Source: http://supreme.nolo.com/us/327/173/case.html
Timestamp: 2019-04-18 15:02:18+00:00

Document:
1. Respondent's employees are engaged "in the production of goods for [interstate] commerce" so as to bring them within the coverage of the Fair Labor Standards Act. Roland Electrical Co. v. Walling, 326 U. S. 657. P. 327 U. S. 176.
2. They are not exempt as employees of a "retail or service establishment" within the meaning of § 13(a)(2) of the Act. Roland Electrical Co. v. Walling, supra. P. 327 U. S. 177.
3. The existence and observance of written agreements entered into in good faith with the labor union of which the employees were members, providing for overtime pay for fewer hours than required by the Act, constitute no bar to the right of the employees to recover under § 16(b) of the Act. P. 327 U. S. 177.
Petitioner sued to enjoin violation of § 15(a) of the Fair Labor Standards Act and to recover under § 16(b) for unpaid overtime compensation. The district court dismissed the complaint. 51 F.Supp. 505. The circuit court of appeals affirmed. 145 F.2d 163. This Court granted certiorari. 325 U.S. 849. Reversed, p. 327 U. S. 178.
The questions here are the same as those in Roland Electrical Co. v. Walling, 326 U. S. 657. They are (1) whether respondent's employees, under the facts of this case, are engaged "in the production of goods for commerce" within the meaning of §§ 6 and 7 of the Fair Labor Standards Act of 1938, 52 Stat. 1060, 1062, 1063, 29 U.S.C. §§ 206 and 207, and (2) whether, if so engaged, they nevertheless, are exempted from the Act because they are engaged in a "retail or service establishment the greater part of whose selling or servicing is in intrastate commerce" within the meaning of § 13(a)(2), 29 U.S.C. § 213(a)(2). As in the Roland Electrical Co. case, we answer the first question in the affirmative and the second in the negative. The respondent also urges as a defense the written agreements which it had renewed from year to year with its employees for a higher number of hours of work per week, before paying overtime, than is prescribed in the Act.
Standards Act of 1938, and to recover under § 16(b) of the Act [Footnote 1] unpaid overtime compensation together with a like sum as liquidated damages, a reasonable attorney's fee and costs.
The District Court heard the case on the pleadings, stipulations of fact and the petitioner's motion for summary judgment, made several findings of law, ordered that the petitioners recover nothing and dismissed the complaint. 51 F.Supp. 505. The Circuit Court of Appeals affirmed the dismissal. 145 F.2d 163. This Court has granted a writ of certiorari because of divergence of opinions among the Circuit Courts of Appeals as to the interpretation of § 13(a)(2), and now decides this case in favor of petitioners, upon principles stated in Roland Electrical Co. v. Walling, supra.
this case had been rendered by employees of respondent's customers engaged in the production of goods for interstate commerce, those employees would have come under the Act. Respondent's employees are not to be excluded from such coverage merely because their employment to do the same work was under independent contracts. Kirschbaum Co. v. Walling, 316 U. S. 517, 316 U. S. 524; Warren-Bradshaw Co. v. Hall, 317 U. S. 88, 317 U. S. 90.
The respondent was engaged almost exclusively in servicing customers for whom such services were necessary in their production of goods for interstate commerce. This took place in the midst of producing the "flow of goods in commerce" intended to be covered by the Act. Accordingly, the respondent cannot be classified as a "retail or service establishment" within the meaning of § 13(a)(2), which contemplates an establishment serving ultimate consumers beyond the end of such "flow of goods in commerce." Roland Electrical Co. v. Walling, supra.
of hours per week than were stipulated in the agreements. It was not necessary for the Circuit Court of Appeals to consider the effect of this agreement because, in its view, the Act did not apply to the respondent's employees. However, under the view which we take, the respondent is entitled to a decision on this further defense. We agree with the District Court that the agreements cannot supersede the Act, and are not a bar to this action. Cf. Brooklyn Bank v. O'Neil, 324 U. S. 697, 324 U. S. 707 et seq.
For these reasons, the judgment of the Circuit Court of Appeals is reversed, and this case is remanded to the District Court for further proceedings in accordance with this opinion.
"SEC. 16. . . ."
52 Stat. 1069, 29 U.S.C. § 216(b).
"SEC. 7. (a) No employer shall, except as otherwise provided in this section, employ any of his employees who is engaged in commerce or in the production of goods for commerce --"
The Fair Labor Standards Act of 1938 was approved June 25, 1938, and this section became effective October 24, 1938. 29 U.S.C. § 207(d).
Many of the customers were engaged also in interstate commerce on those premises.
". . . an employee shall be deemed to have been engaged in the production of goods if such employee was employed . . . in any process or occupation necessary to the production thereof, in any State."
See 100 Factory Management and Maintenance, March 1942, p. 101; 74 Architectural Forum, May 1941, pp. 333, 335; 41 National Safety News, March, 1940, p. 88; Balderston, Karabasz and Brecht, Management of an Enterprise (1935) p. 145; Canover, Clean Windows for Safety, 74 Safety Engineering, Sept.1937, pp. 13, 14; 63 The Foundry, Aug.1935, p. 89; Randall and Martin, Making your Windows Deliver More Daylight, 22 Transactions of the Illuminating Engineering Society, March 1927, pp. 239-257.

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