Aaron v. Bay Ridge Operating Co.

162 F.2d 665, 1947 U.S. App. LEXIS 3134
CourtCourt of Appeals for the Second Circuit
DecidedJune 3, 1947
Docket272, 273, Dockets 20619, 20620
StatusPublished
Cited by10 cases

This text of 162 F.2d 665 (Aaron v. Bay Ridge Operating Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aaron v. Bay Ridge Operating Co., 162 F.2d 665, 1947 U.S. App. LEXIS 3134 (2d Cir. 1947).

Opinions

FRANK, Circuit Judge.

Section 7(a) of the Fair Labor Standards Act, 29 U.S.C.A. § 201 et seq., provides: “No employer shall * * * employ any of his employees * * * for a workweek longer than forty hours * * * unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.” The fundamental question before us here turns on the interpretation of “regular rates.” Since ours is but an intermediate court, of course, in construing those words we are bound by the pertinent decisions of the Supreme Court.

These appeals are from judgments to the extent that they are adverse to plaintiffs, longshoremen working in the Port of New York, who maintain that defendants violated the Act by not paying plaintiffs one and one-half times the “regular rate” for hours, in certain workweeks, in which plaintiffs worked for defendants in excess of forty hours. It is urged by the defendants that the “regular rate” is controlled by provisions of collective bargaining agreements between the defendants and the union, International Longshoremen’s Association, to which plaintiffs belonged in the years in question. The annual collective agreements made with this union since 1921 have provided for a “basic working day” of eight hours and a “basic working week” of forty-four hours. Beginning in 1918, these agreements fixed two sets of hourly rates: (1) Specified hourly rates were set for “work performed from 8 A.M. to 12 Noon and from 1 P.M. to 5 P.M., Monday to Friday inclusive, and from 8 A.M. to 12 Noon Saturday." (2) With a few exceptions, one and one-half times these rates were fixed for what the agreements called “all other time.” In the Fall of 1938, after the enactment of the Fair Labor Standards Act, the agreement changed the labels for these respective periods: The first was now called “straight time”; the second was now called “overtime,” the rates for that period being newly described as “overtime rates.” 'I his nomenclature was thereafter used in the agreements and is contained in the agreements for the years involved in these suits. No other significant changes [667]*667were made in the agreements after the Act went into effect. 1

During the years 1943-1945, here involved, in most instances the defendants applied the terms of these agreements in paying the plaintiffs. As a result, if one of the plaintiffs in a given week worked, say, fifty hours during the so-called “overtime” period, he received for the excess ten hours precisely the same rate per hour as he was paid for the forty hours; that is, he received merely the contract rate—called the “overtime rate” in the contract—for all the fifty hours. If, in a given workweek, he worked thirty hours during the so-called “straight time” period and twenty hours in the so-called “overtime” period, again he received merely the contract rates; that is, [668]*668for the excess ten hours, lie received merely the contractually-labelled “overtime rate.”2

The trial judge held this method of payment correct, on the ground that the rates fixed in the agreements for the “straight time” period constituted the “regular rate” referred to in § 7(a) of the Act.3 In so deciding, he relied on Walling v. A. H. Belo Corp., 316 U.S. 624, 62 S.Ct. 1223, 86 L.Ed. 1716. We think he erred. As recently as May of this year, the Supreme Court, in a unanimous opinion by Chief Justice Vinson—confirming what had been said previously by this court and by several other inferior courts4—decided that the Belo case doctrine must be limited to agreements which contain a “provision for a guaranteed weekly wage with a stipulation of an hourly rate,” and that other types of agreement, whether or not the result of collective bargaining, cannot, by their terms, determine what is the “regular rate” named in the Act. That “regular rate,” said the Court, is an “actual fact.” See 149 Madison Avenue Company v. Asselta, 67 S.Ct. 1178, 1184, citing Walling v. Youngerman-Reynolds Hardwood Co., 325 U.S. 419, 424, 65 S.Ct. 1242, 89 L.Ed. 1705. See also Walling v. Helmerich & Payne, 323 U.S. 37, 65 S.Ct. 11, 89 L.Ed. 29.

In the instant case, the “actual fact” concerning the “regular rate” appears in the findings of the trial judge which are supported by the evidence and which we understand the defendants do not dispute. In an Appendix to this opinion, we have set forth pertinent portions of those findings.

Because government counsel, appearing for the defendants,5 have earnestly asserted the grave precedential importance of these appeals, and because of our respect for the able trial judge, we have considered his opinion with unusual care. None of us, however, is able to agree with that opinion. We conclude that the judgments, in so far as they are adverse to the plaintiffs, must be reversed.

Faced with substantially similar collective bargaining agreements and with facts in many respects the same, the Seventh Circuit in 1914 reached a conclusion like ours, as to longshoremen in the Great Lakes area; see Cabunac v. National Terminals Corp., 139 F.2d 853, affirming the able opinion of Judge Duffy, sub nom. International Longshoremen’s Association v. National Terminals Corp., D.C., 50 F.Supp. 26. Judge Cooper, a few months ago, also reached this conclusion as to longshoremen working in Puerto Rico, in a case in which, as here, government counsel represented the employer and apparently advanced the very arguments advanced here. See Fer-ren v. Waterman S. S. Corp., D.C., 70 F. Supp. 1.

We cannot agree with the argument that our conclusion is unsound because it may require separate computations for each week at rates which may vary from week to week. In Overnight Motor Transport Co. v. Missel, 316 U.S. 572, 580, 62. S.Ct. 1216, 1221, 86 L.Ed. 1682, the Court said that compensation capable of reduction to an hourly basis by application of a uniform principle is “regular in the statutory sense inasmuch as the rate per hour does not vary for the entire week though week by week the regular rate varies with the number of hours worked.” We take this statement as meaning that the statutory element of regularity is met where a single principle or [669]*669rule is uniformly applied in order to obtain the rate.6

We think that the administrative interpretations suggest no conclusion different from ours. 7 The one conceivable exception has to do with Sunday and holiday work. In a letter of May 14, 1943, discussing the Cleveland Stevedore Co., the Administrator said that “overtime compensation for Sunday or holiday work * * * may be credited toward overtime due under the Act,” because “it can be regarded as time outside the employee’s normal working hours”; but we must also consider the following: (1) The day after that letter of May 14, 1943 was written, Judge Duffy held the contrary; see International Longshoremen’s Association v. National Terminal Corp., D.C., 50 F.Supp. 26, affirmed in Cabunac v.

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Aaron v. Bay Ridge Operating Co.
162 F.2d 665 (Second Circuit, 1947)

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Bluebook (online)
162 F.2d 665, 1947 U.S. App. LEXIS 3134, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aaron-v-bay-ridge-operating-co-ca2-1947.