Court Opinion

ID: 9470334
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:02:41.828052+00
Date Added: 2024-06-11T17:41:50.340185
License: Public Domain

CLARK, Circuit Judge,
dissenting:
I agree with the majority’s reading of 29 U.S.C.A. § 203(m), insofar as the majority has concluded that “customarily furnished” by the employer does not mean “voluntarily accepted” by the employee. However, the majority took its own interpretative step— perhaps smaller than the one it has rejected — when it concluded that Davis Brothers, which until 1980 paid full minimum wage and allowed employees the choice of buying discounted meals, now “customarily furnishes” those meals, automatically taking 25 or 35 cents from the minimum wage formerly paid cash in full.
Calling for attention are the last words of the sentence from Section 203(m) quoted by the majority in the opinion’s second paragraph. Those words state simply that a wage includes board, “... if such board ... [is] customarily furnished by such employer to his employees." (emphasis added). These words convey the ordinary sense that the custom of furnishing board must be specific to the restaurant, cafeteria or food service in question if such board is to be included in the wage. They serve no purpose otherwise. Davis Brothers, having initiated its plan so recently as 1980, had no custom of providing board in exchange for a reduction in cash wages.
In Tennessee Coal, Iron and Railroad Co. v. Muscoda Local No. 123, 321 U.S. 590, 645 S.Ct. 698, 88 L.Ed. 949 (1944), cited by the majority, the Supreme Court, in determining that working time in an iron mine should be calculated “portal to portal” (thus including travel time from portal to mine face and back again), examined the mining company’s asserted reliance upon “the alleged ‘immemorial custom and agreements ... ’ which are said to establish ‘the “face to face” method as the standard for computing working time in the iron ore industry.’ ” 321 U.S. at 600, 64 S.Ct. at 704, 88 L.Ed. at 958. The Supreme Court rejected the mining company’s assertion of the existence of a custom, stating its approval of the district court’s examination as follows in part:
*1373That court [the district court], in making its findings, properly directed its attention solely to the evidence concerning petitioners’ iron ore mines and disregarded the customs and contracts in the coal mining industry.
321 U.S. at 601, 64 S.Ct. at 704, 88 L.Ed. at 958.1 Thus, in the instant case, attention should be directed to evidence concerning the custom at Davis Brothers, not to evidence of the vague habits of the restaurant industry as a whole.
The Secretary, in his defense of a regulation which the majority correctly determined sweeps too broadly, neglected to address the simple meaning of the quoted sentence of the statute. The majority approvingly cites two district court opinions construing “customarily furnished.” Donovan v. Miller Properties, Inc., 547 F.Supp. 785 (M.D.La.1982); Melton v. Round Table Restaurants, Inc., Lab.Rep. (BNA), 20 Wage and Hour Cas. 532 (N.D.Ga.1971). However, while both of these district courts rejected the Secretary’s position, they also ignored the language of the statute which specifies that the custom be that of the employer in question. The district court in Donovan v. Miller Properties, Inc., stated, without citation, “Section 3(m) does require that the conditions be ‘customary’ as determined by employers in the industry." 547 F.Supp. at 785. The district court in Melton v. Round Table Restaurants, Inc., noted first that the plaintiff employees, “who may well be considered experts for this purpose, state that it is the custom and the usage throughout the industry to furnish such meals within the work hours”; the court then concluded, “As such, it becomes part of the contract,” citing only Pacific Grape Products Co. v. C.I.R., 219 F.2d 862 (9th Cir.1955) (examining custom between fruit canners and buyers). 20 Wage and Hour Cas. at 534. Tennessee Coal, Iron and Railroad Co. v. Muscoda Local No. 123 provides the more appropriate way to examine custom in the instant matter.
The legislative history of the Fair Labor Standards Act is inconclusive insofar as whether the custom of the individual employer or the custom of the industry is to be the object of examination. The Senate Report accompanying the Fair Labor Standards Amendments of 1966, by which restaurant employees were brought within the minimum wage coverage, does state:
It should be noted that at present “wages” include the reasonable cost of board, lodging, and other facilities customarily provided by the employer to his employees. Employee meals are never considered primarily for the benefit or convenience of the employer and thus meals provided to restaurant employees by their employers will be considered part of wages under the provisions of the present law.
S.Rep. No. 1487, 89th Cong., 2nd Sess., reprinted in 2 1966 U.S.Code Cong. & Adm. News 3002, 3015. However, the paralleling House Report does not contain the crucial second sentence of the above paragraph, although it repeats verbatim the first sentence. H.R.Rep. No. 1366, 89th Cong., 2nd Sess. 19. Nor does the conference report address the matter. Conference Rep. No. 2004, 89th Cong., 2nd Sess., reprinted in 2 1966 U.S.Code Cong. & Ad.News 3047.
Thus, in view of the plain language of the statute and the rule of the Supreme Court for examining custom, Davis Brothers, which only recently brought its plan into being, did not customarily furnish board to its employees.

. The case provides further help in this matter of custom:
The futile efforts by the miners to secure at least partial compensation for their travel time and their dissatisfaction with existing arrangements, moreover, negative the conclusion that there was any real custom as to
the workweek and compensation therefor. A valid custom cannot be based on so turbulent and discordant a history; it requires more than unilateral and arbitrary imposition of working conditions.
321 U.S. at 602, 64 S.Ct. at 705, 88 L.Ed. at 958. (emphasis added).