Shell Oil Co. v. Ricciuti

160 A.2d 257, 147 Conn. 277, 1960 Conn. LEXIS 141
CourtSupreme Court of Connecticut
DecidedApril 14, 1960
StatusPublished
Cited by24 cases

This text of 160 A.2d 257 (Shell Oil Co. v. Ricciuti) is published on Counsel Stack Legal Research, covering Supreme Court of Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shell Oil Co. v. Ricciuti, 160 A.2d 257, 147 Conn. 277, 1960 Conn. LEXIS 141 (Colo. 1960).

Opinions

Meltjtz, J.

The plaintiff, Shell Oil Company, hereinafter called Shell, instituted this action in November, 1956, for a declaratory judgment to determine the status of certain of its employees under the minimum wage law (Rev. 1949, c. 180, as amended; now General Statutes, c. 558, pt. 1) and the authority of the defendant labor commissioner to define by regulation certain terms used in the law. The law expressly excludes from its coverage individuals employed in a bona fide executive or administrative capacity. General Statutes § 3.1-58 (f), later amended by Public Acts 1959, No. 683, § 1. The employees in question are commission managers of service stations owned by Shell. The trial court held that these managers were not employed in a bona fide executive or administrative capacity, as claimed by Shell, but were employees covered by the law, and the plaintiff has appealed.

Shell is engaged in marketing automotive gasoline and other petroleum products in this state through various means, including the sale at retail at service stations owned by Shell and operated by a manager employed by Shell under a written agreement. Among other provisions, the agreement states that the manager shall devote his full business time to the operation of the station and use his best efforts to promote the sale of Shell products; comply strictly and fully with all of Shell’s instructions, rules and regulations, and all federal, state and local laws, ordinances and regulations applicable to the operation of the station; keep such [280]*280records and make such reports as Shell may require; employ, and pay all wages and salaries of, such assistants at the station as Shell may require and approve; and discharge any such assistant at Shell’s request. The manager, however, “shall have no authority to make any commitments whatever in the name or behalf of Shell.” The agreement provides further that it may be terminated at any time by either party on twenty-four hours’ notice.

In operating a service station under the agreement, the manager receives gasoline consigned to him by Shell for sale to the public at prices determined by Shell; he receives a commission, fixed in the agreement, for each gallon of gasoline sold. He has the right, on his own account, to sell at the station such other items of merchandise, and perform such services, as Shell approves. His compensation is derived from commissions on gasoline sales, profits from the sale of other merchandise, and receipts from the performance of services connected with the operation of the station. He sets the prices on all products sold other than gasoline, and the charges for the services he renders; but when Shell recommends the prices to be charged for such products and services, its recommendations are generally followed. The manager employs three to twelve men to work with him, the number being determined by him with the concurrence of Shell. Applicants for the jobs are sought out and interviewed by the manager; if they are satisfactory to him, they go to Shell for approval. The court found that Shell determines the hours of operation of each station and the products which are to be displayed for sale, reserves the right to hire and fire all persons employed at the station, and requires the manager to make a detailed monthly report of the opera[281]*281tion of the station. All persons employed at the station, including the manager, are employees of Shell.

During the period here involved, there was in effect, in addition to the statute (now § 31-58 [f]) defining “employee” as excluding an individual employed in a bona fide executive, administrative or professional capacity, a regulation promulgated by the labor commissioner which established minimum and overtime wages for persons employed in the mercantile trade. Mandatory Order No. 7B, § 180-9-15 (effective Oct. 1, 1951); Conn. Dept. Regs. § 180-9-15. The regulation required the keeping of certain records, exempted from the overtime provisions of the order persons who qualify as executive, administrative or professional employees, and defined an “executive employee” as follows: “Executive Employee. An employee engaged in a bona fide executive capacity shall mean (1) Any employee (a) who is compensated for his services at a rate not less than $75.00 per week or $325.00 per month; and (b) whose primary duty consists of the management of the establishment in which he is employed or of a customarily recognized department or subdivision thereof; and (e) who customarily and regularly directs the work of two or more employees therein; and (d) who has the authority to hire or discharge other employees or whose suggestions and recommendations as to hiring or discharging and as to the advancement and promotion or any other change of status of other employees will be given particular weight; and (e) who customarily and regularly exercises discretionary powers; or (2) An employee who is compensated for his services at a rate not less than $60.00 per week or $260.00 per month, [282]*282who, meeting all of the requirements of b, e, d and e as defined above, does not spend more than 50 per cent of his working time on non-executive duties such as, but not limited to selling, stock work, meat cutting.” Shell does not pay overtime wages to a manager, nor does it keep records showing the hours he works. At times managers have earned more than the minimum prescribed in the definition, and at times they have earned less. The labor commissioner charged Shell with violating the wage order by failing to pay the minimum wage to certain managers. After a hearing, he directed Shell to comply with the order. Shell then commenced this action.

The trial court concluded that it was possible for a manager to work in an executive capacity under the contract. It further concluded, however, that the three managers named as defendants in this action did not serve in a bona fide executive capacity during any period when their compensation was less than $75 a week or $325 a month The contention of Shell is that nowhere in the law is the commissioner given authority to determine the coverage of the law by defining the terms used in the definition section; that a minimum wage requirement is not an element commonly associated with the term “executive employee”; that by incorporating such a requirement in the definition, the commissioner has subjected to overtime regulations employees whom the law itself specifically excludes from coverage; and that the wage order is void so far as its definition of the term “executive employee” extends the coverage of the law to Shell commission managers.

The minimum wage law, like our workmen’s compensation and unemployment compensation laws, [283]*283should receive a liberal construction as regards beneficiaries so that it may accomplish its purpose. West v. Egan, 142 Conn. 437, 442, 115 A.2d 322; Derench v. Administrator, 141 Conn. 321, 324, 106 A.2d 150. In furtherance of that principle, it is essential that exemptions or exclusions be strictly and narrowly construed. Mitchell v. Kentucky Finance Co., 359 U.S. 290, 295, 79 S. Ct. 756, 3 L. Ed. 2d 815. The burden rests on the employer to establish that Ms employees come within an exemption. Walling v. General Industries Co., 330 U.S.

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Bluebook (online)
160 A.2d 257, 147 Conn. 277, 1960 Conn. LEXIS 141, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shell-oil-co-v-ricciuti-conn-1960.