NO. 82-510
I F J THE SUPREME COURT OF THE STATE O F MONTANA
1983
I N THE MATTER OF THE W G CLAIM O
AE F
PERCY HOEHNE ,
Claimant and Respondent,
SHERRODD, I K C .,
A p p e l l a n t a n d Respondent.
APPEAL FROM: D i s t r i c t Court of t h e T h i r t e e n t h J u d i c i a l D i s t r i c t ,
I n a n d f o r t h e County o f Y e l l o w s t o n e ,
The H o n o r a b l e W i l l i a m J . S p e a r e , J u d g e p r e s i d i n g .
COUNSEL O RECORD:
F
For A p p e l l a n t :
Towe, B a l l , E n r i g h t & Mackey; N e i l D. Enright,
B i l l i n g s , Montana
F o r Respondent :
Radovich & J o h n s o n ; George R a d o v i c h , B i l l i n g s ,
Montana
P a u l Van T r i c h t , Dept. o f Labor & I n d u s t r y ,
H e l e n a , Montana
Submitted on B r i e f s : June 2 , 1983
Decided: August 1 8 , 1 9 8 3
Filed:
Clerk
Mr. Chief Justice Frank I. Haswell delivered the Opinion of
the Court.
Sherrodd, Inc., appeals the Yellowstone County
District Court dismissal of its petition for judicial review
of the Department of Labor and Industry ruling, awarding
Percy Hoehne, respondent and former employee of Sherrodd,
overtime compensation plus a penalty. We affirm.
Sherrodd was in the business of providing heavy
equipment and personnel to operate such equipment to various
oil companies. Hoehne was employed by Sherrodd from May
1981 until January 1982 to operate heavy equipment at a rate
of $10 per hour. During this period of time Hoehne was a
Montana resident and Sherrodd was a Hontana corporation with
its principal place of business in Montana. Hoehne sometimes
worked in North Dakota but no actual records were kept
indicating the amount of work done there.
Hoehne claimed that he accumulated many overtime hours
but was not paid the overtime rate for such hours. He filed
a wage claim with the Labor Standards Division of the
Montana Department of Labor and Industry and a hearing was
held on June 22, 1982. On July 26, 1982, the Department
ruled in Hoehne's favor, finding that he worked 349 overtime
hours and awarded him $1,745 in compensated overtime.
Further, he was awarded a penalty of $1,745 as the overtime
wages had been due in excess of the statutory time period as
set forth in section 39-3-206, MCA.
Sherrodd timely filed a petition for judicial review
of the Department's ruling in Yellowstone County District
Court. The Department moved to dismiss the amended petition
and on October 29, 1982, the District Court granted the
motion on the basis of the agency record. Sherrodd brings
t h i s a p p e a l and r a i s e s two i s s u e s f o r c o n s i d e r a t i o n :
1. Did t h e Commissioner o f t h e Montana D e p a r t m e n t of
Labor and Industry have jurisdiction to decide the wage
claim i n question?
2. Is t h e c l a i m a n t e s t o p p e d from c l a i m i n g o v e r t i m e
wages?
S h e r r o d d f i r s t c o n t e n d s t h a t t h e Montana D e p a r t m e n t o f
Labor and Industry did not have jurisdiction to rule on
Hoehne's wage c l a i m a s he o f t e n worked i n North Dakota.
Further, t h e r e was no official request from North Dakota
a u t h o r i z i n g Montana t o proceed on Hoehne's wage claim
p u r s u a n t t o s e c t i o n 39-3-305, MCA.
The D e p a r t m e n t asserts that it had jurisdiction to
e n f o r c e Montana l a w s w i t h r e s p e c t t o H o e h n e ' s c l a i m b e c a u s e
b o t h t h e e m p l o y e e a n d t h e e m p l o y e r were r e s i d e n t s o f Montana
and Sherrodd's principal place of b u s i n e s s was w i t h i n
Montana. Further, t h e employment c o n t r a c t was e n t e r e d i n t o
i n Montana and p a r t o f t h e work i n q u e s t i o n was p e r f o r m e d
here. The e m p l o y e r ' s r e c o r d s d i d n o t i n d i c a t e t h e amount o f
work d o n e i n e a c h s t a t e . Finally, S h e r r o d d was s u b j e c t t o
t h e F a i r Labor S t a n d a r d s A c t o f 1 9 3 8 (FLSA) a n d t h e D e p a r t -
ment had c l e a r a u t h o r i t y t o e n f o r c e t h e f e d e r a l a c t .
The D e p a r t m e n t o f Labor and I n d u s t r y h a s a s t a t u t o r y
duty to enforce Montana wage laws affecting Montana
citizens. S e c t i o n 39-1-102, MCA. The Commissioner o f L a b o r
must investigate violations of Montana wage laws and
i n s t i t u t e a c t i o n s f o r u n p a i d wages. S e c t i o n 39-3-209, MCA.
The commissioner may take assignments of wage claims in
trust for the claimant and maintain any proceeding to
e n f o r c e such claim. S e c t i o n 39-3-211, MCA.
The D e p a r t m e n t may a l s o e n f o r c e t h e p r o v i s i o n s o f t h e
FLSA, r e q u i r i n g minimum wages and o v e r t i m e p a y . I n S t a t e v.
Holman A v i a t i o n Co. ( 1 9 7 8 ) , 1 7 6 Mont. 31, 5 7 5 P.2d 923, t h i s
C o u r t h e l d t h a t t h e D e p a r t m e n t may i n s t i t u t e a c i v i l a c t i o n
o n b e h a l f o f e m p l o y e e s t o r e c o v e r u n p a i d o v e r t i m e wages d u e
u n d e r t h e FLSA. W stated:
e
" T h e M o n t a n a D e p a r t m e n t o f L a b o r was
a u t h o r i z e d by b o t h t h e Montana l e g i s l a -
t u r e , t h r o u g h s e c t i o n 41-1314.2, R.C.M.
( 1 9 4 7 ) [ s e c t i o n 39-3-202, 2 1 1 , 2 1 4 ( 2 ) ( 3 ) ,
MCA], a n d by t h e U n i t e d S t a t e s C o n g r e s s ,
t h r o u g h t h e FLSA a n d 29 CFR 5 1 5 . 8 , t o
i n s t i t u t e c i v i l a c t i o n s on behalf of
employees . . . t o r e c o v e r u n p a i d FLSA
wages." 1 7 6 a t 3 6 , 3 7 5 P.2d a t 926.
I n t h e p r e s e n t case i t i s c l e a r t h a t t h e D e p a r t m e n t
was p e r f o r m i n g i t s s t a t u t o r y d u t y e n f o r c i n g M o n t a n a ' s wage
laws protecting Hoehne, a Montana resident. Such laws
r e g u l a t e Montana c o r p o r a t i o n s , like Sherrodd, and require
them t o p a y minimum a n d o v e r t i m e wages. Also, t h e FLSA
p r o t e c t s a l l c i t i z e n s and t h e Department a c t e d w i t h i n its
a u t h o r i t y e n f o r c i n g it h e r e . S t a t e v . Holman A v i a t i o n Co.,
supra. The Montana D e p a r t m e n t o f L a b o r a n d I n d u s t r y a c t e d
within its j u r i s d i c t i o n i n a d j u d i c a t i n g H o e h n e ' s claim f o r
o v e r t i m e wages.
W e a l s o n o t e t h a t R u l e 4 ( b ) ( I ) , M.R.Civ.P., gives the
c o u r t s o f Montana j u r i s d i c t i o n o v e r a l l p e r s o n s w i t h i n t h e
S t a t e of Montana. T h i s is a c o d i f i c a t i o n of traditional
concepts of j u r i s d i c t i o n t h a t subject a l l persons within a
state's boundaries to that state's jurisdiction. We hold
that under the traditional notions of jurisdiction the
Department properly ruled on this claim. All parties
resided i n Montana a n d t h e p r i n c i p a l p l a c e o f business of
t h e e m p l o y e r was i n Montana. Accordingly, t h e c o u r t s of
Montana h a v e p r o p e r j u r i s d i c t i o n t o h e a r t h i s c a s e . We also
f i n d t h a t when t h e l e g i s l a t u r e d e l e g a t e d j u d i c i a l power t o
t h e D e p a r t m e n t t o d e c i d e wage c l a i m s i t i n t e n d e d t h a t t h e
Department b e bound by j u d i c i a l concepts of jurisdiction.
To r e q u i r e a n e m p l o y e e t o p u r s u e h i s wage c l a i m in
each state he works would unduly burden all parties
involved. The e m p l o y e e would h a v e t o t r a v e l t o e a c h s t a t e
w h e r e h e worked t o p u r s u e h i s c l a i m . T h i s would l e a d t o a n
o p p r e s s i v e b u r d e n on b o t h t h e e m p l o y e e a n d t h e e m p l o y e r i n
many c a s e s . For e x a m p l e , w h e r e a t r u c k e r h a u l s c a r g o t h r o u g h
s e v e r a l s t a t e s t o reach h i s d e s t i n a t i o n , i t would require
b o t h t h e e m p l o y e r and t h e e m p l o y e e t o g o t o e a c h s t a t e t o
have a p o r t i o n of a claim a d j u d i c a t e d . Each p a r t y may a l s o
need witnesses, which m o s t likely reside in the parties'
s t a t e of residence. Furthermore, a s t h e Department p o i n t s
out, t h i s would f r a c t i o n a l i z e t h e e m p l o y e e ' s c l a i m t o s u c h
a n e x t e n t a s t o make p u r s u i t o f i t n o t w o r t h w h i l e .
Second, S h e r r o d d a r g u e s t h a t Hoehne i s e s t o p p e d f r o m
claiming overtime compensation because he f a i l e d t o r e p o r t
a c c u m u l a t e d o v e r t i m e h o u r s and d i d n o t i n f o r m S h e r r o d d t h a t
h e e x p e c t e d o v e r t i m e pay.
Hoehne c o n t e n d s that overtime pay is a statutorily
m a n d a t e d p u b l i c r i g h t . T h e r e f o r e , i t c a n n o t b e w a i v e d and a n
employee c a n n o t be e s t o p p e d from c l a i m i n g it.
This Court has held that a person may either, by
implication or agreement, waive the advantage of a law
intended s o l e l y for h i s benefit. E a r l C l a c k Co. v . S t a u n t o n
( 1 9 3 7 ) , 1 0 5 Mont. 3 7 5 , 72 P.2d 1 0 2 2 ; Anaconda Copper M i n i n g
Co. v . R a v a l l i C o u n t y ( 1 9 1 9 ) , 5 6 Mont. 5 3 0 , 1 8 6 P. 3 3 2 ; S h e a
v. North-Butte M i n i n g Co. ( 1 9 1 9 ) , 55 Mont. 5 2 2 , 1 7 9 P. 499.
Conversely, laws which are intended to protect the public in
general cannot be waived privately, section 1-3-204, MCA, by
either implication or agreement. Shea, supra.
In Kopischke v. First Continental Corp. (1980),
Mont. , 610 P.2d 668, 37 St.Rep. 437, we determined that
public policy requires a used car dealer to inspect the cars
he sells and to make sure they are in safe, working condi-
tion. This duty, as an expression of public policy, cannot
be waived by the use of an "as is" clause in the sales
contract.
An employee's right to receive overtime pay is estab-
lished in Montana state law as well as federal law. These
laws are expressions of public policy created to protect
workers, and restraining those from withholding overtime pay
is vindication of a public right rather than a private
right. Withholding wages due, such as overtime pay, is
considered a continuing public offense. Viirtz v. Malthor,
Inc. (9th Cir. 1960), 391 F.2d 1, cited in State ex rel.
Neiss v. District Court (1973), 162 Mont. 324, 511 P.2d 979.
Since overtime premiums are for the protection and benefit
of the general public, private waiver is contrary to public
policy. Neiss, 162 Mont. at 328, 511 P.2d 981; section
1-3-204, MCA.
In Brooklyn Savings Bank v. O'Neil (1945), 324 U.S.
697, 65 S.Ct. 895, 89 L.Ed. 1296, the United States Supreme
Court interpreted the federal counterpart to the Montana
minimum wage and overtime requirements, section 16(b) of the
FLSA. The Supreme Court held that the intent of the legis-
lature in passing the FLSA was to prevent an employee's
contractual waiver of his right to minimum wages and
overtime and thereby prevent waiver of liquidated damages
for withholding such payments. This, the Court held, would
nullify the purposes of the Act.
Essentially, this Court came to a similar conclusion
in Neiss, supra. In construing Montana's minimum wage
requirements we held that:
". . .since we are dealing with a public
right, public policy demands the minimum
wage shall be paid. Minimum wage provi-
sions exist for the benefit of the whole
public and a claimant of his own accord
- not bargain away his statutory mini-
may-
mum wage. It is elementary that a law
established for a public reason cannot be
compromised by private agreement. Section
1-3-209, MCA." (Emphasis added. ) 162
Mont. at 328, 511 P.2d at 981.
We believe that allowing a noncontractual or implied
waiver of minimum wages or overtime payments would also
nullify the purposes of both statutes and would be contrary
to public policy. Consequently, we hold that one's failure
to assert such rights does not constitute waiver.
Nonasser tion could be the result of mere ignorance, which
should not legitimize what we consider a continuing public
offense or prevent vindication of an important public right.
Hoehne is not estopped from claiming overtime pay owed to
him from his employment with Sherrodd, Inc.
Af f irmed.
3A-44). pd,4
Chief Justice
W concur:
e