Walling v. Griffin Cartage Co.

• Decision Date: 30 August 1945
• Docket Number: No. 4350.,4350.
• Parties: WALLING, Administrator of Wage and Hour Division, U. S. Dept. of Labor, v. GRIFFIN CARTAGE CO., Inc.
• Court: U.S. District Court — Western District of Michigan

62 F. Supp. 396

WALLING, Administrator of Wage and Hour Division, U. S. Dept. of Labor, v. GRIFFIN CARTAGE CO., Inc.

No. 4350.

District Court, E. D. Michigan, S. D.

August 30, 1945.

COPYRIGHT MATERIAL OMITTED

Charles A. Reynard, Regional Atty., U. S. Dept. of Labor, of Cleveland, Ohio, for plaintiff.

Matheson, Dixon & Brady, of Detroit, Mich., for defendant.

PICARD, District Judge.

This is an action by the administrator of the Wage and Hour Division, United States Department of Labor, filed pursuant to Section 17 of the Fair Labor Standards Act of 1938, 29 U.S.C.A. § 217, seeking injunction against defendant and claiming violation of the overtime provisions of the act.

Facts.

Defendant, a common carrier by motor vehicle, has a general cartage business in Wayne County. Less than one percent is in interstate commerce and while cartage services are available to the general public, 95 percent of defendant's business is transporting castings, forgings and machine parts for and between two or three Detroit plants. Defendant transports these articles from plants where they have been partly manufactured to others where additional steps in the production of the finished goods are performed and then carries the completed products to Ford Motor Company and Chrysler also in and about Wayne County, to become component parts of trucks, automobiles, other machines and military equipment sold and shipped in interstate commerce.

On June 12th, 1944 the National War Labor Board issued a directive giving truck drivers a 48 hour week instead of 54 with time and one-half after 48 hours. But the War Labor Board recognized that the Administrator, plaintiff herein, at that time was claiming that defendant's truck drivers came under the Fair Labor Standards Act and, subsequent to the issuance of its order in correspondence with Administrator's counsel, acknowledged that the order was not intended to express the Board's opinion concerning applicability of overtime provisions of the Act to these drivers. In this correspondence the Board likewise made it clear that it was expressing no opinion whether adherence to its order would constitute compliance with the Act and expressly called attention to the fact that the statute and executive order under which it operates gives it no authority to interpret or apply provisions of the Fair Labor Standards Act.

Plaintiff Administrator admits that defendant's employees herein concerned are not engaged in interstate commerce but bases his contention entirely on that clause of Section 7, 29 U.S.C.A. § 207, which provides that no employee "who is engaged * * * in the production of goods for commerce" shall be employed for a work week longer than 40 hours, etc. He claims, of course, that these truckers are engaged in the "production of goods for commerce" because Section 3(j) of the Fair Labor Standards Act, 29 U.S.C.A. § 203(j), provides that "an employee shall be deemed to have been engaged in the production of goods if such employee was employed in producing, manufacturing, mining, handling, transporting, or in any other manner working on such goods * * * in any State."

Defendant denies these men are engaged "in the production of goods for commerce" and asserts further that it is subject to Section 15(a)(1), 29 U.S.C.A. § 215(a)(1), which grants common carriers immunity from liability from the transportation in commerce in the regular course of business, of goods not produced by such common carrier.

Defendant also claims these drivers are exempt from the overtime provisions of the Act by Section 13(b)(1) thereof, 29 U.S.C.A. § 213(b)(1), applicable to employees whose qualifications and maximum hours of service are subject to regulation by the Interstate Commerce Commission under provisions of the Motor Carrier Act 1935, 49 U.S.C.A. § 304.

Defendant further claims these employees come under Section 13(a)(2) of the act which exempts from coverage employees of a retail or service establishment whose selling or servicing is intrastate commerce; that the employees affected have an employment contract with this defendant above the minimum prescribed in the act which should not be disturbed and that the application of the Fair Labor Standards Act to defendant's operators is unconstitutional.

Conclusions of Law

The main question is whether these employees are engaged in "producing goods for commerce" and while it is seemingly a stretch of the imagination to even consider that carting goods from one place to another in Wayne County can be "producing," it appears that by the statutory definition of the word "produced" and sound decisions interpreting and applying it, such an employee is engaged in the production of goods for commerce when his labors further the journey and thereby complete the goods into the final product which is sold in interstate commerce. Rockton & Rion Railroad Co. v. Walling, 4 Cir., 146 F.2d 111; Bracey v. Luray, 4 Cir., 138 F.2d 8.

It is to be noted that the words in the act specifically cover "handling, transporting," etc., and the great weight of authority does hold that if an employee handles or transports such goods he is engaged in the production of goods for commerce. Western Union Telegraph Co. v. Lenroot, 323 U.S. 490, 65 S.Ct. 335; Fox v. Standard Oil Co., 294 U.S. 87, 55 S.Ct. 333, 79 L.Ed. 780.

There seems however to be a variance between interpretations of the above citations, particularly the Western Union opinion but as you analyze these cases and the entire trend of these decisions the United States Supreme Court has seemingly laid down these fundamentals: to-wit, that where an employee transports goods within the State of Michigan he is not engaged in commerce, but where he transports goods from one state to another he is in commerce. So far there is little dispute. The decisions proceed to point out however that Congress can — and this is important — in order to prevent unfair goods from entering commerce, regulate the wages and hours of employees as well as all steps in the manufacturing of goods to be shipped in interstate commerce and it is apparent that Congress has defined the production of goods for commerce as it has so that it can catch up into "the category of production every step in putting the subject of commerce into a state to enter commerce." Western Union case, supra 323 U.S. 490, 65 S.Ct. 342.

One notes the high court's distinction in the following extracts from the Western Union opinion:

"The Government contends that in defining `produced' the statute intends `handled' or `worked on' to mean not only handling or working on in relation to producing or making an article ready to enter interstate transit, but also includes the handling or working on which accomplishes the interstate transit or movement in commerce itself. If this construction is adopted, every transporter, transmitter, or mover in interstate commerce is a `producer' of any goods he carries."

Also:

"Its artificial definition, if construed to mean that `handling' and `worked on' catches up into the category of production every step in putting the subject of commerce into a state to enter commerce, is a sensible and useful one, and not at odds with any other section of the Act."

And:

"They serve a useful purpose when read to relate to all steps, whether manufacture or not, which lead to readiness for putting goods into the stream of commerce."

"We are clear that `handled' or `worked on' includes every kind of incidental operation preparatory to putting goods into the stream of commerce."

In short whenever as a practical matter the local transportation of goods is a step in putting a product of that state into interstate commerce, then as a legal matter, that step, however slight it may be, becomes a part of the "production of goods", whether as stated by plaintiff the step by which this is accomplished is by a hand truck, a traveling crane, a locomotive moving cars wholly within a plant, or a truck traveling over public thoroughfares.

This is seemingly in accord with the other decisions.

In Rockton & Rion Railroad Co. v. Walling, 4 Cir., 146 F.2d 111 the employees of a small railroad engaged in transporting rough stone from a quarry to processing plants in the same state from which finished stone was subsequently shipped interstate, were held to be "engaged * * * in the production of goods for commerce."

In Mid-continent Pipe Line Co. v. Hargrave, 10 Cir., 129 F.2d 655, the court held that employees transporting crude oil from...