Olms interpretative Manual

EMPLOYER

030.401LMRDA,SECTION3(e)

"EMPLOYER" means any employer or any group or association of employers engaged in anindustry affecting commerce (1) which is, with respect to employees engaged in an industryaffecting commerce, an employer within the meaning of any law of the United States relating tothe employment of any employees or (2) which may deal with any labor organization concerninggrievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work, andincludes any person acting directly or indirectly as an employer or as an agent of an employer inrelation to an employee but does not include the United States or any corporation wholly ownedbytheGovernment oftheUnited States oranyStateorpolitical subdivision thereof.

030.402See29 CFR401.5

*030.403U.S.POSTALSERVICE

Section 1209 of the Postal Reorganization Act (39 U.S.C. 1209) applies the provisions of theLabor-Management Reporting and Disclosure Act to Postal Service employees' "labororganizations that have or are seeking to attain recognition . . . and to such organizations' officers,agents, shop stewards, other representatives, and members to the extent to which such provisionswouldbeapplicableifthePostalServicewereanemployer"undersection3(e)ofthe Act.

See29CFR451.3(a)(4).

(TechnicalRevisions:Dec.2016)

030.405COUNTIESANDMUNICIPALGOVERNMENTS

Section 3(e) of the LMRDA, which defines the meaning of "employer" under the Act, expresslyexcludes any "political subdivision" of a State.The term “political subdivision” includes, amongothers, counties and municipal governments, so that such entities are not "employers" under theLMRDA.

See29CFR451.3(a)(4).

030.410CORPORATEOFFICERS

The definition of the term "employer" in section 3(e) includes "any person acting directly orindirectly as an employer or as an agent of an employer in relation to an employee." The clearlanguageofsection3(e)thusincludesmanagerswhoareresponsiblefortheemployer-employee

relationshiponbehalfof thecorporation.SeeNational LaborRelationsBoardv.NewMadridManufacturing Co., 215 F. 2d. 908, 34 LRRM 2844 (8th Cir. 1954), which involves similarlanguageundertheLaborManagement RelationsAct.

(TechnicalRevisions:Dec.2016)

*030.420GOVERNMENT-OWNEDCORPORATIONS

Section 3(e) of the Act does not specifically exclude from its definition of "employer" acorporation owned by a State or a political subdivision of a State. Excluded from the meaning of"employer" under the Act are the United States, any State, any political subdivision of a State, andanycorporationwhollyownedbythe Governmentof the UnitedStates.Thus,a corporationowned by a State or political subdivision is an "employer" under the Act unless the corporation isitselfeitherapoliticalsubdivision ofaStateoranintegralpart oftheState.

Seealso29CFR 452.12

*030.425POLITICALSUBDIVISION

Section3(e) of theLMRDA specificallyexcludesfromitsdefinitionof "employer"anypolitical subdivision of a State. Whether a particular entity is a "political subdivision" of a Statedepends upon the facts of each case. Included among the factors that may be considered are thefollowing:(1) whethertheStateorotherpublic authorityexercisesanyregulatorycontrol overtheentity; (2) whether the State or other political authority participates in the selection of officers ofthe entity; (3) whether the operations of the entity are conducted independently; (4) whether theoperations are financed by the State or other public authority; (5) whether the entity was createdby a legislative act; (6) whether the employees of the entity are civil servants subject to regulationby or wage scales of the State or other public authority; and (7) whether the entity is exempt fromFederaltaxation.

030.430HOSPITALSANDCEMETERIES

Hospitals,whetherornotownedbyreligiousgroups,maybeemployerswithinthemeaningofthe LMRDA. Their status may depend in part on whether they secured medical supplies fromoutside the State in which they are located and whether some of their patients are residents ofotherStates.

Likewise, depending upon the specific facts involved, a cemetery association may be anemployer within the meaning of the Act. See National Labor Relations Boardv. Forest LawnMemorialParkAssociation,206F.2d569(9thCir.1953,32 LRRM2611 cert.denied,347U.S.
915,33LRRM2589(1954).

(TechnicalRevisions:Dec.2016)

030.440ATTORNEY

An attorney would be an employer under section 3(e) of the LMRDA if in connection with hispractice (1) he engages in interstate commerce or renders services to clients engaged in interstatecommerce or in industries affecting interstate commerce (e.g., certain labor unions), or if hemakesfrequentandcontinueduseoftheinstrumentalitiesofcommerce (e.g.,telephone,telegramand mail messages across State lines), and (2) he has any employees for whom he makeswithholdingsunder InternalRevenuelawsorcontributions undertheFederalInsurance

ContributionsAct.

030.450FRANCHISEDAGENTSOFAGVA

Agents franchised by the American Guild of Variety Artists (AGVA) who act only asrepresentatives of certain AGVA members in dealing with employers in the entertainment fieldare not required by section 203 of the LMRDA to report payments made to AGVA for thefranchise. Thisisbecauseafranchised agent,assuch,isnotan"employer"withinthemeaningofsection 3(e) of the Act. In representing AGVA members, a franchised agent's interest is opposedto that of the employer, since his income is derived from commissions on the earnings of theAGVAmembers.

However, a franchised agent who acts not only as a representative of AGVA members but alsoas a producer of package shows, etc. is an "employer” and therefore is required by section203(a)(1) to report franchise fee payments made to AGVA. Such franchise fees do not appear tocome within the exceptions in section 203(a)(1). Although the franchise fees of the franchisedagentswhoalsofunctionasproducersarereportable,paymentsbyfranchisedagentsasproducersinto the AGVA welfare trust fund or the AGVA sick and relief fund appear to come within anexception of section 203(a)(1) of the LMRDA. Such payments appear to come within section302(c)(5) of the Labor Management Relations Act cited by reference as an exception in section203(a)(1).

In this connection, the question has arisen as to whether a franchised agent is subject to thereportingrequirementsof section202ofthe LMRDA.Althoughthe franchisedagentmaybe an"agent . . . or other representative" of AGVA within the meaning of section 3(g), section 202refersonlyto"officers" and "employees"oflabor organizations.
The franchised agent is bound by the terms of the union's standard form contract for theprotectionandbenefitof theunionmemberswho aretheagent'sclientsandisanindependentcontractor ratherthan an"officer"or "employee" oftheunion.

DEFINITIONSRELATINGTOJURISDICTION: