------------------- 23 or in conjunction with" the independent growers' operations. In the bill originally introduced in the Senate, "[agriculture" was defined to include "any practices ordinarily performed by a farmer as an incident to such farming operations." 81 Cong. Rec. 7653 (1937). As this Court explained in Farmers Reser- voir, the phrase "or on a farm" was inserted after the phrase "by a farmer" by an amendment on the Senate floor (337 U.S. at 767 (footnotes omitted)): As originally introduced, the exemption covered such practices only if performed by a farmer. On the floor of the Senate it was objected that this would exclude the threshing of wheat, or other functions necessary to the farmer if those functions were not performed by the farmer and his hands, but by separate companies or- ganized for and devoted solely to that particular job. To take care of that situation the words "or on a farm" were added to the definition. Thus, the wheat threshing companies, even though they were separate enterprises, were in- cluded in the exemption because their work was incidental to farming and was done on the farm. The Court in Farmers Reservoir made particular reference to the objection of Senator Tydings, who stated : In the case I visualize . . . the farmer is not performing the service. The man to whom I refer makes a business of doing nothing but threshing. He owns his own machine, and hauls it from farm to farm, and enters into contracts with farmers to thresh their crops; the point being that while he is dealing with an agricul- ---------------------------------------- Page Break ---------------------------------------- 24 tural commodity, he is not necessarily a farmer, and he is not doing work ordinarily done by a farmer. Id. at 767 n.16 (quoting 81 Cong. Rec. 7653 (1937)). As petitioners observe (Pet. Br. 14-15), the legis- lative history clearly shows that "Congress intended that the definition of an agricultural laborer would include nonfarmers so long as their work involved primary farming activities or. occurred on a farm and was incidental to the farming operations of the farm." While that history illuminates the purpose of the "or on a farm" phrase, it does not directly ad- dress the portion of Section 3(f) that is of central concern here: the phrase "as an incident to or in conjunction with such operations." 29 U.S.C. 203(f). The threshing-machine operation described in the legislative history, which was considered by at least some legislators to constitute secondary farming, dif- fers significantly from the work of petitioners' live haul crews. First, the live haul crew is not part of an enterprise that is in the "business of doing noth- ing but" providing chicken catching and transporta- tion services. Rather, the activities of the live haul crew are merely the first part of petitioners? chicken- processing operation, which itself is only part of petitioners' vertically integrated poultry operation. Second, the chickens collected and transported by the live haul crew belong to petitioners, not the inde- pendent growers. See J.A. 5a, 6a, 29a; Pet. Br. 31. While Congress may have intended by adding the phrase "or on a farm" to reach the employees of an independent contractor hired by a farmer to perform a service for the farmer, such as threshing the farmer's wheat, the legislative history does not ---------------------------------------- Page Break ---------------------------------------- 25 demonstrate that Congress intended to sweep within the agricultural exemption workers who (as here) enter onto a farm to perform a service, not for the farmer upon the farmer's commodities, but for an industrial firm upon the industrial firm's commodi- ties. The Board could therefore reasonably conclude that such workers' activities are not performed "as an incident to or in conjunction with" the primary farming operations of those farms. 29 U.S.C. 203 (f). Instead, such workers are properly regarded as in- dustrial workers entitled to the NLRA's protection, rather than agricultural laborers. C. The Board's Conclusion Is Consistent With the Department of Labor's Regulations Interpreting Section 3(f) of the FLSA The Board's conclusion accords with the Depart- ment of Labor's interpretive regulations, which the Board seeks to follow "whenever possible," Camsco Produce Co., 297 N.L.R.B. 905, 908 & n.14 (1990) (quoting Imperial Garden Growers, 91 N.L.R.B. 1034, 1037 (1950)), and which "constitute a body of experience and informed judgment to which courts and litigants may properly resort for guidance." Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). The Department of Labor regulation addressing the present situation, entitled "Contract arrange- ments for raising poultry," states as follows (29 C.F.R. 780.126): Feed dealers and processors sometimes enter into contractual arrangements. with farmers un- der which the latter agree to raise to marketable size baby chicks supplied by the former who also undertake to furnish all the required feed and possibly additional items. Typically, the feed ---------------------------------------- Page Break ---------------------------------------- 26 dealer or processor retains title to the chickens until they are sold. Under such an arrangement, the activities of the farmers and their employees in raising the poultry are clearly within section 3(f) [of the FLSA]. The activities of the feed dealer or processor, on the other hand, are not "raising of poultry" and employees engaged in them cannot be considered agricultural employees on that ground. Employees of the feed dealer or processor who perform work on a farm as an incident to or in conjunction with the raising of poultry on the farm are employed in "secondary" agriculture (see 780.137 et seq. and Johnston v. Cotton Producers Assn., 244 F. 2d 553). Under this regulation, as under the Board's decision, the status of petitioners' live haul crews depends upon whether they engage in secondary farming, which in turn depends upon whether they "perform work on a farm as an incident to or in conjunction with the raising of poultry on the farm." 29 C.F.R. 780.126. Other Department of Labor regulations confirm the Board's conclusion that the live haul crews do not engage in secondary farming because their work is not performed "as an incident to or in conjunction with" the independent growers' poultry- raising operations. In keeping with the text of Section 3(f) (see pp. 14-15, supra), the regulations provide that second- ary farming must meet three requirements (29 C.F.R. 780.129) (bracketed numerals added): To come within this secondary meaning, [1] a practice must be performed either by a farmer or on a farm. [2] It must also be performed either in connection with the farmer's own farm- ing operations or in connection with farming ---------------------------------------- Page Break ---------------------------------------- 27 operations conducted on the farm where the practice is performed. [3] In addition, the prac- tice must be performed "as an incident to or in conjunction with" the farming operations. The first and third requirements are readily evident on the face of Section 3(f). As the regulations ex- plain, the second ("in connection with") requirement is derived from Section 3(f)'s use of the word "such." See 29 C.F.R. 780.141; see also pp. 14-15, supra. As discussed above, petitioners' live haul drivers do not meet the first requirement; they do not work "on a farm," and their work is not done "by a farmer." See pp. 17-18, supra; see also 29 C.F.R. 780.134 ("Any practice which cannot be performed on a farm, such as `delivery to market,' is necessarily excluded [from secondary agriculture] * * * when performed by someone other than a farmer." (cita- tions omitted)). In any event, none of the workers on the live haul crews meets the second ("in connec- tin with") and third ("incident to") requirements prescribed in the Department of Labor's regulations. With regard to the "in connection with" require- met, the regulations state (29 C.F.R. 780.143) : The fact that a practice performed on a farm is not performed by or for the farmer is a strong indication that it is not performed in connection with the farming operations there conducted. The regulations add that, in determining whether a practice is performed "for" a farmer, it is "highly significant" whether the practice involves property to which the farmer has title or for which the farmer otherwise has responsibility. Ibid. As discussed ---------------------------------------- Page Break ---------------------------------------- 28 above, the live haul crews' work involves property that belongs to petitioners, not the independent grow- ers. 11. Moreover, Holly Farms has not been retained by the independent growers to render the independ- ent growers any service; rather, the growers have been hired by Holly Farms to perform a service for Holly Farms: raising the chicks to maturity. The live haul crews' work begins only after the independ- ent growers' responsibilities have ended. See pp. 18-19, supra. That work is therefore not performed "in connection with" the independent growers' opera- tions. With regard to the "incident to" requirement, the regulations state in relevant part (29 C.F.R. 780.144) : The line between practices that are and those that are not performed "as an incident to or in conjunction with" such farming operations is not susceptible of precise definition. Generally, a practice performed in connection with farming operations is within the statutory language only if it constitutes an established part of agricul- ture, is subordinate to the farming operations ___________________(footnotes) 11 If, in contrast to the facts of this case, the chicken catchers and forklift operators of an independent contractor were hired by a grower to cage and load chickens both raised and owned by the grower, the work of the chicken catchers and forklift operators might be characterized as being performed "for" the grower, and therefore to occur "in connection with" the grower's poultry-raising operations. Cf. 29 C.F.R. 780.136 (whether employees of independent contractors who work on a farm are engaged in secondary agriculture "depends, of course, on whether the practices are performed as an incident to or in conjunction with the farming operations on the particular farm"). ---------------------------------------- Page Break ---------------------------------------- 29 involved, and does not amount to an independent business. The work of the live haul crew is in no sense sub- ordinate to the independent growers' operations. As explained above, the live haul crew plays no role in the independent growers' discharge of their con- tractual responsibilities, nor is the live haul crew under the direction of the independent growers. 12. Accordingly, even if the live haul crew's work were deemed to occur "in connection with" the independent growers' operations, it would not constitute secondary farming under the Department of Labor's regulations because it is not incidental to those operations. Petitioners err in relying (Pet. Br. 23) upon a regulation that defines "preparation for market" to include "[c]ulling, grading, cooping, and loading" of poultry. 29 C.F.R. 780.151(k). Another regulation "emphasize[s] that `preparation for market,' like other practices, must be performed `by a farmer or on a farm as an incident to or in conjunction with such farming operations' in order to be within sec- tion 3(f)." 29 C.F.R. 780.150. The latter regulation makes clear that, to constitute secondary farming, it is not enough that an activity prepares a product for market; the activity must, in addition, occur "as an ___________________(footnotes) 12 Cf. Bayside Enterprises, Inc., 216 N.L.R.B. 502, 505 (1975) (work of truck drivers employed by integrated poultry producer, who delivered and unloaded poultry feed on farms of independent growers, was incidental to the operation of the employer's feed mill rather than the growers' farms), aff'd, 429 U.S. 298 (1977); NLRB v. Samuel B. Gass, 377 F.2d 438, 443-444 (1st Cir. 1967) (same; court notes that "[i]t is sig- nificant that these drivers are not employed or paid by the farms nor are they under the control of the farmers"). ---------------------------------------- Page Break ---------------------------------------- 30 incident to" and "in connection with" primary farm- ing operations. Petitioners also err in relying (Pet. Br. 27-28) on the decision cited in 29 C.F.R. 780.126, Johnston v. Cotton Producers Ass'n, 244 F.2d 553 (5th Cir. 1957). See also NBC Br. 21; CALRB Br. 13. Johnston was employed by a retail store that sold baby chicks, feed, and other supplies to farmers. Johnston, 244 F.2d at 554. The court held that he was exempt from the FLSA as an agricultural laborer because "[s]ubstantially all of [his] work was done as a part of or in connection with the preparation for market * * * of poultry raised on farms." Id. at 555. Unlike Holly Farms' live haul crews, which play no role in the independent growers' poultry-raising operations, Johnston not only caught, cooped, and loaded the chickens onto trucks but also "supervise[d] the growing of the chicks by growers on their farms." Id. at 554. Moreover, unlike Holly Farms, the retail store that employed Johnston had no use for the mature chicks; it retained title to the chicks simply as security for the purchase price of the chicks and other material sold to the farmers. Ibid. The mature birds in Johnston, once cooped and caught, were delivered to third-party processors, not to the retail store. See ibid. Under those circum- stances, it was reasonable to conclude that the em- ployee's activities were performed "as an incident to or in conjunction with" the growers' operations. That conclusion does not conflict with the Board's contrary conclusion in the quite different circum- stances of this case. ---------------------------------------- Page Break ---------------------------------------- 31 III. PETITIONERS' "PRIMARY FARMING" ARGU- MENT SHOULD NOT BE CONSIDERED BECAUSE IT WAS NOT RAISED BELOW; IN ANY EVENT, IT CONFLICTS WITH THE TEXT OF THE STATUTE AND THE DEPARTMENT OF LABOR'S INTER- PRETIVE REGULATIONS Petitioners and some of their amici argue that the chicken catchers and forklift operators (but not the live haul drivers) engage in primary farming by "harvesting" an "agricultural commodity." Pet. Br. 29-30; AFB Br. 8-9; NBC Br. 9, 17. This Court should decline to consider petitioners' "primary farming" argument. If the argument is considered, it should be rejected. A. Petitioners did not advance a primary farm- ing argument before the Board or the court of ap- peals, and neither the Board nor the court addressed it. 13. Petitioners also did not raise the primary farm- ing argument in their petition for a writ of cer- tiorari; it appears for the first time in their opening brief cm the merits. Cf. Sup. Ct. R. 24(a) (brief on the merits "may not raise additional questions or change the substance of the questions already pre- ___________________(footnotes) 13 Although petitioners did not expressly "concede" the Pri- mary farming issue, as the court of appeals believed (Pet. App. A46), they did not raise that issue at all. Instead, they made only a secondary farming argument. See Pet. C.A. Opening Br. 12 ("[T]he activities of catching, caging, and loading live chickens onto a truck for delivery are clearly incidental to or in conjunction with the primary farming practice of raising poultry on those farms,"); Pet. C.A. Reply Br. 18 ("The thrust of Petitioners' position with regard to the chicken catchers and forklift operators is that they per- form work on a farm that is incidental to the farming activi- ties performed by the owner of the farm.") (emphasis omitted). ---------------------------------------- Page Break ---------------------------------------- 32 sented"). 14. The question whether chicken catchers and forklift operators engage in primary farming is analytically distinct from the question whether they engage in secondary farming. See pp. 12-14, supra. Each of those questions, moreover, is one that the Board should have an opportunity to consider in the first instance. See, e.g., Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 891 (1984) ("the task of defining the term. `employee' is one that has been assigned pri- marily to the agency created by Congress to admin- ister the Act") (internal quotation marks omitted). Under those circumstances, this Court should decline to consider petitioners' primary farming argument. See, e.g., Taylor v. Freeland & Kronz, 503 U.S. 638, 645-646 (1992). Indeed, petitioners' failure to ad- vance their primary farming argument before the Board creates a statutory bar to its consideration in judicial proceedings reviewing the Board's order. See 29 U.S.C. 160 (e) ("No objection that has not been urged before the Board * * * shall be considered by the [reviewing] court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances."); Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645, 665-666 (1982) (holding that under 29 U.S.C. 160(e) the court of appeals "was without jurisdiction to con- sider" an issue "not raised during the proceedings before the Board"). ___________________(footnotes) 14 Petitioners framed the question presented in a manner that could be read to encompass a "primary farming" argu- ment. See Pet. iv ("Are chicken catchers, forklift drivers, and live-haul drivers of a vertically integrated poultry pro- ducer considered agricultural employees under Section 2(3 ) of the National Labor Relations Act ('NLRA' or `Act'), 29 U.S.C. 152(3) (1973) ?") (question 5). In the body of their petition, however, petitioners asserted only a secondary farm- ing argument. See Pet. 60-61. ---------------------------------------- Page Break ---------------------------------------- 33 B. In any event, petitioners' contention that the chicken catchers and forklift operators are engaged in "harvesting" poultry conflicts with the text of Section 3(f) of the FLSA and the Department of Labor regulations interpreting the statute. Section 3(f) differentiates "the production, culti- vation, growing, and harvesting of any agricultural or horticultural commodities" from "the raising of livestock, bees, fur-bearing animals, or poultry." 29 U.S.C. 203(f). If the practices of "cultivation, grow- ing, and harvesting" applied to poultry, then the statutory phrase "the raising of * * * poultry" would be superfluous. That result should be avoided. See, e.g., Astoria Fed. Savings & Loan Ass'n v. Solimino, 501 U.S. 104, 112 (1991). To avoid it, Section 3(f) must be construed to make only the "raising" (and not the "harvesting" ) of poultry a primary farming activity. The chicken catchers and forklift operators do not "raise" the poultry that they catch and load onto trucks. The poultry has already been "raised" by the independent growers. Under the explicit wording of the statute, therefore, the chicken catchers and forklift operators are not engaged in primary agri- culture. See Draper Valley Farms, Inc., 307 N.L.R.B. 1440 (1992) ; accord 29 C.F.R. 780.125(b) ("The `raising' of poultry includes the breeding, hatching, propagating, feeding, and general care of poultry."). Petitioners' contrary argument (Pet. Br. 29-30) rests on a misreading of the Department of Labor's interpretive regulations. The regulations define the term "agricultural commodities" to include "domesti- cated animals and some of their products," 29 C.F.R. 780.112. The regulations also state that "'[h]arvest- ing' does not extend to operations subsequent to and unconnected with the actual process whereby agricul- ---------------------------------------- Page Break ---------------------------------------- 34 tural commodities * * * are severed from their attachment to the soil or otherwise reduced to posses- sion." 29 C.F.R. 780.118(b). Reversing that nega- tive formulation, petitioners argue that harvesting must include all operations in which "agricultural commodities," including "domesticated animals" such as poultry, are "reduced to possession." Pet. Br. 29. Although petitioners' argument is plausible in isolation, it fails to take into account the positive definition of "harvesting" in the regulations (29 C.F.R. 780.118(a)): The term "Harvesting" as used in section 3 (f) [of the FLSA] includes all operations customar- ily performed in connection with the removal of the crops by the farmer from their growing position. The regulation goes on to confirm that "harvesting" is an activity performed upon non-animal agricul- tural commodities, such as "the cutting of grain, the picking of fruit, the stripping of bluegrass seed, and the digging up of shrubs and trees grown in a nursery." Ibid. While the "harvesting" of some non- crop agricultural commodities, such as fish, may con- stitute "farming" (see Domsea Farms, Inc., 211 N.L.R.B. 832 (1974); 29 C.F.R. 780.109)), "farm- ing," as applied to poultry, is limited by statute to the "raising of * poultry." 29 U.S.C. 203(f). IV. THE BOARD'S DETERMINATION THAT PETI- TIONERS' LIVE HAUL EMPLOYEES ARE NOT "AGRICULTURAL LABORER[S]" IS ENTITLED TO DEFERENCE This Court has repeatedly recognized that the Board's interpretation of the term "employee" in Section 2(3) of the NLRA "is entitled to considerable deference." Sure-Tan, 467 U.S. at 891; see also, ---------------------------------------- Page Break ---------------------------------------- 35 e.g., Town & Country Electric, Inc., 116 S. Ct. at 453; NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775, 786-787 (1990). In addition, the Court has stated that the Board's construction of the exemption for agricultural laborers in Section 3(f ) of the FLSA "is one we must respect even if the issue might `with nearly equal reason be resolved one way rather than another.'" Bayside, 429 U.S. at 302 (quoting Farm- ers Reservoir, 337 U.S. at 770 (Frankfurter, J., con- curring)). 15. Where, as in this case, the Board's conclusion that particular employees are not "agricul- tural laborer[s]" reflects a reasonable interpretation of the text of Section 3(f) and is consistent with the legislative history of that provision, the Board's prior decisions, and the Department of Labor's construction of the statute, "the appropriate weight which must be given to the judgment of the agency whose special duty is to apply this broad statutory language to varying fact patterns requires enforcement of the Board's order." Bayside, 429 U.S. at 303-304; see also NLRB v. Transportation Management Corp., 462 U.S. 393, 401-402 (1983); NLRB v. Hendricks County Rural Electric Membership Corp., 454 U.S. 170, 189-190 (1981). Moreover, because Section 3(f) defines an area partially exempted from the regulatory framework established by the FLSA, 16 it must be "narrowly con- ___________________(footnotes) 15 This Court's decision in Bayside forecloses petitioners' argument (Pet. Br. 11-12) that the Board's interpretation of Section 3(f) is not entitled to deference. See also NBC Br. 20; AFB Br. 19. 16 See, e.g., FLSA Section 13(a)(6), 29 U.S.C. 213(a) (6) (partial exemption from minimum wage and overtime pay provisions for certain employees employed in "agriculture" as defined by Section 3(f)); see generally 29 C.F.R. 780.100. ---------------------------------------- Page Break ---------------------------------------- 36 strued against the employers seeking to assert [it]" and its application must be limited to those falling "plainly and unmistakably within [its] terms and spirit." Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960); accord A. H. Phillips, Inc. v. Walling, 324 U.S. 490, 493 (1945). It cannot be said that Holly Farms' chicken catchers, forklift operators, and live haul drivers fall "plainly and unmistakably" within the Section 3 (f)'s agricultural exemption. The Board's determination that these employees are NLRA "employees" is therefore entitled to affirmance. CONCLUSION The judgment of the court of appeals should be affirmed. Respectfully submitted. FREDERICK L. FEINSTEIN General Counsel LINDA SHER Associate General Counsel NORTON J. COME Deputy Associate General Counsel JOHN EMAD ARBAB Attorney National Labor Relations Board DREW S. DAYS, III Solicitor General LAWRENCE G. WALLACE Deputy Solicitor General RICHARD H. SEAMON Assistant to the Solicitor General JANUARY 1996 ---------------------------------------- Page Break ---------------------------------------- APPENDIX WILKESBORO DIVISION Effective 2/4/85 AGREEMENT THIS AGREEMENT made this the-day of -19-, by and between Holly Farms Poultry Industries, Inc., a North Carolina corpora- tion, hereinafter referred to as the "Producer," and -, hereinafter- referred to as the "Grower." WITNESSETH: THAT WHEREAS, Holly Farms Poultry Indus- tries, Inc. is engaged in the production of poultry on an integrated basis, being responsible for the rear- ing of chickens from the breeder hens to the process- ing of the poultry into dressed product; and WHEREAS, the Grower has represented himself as an experienced and knowledgeable person in the field of rearing poultry, possessing skill and knowl- edge to supervise and direct the efficient rearing of broilers; and WHEREAS, the Producer desires to utilize the pro- fessed skill, judgment, discretion and knowledge of the Grower on a contractual basis for the production of broilers for use in its processing plants; and WHEREAS, the compensation of the Grower is predicated upon the skill, knowledge and discretion which he agrees to utilize and purports to possess in (1a) ---------------------------------------- Page Break ---------------------------------------- 2a the production of the chickens under his control and supervision; and WHEREAS, the Grower warrants that he is the owner of or in the possession of a farm together with improvements located thereon, sufficient and adequate for use in rearing chickens or broilers. NOW, THEREFORE, in consideration of these premises and the mutual agreements herein set out, the parties do hereunto agree as follows: A. THE PRODUCER AGREES: 1. To furnish and deliver baby chicks to the Grower's farm to be grown out as broilers subject to the termination right of either party as set forth hereinafter. 2. To furnish and deliver all feed and medication which the Producer, with the advice of the Grower, determines to be adequate and sufficient to rear the broilers to marketable weight. 3. To pay Grower in accordance with the formula or method hereinafter set out in this agreement on the following time schedule: a. The Grower will notify the Producer when the unused feed may be picked up. b. The Grower's settlement will be made within a period of fourteen (14) working days from the day the unused feed is picked up. B. THE GROWER AGREES: 1. To furnish the necessary housing, equipment, fuel, water, shavings or litter, electricity, labor, and other facilities or items that are necessary in the ---------------------------------------- Page Break ---------------------------------------- 3a opinion of the Producer to raise the birds to market- able weight. 2. To utilize his best skill, judgment, and knowl- edge in caring for and rearing the birds, The Grower further agrees that no feed, chicks, or medication furnished by the Producer will be used for any pur- pose other than the rearing of birds under this agree- ment, and that in the event feed or other supplies remain in the feeders after the rearing of one frock, this feed or supplies will be utilized in the rearing of the next flock or returned to the Producer. 3. To permit at any time inspection of birds and growing facilities by the Producer or its agents. 4. To be present during the catching or removal of the broilers and to raise and move, prior to the arrival of live haul, the equipment to insure proper care of the equipment and facilities. 5. To exercise the necessary supervision and plan- ning in order to provide properly maintained roads or passageways to poultry houses and around poultry houses. 6. To warrant that the Grower is the owner of the land, buildings, and equipment utilized in the rearing of the chickens or that the Grower is in the legal possession of the property and has the right and authority to utilize the same for this purpose. C. THE PRODUCER AND THE GROWER JOINTLY AGREE: 1. That the delivery date and the number of baby chicks to be placed with the Grower will be deter- mined by consultation and agreement between the. Grower and the Producer with the final decision being made by the Producer. ---------------------------------------- Page Break ---------------------------------------- 4a 2. That after the removal of each flock, the Grower will be paid in accordance with a method or formula as follows: a. A figure to be known as the individual Grower's Efficiency Point Factor will be ascer- tained. The Grower's efficiency point factor will be calculated by determining the Grower's total number of net live weight pounds of poultry grown and the total efficiency points assigned for settlement purposes of the feed (580 points per 100 pounds), and chicks (20 points each) util- ized in producing the broilers. After the Grow- er's efficiency points have been determined, the total number of pounds of broilers will be divided into the total efficiency points giving the efficiency point factor. The efficiency point factor ascer- tained by this division will constitute for settle- ment purposes the individual Grower's settlement based on the average of all grower's efficiency points whose broilers were moved in the same settlement period. (The average of all grower's efficiency points whose broilers were moved in the same settlement period is known as the "float- ing average.") b. Basic Grower Payment (1) The individual Grower's efficiency point factor per pound in relation to the floating average as as- certained by the method set out above will be applied to Exhibit A entitled "Basic Grower Payment Sched- ule." The applicable figures appearing in the column will be ascertained and payment will be made by ap- plying the figures to the applicable column on ---------------------------------------- Page Break ---------------------------------------- 5a Exhibit A. For example, the average of all growers' efficiency points (floating average) whose broilers were moved in the same settlement period is 10.30 points, and the individual Grower's efficiency point factor is 10.00 points, then the individual Grower will receive floating average pay plus a .30 point equiv- alent lower than the floating average which scales out on Exhibit A to be $149.00 per thousand broilers sold. If the floating average is 16.30 points, then the indi- vidual Grower's efficiency point factor is 16.60 points, and the individual Grower will receive floating aver- age pay less a .30 point equivalent higher than the floating average which scales out on Exhibit A to be $131.00 per thousand broilers sold. (2) The settlement period for obtaining the float- ing average will be one week (Monday through Saturday's kill), but in no case will the settlement period contain less than 10 flocks. For example, when 8 flocks are moved in a particular week, two flocks would be added to these 8 flocks making up the 10-flock settlement group. The efficiency point fac- tors used for these two flocks would be the same as the floating average efficiency point factor from the previous week. (3) For the purpose of determining the weekly floating average, growers whose efficiency point fac- tor is 1.50 points per pound more or less than the average for the settlement period will not be used for figuring grower pay other than his own. (4) A copy of the composite Grower's efficiency points for determining the floating average will be available at the office of the Producer. (c) Market Advantage Bonus Payment. A market advantage bonus payment will be paid ---------------------------------------- Page Break ---------------------------------------- 6a to the Grower based upon the Market Advantage Factor determined by reference to the chart at- tached hereto as Exhibit B and its relationship to the Monday Final Georgia Dock Market plus one cent. The Monday Final Georgia Dock Mar- ket plus one cent set forth on Exhibit C refers to the simple average of three quoted markets (Monday of the week of processing and the two previous Mondays). The prices set forth on Exhibit B refer to the quoted cash price per bushel of Chicago, Illinois #2 yellow corn and the quoted cash price per ton of Decatur, Illinois 49% soybean meal. These prices will be aver- aged on Monday of the week of processing for the previous three Mondays of trading and are not necessarily indicative of the price which the Producer pays for any and all of its corn and soybean meal. The market advantage factor as determined by Exhibit B is predicated upon the average consumption of corn and soybean meal per pound of dressed poultry, the average quoted market price of corn and soybean meal for the three Mondays immediately preceding the week of processing, and the estimated freight on the corn and soybean meal. The market advantage factor is then related to the Monday Final Geor- gia Dock Market plus one cent by use of the Market Advantage Bonus Payment Chart (Ex- hibit C) in order to determine the market advantage bonus payment per thousand birds processed. The Monday Final Georgia Dock Market plus one cent is used for convenience and is not necessarily indicative of the price at which the Producer sells, its poultry products and the market advantage bonus payment chart includes ---------------------------------------- Page Break ---------------------------------------- 7a an estimated constant factor to cover all addi- tional charges. As an example in determining the market ad- vantage bonus payment, assume corn price of $2.70 per bushel and soybean meal of $160.00 per ton. Exhibit B shows a market advantage factor of 15.38. Then assuming a Monday Final Georgia Dock Market plus one cent of 49.00 cents per pound, the market advantage bonus payment determined by use of Exhibit C is $9.50 per thousand birds sold. d. A settlement sheet prepared in accordance with the procedures hereinabove set out and re- flecting the amount paid the Grower, the effi- ciency point factor per pound, the average of the Monday Final Georgia Dock Market, price plus one cent of the Monday of the week of processing and the two previous Mondays; the average of the previous three Monday's daily prices on #2 yellow corn and 49% soybean meal; and other information will be furnished the Grower. 3. In the event of one hundred percent (100%) loss of all birds placed in any one house as a result of fire or disease not resulting from the negligence or intentional acts of the Grower, the Producer will pay the Grower $7.00 per thousand chickens placed for each week including fractions thereof which the Grower has had the chickens. For example, if fire destroys a house of 10,500 birds at five weeks and two days of age, the grower pay for this house is $388.50. A loss of eighty percent (80%) or more of the flock shall be interpreted for purposes of this paragraph as one hundred percent (100%) loss. 4. That for the convenience of not having to initiate a new agreement after each flock, this agree- ---------------------------------------- Page Break ---------------------------------------- 8a ment shall remain in full force and effect with the privilege on the part of either party to terminate the same after the removal of any particular frock. In the event of termination, the Producer shall have the right and privilege to enter the premises and remove any feed, medication, equipment, and other property belonging to the Producer. 5. In the event the Producer in its sole judgment shall determine that the flock or birds in possession of the Grower is deteriorating or that the Grower is failing to maintain the normal and ordinary growth, or in the event the Grower shall wrongfully dispose of feed, chicks, medication, or any other property of the Producer, then the Producer may engage a court of proper jurisdiction and obtain an injunctive or mandatory order authorizing the Producer to go upon the premises of the Grower and remove therefrom the birds, feed, medication, supplies, or other property belonging to the Producer. The Grower, under these circumstances, does hereby forfeit any compensation or payment he would otherwise receive with refer- ence to this flock. 6. That title to feed, chicks, and medication fur- nished by the Producer is and shall remain the sole and exclusive property of the Producer. 7. The Producer and Grower are each independ- ent contractors performing services using their sep- arate discretion and judgment. The Producer and the Grower shall, in their separate and independent discretion, employ and supervise exclusively their own servants, agents and employees. 8. That Producer shall under no circumstances be held responsible for damages to Grower caused by delay or failure to perform hereunder when such delay or failure is due to fire, strikes, acts of God, ---------------------------------------- Page Break ---------------------------------------- 9a legal acts of public authorities or delays or defaults due to labor, feed, chick, or medication shortages. The provisions of the paragraph are subject to and are not inconsistent with Part C, section 3, page 7, of this agreement. The Producer agrees to comply with the provisions of Part C, section 3, page 7 of this agreement. IN WITNESS WHEREOF, the respective parties have hereunto, either in person or by their authorized agents, affixed their hands and seals hereto. HOLLY FARMS POULTRY INDUSTRIES, INC. By Grower (Seal) Spouse (Seal) Business Name or Account Name of Grower Address ( ) Telephone Number Social Security or Identification Number [Exhibits Omitted] U.S. GOVERNMENT PRINTING OFFICE; 1996 405017 40052 ---------------------------------------- Page Break ----------------------------------------