Title: Lorinser v. B & B EMPLOYMENT
Citation: 190 N.W.2d 21
Docket Number: 8664
State: north-dakota
Issuer: north-dakota Supreme Court
Date: August 31, 1971

190 N.W.2d 21 (1971) Claire LORINSER, Plaintiff and Appellant, v. B &amp; B EMPLOYMENT, Defendant and Respondent. Civ. No. 8664. Supreme Court of North Dakota. August 31, 1971. *22 Harold A. Halgrimson, Fargo, and Garrity, Cahill, Gunhus, Streed &amp; Grinnell, Moorhead, Minn., for plaintiff and appellant. Solberg, Anderson &amp; Stewart, Fargo, for defendant and respondent. ERICKSTAD, Judge (on reassignment). The plaintiff Claire Lorinser, whom we shall hereinafter refer to as Mrs. Lorinser, appeals from a judgment of the district court of Cass County, dated May 5, 1970, which dismissed her complaint against B &amp; B Employment, Inc., which we shall hereinafter refer to as B &amp; B company. In the complaint, Mrs. Lorinser asserts, among other things, that she was an employee of B &amp; B company from May 20, 1968, to October 4, 1968; that during that time she was paid at a rate lower than the federal minimum wage of $1.60 per hour, and that accordingly she is entitled to be paid $1200 as the unpaid portion of her minimum wage, and an additional $1200 as liquidated damages, together with reasonable attorney fees and costs. B &amp; B company's main defense is that the complaint fails to state a claim upon which relief can be granted. Although it also asserted a counterclaim, it abandoned the counterclaim at the trial, so we shall not discuss the counterclaim. The judgment appealed from resulted from a motion made by B &amp; B company under Rule 41(b) of the North Dakota Rules of Civil Procedure, after both parties had rested and before the case was submitted to the jury, for a dismissal of the plaintiff's complaint upon the ground that B &amp; B company is exempt from the minimum wage requirements of the federal law under Section 213(a) (1) and (a) (2) of Title 29, U.S.C.A. The pertinent parts of that section of the Fair Labor Standards Act read: The court granted B &amp; B company's motion, believing that it was exempt under § 213(a) (2). No serious argument was made in the lower court and none is made in our court that § 213(a) (1) applies. The question for us to determine in this appeal is whether B &amp; B company is a "retail or service establishment" exempt under § 213(a) (2). The pertinent part of Section 206, Title 29, U.S.C.A., reads: Mrs. Lorinser contends that in concluding as it did the trial court failed to give proper weight to the interpretive ruling of the administrator of the Wage and Hour and Public Contracts Divisions of the United States Department of Labor as contained in the Federal Register of October 17, 1967. The pertinent part of the Register follows: In the instant case, Mrs. Lorinser's employment consisted mainly of finding employers who needed temporary employees, and then finding employees for those employers. B &amp; B company's office is situated in Fargo, but Mrs. Lorinser's work necessitated the use of the telephone across state lines into Moorhead and also on occasion required personal visitation on her part with prospective employers in Moorhead. Commerce is defined as meaning trade, commerce, transportation, transmission, or communication among the several states or between any state and any place outside thereof. Section 203(b), Title 29, U.S.C. A., page 295. Lest someone question at this point whether B &amp; B company was engaged in commerce within the meaning of the federal Act, we draw attention to and rely upon what was recently said by the Supreme Court of Minnesota pertinent thereto. In holding that a plaintiff accountant employed by an accounting firm was engaged in "commerce while working on an account for an out-of-state client", the Minnesota Supreme Court said: Inasmuch as the ruling relied upon by Mrs. Lorinser that an employment agency is not exempt is an interpretive ruling, we think it important to determine what weight the federal courts give to such a ruling. In 1944 the Supreme Court of the United States, in dealing with the authoritative weight to be given interpretive bulletins, said: The court of appeals for the third circuit has more recently said: It is important also to note that the federal courts in construing the Fair Labor Standards Act have held that the exemptions therein, "* * * are to be narrowly construed against the employers seeking to assert them and their application limited to those establishments plainly and unmistakably within their terms and spirit." Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 80 S. Ct. 453, 456, 4 L. Ed. 2d 393 (1960). When Congress amended the Act in 1949 it provided that pre-1949 rulings and interpretations by the administrator should remain in effect unless inconsistent with the statute as amended. 63 Stat. 920, § 16(c), 29 U.S.C.A. § 208 note. Mitchell v. Kentucky Finance Company, 359 U.S. 290, 79 S. Ct. 756, 758, 3 L. Ed. 2d 815 (1959). That pre-1949 rulings and interpretations of the administrator, dating back to 1941, *26 were to the effect that employment agencies are not exempt has not been disputed by B &amp; B company. In light of this background, we shall now attempt to decide whether B &amp; B company is exempt from the minimum wage requirements of the Fair Labor Standards Act as amended. A post-1949 decision of one of the United States district courts in the State of North Carolina, in determining whether a telephone answering service company came within the retail concept of the exemption, discusses two characteristics of a retail establishment. We quote therefrom. Applying that test to the instant case, we find that the providing of temporary employees by B &amp; B company was not a selling of a service to satisfy the needs of the general community, but was a selling of services to satisfy a special segment of the community. The trial court decision which the administrator refers to in his ruling of October 17, 1967, concluded in 1941 that an employment agency was not exempt. In discussing the effect of an early amendment, the court said: We do not believe that subsequent amendments bring employment agencies within the exemption now provided for in Section 213(a) (2). Accordingly, in light of the pre-amendment and post-amendment interpretations, by the administrator, of the exemption provisions of the Fair Labor Standards Act; the rule that exemptions under the Act are to be construed narrowly against the application of the exemption; the need for harmony between federal and state courts if the federal system is not to break down; and the absence of what we believe to be an essential aspect of the sale of retail services as contemplated by Section 213(a) (2) of the Act, we conclude that the trial court erred in dismissing the complaint. The judgment of the trial court is therefore reversed and the case is remanded for a new trial. STRUTZ, C. J., and TEIGEN, PAULSON and KNUDSON, JJ., concur.