Shain v. Armour & Co.

• Decision Date: 17 June 1943
• Docket Number: No. 256.,256.
• Citation: 50 F. Supp. 907
• Court: U.S. District Court — Western District of Kentucky
• Parties: SHAIN et al. v. ARMOUR & CO.

50 F. Supp. 907

SHAIN et al. v. ARMOUR & CO.

No. 256.

District Court, W. D. Kentucky, at Louisville.

June 17, 1943.

COPYRIGHT MATERIAL OMITTED

J. Paul Keith, Jr., and Jones, Keith & Jones, all of Louisville, Ky., for plaintiffs.

R. Lee Blackwell and Bullitt & Middleton, all of Louisville, Ky., for defendant.

Irving J. Levy, of Washington, D. C., Jeter S. Ray, of Nashville, Tenn., John L. Young, of Versailles, Ky., Leonard E. Ladd, of Nashville, Tenn., and Hugh McCloskey, of New Orleans, La., for United States Department of Labor, amicus curiae.

MILLER, District Judge.

The plaintiff, Alfred C. Shain, brought this action on behalf of himself as an employee of the defendant, Armour & Company, and on behalf of approximately 57 other employees of the defendant to recover for the "time and a half" benefits of Section 7(a) of the Fair Labor Standards Act of 1938, 29 U.S.C.A. §§ 201 through 219. Following a pre-trial conference, the Court was asked to rule on the applicability of the Act to the plaintiffs as a whole, to certain groups of individuals of the plaintiffs, and to different individuals of the plaintiffs, considering in each case the conditions under which the services were being performed. If and where liability is found to exist further proceedings will be taken to determine the amount of recovery in each instance.

The defendant, Armour & Company, operates a plant at Number 333 Byrne Street, Louisville, Kentucky, which is known as Armour Creameries (hereinafter called Armour), at which all of the plaintiffs were employed during the period in controversy. Armour's business is divided into six departments which are generally known as the Creamery Department, Poultry Department, Cheese Department, Egg Department, Engine Room Department, and Shipping Department or Warehouse Department. It normally employs about 100 persons.

The Creamery Department is concerned primarily with handling butter which either (a) is churned at the plant from cream brought into the plant or (b) is churned elsewhere and brought into the plant in tubs in bulk, and after having remained in coolers the required time is taken into the Print Room where it is cut into pounds or smaller quantities, wrapped and cartoned, and then again placed in the coolers where it remains until it is shipped. Employees in this department receive, test, pasteurize and churn the cream and test, cut, print and carton the butter and perform other duties in connection therewith.

The Poultry Department is concerned primarily with handling poultry. Part of its business is buying, handling and selling live poultry; and part is buying, handling, slaughtering and dressing poultry at the plant or handling poultry dressed elsewhere, which is then stored in coolers until time for shipment. Live poultry is bought on markets throughout Kentucky, Indiana and Tennessee. Employees in the poultry department did some slaughtering, picking, and dressing of poultry and test, weigh and prepare for shipment poultry dressed prior to receipt at the plant.

The Cheese Department is concerned primarily with (a) curing and paraffining and storing in coolers green cheese brought into Louisville from three Kentucky plants outside Louisville, or (b) storing in coolers cheese already cured and paraffined which was manufactured elsewhere, until time for shipment. Employees in the cheese department insepected, weighed, racked and paraffined and packaged the cheese.

The Egg Department is concerned primarily with (a) packing and grading eggs which are stored in coolers until time for distribution or (b) grading and storing eggs or (c) storing broken canned eggs, until time for distribution. Other eggs are graded or candled elsewhere prior to being shipped to Louisville and upon receipt at the Louisville plant are stored and shipped as the demands of the business may require.

The Engine Room Department includes employees who are engaged as firemen, engineers, and in maintenance and repair of all of Armour's facilities; and the engine room provides the steam power for substantially all facilities for refrigeration, pasteurization, sterilization and other general purposes. Steam is also produced for an apparently nonaffiliated establishment belonging to Consolidated Produce Company, which is located adjacent to defendant's establishment at Louisville.

The Shipping or Warehouse Department is concerned primarily with receiving finished products, such as poultry, eggs, butter and cheese, and storage and shipping of the same. The defendant also employs route truck men who haul produce to the Louisville plant from receiving stations and the cheese factories, as well as drivers who haul produce to branch establishments. A city driver was also employed.

Each of the foregoing departments is in charge of a "key man" who is a working foreman. Several "key men" are plaintiffs in this action.

During the years 1939, 1940 and 1941 the defendant did an annual business of approximately from $5,000,000 to $7,000,000. This business was divided during the years in question among the four production departments as follows:

                Department   1939 %    1940 %    1941 %
                Creamery       58.5      59.7      58.3
                Poultry        17.5      16.9      20.3
                Cheese         15        14.4      14.8
                Egg             9         8.9       6.6
                

Armour maintains and operates 14 coolers or freezers as a part of its plant. The cream, butter in bulk, poultry, cheese and eggs come from Kentucky and points outside Kentucky; its finished products are distributed principally throughout Southeastern United States. The defendant's Louisville plant is an outlet of the Armour organization being used as a terminal for distribution of products going into Southeastern United States.

Whether or not the Act applies to any particular plaintiff depends upon the nature of the particular employee's duties. A. B. Kirschbaum Company v. Walling, 316 U.S. 517, 62 S.Ct. 1116, 86 L.Ed. 1638. It would appear well settled that employees in the creamery, poultry, cheese and egg departments were engaged in the production of goods for commerce, within the provisions of the Act. United States v. F. W. Darby Lumber Co., 312 U.S. 100, 657, 61 S. Ct. 451, 85 L.Ed. 609, 132 A.L.R. 1430; Warren-Bradshaw Drilling Co. v. Hall, 317 U.S. 88, 63 S.Ct. 125, 87 L.Ed. ___; Fleming v. Swift & Co., D. C., 41 F.Supp. 825, affirmed 7 Cir., 131 F.2d 249. Employees in the shipping or warehouse departments are likewise covered by the Act by reason of their duties receiving, handling, and shipping products coming from and going to other States. Walling v. Jacksonville Paper Co., 317 U.S. 564, 63 S.Ct. 332, 87 L.Ed. ___; Fleming v. Swift & Co., supra. The maintenance employees, including engineers, mechanics, firemen and other employees engaged in producing steam, heat and power for the plant, as well as maintaining the plant, equipment and machinery are likewise engaged in the production of goods for commerce or in an occupation necessary thereto as defined by Section 3(j) of the Act, 29 U.S.C.A. § 203(j). A. B. Kirschbaum Co. v. Walling, supra; Warren-Bradshaw Drilling Co. v. Hall, supra. The normal applicability of the Act to these employees is not seriously contested by the defendant who relies chiefly for its defense upon specific exemption provisions of the Act hereinafter referred to.

The defendant claims complete exemption for all of the employee plaintiffs by reason of the provisions of that part of Section 7(c) of the Act which reads as follows: "In the case of an employer engaged in the first processing of milk, whey, skimmed milk, or cream into dairy products * * * the provisions of subsection (a) shall not apply to his employees in any place of employment where he is so engaged." Defendant contends that since it is engaged, through the operations of its Creamery Department, in the first processing of milk or cream into butter at its plant in Louisville, Kentucky, where all of the employees work, it is entitled to the complete exemption for all of said employees regardless of what type of work they may be engaged in. It points out that Armour Company actually churned from cream in its plant at 333 Byrne Street, Louisville, Kentucky, over $2,000,000 worth of butter in each of the three years in question, that its Creamery Department did over 58% of the Company's whole business, that the exemption does not require that the employer be engaged exclusively in the first processing of cream into butter, and since the major portion of its business is actually the first processing of cream into butter, without any attempt on its part to claim the exemption by subterfuge, it is entitled to the complete exemption for all employees at the place of employment where this work is carried on. This contention presents a strict and technical construction of the words used in Section 7(c) of the Act, which in the opinion of the Court is entirely inconsistent with the fundamental purpose of the Act and with the common sense interpretation which would have to be employed in dealing with any company engaged in several various kinds of activities. Section 7(c) of the Act does not exempt industries as a whole from the overtime provisions of the Act, but only those specific processes therein mentioned. Fleming v. Swift & Co., supra; Walling v. Bridgeman-Russell Co. (D.C.Minn.) December 10, 1942;¹ Walling v. DeSota Creamery and Produce Co. (D.C.Minn.) April 27, 1943.¹

The defendant further contends that although the Court might rule against the total exemption claimed yet the exemption would necessarily apply to such employees as were actually engaged in the first processing of cream into butter at the plant, under the provisions of Section 7(c) of the Act. Some of these employees may be exclusively engaged in such work; other of these employees devote part of their time during the week to such work and part of their time during the same week to other work at the plant. Such...