Seese v. Bethlehem Steel Co.

• Decision Date: 14 October 1947
• Docket Number: Civ. A. No. 3454.
• Citation: 74 F. Supp. 412
• Parties: SEESE et al. v. BETHLEHEM STEEL CO.
• Court: U.S. District Court — District of Maryland

74 F. Supp. 412

SEESE et al. v. BETHLEHEM STEEL CO.

Civ. A. No. 3454.

District Court, D. Maryland.

October 14, 1947.

Maurice Braverman, of Baltimore, Md., for plaintiff.

Bernard J. Flynn, U. S. Atty., and C. Ross McKenrick, Asst. U. S. Atty., both of Baltimore, Md., and Peyton Ford, Asst. Atty. Gen., for United States, intervenor.

Marbury, Miller & Evans, Wm. L. Marbury and Chas. C. G. Evans, all of Baltimore, Md., for defendant.

I. Duke Avnet, Piper, Watkins, Avirett & Egerton and John W. Avirett, 2d, all of Baltimore, Md., amici curiæ.

CHESNUT, District Judge.

The important question in this case is the constitutionality of the recent Portal-to-Portal Act of 1947, approved May 14, 1947, being Chapter 52, Public Law 49, 29 U.S.C.A. § 251 et seq. But preliminarily there is a technical question of pleading to be considered. It arises in this way.

On February 19, 1947, the suit in this case was first filed by Ray Seese, President, and Curtis Wolfe, Secretary of Local 24, Industrial Union of Marine and Shipbuilding Workers of America, for themselves individually and on behalf of more than one hundred additional employees to recover wages and liquidated damages for alleged overtime work under the Fair Labor Standards Act, § 16(b), 29 U.S.C.A. § 201 et seq. The complaint made no charge that minimum wages in accordance with the Act had not been paid but was based exclusively on the alleged failure to comply with section 7 of the Act, 29 U.S.C.A. § 207, which provided "No employer shall * * * employ any of his employees who is engaged in commerce or in the production of goods for commerce — (1) for a workweek longer than forty-four hours during the first year from the effective date of this section, (2) for a workweek longer than forty-two hours during the second year from such date, or (3) for a workweek longer than forty hours after the expiration of the second year from such date, unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed."

The complaint alleges such overtime work by various plaintiffs from and including a portion of the year 1938 (the effective date of the Act being October 24, 1938) to and including the date when the suit was filed in 1947. It further appeared from the complaint that the nature of the overtime work was what has popularly been termed "portal-to-portal" activities. That is to say, the defendant employer, Bethlehem Steel Company, Shipbuilding Division, had a large plant covering several acres of ground with buildings and docks on Key Highway in Baltimore City, for the repair of the ships, and had very many employees. It was alleged that the employees were required to report at various gates on the premises and punch a time clock nearby and thereafter spend an amount of time, not specifically described otherwise than as "substantial" in walking from the gates to their place of beginning of productive work for the day, and in equipping themselves with clothing and tools suitable for the work; and to be ready for that work when the whistle blew; and after the whistle blew again at the end of their day's productive work, it required time for them to make themselves ready for leaving the premises when the clock at the gate was again punched. In other words, more shortly stated, it was alleged that the plaintiffs were paid only for the time spent between whistle and whistle and not for the whole time spent on the premises as recorded on the time clock. It was for this class of alleged overtime work that compensation and liquidated damages were claimed.

Subsequently, on May 14, 1947, Congress passed the Portal-to-Portal Act. With respect to all types of activity by employees the Act provided that such activity should not be compensable unless it had been made so by either contract, custom or practice in effect at the time of the activity.¹

After the passage of the Portal-to-Portal Act the plaintiffs, on September 11, 1947, filed an amended complaint to give effect to the Portal-to-Portal Act with respect to the naming of the plaintiffs; and thereafter the defendant filed an amended motion to dismiss the complaint on the grounds that (1) under the Portal-to-Portal Act it failed to state a claim upon which relief can be granted and (2) the court does not have jurisdiction to enforce any liability in respect to the claims asserted in that the plaintiffs failed to allege that the activities for which compensation is claimed are compensable by either — contract, custom or practice.

Counsel for the plaintiffs, however, make the point that the provision of the Portal-to-Portal Act is only an exception to the general affirmative provisions of the Fair Labor Standards Act and therefore as a rule of pleading it was not necessary for the complaint to negative the exception but that the latter is available to the defendant only in its answer as a defense on the merits.

In support of this view counsel cite the case of Deaton v. Titusville Bldg. Corporation, D.C.S.D.N.Y., 72 F.Supp. 986, Coxe, D. J. And a decision to the same general effect seems to have been made in Lemme v. V. LaRose & Sons, Inc., D.C.E.D.N.Y., 7 F.R.D. 485, Kennedy, D. J. Both apparently dealt with complaints which were good when filed before the passage of the Portal-to-Portal Act. Compare discussion by Judge Medina in Bartel's v. Sperti, Inc., D.C.S.D.N.Y., 73 F.Supp. 751. In the present case we are dealing with the sufficiency of an amended complaint filed after the passage of the Portal-to-Portal Act.

I am also referred to a large number of similar cases in other districts in which motions to dismiss complaints for overtime work under the Fair Labor Standards Act setting up so-called portal-to-portal claims have been granted for failure to allege activities compensable under the Portal-to-Portal Act. See Story v. Todd Houston Shipyard Co., D.C.S.D.Tex., 72 F.Supp. 690; Cochran v. St. Paul & Tacoma Lumber Co., D.C.W.D.Wash., 73 F.Supp. 288; Boehle v. Electro Metallurgical Co., D.C. Or., 72 F.Supp. 21; Burfeind v. Eagle-Picher Co., D.C.N.D.Tex., 71 F.Supp. 929; Fajack v. Cleveland Graphite Co., D.C.N. D.Ohio, 73 F.Supp. 308; Lasater et al. v. Hercules Powder Co., D.C.E.D.Tenn., 73 F.Supp. 264.² It seems clear enough that the motions to dismiss in these latter cases could not have been properly granted unless the courts were satisfied that (1) the complaints failed to state a cause of action, absent the averment that the activities were compensable by contract, custom or practice, and (2) the Portal-to-Portal Act was constitutional.

In view of some diversity of opinion upon this subject of pleading, I have independently considered the point involved. I reach the conclusion that the effect of the Portal-to-Portal Act is to require the complaint to allege that the portal-to-portal activities are compensable in accordance with the Portal-to-Portal Act and that failing to do so the complaint does not state a good cause of action unless the Portal-to-Portal Act in this respect is unconstitutional as contended for by counsel for the plaintiffs. The reason for this conclusion is that the Portal-to-Portal Act in this respect does not constitute technically an exception to the general liability under the Fair Labor Standards Act but is an enactment by Congress which specifically defines what constitutes compensable time under the Fair Labor Standards Act.

Whether a pleading must negative an alleged exception must be determined from the wording of the statute — "the true test is whether the exception is so incorporated with the substance of the clause defining the right, duty, liability, or offense as to constitute a material part of the description of the acts, omissions, or other ingredients thereof". 49 C.J. p. 154. There are many decisions illustrating the disputed point pro and con, as it is not always easy to determine how it should be decided under the particular statute; but the subject matter of the enactment and the structural wording of the particular Act are important. United States v. Cook, 17 Wall. 168, 21 L.Ed. 538; 153 A.L.R. 1218.

When we look at the wording and structure of the Portal Act we find that it was clearly intended to define what activities claimed to create a liability for overtime work were made compensable. Thus the language reads — "No employer shall be subject to any liability or punishment under the Fair Labor Standards Act of 1938, as amended, * * * on account of the failure of such employer to pay an employee minimum wages, or to pay an employee overtime compensation, for or on account of any activity of an employee engaged in prior to the date of the enactment of this Act, except an activity which was compensable by either —" contract, custom or practice. It will be noted that the Act in this respect is not limited to portal-to-portal activities as such but defines the essential characteristics of any alleged liability for nonpayment of minimum wages or overtime compensation. None are to be compensable "except an activity which was compensable by either —" contract, custom or practice. Furthermore, while the language includes the word "except", it seems entirely clear from the whole wording that the exception is the only activity which is compensable. Therefore the complaint is legally sufficient only when it alleges activities that are compensable under the Fair Labor Standards Act as amended by the Portal-to-Portal Act. Conversely, the complaint does not state a legal liability unless it alleges compensable activities.

And I think this view of the matter is made even more certain by the provision of subsection (d) of section 2 of the Portal-to-Portal Act which withdraws jurisdiction to enforce liability with respect to an activity which was not compensable under subsections (a) and (b) of section 2 of the Portal-to-Portal Act. It is, of course, a...