Document: 361 U.S. 388 80 S.Ct. 453 4 L.Ed.2d 393 John W. ARNOLD, Petitioner,v.BEN KANOWSKY, INC. No. 60. Argued Jan. 11, 1960. Decided Feb. 23, Rehearing Denied April 4, See 362 945, 803. Miss Bessie Margolin, Washington, D.C., for the United States, as amicus curiae. Mr. Arthur J. Riggs, Dallas, Tex., petitioner. G. H. Kelsoe, Jr., respondent. Chief Justice WARREN delivered opinion of Court. 1 This case concerns provisions Fair Labor Standards Act 1938 exempting from wages-and-hours coverage certain retail sales and service establishments.1 The suit was brought by petitioner individually under § 16(b) Act, 29 U.S.C.A. 216(b) payment overtime wages claimed 7, 207. Court Appeals Fifth Circuit reversed a District judgment petitioner2 we granted certiorari, 359 983, 79 943, 3 932. proceedings in this are forma pauperis. Both sides submitted on their briefs, oral argument heard only representative Secretary appearing 2 Respondent conducts an interior decorating custom furniture business Texas. On same premises he fabricates aircraft parts phenolic, cloth-impregnated phenol resin. plastic is widely used automotive can be machined woodworking equipment respondent has available his shop. Petitioner employed October 17, 1954, through September 2, 1955, primarily fabrication phenolic parts. At trial, Chance Vought Aircraft, Inc., testified that company purchased over $34,000 worth these were missiles sold to States Navy. A Temco Aircraft Company it about $2,000 annually Kanowsky use manufacturing subassemblies Air Force or prime contractors, many whom located outside State. also shipped small amount sheet directly During year beginning 1, respondent's totaled $99,117.52, its $39,751.71, almost exactly 40% total sales. Its secretary-treasurer admitted alone accounted at least 25% company's introduced no evidence concerning nature forms other than Notwithstanding percentage attributable parts, exemption because character business. 5 found engaged production goods commerce within meaning upon admission had been paid hours straight time rates, entered unpaid compensation plus attorney's fee. ground exempt Act's requirements 13(a)(2) 'retail establishment.' 6 We believe error must reversed. wording statute, clear legislative history, decisions require conclusion. 7 admittedly manufacture commerce. That activity may considered 'sideline' viewpoint does not remove unless activities fall specific exemptions enumerated 13 Act. As originally passed 1938, exempted 'any employee any establishment greater part whose selling servicing intrastate commerce.'3 In 1949 Congress substituted three-part definition provision. Any if more 50% establishment's annual dollar volume made State, 75% resale, recognized industry 8 occasion last Term point out revision represent general broadening contained 13.4 Rather, 'was acting implementation particularized purpose' replace unsatisfactory 'business use' test, which developed around provision, with formula would once flexible provide statutory guidance Administrator.5 9 have held narrowly construed against employers seeking assert them application limited those establishments plainly unmistakably terms spirit.6 three conditions explicit prerequisites exemption, merely suggested guidelines judicial determination employer's status.7 10 While contains every satisfy qualify retailer-manufacturer additional 13(a)(4) since 'makes processes' sells.8 11 Turning facts case, respondent, 'making processing sells.' To gain therefore comply criteria they incorporated reference 13(a)(4), well itself. It meet two standards included 13(a)(4). 12 First, account volume. court below assumed community without support fact. conclusion justified, intended employer who asserts assume burden proving 75 percent retail.'9 Second, but doing so, error. one incorporation airplanes Navy exceeded total. These indisputably expectation sold. Such transactions clearly concept resale.10 14 Since sustained resale being particular industry, need reach question whether itself met.11 15 hold satisfied entitled thereunder. reversed; reinstated; cause remanded consideration prayer further counsel fees accordance provision 16 so ordered. 17 Judgment reinstated directions. 18 WHITTAKER (dissenting). 19 Section 13(a) exempts wage-and-hour employees establishment,' there defined. note Court's opinion. Therefore, entity 'establishment.' single conduct (or more) 'establishments,' side even roof, could defined 13(a), not. Here, appears separately activities: (1) sale enterprise several persons—the number stated record—were employed, (2) business, commonly employing five persons, (3) furniture, small, varying, employees. petitioner's employment respondent—from 1955—he worked period enterprises then another, but, says, parts.* Upon Court, showing distinguished enterprises, all petitioner, 20 Although, correctly enterprise, major and, hence, services rendered locally, done locally resale. And, therefore, appear—at room finding—that 13(a). But, finding conducted 'establishments' 'establishment'; nor what 21 Only constituted 'establishment' record judgment, stated, effect. here Department Labor, position that, matter law, operated 'establishments'; might 'establishment,' establishment' (I agree so); another 'establishment'—why explicated. argues some latter not, force prior amendment (63 Stat. 917), teeth amendment, clause section, amended, provides (§§ 7) do apply respect 'notwithstanding such makes processes sells * *.' (Emphasis added.) absence, here, essential (showing each 'establishments'—if one) findings, I think disclose matters requisite decision sought presented. would, dismiss writ improvidently granted, or, very least, remand new trial proper findings fact determinative issues. U.S.C. 213(a), 63 917, 'The sections shall establishment, 50 per centum State located. mean both) industry; (4) qualifies subsection notwithstanding sells: Provided, 85 processed located; reported 250 F.2d 47. Denial rehearing 252 787. 52 1060, 1067. Mitchell v. Kentucky Finance Co., 290, 294, 756, 759, 815. Id., page 293, 758. statement Senator Holland, manager during debate Senate, 95 Cong.Rec. 12491; remarks Representative Lucas, House, 11116. 295, cases White Motor Co. Littleton, Cir., 1941, 124 92, relied decided when longer vitality view amendment. extent rests absence 'retail' shown F.2d, 94. Prior amendments whole area excluded exemption. repeatedly former 13(a)(2). E.g., Grant Bergdorf & Goodman 1949, 172 109; Fred Wolferman, Inc. Gustafson, 1948, 169 759; Walling Goldblatt Bros., 1945, 152 475; American Stores 1943, 133 840; Davis Lumber 52; Collins Kidd Dairy Ice 1942, 132 79; see Roland Electrical Walling, 326 657, 666—678, 66 413, 417—423, 90 L.Ed. 383. Administrator's interpretation comporting Interp. Bill. 6, revised reissued June 16, 1942 WH Manual 326. history amendments, reflected statements sponsors Committee Reports, evidences amended 'does activities, exempt, section 13(a)(4).' Statement House Conferees, 14932; floor managers Holland Representatives Lesinski 12495, 14942, 11216. Remarks 12502; 11004, 11116; majority Senate 14877. 14877; CFR 779.15(c) (Supp.1959); cf. Sherry Corine Corp., 1959, 264 831, 834. cited materials indicate, 'resale' rule residence farm construction repair maintenance 3(n), 203(n), evinces intent classify articles 'resale.' having brings him will drawn into litigation seeks 13, event employer. witness testified: 'Q. your knowledge, weeks didn't work all? A. There be, yes, sir. did seventy-five things nature? Yes, sir.' Justice, How (interior decorating) job down town? town practically time. Were you know stuff like balance phenolics?

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