Young v. Kellex Corporation

• Decision Date: 02 January 1948
• Docket Number: Civil Action No. 754.
• Citation: 82 F. Supp. 953
• Parties: YOUNG v. KELLEX CORPORATION et al.
• Court: U.S. District Court — Eastern District of Tennessee

82 F. Supp. 953

YOUNG v. KELLEX CORPORATION et al.

Civil Action No. 754.

United States District Court E. D. Tennessee, N. D.

January 2, 1948.

Southern & Southern and Ann Nigro, all of Knoxville, Tenn., for plaintiff.

R. R. Kramer and Porter Greenwood, both of Knoxville, Tenn. (Kramer, McNabb & Greenwood, of Knoxville, Tenn., of counsel), for defendants.

TAYLOR, Chief Judge.

This is an action for overtime, liquidated damages, and attorney's fee under the Fair Labor Standards Act of 1938, 29 U.S. C.A. §§ 201 to 219, for a period of employment beginning November 19, 1944, and extending to September 16, 1945, and for double time under Executive Order No. 9240, as amended by Executive Order No. 9248, and as set out as a note under Section 326 of Title 40, U.S.C.A. Suit was commenced in the Circuit Court of Roane County, Tennessee, and removed to this Court, defendant in removal relying on diversity of citizenship, jurisdictional amount of claim, and involvement of a federal question. Plaintiff Glenn M. Young sues for himself and all others similarly situated, but no other plaintiffs are named. The named defendants are Kellex Corporation and M. W. Kellog Company, both foreign corporations, the former allegedly a subsidiary of the latter. M. W. Kellog Company was not served with process and is not in court.

It has been stipulated by the parties that during his period of employment with Kellex Corporation plaintiff worked a total of 1568 overtime hours, exclusive of overtime on days classed as 7th consecutive days; also, that from May 6, 1945, to August 19, 1945, plaintiff was paid in full for all Sunday work, as 7th consecutive days of work, but that prior to May 6, 1945, he was not paid for any seventh consecutive day of work.

During the period under consideration, plaintiff was employed by Kellex Corporation as "transportation manager," having charge of a motor pool at Oak Ridge, Tennessee, and being responsible for keeping all automobiles of the pool in condition and readiness for use, as well as having under his supervision about 20 chauffeurs and chauffeurettes.

Several points of controversy appear in the case. Plaintiff claims he was an hourly employee, receiving a base pay of $1.62½ per hour. Defendant insists that plaintiff was paid a weekly salary, not an hourly wage; also, that plaintiff has been fully paid. Plaintiff claims that he was a laborer, within the meaning of the Fair Labor Standards Act and entitled to its benefits. Defendant contends that plaintiff was an executive, being a transportation manager with certain executive functions, or an administrator, having power to hire and fire subordinate employees, hence exempted from coverage of the Act. Plaintiff claims that he was engaged in an occupation necessary to the production of goods for interstate commerce, within the meaning of the Act, and within the rule of Warren-Bradshaw Drilling Co. v. Hall, 317 U.S. 88, 63 S.Ct. 125, 87 L.Ed. 83, and related cases. Defendant insists that plaintiff's employer, hence plaintiff also, was engaged in original construction and for that reason not within the coverage of the Act.

Proof has been taken on the controverted points and briefs have been filed. It has been admitted on behalf of plaintiff that in order to recover under the Act, plaintiff must prove one of the following: (1) That he was engaged in interstate commerce; or, (2) that he was engaged in the production of goods for interstate commerce; or (3) that his occupation was necessary to the production of goods for interstate commerce.

As regards recovery under the Act, plaintiff places his reliance on requirement No. 3, and has directed the burden of his proof to the end that he was engaged in an occupation "necessary to the production" of goods of commerce, within the requirements of Section 203(j) of the Act. Only the Act is relied on as requiring payment of time and one-half for overtime, liquidated damages, and attorney's fee. Executive Order No. 9240 is relied on as authorizing double time for Sundays, as 7th consecutive days within the workweeks, although recovery for Sunday work as overtime under the Act has not been treated as excluded.

Although plaintiff has placed reliance on Executive Order No. 9240, as amended by Executive Order 9248, it has not been shown how the Order applies in plaintiff's favor, nor has defendant demonstrated that it does not apply. Counsel's brief for defendant refers to the case of Wells et al. v. Ford, Bacon and Davis, Inc., 6 F.R.D. 606, decided by the District Court for Western District of Kentucky, and affirmed without opinion by 6 Cir., 145 F.2d 240. But in that case the claim of plaintiffs under the Executive Order was dismissed on the ground that plaintiffs had not properly joined themselves in the purported class action. It was not necessary under the decision there for the court to construe the Executive Order as it might have applied in a proper case.

In the case here, plaintiff sues alone and claims more than the minimum jurisdictional amount. It is not seriously contended that plaintiff cannot join his claim under the Executive Order to his claim under the Fair Labor Standards Act, if that were necessary to confer jurisdiction. Also, plaintiff here relies on the Executive Order only for recovery of double time for 7th consecutive days, which the court in the Wells case observed was provided for in the Executive Order. Dictum of the Wells case is to the effect that the Executive Order does not require payment of time and one-half for overtime. That case is no authority for holding that Executive Order 9240 either is, or is not, applicable to the case here. Nor, apparently, is any authority to be found in judicial decisions.

Executive Order No. 9240, as amended by Executive Order No. 9248, was before the New York courts in Steiner v. Pleasantville Constructors, Inc., 1944, 182 Misc. 66, 49 N.Y.S.2d 42. There the court held that plaintiff was not entitled to recover double time for Sunday work under the provisions of the Fair Labor Standards Act, and in its very brief opinion the court added, "Executive Order No. 9240, as amended by Executive Order No. 9248, * * * is not binding on the defendant." Plaintiff there was a dock worker for a contractor engaged in construction of a training base. The court did not explain why the Executive Order was not binding on defendant. The decision was affirmed without opinion by the Appellate Division. 269 App.Div. 738, 54 N.Y.S.2d 700.

In Barrett v. National Malleable & Steel Castings Co., D.C.1946, 68 F.Supp. 410, plaintiffs sought recovery of double time for "7th consecutive days." There plaintiffs relied on the Fair Labor Standards Act, and the court held that the Act did not provide for double time for 7th consecutive days. Although conditions contemplated by the Executive Order were present, apparently the Order was not relied on. That the Order was in the court's mind is indicated by the fact that the court cited the Steiner case, supra.

As the question of recovery for double time under the Executive Order is before the Court here, it is necessary to inquire into the applicability of that Order. Executive Order No. 9240, as amended by Executive Order 9248, is set out in full in 40 U.S.C.A., as a note under section 326.

It provides in part as follows:

"V. All Federal departments and agencies affected by this order shall refer to the Secretary of Labor for determination questions of interpretation and application arising hereunder. In any industry or occupation in which the Secretary finds that a wage stabilization agreement approved by a Government department or agency is operating satisfactorily, or in any industry or occupation in which the Secretary finds that the nature and exigencies of operations make such action necessary or advisable for the successful prosecution of the war, the Secretary may determine that any or all of the provisions of this order shall not apply to such industry or occupation or to any classes of employees therein."

That Executive Order No. 9240 was not intended to apply in every case where war work was being done, is plainly implicit in the language quoted. It was stipulated by the parties here that defendant did pay plaintiff for his 7th consecutive days from May 6, 1945, which is some indication that the Executive Order was then made effective as to employees of defendant. Sunday pay was continued to August 19, 1945. It may have been only a coincidence that payments in line with the Executive Order were discontinued after August 19, 1945, but Executive Order 9240 was revoked August 22, 1945. Executive Order No. 9601, 40 U.S.C.A. § 326 note, 10 F.R. 10275.

Also implicit in the quoted language is an intention that the Order shall be applied administratively, if at all, and that the Order does not of itself create rights in favor of employees which can be enforced in the courts. This conclusion is implied in other language of the Order, which directs the manner in which the Order will be given effectiveness.

"II. All Federal departments and agencies shall conform the provisions in all existing and future contracts negotiated, executed, or supervised by them to the policies of this order. All such departments and agencies shall immediately open negotiations to alter provisions in existing contracts to conform them to the requirements of this order."

Implication from this provision is, that the rights of employees under Executive Order No. 9240, if they exist at all, are derivative — not from the Order itself, but from contracts that incorporate its provisions. If through an exercise of administrative discretion it is found that the Order should be applied in a particular situation where work is being done under Government contract, and if the contract between the Government and the contractor incorporates the wage provisions of the Order, then the employee of the contractor, if he otherwise qualifies, becomes a...