Strand v. Garden Valley Telephone Co., Civil Action No. 185.

• Decision Date: 27 September 1943
• Docket Number: Civil Action No. 185.
• Citation: 51 F. Supp. 898
• Parties: STRAND et al. v. GARDEN VALLEY TELEPHONE CO.
• Court: U.S. District Court — District of Minnesota

51 F. Supp. 898

STRAND et al. v. GARDEN VALLEY TELEPHONE CO.

Civil Action No. 185.

District Court, D. Minnesota, Sixth Division.

September 27, 1943.

COPYRIGHT MATERIAL OMITTED

O. E. Lewis, of Bagley, Minn., and Geo. A. Lewis, of Minneapolis, Minn., for plaintiffs.

O'Brien & Sylvestre, of Crookston, Minn., for defendant.

VOGEL, District Judge.

This is an action brought under the Fair Labor Standards Act of 1938, 29 U.S.C.A. § 201 et seq., to recover unpaid overtime wages, liquidated damages for failure to pay such wages, and reasonable attorneys' fees as provided for in the Act.

The plaintiffs are Agnes E. Strand, Lena M. Bakken and John P. Hanson. Originally there was a fourth plaintiff, Arnold S. Peterson, who dismissed his case during the trial.

The defendant, Garden Valley Telephone Company, is a co-operative association formed under the laws of the State of Minnesota. During the times covered by the complaint the defendant operated sixteen to eighteen telephone exchanges in the State of Minnesota, one of such exchanges being at Fosston, Minnesota. The defendant owned no property outside the State of Minnesota and its own lines did not cross state lines, but were wholly within the State of Minnesota. At all times covered by the complaint the defendant had more than five hundred stations or telephones, sometimes having in operation as high as four thousand five hundred telephones. It rendered service twenty-four hours each day. It maintained long distance telephone connections with the Northwestern Bell Telephone Company, whereby it offered to its customers long distance telephone service with points outside the State of Minnesota. On long distance telephone calls made over the defendant's lines to points outside defendant's territory, where such calls were collected for by the defendant, and on incoming "collect" calls from points outside the defendant's territory, the defendant received approximately one-third of the charge therefor. On calls made outside the defendant's territory and paid for at the point of origin, the defendant received no revenue. The defendant's gross earnings per year on interstate business was estimated by the defendant's manager at $3,100. The defendant had an agreement with the Western Union Telegraph Company whereby messages to be transmitted by Western Union telegram could be phoned to the defendant's operators, who would transmit the messages to the local Western Union operator to be sent to places outside the defendant's territory, including points outside the State of Minnesota. On such calls the defendant received commissions which averaged something in the neighborhood of $100 a year. The defendant's gross revenue from all sources for the years covered by the complaint ranged from $71,871.56 to $90,144.82. To summarize, the defendant is a Minnesota corporation operating a telephone business and owning property wholly within the State of Minnesota, but offering to its customers and to the public telephone and telegraph connections with any point in the United States, and presumably elsewhere. By such connections it has become an integral part of that vast network of telephone and telegraph communication over the entire country.

On April 10, 1942, a judgment was entered in this court in an action commenced by L. Metcalf Walling, as Administrator of the Wage and Hour Division, United States Department of Labor (hereafter referred to as the Administrator), against Garden Valley Telephone Company, a corporation, the defendant herein. Judgment in such action was entered pursuant to a stipulation entered into between the Administrator and the defendant whereby the defendant, without admitting the allegations of the complaint, consented to the entry of a judgment restraining the defendant from violating the provisions of the Fair Labor Standards Act of 1938, and providing, also, that the defendant would do and perform certain things set forth in said stipulation for the entry of judgment. The stipulation referred to provided that the defendant would pay to each of its employees employed in or about its place of business at Erskine, Minnesota (home office of the Company), "A sum of money equal to the difference between the amounts of wages actually paid each such employee for the employment during the said periods and the amounts each such employee should have been paid had he been compensated for his said employment at the minimum and overtime rates of pay as required by Sections 6 and 7 of the Fair Labor Standards Act of 1938". The stipulation also provided that the defendant would compute the sums so due its employees and submit to the Administrator a schedule giving the names of the employees and the amounts due; that the Administrator could approve or disapprove the schedule submitted, and that such "schedule as approved by the plaintiff (if prepared by the defendant) or as prepared by the plaintiff or his representative, shall be final and binding upon the defendant as to the total and individual amounts due and the detailed items thereof." Such schedules were prepared, submitted to the Administrator, and, after an investigation by him, were changed and then approved and payments thereon were attempted. In the case of Strand the defendant sent to her by mail a check in the amount of $17.42, which the plaintiff retained but did not cash. She did not execute the receipt and the agreement or release which accompanied the check. In the case of the plaintiff Bakken the defendant offered her a check in the amount of $24.83 and received from her a receipt for $25.08, which stated on its face that it represented "unpaid wages computed or approved by the Wage and Hour Division under the provisions of the Fair Labor Standards Act of 1938, and covering the period or periods of employment from October, 1938, to November, 1941". The receipt was signed on May 16, 1942, by the plaintiff. In addition thereto the defendant required the said plaintiff to sign and the plaintiff did sign a release reciting a consideration of $25.08, whereby the plaintiff accepted the said amount "as full payment for any and all claims or wages due me under said Act and while in the employ of the Garden Valley Telephone Company". Such agreement is also dated May 16, 1942. The difference between the amounts of $25.08, as shown by the receipts, and the amount of the check, $24.83, represents a deduction in accordance with the Federal Insurance Contributions Act, 26 U.S.C.A. Int.Rev. Code, § 1400 et seq. This plaintiff did not cash the check, but has maintained it in her possession ever since. With reference to the plaintiff Hanson, he received a check from the defendant in the amount of $587.75 (added insurance deductions would have made the amount $593.69). This plaintiff also executed a receipt and agreement similar to those executed by the plaintiff Bakken. This plaintiff, also, did not cash the check of $587.75, but maintained it in his possession up to the time of trial. All of the aforementioned amounts were approved by the Administrator as the result of the stipulation and judgment in the case between the Administrator and the defendant.

The facts applying individually to the three claims will be given separate analysis as follows:

Agnes E. Strand

The plaintiff Strand was employed by the defendant as chief switchboard operator at its exchange at Fosston, Minnesota. Her general hours of employment were from 8:00 A. M to 2:00 P. M., seven days per week. In addition thereto this plaintiff, by virtue of her position as chief operator, had to perform supervising duties, make out records and reports, and collect from users of telephones in the business section of Fosston. She performed the collection work for the defendant between October 24, 1938, and November 28, 1941. Subsequent to that date she was relieved of the collection work. Business telephones, for which this plaintiff had to make collection in the town of Fosston, averaged from fifty to sixty in number. There is considerable dispute in the testimony as to how much time this plaintiff was required to spend in performing her duties other than switchboard operating. It was claimed by the plaintiff that it was necessary for her to make approximately one hundred and fifteen to one hundred and twenty separate calls in order to make the collections. Collecting was done by the plaintiff between the first and seventeenth of each month. Where business men had a telephone at their residence as well as at their place of business, the plaintiff collected for both phones at the place of business, so that, in all, she took care of approximately one hundred and ten to one hundred and fifteen telephone bills. All of the places for collection were within approximately three blocks from the defendant's office. Plaintiff kept no records as to the amount of time the collecting or other work consumed. In testifying she merely gave estimates of such time. Between the first and seventeenth of each month she believed she put in approximately twenty-one hours additional per week. After the seventeenth she testified that her additional work consumed approximately thirteen hours per week. There was some testimony to the effect that the work of chief operator, not including the collecting, would amount to one and one-half to two hours per week. A consideration of all of the testimony convinces me that, in addition to her regular forty-two hours per week spent at the switch-board, this plaintiff spent ten hours per week between the first and seventeenth of each month and for the balance of the month four hours additional each week, and I so find.

Lena M. Bakken

This plaintiff was employed by the defendant during the period covered by the complaint as a night switchboard operator at the defendant's exchange at Fosston, Minnesota. She reported for duty at 9:00 P. M., remaining on duty until 8:00 A. M. the following morning, working seven days per week. She received...