Hartmaier v. Long

• Decision Date: 12 March 1951
• Docket Number: No. 40983,No. 2,40983,2
• Parties: HARTMAIER et al. v. LONG et al
• Court: Missouri Supreme Court

Page 332

238 S.W.2d 332

361 Mo. 1151

HARTMAIER et al. v. LONG et al.

No. 40983.

Supreme Court of Missouri, Division No. 2.

March 12, 1951.

Motion for Rehearing or to Transfer to Court En Banc Denied

April 9, 1951.

Charles W. Hess, Jr., Roger C. Slaughter, Kansas City, for appellants.

H. M. Langworthy, Clyde J. Linde and Robert B. Langworthy, all of Kansas City (Langworthy, Matz & Linde, Kansas City, of counsel), for respondent.

William S. Tyson, Solicitor, Bessie Margolin, Asst. Solicitor, William A. Lowe, and Joseph D. Mladinov, Attorneys, Dept. of Labor, all of Washington, D. C., and Francis M. Cook, Regional Attorney, Kansas City, Mo., amici curiae.

BOHLING, Commissioner.

The question upon this review is the right of 114 plaintiffs (appellants), John F. Hartmaier and others, to recover a total in excess of $100,000 alleged unpaid overtime wages, liquidated damages, and reasonable attorneys' fees under the Fair Labor Standards Act (sometimes herein referred to as the Act) of Congress of 1938, as amended, ¹ from John C. Long and Robert W. Long, co-partners doing business as Long Construction Company, and Turner Construction Company, a corporation (respondents).

Trial was to the court without a jury. The judgment was for defendants, who are referred to in the record and herein as 'Long -Turner.' The case is pending on rehearing. ² We review the claims of the plaintiffs as suits in equity. R.S.1949, Sec. 510.310, subd. 4.

Plaintiffs contend they 'engaged in commerce or in the production of goods for commerce' under the Fair Labor Standards Act as employees of Long-Turner in the construction of the Pratt & Whitney aircraft engine plant near Kansas City, Missouri. They say they worked six 8-hour days, 48 hours a workweek; and since 40 hours is the basic workweek under the Act and 8-hours is the basic work day under the Federal 8-hour day Act, ³ the basic workweek was five days, and the sixth day constituted overtime. Plaintiffs are classified in the record as firemen, guards, surveyors, waterboys, clerks, and a nurse.

Defendants contend (1) that no plaintiff has sustained the burden of establishing that during any workweek while employed by defendants he performed work within the Act; and (2) that in any event the claims are barred by the good faith provisions of Sec. 9 of the Portal to Portal Act of 1947. 29 U.S.C.A. Sec. 258, 61 Stat. 88, Sec. 9.

In April, 1942, Navy Department officials decided upon the construction of a plant for the manufacture of additional Pratt & Whitney aircraft engines, and its operation by a subsidiary corporation to be organized by the United Aircraft Corporation, East Hartford, Connecticut (hereinafter designated United). Several agreements followed.

On August 4, 1942, Defense Plant Corporation, 54 Stat. 572, 573, Sec. 5, 15 U.S.C.A. Secs. 604, 606b, later the Reconstruction Finance Corporation, 59 Stat. 310, 15 U.S.C.A. Sec. 611 note, a corporate agency of the United States, agreed with Pratt & Whitney Aircraft Corporation of Missouri (a small wholly owned subsidiary of United and hereinafter designated Pratt & Whitney), to acquire the plant site, construct the plant (buildings, machinery et cetera), and lease the completed plant to Pratt & Whitney for $1.00 a year. Pratt & Whitney was to assist in the selection of the site and was to proceed with the construction and equipment of the plant on behalf of and subject to the approval of Defense Plant Corporation, that is, the Government. All costs connected with the construction of the plant (acquisition of the site, buildings, machinery and its installation) were to be advanced by the Defense Plant Corporation with title thereto in the Defense Plant Corporation.

Under an agreement, dated September 12, 1942, between the United States, acting through the Navy Department, on the one part, and Pratt & Whitney and United, on the other part, Pratt & Whitney was to operate said plant as agent for the United States, furnishing the management, engineering, and production experience. The title to all materials, parts, equipment et cetera under said agreement was in the Navy Department, the Government, and not in Pratt & Whitney.

Each contract was to be performed by Pratt & Whitney and United without profit, directly or indirectly.

A long written contract was entered into for the construction of the plant between Pratt & Whitney, as Agent for the Defense Plant Corporation, that is, the United States Government, the Owner. The 'Owner, Agent and Architect-Engineer' had the right to inspect the work and the right of access to the books, records et cetera at all times.

The contract called for the construction of buildings having approximately 86 acres of floor space, with a manufacturing building of about 2500 by 1700 feet, laid out in squares of 40 feet; and of roads, sidewalks, parking spaces, fences, spur or switch tracks, sewers, and utilities. The contract was on a cost-plus-a-fixed-fee basis with the Owner paying for and having title to all construction equipment, tools, materials and supplies chargeable to the cost of the work.

Construction work started in August, 1942, on a 400 acre plant site, and was completed early in 1944. Several thousand persons were employed in this construction work.

The Secretary of Labor determined the hourly wage rates applicable to mechanics and laborers. They are not involved. He did not include plaintiffs, who were considered 'non-manual' employees and whose salary scale and terms of employment were discussed and established by Defense Plant Corporation officials and Long-Turner before construction started. They were paid on a weekly basis, and were not held to exact hours as were mechanics and laborers. They were docked if they missed a day and received extra pay if they worked on the seventh day. Their compensation was set higher than comparable wages and salaries in private industry to secure a full week's work and to finish the task, as each day deducted from the finishing time meant a saving of the lives of the boys in the Armed Services. The construction contract did not provide for the length of the workweek. The Long-Turner payroll accounts were continuously audited, sometimes preaudited, by Government auditors; and payments were made out of funds advanced by the United States Treasury. Long-Turner had to secure the approval of the Defense Plant Corporation before any wage or salary schedule could be established or any changes could be made therein.

The court found, among other things, that Long-Turner were engaged in original construction work under a contract with Pratt & Whitney as agent for Defense Plant Corporation, a Government agency, with the Government advancing the necessary funds and having title to all construction materials and owning or leasing the construction equipment; that Long-Turner did not process or produce any goods for commerce; that plaintiffs did not receive or unload incoming materials; and that Defense Plant Corporation had approved in August, 1942, all wage rates paid plaintiffs.

The court gave Long-Turner's conclusions of law and embodied them in its judgment that plaintiffs were not engaged in commerce or in the production of goods for commerce within the Fair Labor Standards Act during any workweek while employed by Long-Turner.

Plaintiffs' theory as disclosed by its refused findings of fact and conclusions of law was that the firemen, surveyors, waterboys, the nurse, and a few specifically named employees were engaged in commerce or in the production of goods for commerce during a substantial portion of each and every workweek of their employment by Long-Turner.

Plaintiffs concede they had the burden of proof. ⁴

The record presents varied situations. For instance: Some of the plaintiffs worked as a fireman, and as a guard, or as a laborer at different times, and at different stations or places on the 400 acre tract, sometimes at different times within a given week. All of them did not work over or as many as five 8-hour days every week.

As mentioned supra (note 1), 'in industries engaged in commerce or in the production of goods for commerce', 29 U.S.C.A. Sec. 202, employers are not to employ any employee 'who is engaged in commerce or in the production of goods for commerce * * * for a workweek longer than forty hours * * *, unless such employee' receive time and a half for the hours employed above forty. Id., Sec. 207(a)(3).

Some employees may be under the Act while other employees of the same employer, doing a different work, are not. If a substantial part of the employee's activities are within the Act, he is entitled to its protection. ⁵

The employee's activities are to be performed with the employer's knowledge and consent, expressed or implied; unauthorized activities being insufficient to impose liability upon the employer. ⁶

'Goods,' as used in the Fair Labor Standards Act, 'does not include goods after their delivery into the actual physical possession of the ultimate consumer thereof other than a producer, manufacturer, or processor thereof.' 29 U.S.C.A. Sec. 203(i).

The application of the Act depends on the duties of the employees rather than the nature of the employer's business. ⁷

A building contractor is the 'ultimate consumer' of building materials obtained from outside the state rather than a 'producer, manufacturer or processor' thereof. ⁸ It is well settled that employees engaged in original construction are not within the Act even though the building or facility will be used for purposes within the Act upon completion. ⁹

Reed v. Murphey, 5 Cir., 168 F.2d 257, 259-261, involved employees working under two World War II cost-plus-a-fixed-fee contracts. One of the contracts was for the construction of a Navy camp and an Advance Base Depot. The second contract was for the maintenance and operation of the Advance Base Depot. Defendants maintained separate and distinct organizations. The construction contract...