Thompson v. Iowa Beef Packers, Inc.

• Decision Date: 09 April 1971
• Docket Number: No. 54323,54323
• Citation: 185 N.W.2d 738
• Parties: 19 Wage & Hour Cas. (BNA) 1060, 65 Lab.Cas. P 32,482 Edward D. THOMPSON, Jay Nollen, Kenneth A. Harder, Donald J. Sporrer, Lawrence W. Kennedy, Albert Weaver, James R. Morgan, Val Jean Johannsen, Raymond James Johnson, Luverne M. Hoffman, Carol W. Vennink, Ben J. Lackman, Larry James Larrison, and Lawrence J. Kabela, Appellees, v. IOWA BEEF PACKERS, INC., Appellant.
• Court: Iowa Supreme Court

Page 738

185 N.W.2d 738

19 Wage & Hour Cas. (BNA) 1060, 65 Lab.Cas. P 32,482

Edward D. THOMPSON, Jay Nollen, Kenneth A. Harder, Donald J. Sporrer, Lawrence W. Kennedy, Albert Weaver, James R. Morgan, Val Jean Johannsen, Raymond James Johnson, Luverne M. Hoffman, Carol W. Vennink, Ben J. Lackman, Larry James Larrison, and Lawrence J. Kabela, Appellees, v. IOWA BEEF PACKERS, INC., Appellant.

No. 54323.

Supreme Court of Iowa.

April 9, 1971.

P. L. Nymann, Dakota City, Neb., for appellant.

Raun & Franck, Denison, for appellees.

UHLENHOPP, Justice.

The main question presented in this appeal is whether workmen are required to attempt contract arbitration before they can sue for overtime compensation under the Fair Labor Standards Act (FLSA), 29 U.S.C.A. §§ 201--219.

The case was tried by ordinary proceedings without a jury. From the evidence the trial court could reasonably find that plaintiffs were maintenance men in defendant's plant near Denison, Iowa, during the period in question from April 28, 1965, to April 28, 1967. The plant was fairly new. During the first years many breakdowns occurred, necessitating much work by the maintenance men to avoid costly 'down time.' A bell was sounded when the men were needed. After the plant had been constructed, a lunch room for the maintenance men was added just off the kill floor so they could answer the bell more readily.

Under the contract between the union and defendant, the men were supposed to have a thirty-minute lunch period. The evidence clearly indicates, however, that until February of 1966, the lunch period existed more in name than in fact. On numerous occasions the men were obliged to answer bells during lunch. When they tried to eat lunch later, they would frequently be interrupted again by the bell.

Eventually one of the maintenance men undertook grievance procedure because he was not getting his lunch period. This precipitated a meeting by defendant's industrial relations officer with the maintenance men in February, 1966. That officer instructed the men that they were free to leave the premises during their lunch period.

The instructions appear to have been honored by the employer more in the breach than in observance. Breakdowns continued to occur, the production people needed immediate help from the maintenance men, the bell continued to be rung during lunch periods, and the maintenance men were expected to, and did, respond. The situation did not in fact change from what it had been. A procedure for two shifts of maintenance men was attempted, but did not prove efficacious.

On April 28, 1967, plaintiffs commenced this action for compensation for their lunch periods during the preceding two years. Shortly thereafter, the industrial relations officer dealt with the situation in a letter which was sent to each maintenance man. That letter, however, related to the future.

The collective bargaining contract between the union and defendant provided grievance procedure including arbitration. The trial court overruled defendant's contention that the men had to arbitrate before they could sue, held on the facts that the maintenance men were actually on call during their lunch period for the two years in question, and granted the men compensation accordingly. Defendant appeals.

Defendant makes three contentions here. First, the workmen were not on call during lunch periods after the instructions were given in February 1966 to the effect they could leave the premises during such periods. Second, one of the workmen who said he always got his 30 minutes for lunch at some time during the day could not in any event claim he had not gotten his lunch periods. Third, the men had to attempt arbitration before they could sue.

I. Defendant's first two contentions are primarily factual and may be considered together. The trial court's findings of fact, if supported by substantial evidence, bind us. Rule 344(f)(1), Rules of Civil Procedure.

The legal principle regarding compensable time under FLSA for being 'on call' was announced in Armour & Co. v. Wantock, 323 U.S. 126, 65 S.Ct. 165, 89 L.Ed. 118. The decisions lay stress on whether the employees are actually free to pursue their own interests during their lunch period. If, in fact, the employer retains a hold on the employees for services when needed during a lunch period, so that the employees are not actually at liberty, the period constitutes compensable time. Glenn L. Martin Nebraska Co. v. Culkin, 197 F.2d 981 (8th Cir.); F. W. Stock & Sons v. Thompson, 194 F.2d 493 (6th Cir.); Wirtz v. Minton Rendering Co., 54 Lab.Cas. 31,876 31,876 (U.S.Dist.Ct.N.D.Tex.); Hofler v. Spearin, Preston & Burrows, Inc., 51 Misc.2d 758, 273 N.Y.S.2d 863.

Here the men had 30 minutes for lunch. It hardly seems reasonable that the parties contemplated the men would drive from the plant to their homes or other places, eat, drive back, and he back on time. In fact, a separate lunch building was provided for them on the premises, where they would hear the bell. On numerous occasions, both before and after February 1966, they were actually called during the lunch period. On cross-examination, defendant's witness LaFleur admitted with commendable candor, 'If it was a serious break-down and the men were present, were readily accessible, they were asked to help with the break-down, yes; if they were on their lunch break. If they were called on their lunch break and given a lunch break later, the same thing could happen. They would have to answer the bell then, too.' Defendant's witness Walker made somewhat similar admissions. Defendant's witness O'Brien, telling about frequent breakdowns before new equipment was installed in recent times, stated in a letter that 'The maintenance men will remember the thousands of times they had to run because the boilers have dropped out'; 'Many will remember the loss of steam that caused hours of dying time and lost profits'; 'The maintenance men will remember the long hard hours of work put in on the sump under the coolers.'

As to the period subsequent to February 1966, the trial court found the situation was no different than before--the men were actually on call. We do not say we would reach the same finding on the evidence, but substantial evidence supports the trial court's finding.

As to the contention that one workman actually got his 30 minutes for lunch each day, we think defendant misapprehends the rationale of Armour & Co. v. Wantock. The question is not whether a workman actually gets his 30 minutes without interruption. The question is whether he is on call during that period, or free to pursue his own interests. He may get his lunch times without interruption every day for a week or at various times throughout a given day. But if those times in fact belong to the employer, if the employee is not free but is actually subject to call during those times, then the times are compensable. The trial court could reasonably find that such was the situation here.

We cannot sustain defendant's challenges to the findings of fact.

II. What about defendant's contention that plaintiffs had to attempt arbitration before they could sue? The contract under which plaintiffs worked contained a provision for four-step grievance procedure culminating in binding arbitration. Plaintiffs did not pursue that course but brought their complaint directly to court. Did they have the choice of arbitration or litigation, or were they obliged to try arbitration first?

Defendant is engaged in interstate commerce, and substantive federal labor law applies. Humphrey v. Moore, 375 U.S. 335, 84 S.Ct. 363, 11 L.Ed.2d 370. The present controversy is undoubtedly arbitrable. Donahue v. Susquehanna Collieries Co., 138 F.2d 3 (3rd Cir.). Agreements to arbitrate may ordinarily be specifically enforced. United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409.

As a general rule, federal labor policy requires that employees seeking to assert grievances must initially attempt to use contract grievance procedure including arbitration. Textile Workers Union of America v. Lincoln Mills v. Alabama, 353 U.S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972; Republic Steel Corp. v. Maddox, 379 U.S. 650, 85 S.Ct. 614, 13 L.Ed.2d 580. These decisions are founded on § 301(a) of the Labor Management Relations Act of 1947 (LMRA), 29 U.S.C.A. § 185(a).

In accordance with this general rule, federal courts of appeal have held that employees must attempt to arbitrate FLSA claims before they can come to court. Donahue v. Susquehanna Collieries Co., supra; Watkins v. Hudson Coal Co., 151 F.2d 311 (3rd Cir.); Evans v. Hudson Coal Co., 165 F.2d 970 (3rd Cir.); Beckley v. Teyssier, 332 F.2d 495 (9th Cir.). Some federal and state trial courts had previously held to the contrary. Annot., 24 A.L.R.2d 752.

The United States Supreme Court does not appear to have spoken on the problem as to FLSA claims, but it recently decided U.S. Bulk Carriers, Inc. v. Arguelles, 400 U.S. 351, 91 S.Ct. 409, 27 L.Ed.2d 456. A federal statute which antedates the Labor Management Relations Act, requires a master or owner of a vessel to pay seamen promptly, failing which the seamen are entitled to recover 'two days' pay for each and every day during which payment is delayed * * * which sum shall be recoverable as wages in any claim made before the court * * *.' 46 U.S.C.A. § 596. In Arguelles, a majority of the Court thought that statute indicated Congressional intent to permit a seaman to sue without first attempting arbitration which prevailed over Congressional intent favoring prior arbitration generally.

Does the Fair Labor Standards Act indicate similar Congressional intent, leading to the belief that the United States Supreme Court will apply Arguelles to FLSA cases? We are inclined to think so, although the question is close.

The Fair Labor Standards Act too antedates the Labor Management Relations Act. It also...