Southern Pac. Co. v. Joint Council Dining Car Employees

165 F.2d 26, 1947 U.S. App. LEXIS 2928
CourtCourt of Appeals for the Ninth Circuit
DecidedDecember 9, 1947
DocketNo. 11566
StatusPublished
Cited by10 cases

This text of 165 F.2d 26 (Southern Pac. Co. v. Joint Council Dining Car Employees) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Southern Pac. Co. v. Joint Council Dining Car Employees, 165 F.2d 26, 1947 U.S. App. LEXIS 2928 (9th Cir. 1947).

Opinions

BONE, Circuit Judge.

This is an appeal from a judgment of the district court enforcing an award of the Third Division of the National Railroad Adjustment Board, hereinafter called the Board. The judgment gave damages for the admitted cost of meals furnished by appellant, hereinafter called Railway, to its dining car waiters, hereinafter called Waiters, holding that such meals are not a part of their wages within Section 3(m), of the Fair Labor Standards Act, 29 U.S.C.A. § 203 (m), hereafter called the Act.

Its holding is against the Railway’s contention there and here made that, in determining whether the Railway had paid the Waiters the 36^ per hour minimum required by a wage order of the Administrator of that Act,1 the admitted cost of the meals is to be added to the lesser cash wage paid of 32j/£0. A later wage order made the minimum 40$ per hour. The parties agree that if the admitted cost of the meals be included in the wages, both wage orders will be complied with and the judgment must be reversed.

Section 3(m) provides “‘Wage’ paid to any employee includes the reasonable cost, as determined by the Administrator, to the employer of furnishing such employee with board, lodging, or other facilities, if such board, lodging, or other facilities are customarily furnished by such employer to his employees.” and the regulation thereunder, as follows:

“§ 521.1. Reasonable cost under section 3(m) of the Act. The term ‘reasonable cost’ in section 3(m) of the act is hereby determined’ to be not more than the actual cost to the employer of the board, lodging, or other facilities customarily furnished 'by him to his employees.

“(a) Reasonable cost does not include a profit to the employer or to any affiliated person. * * *

“(d) The cost of furnishing ‘facilities’ which are primarily for the benefit or convenience of the employer will not be recognized as reasonable and may not therefore be included in computing wages.”

The district court found “Continuously since the year 1936 there has been in effect between petitioner and respondent an agreement concerning rates of pay, rules and working conditions of said craft or class of dining car waiters, whereby and whereunder as one of said working conditions meals were to be supplied in the dining cars of respondent to the members of said craft or class, without cost or charge to them, while on itinerant duty in said cars in the course of their employment, and primarily for the benefit and convenience of respondent.”

Appellant here claims that the evidence does not sustain the Waiters’ burden of proof that the meals were “primarily for the benefit or convenience of the respondent” below, the Railway, and that eating them, on the Waiters’ own time, is not a working condition.

The litigation began in a grievance dispute between the Railway and the Waiters under Section 3, 45 U.S.C.A. § 153, of the Railway Labor Act before the Third Division of the National Railway Adjustment Board.2 The Railway there contended that no contract existed between it and the Waiters to furnish such meals and hence there was nothing over which the Board had jurisdiction. It also contended that if' they were a part of the contract they fell clearly within Section 3(m) and were a part of the wages. The Waiters there contended that “It [the furnishing of meals] was [28]*28part of the price these managements were willing to pay to insure the desired service,”3 and that this price was" an implied part of the contract which had existed between the parties since at least 1932.

The Division held “that the carrier is under a contractual obligation to furnish free meals under the circumstances of this case, and that this service is not a mere gratuity or one that may be charged for at will”. The Railway has since accepted this decision and its contention is that because so agreed to be furnished to the Waiters as part of the admitted price paid for their services, the meals are necessarily a part of the wages. Merely because there was a contract to furnish the meals, the Division stated its conclusion of law “That the carrier violated the effective agreement by charging the claimant for meals as alleged in the claim”.

In arriving at this conclusion of law, the Division refused to consider whether the meals for many years so customarily furnished were under 3(m) of the Act, and applicable Regulation 531.1(d), “facilities which are primarily for the benefit or convenience of the employer” and hence their cost not to be added to the cash wage in determining whether the minimum wage had been paid. It held that it would do no more than determine whether the furnishing of the meals was a part of the contract and leave to the courts the effect on the contract of Section 3(m) of the Act, stating “From its inception this Board has consistently held that its functions are limited to interpreting and applying the rules agreed upon by the parties. Having concluded that the parties before us had an effective agreement that obligated the carrier to provide the claimant with free meals under the circumstances and during the period in controversy we have, therefore, fully discharged our duty in the premises. It has not been suggested that the Fair Labor Standards Act has ever been construed as forbidding carriers from contracting to furnish free meals to their employees. The wages to which the claimant is entitled is a matter of law, rather than of contract. Section 16[b] of the act contains appropriate provisions for its [the law’s] enforcement, but this is not the responsibility of this Board. To say more would merely becloud the issue.”

The case thus came to the district court without any findings on the sole contention there presented, i. e., Was the cost of the meals so contracted to -be furnished not to be added to the cash wage in determining the minimum wage? That is to say, no question here exists concerning prima facie value of any finding of the Division under 45 U.S.C.A. § 153 subd. l(p), providing that “the findings and order of the division * * * shall be prima facie evidence of the facts therein stated.”

A. The eating, on the Waiters’ own time, of meals furnished as a part of the "price” for their working at all, is not a "working condition.” If it were, it nevertheless is a part of the wage or price.

The Waiters argue (and the district court found) that, though the cost of the meals is a part of the price to secure the Waiters’ services, it is not to be added to the cash paid because such-meals are a part of the Waiters’ working conditions. They would have added to Section 3(m) of the Act the words “except when such board is furnished as a part of the employees’ working conditions.” That section would then read “Wage” includes the reasonable cost to the employer of furnishing such employee with board, if such board is customarily furnished by such employer to his employees, [except when such board is furnished as a part of the employees’ working conditions],

We can find no reason so to construe the plain meaning of the Fair Labor Standards Act against the employer even if it were not a penal statute with its Section 16(a) providing imprisonment of the employer for its violation. The only exception to Section 3(m) is that of Regulation 531.1(d) respecting the “primarily” benefited Railway. Expressio unius est exclusio alterius.

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Bluebook (online)
165 F.2d 26, 1947 U.S. App. LEXIS 2928, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southern-pac-co-v-joint-council-dining-car-employees-ca9-1947.