Walling v. v. Portland Terminal Co, No. 336

• Court: United States Supreme Court
• Writing for the Court: BLACK
• Citation: 330 U.S. 148,67 S.Ct. 639,91 L.Ed. 809
• Parties: WALLING, Adm'r, Wage & Hour Div., U.S. Department of Labor, v. PORTLAND TERMINAL CO
• Docket Number: No. 336
• Decision Date: 17 February 1947

330 U.S. 148 67 S.Ct. 639 91 L.Ed. 809 WALLING, Adm'r, Wage & Hour Div., U.S. Department of Labor,

v.

PORTLAND TERMINAL CO.

No. 336. Argued Jan. 17, 1947. Decided Feb. 17, 1947.

Page 149

Mr. William S. Tyson of Washington, D.C., for petitioner.

Mr. E. Spencer Miller, of Portland, Mc., for respondent.

Mr. Justice BLACK delivered the opinion of the Court.

This is an action brought by petitioner against respondent in a Federal District Court to enjoin an alleged violation of §§ 15(a)(2) and 15(a)(5) of the Fair Labor Standards Act, 52 Stat. 1060, 1068, 29 U.S.C. §§ 201 et seq., 215(a)(2), (5), 29 U.S.C.A. §§ 201 et seq., 215(a)(2, 5), which requires as to the employees covered by the Act the maintenance of records concerning their wages and the payment to them of minimum wages. The District Court denied the injunction on the ground that the articular persons involved were not employees, 61 F.Supp. 345, and the Circuit Court of Appeals affirmed on the same ground, one judge dissenting. 1 Cir., 155 F.2d 215. See also Walling v. Jacksonville Terminal Co., 5 Cir., 148 F.2d 768. Certiorari was granted because of the importance of the questions involved to the administration of the Act. 329 U.S. 696, 67 S.Ct. 85. The findings of fact by the District Court, approved by the Circuit Court of Appeals, and not challenged here, show:

For many years the respondent railroad has given a course of practical training to prospective yard brakemen. This training is a necessary requisite to entrusting them with the important work brakemen must do. An applicant for such jobs is never accepted until he has had this preliminary training, the average length of which is seven or eight days. If accepted for the training course, an applicant is turned over to a yard crew for instruction. Under this supervision, he first learns the routine activities by observation, and is then gradually permitted to do actual work under close scrutiny. His activities do

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not displace any of the regular employees, who do most of the work themselves, and must stand immediately by to supervise whatever the trainees do. The applicant's work does not expedite the company business, but may, and sometimes does, actually impede and retard it. If these trainees complete their course of instruction satisfactorily and are certified as competent, their names are included in a list from which the company can draw when their services are needed. Unless they complete the training and are certified as competent, they are not placed on the list. Those who are certified and not immediately put to work constitute a pool of qualified workmen available to the railroad when needed. Trainees received no pay or allowance of any kind prior to October 1, 1943. At that time, however, the respondent and the collective bargaining agent, the Brotherhood of Railroad Trainmen, agreed that, for the war period, men who proved their competency and were thereafter listed as accepted and available for work as brakemen, should be given a retroactive allowance of $4 per day for their training period. The findings do not indicate that the railroad ever undertook to pay, or the trainees ever expected to receive, any remuneration for the training period other than the contingent allowance.

The Fair Labor Standards Act fixes the minimum wage that employers must pay all employees who work in activities covered by the Act. There is no question but that these trainees do work in the kind of activities covered by the Act. Consequently, if they are employees within the Act's meaning, their employment is governed by the minimum wage provisions. But in determining who are 'employees' under the Act, common law meployee categories or employer-employee classifications under other statutes are not of controlling significance. See N.L.R.B. v. Hearst Publications, 322 U.S. 111, 128, 129, 64 S.Ct. 851, 859, 88 L.Ed. 1170. This Act contains its own definitions, comprehensive enough to require its application to many persons and working rela-

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tionships, which prior to this Act, were not deemed to fall within an employer-employee category. See United States v. Rosenwasser, 323 U.S. 360, 362, 363, 65 S.Ct. 295, 296, 89 L.Ed. 301.

Without doubt the Act covers trainees, beginners, apprentices, or learners if they are employed to work for an employer for compensation. This is shown by s 14 of the Act which empowers the Administrator to grant special certificates for the employment of learners, apprentices and handicapped persons at less than the general minimum wage.¹ The language of this section and its legislative history reveal its purpose. Many persons suffer from such physical handicaps, and many others have so little experience in particular vocations that they are unable to get and hold jobs at standard wages. Consequently, to impose a minimum wage as to them might deprive them of all opportunity to secure work, thereby defeating one of the Act's purposes, which was to increase opportunities for gainful employment. On the other hand, to have written a blanket exemption of all of them from the Act's provisions might have left open a way for wholesale evasions. Flexibility of wage rates for them was therefore provided under the safeguard of administrative permits. This section plainly means that employers who hire beginners, learners, or handicapped persons,

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expressly or impliedly agree to pay them compensation, must pay them the prescribed minimum wage, unless a permit not to pay such minimum has been obtained from the Administrator. On the other hand, the section carries no implication that all instructors must either get a permit or pay minimum wages to all learners; the section only relates to learners who are in 'employment.' And the meaning of that term is found in other sections of the Act.

Section 3(g) of the Act defines 'employ' as including 'to suffer or permit to work' and § 3(e) defines 'employee' as 'any individual employed by an employer.' The definition 'suffer or permit to work' was obviously not intended to stamp all persons as employees who, without any express or implied compensation agreement, might work for their own advantage on the premises of another. Otherwise, all students would be employees of the school or college they attended, and as such entitled to receive minimum wages. So also, such a construction would sweep under the Act each person who, without promise or expectation of compensation, but solely for his personal purpose or pleasure, worked in activities carried on by other persons either for their pleasure or profit. But there is no indication from the legislation now before us that Congress intended to outlaw such relationships as these. The Act's purpose as to wages was to insure that every person whose employment contemplated compensation should...