decided: June 7, 1975.
ROBERT W. COSTIGAN, REGISTER OF WILLS OF PHILADELPHIA COUNTY AND CLERK OF THE ORPHANS' COURT DIVISION OF THE COURT OF COMMON PLEAS OF PHILADELPHIA COUNTY, APPELLANT,
PHILADELPHIA FINANCE DEPARTMENT EMPLOYEES LOCAL 696, AMERICAN FEDERATION OF STATE, COUNTY AND MUNICIPAL EMPLOYEES, AFL-CIO BY CHARLES SANTORE AND JOHN COSTA, TRUSTEES AD LITEM
Nathan L. Posner, Herbert S. Levin, Fox, Rothschild, O'Brien & Frankel, Philadelphia, Howard R. Flaxman, Philadelphia, for appellant.
Leonard M. Sagot, Philadelphia, Randall J. Sommovilla, Thomas W. Jennings, Philadelphia, for appellee.
Edward H. Feege, Allentown, Charles N. Sweet, Morrisville, Stephen J. Cabot, Philadelphia, amicus curiae Counsel for the Pennsylvania State Association of County Commissioners; Curtin & Heefner, Morrisville, Hayes & Feege, P. C., Allentown, Pechner, Sacks, Dorfman, Rosen & Richardson, Philadelphia, of counsel.
Jones, C. J., and O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Eagen, J., did not participate in the consideration or decision of this case. Pomeroy, J., joined the opinion of the Court and filed a concurring opinion.
[ 462 Pa. Page 428]
OPINION OF THE COURT
Appellant Robert Costigan, Register of Wills of Philadelphia, brought this action in equity to enjoin arbitration under a collective bargaining agreement entered into by his predecessor, William King, and appellee Philadelphia Finance Department Employees Local 696, the collective bargaining agent of the employees of the Register of Wills.*fn1 Appellant contended that the collective bargaining agreement was void because 1) Register King was without power to enter into the agreement or to bind his successor to its terms and 2) the City of Philadelphia was a joint employer of the employees in question but not a party to the agreement.*fn2 The trial court
[ 462 Pa. Page 429]
rejected both contentions, dismissed the complaint, and directed that the arbitration proceed. This appeal followed.*fn3 We conclude that the City of Philadelphia is a joint employer of the employees of the Register of Wills and therefore reverse.*fn4
Sometime prior to November, 1971, appellee notified Register King that 34 of the 38 employees in the office of the Register of Wills and 19 of the 20 employees in the office of the Clerk of the Orphans' Court had signed authorization cards designating appellee as their exclusive bargaining representative. Appellee therefore demanded that the Register recognize it as the collective bargaining agent for the employees. Several meetings were held relating to the demand and the terms of a possible collective bargaining agreement. While these negotiations
[ 462 Pa. Page 430]
were in progress, an election for Register of Wills was held at which appellant was the victor.
Register King agreed to recognize appellee as the bargaining representative of the employees in the two offices and, on November 30, 1971, he joined with appellee in a joint petition to the Pennsylvania Labor Relations Board (Board) requesting certification of appellee as the exclusive collective bargaining representative of those employees. Appellant was advised of this development and, on November 29, 1971, filed with the Board a letter objecting to any action on the request for certification until appellant had taken office. The Board has taken no action on the joint petition for certification.*fn5
On December 29, 1971, Register King entered into a written collective bargaining agreement with appellee to take effect at noon on December 31, 1971, and expire at noon on June 30, 1973.*fn6 That agreement contained, inter alia, the following provisions:
"During the term of this AGREEMENT, the Employer shall not lay off any Employee of the bargaining
[ 462 Pa. Page 431]
unit who was employed at the time this AGREEMENT was executed.
"Employees shall not be disciplined or discharged except for just cause."
On December 30, 1971, Register King took the oath of office as a judge of the court of common pleas. On the same day, appellant notified many of the employees in the bargaining unit that he would not require their services after he took office on January 3, 1972. Upon assuming office, appellant orally discharged these employees, and replaced them with others.
Appellee claimed that these discharges were in violation of the collective bargaining agreement and, pursuant to the grievance procedure established by the agreement, initiated proceedings to submit this question to arbitration. Appellant then filed this action in equity seeking to enjoin the arbitration on the ground that the collective bargaining agreement was invalid. A trial was held on July 12, 1972, and an adjudication dismissing the complaint followed on January 31, 1974. On April 15, 1974, a final decree was entered overruling appellant's exceptions and this appeal followed.
We have previously addressed the question of who is the employer of particular public employees in Sweet v. Pennsylvania Labor Relations Board, 457 Pa. 456, 322 A.2d 362 (1974). There we recognized that:
"The determination of who is the employer or employers of a group of employes is not governed by Act 195, however, even though the Act may have raised certain considerations in this regard which were not envisioned prior to its passage.
[ 462 Pa. Page 432]
"This Court has not heretofore been called upon to determine who is the particular employer of a given employe in relationship to Act 195, the Pennsylvania Labor Relations Act, P.L. 1168, No. 294, § 1 et seq., as amended, 43 P.S. § 211.1 et seq., or the Labor Anti-Injunction Act, P.L. 1198, § 1 et seq., as amended, 43 P.S. § 206a et seq. Each of these acts has defined 'employer' only for purposes of the respective acts. Our decisions under the Pennsylvania Labor Relations Act and the Labor Anti-Injunction Act have dealt with the issue of whether the employer in question came within the scope of the pertinent act. E. g., Pennsylvania Labor Relations Board v. Overbrook Golf Club, 385 Pa. 358, 123 A.2d 698 (1956); Locust Club v. Hotel and Club Employees' Union, 397 Pa. 357, 155 A.2d 27 (1959). The more fundamental question of whether an employer-employe relationship exists is one of first impression with this Court in the context of labor relations. The tests developed in other areas of the law for ascertaining the existence of an employer-employe relationship, however, are equally probative of the issue as presented in the instant case."
Id. at 461-62, 322 A.2d at 364-65 (emphasis in original, footnote omitted).
Although common law principles relating to the existence of an employer-employee relationship are relevant to the determination of that question under the Public Employee Relations Act, these principles are not to be applied without regard for the purposes and policies of that Act. In this regard, we find highly persuasive the analysis of the United States Supreme Court in NLRB v. E. C. Atkins & Co., 331 U.S. 398, 67 S.Ct. 1265, 91 L.Ed. 1653 (1947).*fn7 That case considered whether certain
[ 462 Pa. Page 433]
guards employed at a defense plant, who were required to be civilian auxiliaries of the military police of the United States Army, were employees of the defense contractor within the meaning of the NLRA. In sustaining the NLRB's conclusion that the guards were employees of the contractor, the Court wrote:
"[T]he terms 'employee' and 'employer' in [the National Labor Relations Act] carry with them more than the technical and traditional common law definitions. They also draw substance from the policy and purposes of the Act, the circumstances and background of particular employment relationships, and all the hard facts of industrial life.
"And so the Board, in performing its delegated function of defining and applying these terms, must bring to its task an appreciation of economic realities, as well as a recognition of the aims which Congress sought to achieve by this statute. This does not mean that it should disregard the technical and traditional concepts of 'employee' and 'employer.' But it is not confined to those concepts. It is free to take account of the more relevant economic and statutory considerations.
"The most important incidents of the employer-employees relationship -- wages, hours and promotion -- remained matters to be determined by respondent rather than by the Army. Respondent could settle those vital matters unilaterally or by agreement with the guards. And the guards were free to negotiate and bargain individually or collectively on these items. It is precisely such a situation to which the National Labor Relations Act is applicable. It is a situation where collective
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bargaining may be appropriate and where statutory objectives may be achieved despite the limitations imposed by militarization. Under such circumstances, the Board may properly find that an employee status exists for purposes of the Act.
"In this setting, it matters not that respondent was deprived of some of the usual powers of an employer, such as the absolute power to hire and fire the guards and the absolute power to control their physical activities in the performance of their service. Those are relevant but not exclusive indicia of an employer-employee relationship under this statute. As we have seen, judgment as to the existence of such a relationship for purposes of this Act must be made with more then the common law concepts in mind. That relationship may spring as readily from the power to determine the wages and hours of another, coupled with the obligation to bear the financial burden of those wages and the receipt of the benefits of the hours worked, as from the absolute power to hire and fire or the power to control all the activities of the worker. In other words, where the conditions of the relation are such that the process of collective bargaining may appropriately be utilized as contemplated by the Act, the necessary relationship may be found to be present."
Id. at 403, 413-14, 67 S.Ct. at 1268-69, 1273.
In the instant case, no single entity controls all of the terms of the employment relationship. The Register of Wills is conceded by all parties to have the exclusive power to hire, fire, promote, and direct the work of the employees. The City of Philadelphia pays most of the employee salaries and other compensation costs of the office and exercises considerable control over the fringe benefits accorded the employees, which include enrollment under the City's group life and health insurance
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plans and coverage by the City's pension plan.*fn8 Thus the Register and the City each exercise independent control over important "conditions of the relation [which] are such that the process of collective bargaining may appropriately be utilized as contemplated by the Act," and both must be deemed employers for purposes of the Act. Cf. Fischer v. Rzymek, 15 Pa. Commw. 105, 324 A.2d 836 (1974) (opinion of Rogers, J., in chambers); Ace-Alkire Freight Lines, Inc. v. NLRB, 431 F.2d 280 (8th Cir. 1971); S. S. Kresge Co. v. NLRB, 416 F.2d 1225 (6th Cir. 1969); Gallenkamp Stores Co. v. NLRB, 402 F.2d 525 (9th Cir. 1968); NLRB v. Greyhound Corp., 368 F.2d 778 (5th Cir. 1966); Ohio Inns, 205 N.L.R.B. No. 102, 84 L.R.R.M. 1005 (1973); Massachusetts SPCA, 203 N.L.R.B. No. 22, 83 L.R.R.M. 1017 (1973); Floyd Epperson, 202 N.L.R.B. No. 9, 82 L.R.R.M. 1473 (1973).
A similar result has been reached under the New York Public Employees Fair Employment Act. In County of Ulster v. CSEA Unit of Ulster County Sheriff's Department, 37 A.D.2d 437, 326 N.Y.S.2d 706 (3d Dept. 1971), a county and its sheriff were held to be joint employers of the sheriff's deputies because each had an important degree of control over the employment relationship. We
[ 462 Pa. Page 436]
believe that the reasoning of the court in that case is equally applicable here:
"While a finding of joint employers is rare, the appellant's determination of the practical necessity for such a finding is supported by the record and should not be disturbed. The Taylor Law was enacted with the hope that it would insure tranquility in the government's labor relations by protecting the rights of employees and the public generally. The prohibition of public strikes was continued, but the statute allowed employees to redress their grievances by requiring that the public employer negotiate and contract with employee groups with respect to the terms and conditions of employment. . . . The statute mandates that employees negotiate with respect to terms and conditions of employment. . . . Obviously, these negotiations cannot be effective if employees are obliged to negotiate with an employer who is without power with respect to the matter in dispute."
Id. at 439, 326 N.Y.S.2d at 709.
Appellee strenuously urges that the mere fact that the office of the Register of Wills is funded by another public agency (the City) does not establish the latter as the public employer of the employees of that office. While we agree with this proposition,*fn9 it has no application here, for the City in fact exercises control over important
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aspects of the employment relation. Compare Dauphin County Child Care Services, Case No. PERA-R-5131-C (PLRB, Sept. 4, 1974) (agency receipt of 60% of its funding from the Commonwealth and requirement that it select new employees from civil service lists compiled by the Commonwealth does not preclude it from being the public employer of those who are employed in the agency where agency exercises full control over the terms and conditions of employment); County of Erie v. Board of Trustees, 62 Misc.2d 396, 308 N.Y.S.2d 515 (Sup.Ct.Erie 1970) (public library which is funded by county but whose board of trustees exercises full control over hiring, firing, and all other terms and conditions of employment subject to the limits of available appropriations is sole employer of library employees).
Because the City of Philadelphia, the joint employer of the employees involved in this case, was not a party to this agreement, we conclude that the agreement was not authorized by the Public Employees Relation Act and is therefore void. The decree is reversed, and appellee is enjoined from proceeding to arbitration under the purported collective bargaining agreement. Each party pay own costs.
POMEROY, Justice (concurring).
I have no disagreement with the court's opinion, and join in it. I do so, however, because, as noted in footnote 5 of the opinion, ante at 458, neither party has questioned the propriety of presenting the question of who is the employer to the courts without first obtaining a determination on that point by the Pennsylvania Labor Relations
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Board in the certification proceedings. In Hartshorn et al. v. Allegheny County et al., 460 Pa. 560, 333 A.2d 914 (1975), I expressed the opinion that in light of the legislative scheme of the Public Employer Relations Act.*fn1 ("Act 195"), and other considerations, including the doctrine of primary jurisdiction, the determination of who is a "public" employee should be made in the first instance by the Board. Hartshorn v. Allegheny County, supra, 460 Pa. at 560, 333 A.2d 914 (dissenting opinion of Pomeroy, J.). The same considerations as were there expressed are equally applicable here, where one of the basic questions is who is the public employer. That this is the proper procedure is clearly indicated by § 604 of Act 195. It provides: "The board shall determine the appropriateness of a unit which shall be the public employer unit or a subdivision thereof . . ." It is to be noted, moreover, that the judicial proceedings in Sweet v. Pennsylvania Labor Relations Board, 457 Pa. 456, 322 A.2d 362 (1974) came only after the Board had acted. This in my view, was the proper procedural sequence.