No. 13725 IN THE SUPREMI3 COURT OF THE STATE OF MONTANA

AMOS A. PLOUFFE, Plaintiff and Appellant,

FARM & RANCH EQUIPMENT COMPANY, a corporation, Defendantand Respondent.

Appeal from: District Court of the Eighth Judicial District, Honorable R. J. Nelson, Judge presiding. Counsel of Record: For Appellant: McKittrick and Duffy, Great Falls, Montana Joseph Duffy argued, Great Falls,Montana For Respondent: Burton and Waite, Great Falls,Montana CharlesM. Cruickshank, I11 argued, Great Falls,

Montana

Submitted: September 13, 1977 Decided:

### NT 

### 2

## 51977

Filed: 

### ?CT 2

## 5

## !QVMr. Justice Frank I. Haswell delivered the opinion of the Court.

A former employee filed a civil action against his employer to recover overtime wages and vacation pay, statutory penalties, attorney fees and costs. The district court of Cascade County denied him summary judgment and dismissed his complaint. He appeals. Plaintiff is Amos A. Plouffe who was employed for over three years as a farm equipment mechanic by defendant Farm & Ranch Equipment Company, a corporation,engaged in sales and repair of farm equipment. Plouffe claims that between July 15, 1971 and July 28, 1972,he worked a total of 438-3/4 hours in excess of 40 hours per week forwhich he was paid straight time rather than the overtime rate of time and a half. He claims he is entitled to an additional $669.39 overtime pay, a statutory penalty in an equal amount, attorney fees of $350 and costs. He bases his overtimepay claim onMontana's Minimum Wages and Hours Act, section 41-2301 et seq., R.C.M. 1947. He bases his civil suit for collection of the overtime pay, statutorypenalties, attormy fees and costs on Montana's Wage PaymentAct, section 41-1301 et seq., R.C.M. 1947. Plouffe also claims an additional 80hours vacation pay in the sum of $240, a statutorypenalty in an equal amount,and costs. On August 5, 1972,Plouffe filed his claimwith the Montana Department of Labor and Industry, Labor Standards ~ivision. Subsequently,at a date unclear from the record before us, the department denied his claim. On February 23, 1973,Plouffe filed his complaint in the district court of Cascade County seeking recovery by civil suit of the amounts set forth above. His employer answered by a general denial and plead the affirmative defenses of (1)exemption frompayment under the federal Fair Labor StandardsAct, 29 USCA, Sec. 201 et seq. as amended, and (2) the bar of the statute of limitations. His employer also sought an award of $350 attorney fees as the prevailing party. Following pretrial discovery,plaintiff Plouffemoved for summary judgment. Thereafter the district court entered findings of fact,conclusions of law and judgment to the effect that defendant employer,by the nature of its business, is exempt from the wage and overtimeprovisions of Montana's Minimum Wages and Hours Act and dismissed plaintiff's entire complaint. Plaintiff now appeals. The ultimate issue for review iswhether the judgment of the district court is correct. The underlying issues can be summarized as follows: (1) Is the employer exempt from payment of overtime wages under the federal Fair Labor Standards Act? (2) Is the employer exempt from payment of overtime wages under Montana's Minimum Wages and HoursAct? (3) Does the federal Fair Labor Standards Act preempt the field of wage and hour regulation to the exclusion of Montana's Minimum Wages and Hours Act? (4) Should plaintiff's entire complaint have been dismissed? We hold that the federal Fair Labor Standards Act expressly exempts the employer in this case frompaying overtimewages to plaintiff. Section 207 of the Fair Labor Standards Act provides that no employer shall employ any of his employees for a workweek longer than 40 hours unless such employee receives time and

a half his regular rate of pay for the excess. Section 213 provided: "Exemptions

## * * 

## *

### " (b)Theprovisions of Section 207 of this title shall not applywith respect to-- 

## * * * "(10)Any salesman,partsman, ormechanic primarily engaqednselling or servicing automobiles, trailers, trucks, farm implements,or aircraft if employed by a nonmanufacturinq establishment primarily engaged in the business of sellinq suchvehicles to ultimate purchasers." (Emphasisadded.) Act of September 23, 1966,P.L. 89-601, 80 Stat. 836 (1966) (Current version at 29 U.S.C. S 213(b) (10) (Supp.1V 1974)). This exemption frompayment of overtime wages clearly applies under the admitted facts of this case. We further hold that the employer in this case is not exempt from the payment of overtime wages under Montana'sMinimum Wages and Hours Act. This Act provides: "41-2303. Compensation. (a)Except asmay otherwise be provided pursuant to this act, every employer shallpay to each of his employeeswages at a rate not less than provided in subsection (1) and (2) save and except for farmworkers as herein defined:

"(b) No employer shall employ any of his employees for a work week longer than forty (40)hours, unless such employee receives for his employment in excess of forty (40) hours in a work week at a rate of not less than one and one-half (1-1/2) times the hourly wage rate at which he is employed. No overtimeprovision shall apply for farmworkers

## * * 

## *." Farm worker as defined in section 41-2302(f) 

### " 

## * * * means any person employed to do any serviceperformed on a farm or ranch." Thus the situs of the work performed is the basis of the exemption. Here the work was not performed on a farm or ranch; the exemption does not apply; and the employee is entitled to overtimewages at the rate of 1-1/2 times his regular hourly rate of pay for the hours worked in excess of 40hours per week. The employer argues that it is exempt from Montana's Minimum Wages and HoursAct because: (1) The employer is subject to all the provisions of the Fair Labor StandardsAct except the overtime pay provisions indicating a congressional intent to substantially cover him by itsprovisionsand grant him an exemption therein, (2)the Minimum Wages and HoursAct exemption of "farmworkers",and (3) the Montana Labor Department ruling that the employer isnot covered by

our Minimum Wages and HoursAct. The first argument is answered hereafter in our discussion of preemption. The second argument has already been answered by the definition of "farm worker" in our Minimum Wages and Hours Act. The short answer to the third argument is that the Montana Labor Department's ruling that the employee isnot covered by Montana's Minimum Wages and HoursAct is incorrect. As heretofore noted, the language of theMinimum Wages and Hours Act requires payment of overtime wages to all employees and there is no exemption covering this case. The exemption of overtime wages under the federal Fair Labor StandardsAct and the absence of such exemption under Montana'sMinimum Wages and HoursAct posits the principal issue on appeal: Does the federal Fair Labor StandardsAct preempt the entire field of wage and hour regulation precluding state legislation on this subject? It is conceded that Congresshas the power to preempt under the commerce clause of the United States Constitution. It is equally clear that where Congresspreempts the field, state laws to the contrarymust yield. The supremacy clause,Art. VI, United States Constitution provides: "This constitution and the laws of the United States which shall be made inpursuance thereof, and all treatiesmade, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the constitution or lawsof any state to the contrary notwithstanding." The question in this case iswhether Congress did in factpreempt the entire field of wage and hour regulationby enactment of the Fair Labor StandardsAct. The issue turns on the legislativeintent of Congress. The employer asserts that when Congressmoved to regulate

commerce by enactment of the Fair Labor StandardsAct itpreempted the entire field ofwage and hour regulation and the states are precluded from enacting legislation concerning the same subjectmatter. The employer argues that it is covered by all provisions of the Fair Labor Standards Act except the overtimepay provision indicating an intentionby Congress to occupy the whole field and in so preempting to grant it a specific exemption from payment of overtimewages based on a legislative policy to protect agriculture, a financially fragile industry. The time is long past for this contention to prevail. The language of the Fair Labor Standards Act itself indicates a congressional intent not to preempt to the exclusion of statewage and hour laws. "Section 218. Relation to other laws. "(a) No provision of this chapter or of any order thereunder shall excuse noncompliance with any Federal or State law ormunicipal ordinance establishing a minimum wage higher than the minimum wage established under this chapter or amaximum workweek lower than themaximum workweek established under this chapter

## * 

## * *." Case law interpreting the Fair Labor StandardsAct likewise destroys the employer's contention of congressionalpreemption. Maneja v. Waialua Agri. Co., 349 U.S. 254, 99 L ed 1040, 75 S.Ct. 719 (1955); Divine v. Levy, 36 F.Supp. 55 (1940); Eastern Sugar Associates v. Pena, 222 F.2d 934 (1955), cert.den. 355 U.S. 900. Perhaps the best example of denial of the employer's preemption argument and at the same time establishing statepower to eliminate exemptions granted in the Fair Labor StandardsAct, is the following holding: "This section [Sec. 218, FLSA] expressly contemplates that workers covered by state law as well as the FLSA shall have any additional benefits provided by state law--higherminimum wages; or lowermaximum work week. By necessary implication it permits state laws to operate even as to workers exempt from the FLSA." Williams v. Transit Co., 472 F.2d 1258 (1972) State courts have similarlyheld no federal preemption by the Fair Labor StandardsAct: "Anticipating such an apparent conflictbetween the federal act and similar state legislation, the congressprovided in 29 USCA Section 218(a) 

## * * 

## * for enforcing compliancewith a stateminimum wage higher and a state 'maximum workweek' lower than that established by the federal act, i-e.,the statute specifically prohibits preenption,by the federal act, of any stateminimum wage ormaximum hour/overtime ('maximumworkweek')provision more favorable to the employee than that prescribed by the federal act." State v. Comfort Cab, Inc., 118N.J. Super. 162, 286 A.2d 742. To the same effect see Hendrix v. Delta Airlines, La.App. 234 So.2d 93;Yellow Cab Co. v. New Jersey, 126 N.J.Super. 81, 312A.2d 870. The Montana attorney general has ruled likewise: "Since the Montana Constitution and statutes enacted pursuant thereto set a lower maximum hour standard than does the FederalAct it followsas amatter of course that the Montana Eight Hour Law takes precedence and must be compliedwith regardlessof the provisions of the Fair Labor StandardsAct." Opinion 89,Opinions of theAttorney General, Feb. 8, 1950. In summary,we hold that the Fair Labor Standards Act does not preempt the subject of wage, hour or overtime regulation to the exclusion ofMontana's Minimum Wages and HoursAct; that the employer here is not exempt from payment of overtime wages under either the Fair Labor StandardsAct exemption orMontana's Minimum Wages and Hours Act; and that the employee is entitled to overtimepay of $669.39 pursuant to our Minimum Wages and HoursAct under the admitted facts of this case. Accordingly, the district court was in error in dismissing plaintiff's complaint. The findings of fact, conclusions of law and judgment of the district court are vacated. The case is remanded to the district courtwith directions to reinstate plaintiff's complaint; grant plaintiff partial summary judgment in the amount of $669.39for overtime wages; for a hearing and determination 

### of the amount to be awarded plaintiff as reasonable attorney fees; for such further proceedings asmay be necessary to determineplaintiff's right to vacation pay and the statutory penalties in section 41- 1302,R.C.M., on his overtimepay award and his claim forvacation pay, and for the determination and award of such costs and disbursements to plaintiff as are authorized by statute.

Justice