Federal Elec. Corp. v. Dunlop, Civ. A. No. 74-320-Orl-Civ-Y.

• Decision Date: 30 March 1976
• Docket Number: Civ. A. No. 74-320-Orl-Civ-Y.
• Citation: 419 F. Supp. 221
• Parties: FEDERAL ELECTRIC CORPORATION, Plaintiff, v. John T. DUNLOP, Secretary of Labor, et al., Defendants.
• Court: U.S. District Court — Middle District of Florida

419 F. Supp. 221

FEDERAL ELECTRIC CORPORATION, Plaintiff, v. John T. DUNLOP, Secretary of Labor, et al., Defendants.

Civ. A. No. 74-320-Orl-Civ-Y.

United States District Court, M. D. Florida, Orlando Division.

March 30, 1976.

Spencer, Fane, Britt & Browne, by Stanley E. Craven, Kansas City, Mo., and Crofton, Holland, Starling, Harris & Severs, P. A., by Charles M. Harris, Titusville, Fla., for plaintiff.

John L. Briggs, U. S. Atty., Jacksonville, Fla., by William F. Duane, Asst. U. S. Atty., Orlando, Fla., and Jack A. Diamond, Washington, D. C., and Anthony B. Cuviello, Atlanta, Ga., for U. S. Dept. of Labor.

MEMORANDUM OPINION

GEORGE C. YOUNG, Chief Judge.

The plaintiff in this action, Federal Electric Corporation (FEC) brought this suit for declaratory judgment under 28 U.S.C. § 2201 to obtain review of certain final actions taken by defendants as representatives of the Department of Labor pursuant to the Service Contract Act, 41 U.S.C. § 351 et seq. (hereinafter the "Act"). Jurisdiction of this action is vested in this Court under §§ 702, 704 of Title 5, United States Code.

At the trial, the Court granted defendants' motion to dismiss for lack of case or controversy as to two of the issues involved (Order of August 28, 1975). As a result, a single issue remained for this Court's decision. The parties agreed that that issue could be decided on the basis of stipulations and memoranda, and they have submitted these for the Court's consideration. These factual stipulations are hereby incorporated by reference and are attached as Appendix "A".

The sole remaining issue is whether employees of FEC who fit within ten specific job classifications are "service employees" as defined in the Act. The job classifications involved are all related to computer operations: (1) keypunch operator; (2) senior keypunch operator; (3) technical clerk; (4) senior technical clerk; (5) control specialist; (6) production specialist; (7) auxiliary equipment operator; (8) junior computer operator; (9) intermediate computer operator; and (10) senior computer operator.

The parties have also stipulated that each of the above ten classifications would be classified as a "general schedule" occupation in the federal civil service and would be covered under the Classification Act, as amended, 5 U.S.C. § 5101 et seq. None of these classifications would be covered as a "blue collar" or "wage board" occupation in the federal service. Further stipulations detail the exact white collar "GS" classifications of the jobs, the duties and requisite knowledge and abilities involved in each.

I. SCOPE OF REVIEW: The issues here presented is whether the Secretary of Labor correctly determined that the job classifications which are the subject of this suit come within the purview of the Service Contract Act. The determination of the Secretary as to the applicability of the Act to specific classifications must be upheld by this Court "if it has `warrant in the record' and a reasonable basis in law." NLRB v. Hearst Publications, Inc., 322 U.S. 111, 131, 64 S.Ct. 851, 861, 88 L.Ed. 1170, 1185 (1944).

II. APPLICABILITY OF THE ACT:

The Act applies to "every contract . . entered into by the United States . . . in excess of $2,500, except as provided in section 356 of this title . . ., the principal purpose of which is to furnish services in the United States through the use of service employees, as defined herein . . ." 41 U.S.C. § 351(a).

A "service employee" is specifically defined in § 357(b) to mean:

". . . guards, watchmen, and any person engaged in a recognized trade or craft, or other skilled mechanical craft, or in unskilled, semiskilled, or skilled manual labor occupation; and any other employee including a foreman or supervisor in a position having trade, craft, or laboring experience as the paramount requirement; and shall include all such persons regardless of any contractual relationship that may be alleged to exist between a contractor or subcontractor and such persons."

The essence of plaintiff's contentions is that the Act was never intended to cover persons providing services who fell within the traditional "white collar" classifications as set forth in the Classification Act, 5 U.S.C. § 5101 et seq. Plaintiff contends that the intent of the Act was to include only "blue collar" or "wage board" employees (with the exception of "guards" and "watchmen", which were not excluded from the coverage of the Classification Act, but which were specifically included in the coverage of the Service Contract Act, § 357(b)). As indicative of the Congressional intent, plaintiff points to (1) the marked similarities between the exclusions from the Classification Act in 5 U.S.C. § 5102(c)(7) and the inclusions in the Service Contract Act, 41 U.S.C. § 357(b); (2) the Department of Labor's own statement, contained in 29 C.F.R. § 4.113(b), regarding the extent of the Service Contract Act's coverage;^* (3) the Report on the Service Contract Act issued by the House Education and Labor Committee on September 1, 1965 (H.Rep.No.948) and adopted by the Senate's Labor and Public Welfare Committee on September 30, 1965 (S.Rep.No.798), U.S.Code Cong. & Admin. News 1965, p. 3737;^** and (4) statements of then Solicitor of Labor Donahue before the Special Subcommittee on Labor of the House of Representatives on August 5, 1965.^*** Plaintiff relies additionally on Descomp v. Sampson, 377 F.Supp. 254 (D.C. Del.1974), which is the only case known to this Court to have considered the same issue and which case fully supports plaintiff's contentions.

Defendants, on the other hand, contend that the statutory definition of "service employee" given in 41 U.S.C. § 357(b), when the words of the statute are given their "ordinary" meaning, would include the job classifications here in issue. Defendants further rely on what they perceive to be the all-inclusive character of § 357(b)'s language:

". . . any person engaged in a recognized trade or craft, or other skilled mechanical craft, or in unskilled, semiskilled, or skilled manual labor occupations; and any other employee including a foreman or supervisor in a position having trade, craft, or laboring experience as the paramount requirement; and shall include all such persons regardless of any contractual relationship that may be alleged to exist between a contractor or subcontractor and such persons." (emphasis supplied).

Defendants urge that the only exceptions to the Act are found in § 356 or as are authorized under the power given to the Secretary under § 353(b) to approve certain variances not in issue here.

With regard to plaintiff's assertion that the Act was meant to cover only "blue collar" service employees (and "guards" and "watchmen" as specifically provided in § 357(b)), defendants contend that the "blue collar"—"white collar" distinction is neither an accurate nor complete expression of Congressional intent; and that while their own statement in 29 C.F.R. § 4.113(b) does speak of the scope of coverage in "blue collar" terms, that statement cannot fairly be read to limit the Act's coverage to traditionally "blue collar" job categories. Defendants point to other regulations which would arguably suggest that "white collar" workers would in fact be included under the Act. Defendants interpret the Congressional intent to be that of providing labor standards protection for all service contracts except those which had already received the attention of Congress (e. g., by the Walsh-Healy or Davis-Bacon Acts).

Finally, defendants contend that Descomp v. Sampson, supra, was wrongly decided.

While this court must accord due deference to the expertise of the Secretary of Labor, this Court is also under a higher duty to ascertain and declare the law as Congress intended it. This duty includes holding, when necessary, that the Secretary's determination has exceeded the boundaries set by Congress. An analysis of the statute and consideration of the legislative history and the arguments of the parties has led this Court to conclude that the Secretary has, with respect to the job classifications here involved, exceeded those statutory boundaries.

Section 351 of Title 41 applies to every contract entered into by the United States or the District of Columbia in excess of $2,500, subject to the exemptions provided in § 356, "the principal purpose of which is to furnish services in the United States . . ." If Congress had stopped here, the Secretary would be correct in his expansive reading of the statute. But Congress further provided that the services contracted for be "through the use of service employees, as defined herein, . . ." (emphasis supplied). This is a clear definitional limitation on the coverage of the Act, a restriction which would be independent of the exemptions for certain types of contracts and work contained in § 356.

Neither can § 357(b) be read as widely as the Secretary contends. The "any . . . all" language of that subsection must be read in the context in which those words appear. "Any" and "all" simply operate to include within the term "service employee" the totality of those persons who fit within the job categories set out in the remainder of § 357(b). The words have no talismanic or independent effect and they are not indicative, one way or the other, of the legislative intent as to the scope of the term "service employee." Descomp v. Sampson, supra, at 261-262.

It is presumed that when Congress drafts a statute, it does so with full knowledge of the existing law and with great care for the precise language which must be used to achieve the desired result. The terms employed in the Service Contract Act and its legislative history are in accord in indicating that Congress not only was fully cognizant of the Classification Act, but used that Act as a reference point in drafting the Service Contract Act's definition of "service employee." While it is true that the employment of terms in a...