Tobin v. Anthony-Williams Mfg. Co.

• Decision Date: 29 May 1952
• Docket Number: No. 14418.,14418.
• Citation: 196 F.2d 547
• Parties: TOBIN v. ANTHONY-WILLIAMS MFG. CO., Inc.
• Court: U.S. Court of Appeals — Eighth Circuit

196 F.2d 547 (1952)

TOBIN v. ANTHONY-WILLIAMS MFG. CO., Inc.

No. 14418.

United States Court of Appeals Eighth Circuit.

May 6, 1952.

Rehearing Denied May 29, 1952.

William A. Lowe, Attorney, U.S. Department of Labor, Washington, D.C. (William S. Tyson, Sol., Bessie Margolin, Asst. Sol., Washington, D. C., and Earl Street, Regional Attorney, Dallas, Tex., on the brief), for appellant.

L. B. Smead, Camden, Ark., for appellee.

Before SANBORN, WOODROUGH, and THOMAS, Circuit Judges.

WOODROUGH, Circuit Judge.

The Secretary of Labor instituted this action under Section 17 of the Fair Labor Standards Act of 1938, c. 676, 52 Stat. 1060, 29 U.S.C.A. § 201 et seq., as amended in 1949, c. 736, 63 Stat. 910, to enjoin the Anthony-Williams Company from violating the overtime compensation, record-keeping, and shipment provisions of the Act. After trial the District Court dismissed the complaint and this appeal followed.

On the appeal there are two distinct questions for consideration: 1) were certain truck drivers and woods workers "employees" of defendant within the meaning of the Act as contended by plaintiff, or were they independent contractors, as contended by the defendant and as was held by the trial court; and 2) did the District Court err in refusing to issue injunction against defendant in respect to the overtime, record-keeping and shipment requirements of the Act.

1. The status of the truck drivers and woods workers.

Defendant is a corporation organized under the laws of the State of Arkansas with its office and principal place of business at Kingsland, Arkansas. It is engaged in the production and sale of pine and hardwood lumber. The timber used by defendant in such production comes from lands owned by it and from other lands as to which defendant owns the timber rights. The timber is cut, and the logs hauled to the mill by truck. At the mill the logs are manufactured into pine and hardwood lumber, a substantial part of which is then sold and shipped in interstate commerce.

About three years prior to the trial (which was held in January of 1951), defendant made new arrangements with most of its employees who drove trucks hauling logs from the place where the timber was cut to the mill. Such haulers had previously been considered and paid as employees. Under the new arrangement, the truck drivers purchased their trucks from defendant and agreed to be paid for the logs hauled at a certain rate per thousand board feet hauled, dependent on the actual length of the haul. From this payment, the defendant would deduct $2 per thousand board feet hauled and would apply it on the purchase price of the truck. Of the five drivers whose cases are considered on this appeal (the District Court listed eight men in its memorandum, but the status of three of them is not presently in issue for one reason or another), four of them made no down payment on the purchase price of their trucks and one made a down payment of $350. None of the five pledged their credit in the purchase arrangement, or agreed to pay for his truck in any specified time, but only agreed to the $2 deduction above set out. In the papers signed in connection with the so-called "sale" of the trucks, it was specified that the trucks were to be used only in connection with the business of defendant, and none of the five drivers did use the trucks for anything other than that business.

In the actual logging and hauling operation, the defendant's foreman specified the places where timber was to be cut, and if the timber was on land owned by defendant the specified trees to be cut would be marked; while if the trees were on land in which the defendant owned the timber rights, the size of timber to be cut would be specified. Defendant's foreman kept a close check on the whole operation, seeing to it that the stumps were cut to a proper height and that the workers cut high enough into the tree tops.

When the new arrangement was inaugurated, the defendant employed the men who cut down the timber and prepared it for loading on the trucks. About a year and a half before the trial, this arrangement was changed as to four of the haulers, and those haulers were required to hire their own woods workers and pay them. When this new arrangement was made, the rate per thousand board feet hauled paid to the haulers was raised by an amount approximately equal to the amount formerly paid to the woods workers by the defendant. The truck driver haulers then reimbursed the woods workers at the same rate of pay those workers had previously received from the company.

The truckers had to furnish the woods workers working under them with saws and axes, but defendant furnished the teams necessary to drag the logs from the point where they were cut down to the point where they were loaded on the trucks. The actual loading onto the trucks was done by a machine adapted for that purpose. This machine was owned by the defendant and was operated by a man who was admittedly an employee of defendant.

The work done by the haulers in question was necessarily limited by the amount of work done by the employee loader and also by the fact that the storage capacity of defendant for logs was limited. This limited capacity necessitated a plan of rotating the work so that one hauler does not work every third day. The rotation plan was adopted by mutual agreement of the haulers.

It was shown that two admitted employees of defendant do the same work as do the haulers in question. The alleged independent contractor haulers made a little more or a little less money than the employee-haulers, dependent on the actual number of hours worked. The haulers in question had never lost money hauling, but "neither had they made much".

It is undisputed that the haulers in question worked more than 40 hours per week, and that if they were employees rather than independent contractors, then the defendant has violated the provisions of the Fair Labor Standards Act as to overtime compensation and as to record-keeping.

In his memorandum opinion the trial judge stated: "The facts in this case are similar to the facts in United States v. Silk, 331 U.S. 704, 67 S.Ct. 1463, 91 L.Ed. 1757 and the holding of the Supreme Court in that case will control here." Appellee adopts that theory here and predicates his position solely thereon. We agree that the Silk case controls this case, but we cannot agree that the application of the holding in that case will result in a holding that the haulers and woods workers in this case are independent contractors rather than employees.

In the Silk case, in discussing the Social Security Act, the Supreme Court stated, 331 U.S. at page 716, 67 S.Ct. at page 1469: "Probably it is quite impossible to extract from the statute a rule of thumb to define the limits of the employer-employee relationship. The Social Security Agency and the courts will find that degrees of control, opportunities for profit or loss, investment in facilities, permanency of relation and skill required in the claimed independent operation are important for decision. No one is controlling nor is the list complete."

Applying that general test, we think that the haulers and woods workers in this case must be held to be employees. Defendant, in effect, controls their activities. They are directed where and what to cut. The amounts of their deliveries are determined by the work of defendant's loader and by the capacity of defendant's storage facilities. The haulers have no substantial investment in their trucks, and their ownership is no more than nominal. They cannot use the trucks for other than defendant's business, even on days they are not working for the defendant. Defendant does not furnish the woods workers with saws and axes, but the teams necessary are...