Mary Lincoln Candies, Inc. v. Department of Labor

There is open to us on this record one question only: May a minimum wage order under article 19 of the New York State Labor Law, validly fix a so-called “ Guaranteed Wage ” (for women and minors), that is, may such an order require employers not only to pay a minimum hourly rate to such employees, but also to pay that minimum hourly rate for a minimum number of hours per week? Although the Appellate Division certified to us a question, among others, as to the reasonableness of the hourly rate here fixed and of the number of hours for which that hourly

Directory Order No. 3, here under scrutiny, requires the payment of a minimum of ten dollars to any minor employee of either sex, or any adult female employee, who works three days or less in any week, during the “ peak period ” in the confectionery industry, and a minimum of seven dollars per week to any such employee who works two days or less in any week during the dull period in that industry. Directory Order No. 3 was promulgated by the Industrial Commissioner after full compliance with the elaborate statutory procedures as to investigation, hearings, wage board recommendations, etc. The manufacturers thereupon petitioned the Board of Standards and Appeals for a review, and that Board held the order to be valid and reasonable in all its parts. Then followed this suit against the State Department of Labor, under section 111 of the Labor Law “ to determine the validity and reasonableness ” of the order. While in form a suit against the State Labor Department, this litigation is in substance an appeal from the determination of the Board of Standards and Appeals. (Labor Law, § 111, subd. 2.)

Special Term upheld various provisions (not here in question) of Order No. 3 but struck down the provisions for “ Guaranteed Wages ” as “ not reasonable and in reasonable compliance with the statute.” ( 175 Misc. Rep. 399 , 402.) The opinion in that court makes clear that the reasonableness of the “ cents per hour ” and “ minimum hours to be paid for ” directions of the Order were not passed on by Special Term, but only the validity under article 19 of the Labor Law, of any provision at all for a “ Guaranteed wage.” The Appellate Division affirmed.

The constitutionality of article 19 itself is, of course, not in question. (West Coast Hotel Co. v. Parrish, 300 U. S. 379 .) But plaintiffs say this “ Guaranteed Wages ” feature of Directory Order No. 3

The very concept of minimum wage legislation necessarily involves the determination of the cost of living and the fixing of a wage that will reasonably cover, or approach, that cost. The idea of a “ living wage ” is the heart and core of all such legislation. The earliest of the State minimum wage laws (Massachusetts, L. 1912, ch. 706) called upon the wage boards of that State to take into consideration “ the. needs of the employees ” as well

In reciting the “ factual background ” of our present minimum wage law, the Legislature declared that its purpose was “ to secure wages sufficient to provide adequate maintenance and to protect the health of women and minors.” (Labor Law, art. 19, § 550, added L. 1937, ch. 276.) It is fairly to be assumed that the Legislature, bent on seeing to it that women and minors should, so far as possible, receive subsistence wages for their work, appreciated that no hourly rate of wages could achieve that result unless it were multiplied by some appropriate number of hours. Plaintiffs’ argument seems based on an assumption that article 19 set up only a system for

The words “ Guaranteed Wages ” mean no more than required or ordered wages. Directory Order No. 3 guarantees no work or wages to anyone. It requires no employer to hire or pay anyone. It fixes the minimum amount an employee is to get in any week wherein her services are needed and requested by the employer. Having called her into service, the employer, says the order, must pay her no less than ten dollars (in the rush season) or seven dollars (in the slack season). Plaintiffs say that at times they need less than three (or two) days work per week but that, under this order, they must either pay for services they do not need and camiot use or go without the workers’ services entirely. Assuming that this is factually correct as to their industry, we still conclude that the order does not, for that reason, fail to stand the tests of section 555. We hold that a minimum wage order, to be valid under our statute, need not be consistent with the actual market value of the work actually done in every period of employment however short. The contrary argument, applied to extreme situations, leads to impossible results. If it be a valid objection to a minimum, wage order that it requires, or may require, payment for work not actually needed or done, then an order mandating a thirty-five cents per hour wage would be illegal because the employer might need the worker for only a half hour, or ten minutes. Invalidating an order for such a reason would wipe the statute off the books. We do not agree, on this record, that this Wage Board paid no attention at all to the value of services or to the wages currently being paid in the industry. Both these subjects were inquired into and there are findings as to each. In fact, the Wage Board report says that,

We do not hold that the Wage Boards have unlimited authority to make any extraordinary or whimsical requirements, as to hours and wages, that suit their fancy. The provisions of any such order must be reasonably fit for enforcement of the policy of the statute under the circumstances of the particular employment. We see nothing strange or startling about the requirements here. A week is not an unusual unit of wages or employment. Requiring payment, in a week where any work is done, for two-sevenths or three-sevenths of the days of that week, is not so plainly arbitrary as to offend against the statute itself. In this connection we take notice of the orders current in other States, as referred to in the brief filed here, in support of the Labor Department’s position, by the Attorneys-General of Minnesota, Illinois, New Hampshire, North Dakota and Utah, as amid curiae. All those states have Minimum Wage Acts which differ in no important way from article 19 of our Labor Law. Each of the Attorneys-General informs us that his state promulgates orders for “ fixed or established weekly wages.” Plaintiffs say that no order promulgated in any of those five states “ goes so far as to guarantee wages for the whole week or part of a week,” but plaintiffs’ own analysis of various orders in effect in those other states shows, we think, the contrary. In three of the states (Illinois, New Hampshire and Utah) there are found orders which in effect “ guarantee ” a worker at least four hours pay on any day she is called to work. Other orders, in those three and the other two states, fix a higher rate of wage per hour in any week where less than a minimum number of hours employment is furnished. It is our view that all these orders proceed on the same theory as does the order under attack in this suit,' the theory that part time employment must, by the application of some formula, produce more money return to the worker than she would receive if her pay envelope contained only an amount arrived at by multiplying the market value of her hourly service by the exact number of actual hours work which the employer had made

The judgments should be reversed and the action remitted to the Special Term for proceedings not inconsistent with this opinion with costs in all courts to the appellants to abide the event. The first question certified should be answered in the affirmative and the third in the negative. The second and fourth questions certified are not answered.

(dissenting). The primary question presented for

decision on this appeal is whether article 19 of the Labor Law authorizes a directory order issued to the confectionery industry by the Department of Labor providing for a so-called guaranteed wage for part time employment. Such a guaranteed wage is based solely upon an amount considered sufficient to provide adequate maintenance and to protect health without regard to the value of the services rendered. Directory Order No. 3, the Order in question, besides providing for a basic hourly rate of thirty-five cents an hour, requires that employees must be paid a minimum of ten dollars for three days or less during the peak period and seven dollars for two days or less during the slack period irrespective of the amount of time actually worked. It is conceded that these provisions of this order mean that: “if an experienced employee works for any period whatever (e. g., ten minutes) in a week during which the employer’s establishment is in operation for the given two days or three (according as the industry is ‘ sluggish ’ or ‘ at peak ’), then the so-called guaranteed weekly minimum wage is to be paid. (This construction is not disputed.) ” By this regulation no attempt has been made to compensate short periods of employment at an increased rate per hour, but a flat rate of ten dollars or seven dollars is fixed for a work period, however short, and hence without taking into account the value of the service rendered. This order in effect outlaws part time employment with the result that the only alternative for an employee or an employer is either for the latter to pay for labor that is not used or for both to be deprived of part time labor that is necessary for both.

A reading of the statute shows that it is implicit therein, when read both as a whole and with emphasis on the particular language used, that the Wage Board and the Commissioner are not authorized to fix a guaranteed wage for part time employment irrespective of service actually rendered. The introductory section (550), denominated “ Factual background,” expressly states that the mischief to be remedied is the employment of women and minors at “ wages insufficient to provide adequate maintenance and to protect health and unreasonably low and not fairly commensurate with the value of the services rendered. Such a condition is contrary to public interest and public policy commands its regulation.”

Thus the evil complained of is expressly stated to be comprised of two attributes, namely, wages insufficient to provide adequate

In addition, in section 556 the statute is very specific and detailed in providing that the regulations adopted by the Wage Board: “ may among other things define and govern learners and apprentices, their rates, number, proportion or length of service, piece rates or their relation to time rates, overtime or part-time rates, bonuses or special pay for special or extra work, deductions for board, lodging, apparel or other items or services supplied by the employer, and other special conditions or circumstances.”

Where the statute is so exact in defining the minute powers which the Board possesses, and at the same time makes no mention whatever of the extraordinary power to fix guaranteed wages irrespective of services rendered, and in some instances where no services at all are rendered, it would seem a fair inference that the Legislature did not intend to give such power to the Board. If such had been the intention of the Legislature, it could very easily have included a provision to that effect. To find so great and novel a power conferred upon the Wage Board and the Commissioner in the absence of clear legislative expression, is to fly in the face of the settled principle of statutory construction, that a grant of such power will not be inferred from what is at best ambiguous language.

On the contrary, the statute prescribes that the Wage Board is to recommend “ Minimum Wage Bates ” and such regulations as may be deemed appropriate to safeguard the minimum wage

Looked at realistically, a distinction exists between wages sufficient to meet a minimum cost of living necessary for health, when an employee is working on a full time basis, and wages sufficient to meet adequate maintenance necessary for health when an employee, through no fault of the employer, can find only part-time employment. The principle involved is not inconsequential.. If, as advocated by appellant, it is held that by intendment the Legislature empowered the establishment of a minimum guaranteed wage for part time employment irrespective of services, rendered, then it follows that wages may be guaranteed on a monthly or yearly basis irrespective of services rendered. This follows as a necessary corollary to the contention of appellant that the Legislature intended to confer such power in relation to part time employment.

Starting with a laudable effort to raise wages which were not - commensurate with the value of the services rendered through employment of the police power in aid of adequate maintenance for women and minors, the Wage Board and the Commissioner have swung to the other extreme and interpreted the statute to provide for a wage rate for part time employment without any regard to the value of the services rendered.

Since this appeal may rest upon the decision of the construction of article 19, it becomes unnecessary to consider the constitutional questions involved.

It follows that the judgment appealed from should be affirmed, the first question certified answered in the negative, the third

Lehman, Ch. J., Loughran and Rippey, JJ., concur with Desmond, J.; Finch, J., dissents in opinion in which Lewis and Conway, JJ., concur.

Judgments reversed, etc.