Document: 410 U.S. 512 93 S.Ct. 1138 35 L.Ed.2d 463 Peter J. BRENNAN, Secretary of Labor, Petitioner,v.ARNHEIM AND NEELY, INC., et al. No. 71—1598. Argued Jan. 16, 1973. Decided Feb. 28, Rehearing Denied Apr. See 411 940, 1888. Syllabus Respondent company, a fully integrated real estate management concern directing from its central office manifold operations at nine separately owned buildings, including leasing the properties for owners and hiring, firing, supervising, negotiating wages those employed in held to be an 'enterprise' within meaning § 3(r) Fair Labor Standards Act since respondent conducts related activities through unified operation or control, common business purpose. It is irrelevant, purposes defining respondent's enterprise under 3(r), that building owners, who are not defendants this enforcement action Act, have no relationship with one another purpose, their as employers issue here. Pp. 516—521. 3 Cir., 444 F.2d 609, reversed remanded. Andrew L. Frey, Washington, D.C., petitioner. Eugene B. Strassburger, Jr., Pittsburgh, Pa., Arnheim Neely, Inc. Frank Seamans, Institute Real Estate Management. Mr. Justice STEWART delivered opinion Court. 1 This case began when sued company alleged violations 1938, amended, 52 Stat. 1060, 29 U.S.C. 201 seq. The sought injunction against future minimum wage, overtime, recordkeeping provisions well back affected employees. An employee entitled benefits wage maximum hours if he is, inter alia, 'employed engaged commerce production goods . ..' §§ 206(a), 207(a). 2 As stipulated District Court, manages eight commercial buildings apartment complex Pittsburgh area. With exception minor ownership interest does own these properties. Its services provided according contracts entered into owners. Under contracts, obtains tenants negotiates signs leases, institutes whatever legal actions necessary respect generally maintains collects rental payments on behalf deposits them separate bank accounts each building. These accounts, net expenses fees, belong Payments periodically made supervisory, maintenance, janitorial staffs similarly extensive. payroll operations, job supervision buildings. also fixes work, rates pay fringe benefits—subject approval engages collective bargaining where employees unionized. 324 F.Supp. 987, 990—991. 4 Court custodial, operational workers managed by were 'employees,' was 'employer,' 3(d) 3(e) 203(d), (e). F.Supp., 990—993. gross rentals, rather than commissions obtained, proper measure 'annual volume sales done' dollar portion staturory definition 'enterprise commerce.' Id., 993 994.1 Though it rejected claim sufficiently covered time before 1966 amendments went effect,2 determined aggregate all locations 'related,' performed 'common control,' 'a purpose,' thereby constituting f 203(r). 994—995. 5 On cross appeals, Appeals Third Circuit affirmed Court's determination 'employer' use rentals 'gross sales.' 611—612. erred, however, aggregating determine sales' 'enterprise.' Recognizing decision conflicted substantially identical Fourth Circuit, Shultz v. Falk, 439 340, establishments could deemed part single enterprise, showing purpose required. F.2d, 613. 6 'If record revealed retention Company, agent, accompanied change independent owners—for example facts such pooling profits various demonstrating purpose—the result might different. Here, reveals share except hire Company agent. .. Without more here presented, we think requirement has been satisfied.' 614. 7 reaching issues regarding engagement prior 1967, remanded proof individual Ibid. In order resolve intercircuit conflict, granted Secretary's petition certiorari, 409 840, 56, 34 79, which raises question whether served should aggregated Act. Since cross-petition certiorari filed respondent, important fact serve sales,' us.3 8 concept came being 1961 amendments, broadened coverage Rather confining protections themselves 'engaged commerce,' 207(a), new brought commerce' ambit provisions.4 Congress defined include limitation. standard original included 'any retail service annual less $1,000,000 ..,' 75 66, changed enterprises 'whose done $500,000' period February 1, January 31, 1969, $250,000 thereafter. 203(s)(1). presence dollar-volume cutoff turn, places importance Act's 9 term statute follows: 10 "Enterprise' means (either control) any person persons includes corporate other organizational units 203(r) (emphasis added). 11 Specific exemptions noted, making clear exclusive-dealership arrangements, collective-purchasing pools, franchises, leases premises large landlords do create 'enterprises' whthin 12 correctly identified three main elements statutory 'enterprise': activities, We believe erred holding failed meet criteria. Once recognized employer employees, follows quite simply after all, but company. virtually identical, plainly 'related' sense intended. Senate report accompanying indicated: 'Within term, they same similar S.Rep. 145, 87th Cong., 1st Sess., 41; U.S.Cope Congressional & Admin.News, 1961, p. 1660. similarly, 'either control.' office. For determining irrelevant between agency; maintained building; risk loss chance gain capital investment respondent. All required control operation, are. 13 analysis problem, placed great weight another, true, beside point, examination. Judge Winter wrote conflicting 'It defendants' must together projects.' 346. present case, several tied managing profit. specifically 3(r). 14 cited explaining noted above, exclusive-dealing space shopping centers, like: 15 'The bill contains insure small local business, itself enough come coverage, will become subject act considered dealings. 16 expressly makes establishment shall so operated controlled because franchise, group purchasing, advertising arrangement happens lease establishments.' 41. 17 stress dealt deal party and, question. hold, nor capacity employers5 some abstract Act.6 18 argued straightforward application criteria ignores significance limitation 3(s) '(e)nterprise evidence legislative history indicates exempt businesses obligations 613; Sess. 5. If too reach reasoned Appeals, would 'anomalous' treat 'merely agent buildings.' again, response argument 'employees.' Furthermore, size produced management. true exemption businesses, holdings Appeals.7 contrary amounts collateral attack determinations below, cannot make absence certiorari.8 19 hold correct Accordingly, judgment further proceedings consistent opinion. 20 ordered. 21 Judgment 22 WHITE, dissenting. 23 undisputed hour requirements seq., apply involved commerce.'1 203(s), 206, 207. 'means .' contractor specified otherwise occupying leased person. 24 But, amount minimum. Id. did intend cover expanding approach. Instead, drew economic line. line draw wage.' 5; U.S.Code 1624. Nor intended swallow up exclusion businesses. Related conducted only 'where joined either system unit purpose.' Admin.News And express concept, Report said, 'insure dealings.' 25 us, independently recommend tenants, collect rents, hire, fire, supervise maintain operate holds even none generate sufficient collectively excess minimums hence Act.2 Because appears me applying way limitations congressional intention represent, I respectfully dissent. 26 There connection employ represent them. They accountable to, follow perhaps diverse directions of, principals. constitute unit, surely Hence there covers 'related activities' 'for 27 indicated, unaware possibility stretching beyond bounds guard it. Committee said: 'Thus mere stores join combine purchasing run combined reasons mean 'enterprise." 42; 1661. Common agents, therefore convert entities enterprise. 28 'There may number different types arrangements established cases. key found answer question, 'Who receives profits, suffers losses, sets working conditions respects attributes businessman operating profit?" standard, can treated such. manager merely commission his services. manages, direction principal. income accounted separately. owner any. Each that, although matters, instructions, approve carries identification number. Employees hired building, supplies items purchased Should particular terminate manager, remain 30 Neely agency unquestionably insofar concerned, 203(d) defines acting directly indirectly relation But far cry concluding commerce.3 31 Unquestionably, bears burden them, individually jurisdictional nentioned construing work majority distorts intent. pertinent part, provides that: '(s) 'Enterprise commerce, handling, selling, moved commrce person, which— '(1) during whose $500,000 (exclusive excise taxes level stated) gasoline stated), beginning 203(s). Section 3(s)(3) enacted referred to: Pub.L. 87—30, 65, 66 construed require two amendments. 995—997. see n. supra, 'employees' qualified. 997. Government appealed issue, it, NLRB International Van Lines, 48, 4, 74, 77, 201, cases cited. 8, infra. 67, 69. both 203(d). broad 'several simultaneous 'employers." 992; Wirtz Hebert, 368 139; Mid-Continent Pipe Line Co. Hargrave, 129 655. Contrary view taken dissent, 'the solely relevant years, collected exceeded $1,000,000. 993. 72—844, Falk Brennan, sub nom. Shultz, 954, 1419, 686, consider context commissions, maintenance discussed opinion, passed 65—67, 69, greatly scope adding was. Therefore, engaged, covered. agreed 'enterprise,' agree cumulative coverage. demonstrated CFR 779.203, 'terms ('employer,' 'establishment,' 'enterprise') synonymous.'

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