Plaintiffs brought this action to recover certain unemployment insurance contributions assessed and paid under protest pursuant to the Unemployment Insurance Act. (Stats. 1935, p. 1226, as amended; 3 Deering’s Gen. Laws, Act 8780d.) The assessments were for the period January 1, 1944, through September 30, 1947, and amounted to $5,348.20. Plaintiffs pursued all administrative proceedings prerequisite to the institution of this action. Their claim of refund is predicated upon the contention that their packing*488house employees were engaged in exempt “agricultural labor” and not in commercial activities, which latter activities are not exempted by the act. The court sustained defendants’ demurrer without leave to amend, and from the ensuing judgment plaintiffs appeal. The record and applicable legal principles affecting the construction of the act support the propriety of the assailed judgment.
It appears from the complaint that four of the Stivers brothers—Morgan A., Glenn, Howard, and Archie*—were members of a partnership which owned, among other properties, 357 acres of citrus groves. Morgan A. Stivers was the managing and operating partner of all properties of the “ four-way ' partnership. ’ ’ A fifth brother, Raymond K. Stivers, owned separately an additional 70 acres of citrus groves. He and the four-way partnership formed a packinghouse partnership, known as the Stivers Packing Company. During the tax period’ involved the packing company owned and operated a packing-house, under the management of Raymond K. Stivers. All the fruit from the Stivers’ groves— the combined 427 acres—was packed in this packing-house and constituted 80 per cent of the entire amount of products handled; the remaining 20 per cent of the total fruit packed came from the groves of others. Raymond K. Stivers had a one-third interest in the Stivers Packing Company, and the four-way partnership had a two-thirds interest. All the cost of operating the Stivers’ groves was paid by the packing company. These groves were charged with their proportionate expense on the following basis: a credit was allowed for all receipts from the respective fruit sold, against which was made a charge per box for packing, plus an additional charge for the particular operation and maintenance cost, and the balance then accrued in favor of Raymond K. Stivers or the four-way partnership according to the grove accounting. The packing-house partnership did not operate, maintain or manage any “non-Stivers” citrus groves. It is alleged in the complaint that “the primary and sole purpose of said packinghouse partnership was to produce, harvest, pick, sell and ship citrus fruits” from the Stivers’ groves; but the general allegation that this was the “sole” purpose must fall before the specific, contradictory allegation that “not more than 20% of the total fruit packed” came from the groves of others. The labor here in question involves only *489the services rendered by the employees of the packing-house partnership working in the packing-house.
Plaintiffs’ liability for contributions on the wages paid the packing-house employees depends on whether or not such employees may be classified as ‘ ‘ agricultural labor. ” The Unemployment Insurance Act excludes, without definition, “agricultural labor” from the term “employment” within its coverage provisions. The necessary definition for administrative purposes has been supplied by rule of the Department of Employment. (Cal. Admin. Code, tit. 22, § 43,1 amending rule 7.1 following its interpretation in California Emp. Com. v. Kovacevich, 27 Cal.2d 546, 551-553 [165 P.2d 917].) It thus appears that packing-house labor, in order to be classed as agricultural, must be “services performed ... in the employ of the owner or tenant of a farm on which the materials in their raw or natural state were produced” and “carried on as an incident to ordinary farming operations as distinguished from . . . commercial operations.”
Defendants properly rely upon the rationale of California Emp. Com. v. Butte County Rice Growers Assn., 25 Cal.2d 624 [154 P.2d 892], as determinative of plaintiffs’ liability for contributions under the act. That ease involved employees of an incorporated farmers’ cooperative association operating a warehouse located near a railroad siding for the storage of rice and grain for shipment to market—services performed *490off the farm following the harvesting of the crops. The association’s storage and shipping facilities were available not only to members but also to others upon payment of a nominal application fee, and under the terms of its state warehouse license the cooperative was obligated to serve the public in providing storage accommodations. Under such circumstances the warehouse was held to be a commercial enterprise, helpful to but separate and apart from the farming operations, and the activities of the employees were classified as commercial rather than agricultural within the concept of the act.
Plaintiffs seek to avoid the commercial aspect of their packing-house upon the premise that its principal purpose was to facilitate the marketing of the crops from the Stivers ’ groves. However, the test under the act is not the principal purpose of the enterprise but whether the services performed by its employees were “carried on as an incident to ordinary farming operations as distinguished from . . . commercial operations.” Thus significant is the fact that the packinghouse served the public to the extent of 20 per cent of its total fruit packing operations, a sizable amount attesting to its commercial character. Plaintiffs argue that this 20 per cent factor is not of controlling importance, since 80 per cent of the fruit handled in the packing-house came from Stivers’ groves and such packing services in readying their own farm products for marketing constituted agricultural labor. Accordingly, they cite the act’s provision for segregation of the employee’s services on a percentage basis and classification of the aggregate employment by reference to how “one-half or more” of the employee’s time is spent. (§ 7.1, Stats. 1945, pp. 1486, 22302; Admin. Code, tit. 22, § 42(b), effective April 1, 1945.) The employer is required to keep accurate records in segregation of the exempt and nonexempt employment. (Cal. Admin. Code, tit. 22, § 42(a).3) *491But these provisions appear to have been adopted as a reasonable method of determining whether a specific employee or group of employees, engaged part of the time in exempt work and part of the time in nonexempt work, is in taxable employment and entitled to the coverage provisions of the act. They do not apply in favor of an employer who conducts a single integrated operation having a definite commercial aspect, such as the packing-house in question, so as to exempt such employer from liability for contributions in any period in which the commercial phase of such single integrated operation may fall below 50 per cent of the total operation. A contrary construction would be unreasonable in view of the broad coverage intended by the act in fixing taxable employment. (California Emp. Stab. Com. v. Lewis, 68 Cal.App.2d 552, 554 [157 P.2d 38], and cases there cited.) Accordingly, the comparative percentage measure of the packing-house services rendered to the public does not remove the force of that consideration in reflecting the commercial nature of plaintiffs’ packing-house enterprise.
Nor does it matter that here plaintiffs’ packing-house is a partnership rather than a corporate entity as was the situation in California Emp. Com. v. Butte County Rice Growers Assn., supra, 25 Cal.2d 624, so that the warehouse activities were not services performed for the owner or tenant of a farm within the concept of “agricultural labor” under the act. To this point plaintiffs maintain that, save in exceptional circumstances, a partnership under California law is not regarded as an entity distinct from the individuals composing it. (Reed v. Industrial Acc. Com., 10 Cal.2d 191, 192-193 [73 P.2d 1212, 114 A.L.R. 720] ; Park v. Union Mfg. Co., 45 Cal.App.2d 401, 407 [114 P.2d 373].) Accordingly, they claim that since they constituted the packing-house partnership and also owned the Stivers’ groves on which the citrus fruit was produced, the packing-house employees were in effect performing services for the owners of the land. In opposition to plaintiffs’ argument, defendants cite the act’s express definition of an “employing unit” to mean “any individual or type of organization, including any partnership . . . corporation. . . .” (§8.5; Stats. 1937, p. 2053; am. without material changes by Stats. 1947, p. 2627.) Such provision, they claim, in effect declares that, for the purposes *492of the act, a partnership is to be regarded as a separate entity. As a factual consideration indicating the distinct nature of the packing-house partnership, defendants point out the disproportionate ownership interests therein of the member-growers of the Stivers’ fruit: the four-way Stivers’ partnership owning some five-sixths of the total citrus acreage and two-thirds of the packing-house company; Raymond K. Stivers individually owning one-sixth of the citrus acreage and one-third of the packing-house company. However, it is unnecessary to do more than note here the respective contentions as to the “separate entity” of plaintiffs’ partnership, for it is the independent factor of the “commercial nature” of the packing-house enterprise which we deem sufficient to establish plaintiffs’ liability for the unemployment contributions in question.
, Undoubtedly, services performed in a packing-house operated by and for the farmer-grower of agricultural products may constitute “agricultural labor” under the act provided “such services are carried on as an incident to ordinary farming operations as distinguished from . . . commercial operations. ’ ’ But here -the producers of the fruit formed a packing-house partnership which functioned not alone in their behalf in the marketing process. Rather, the packinghouse also served the public to the substantial extent of 20 per cent of its total fruit packing services. As so operating for profit on a commercial scale, the packing-house became a single integrated enterprise operating much the same as any business concern, and it should not be treated any differently insofar as bearing its proportionate share of the social responsibilities flowing from the state unemployment insurance law. Consistent with a liberal construction of the act to effectuate its intended coverage (California Emp. Com. v. Butte County Rice Growers Assn., supra, 25 Cal.2d 624, 630), the commercial packing-house labor here involved was not exempt employment. Accordingly, plaintiffs’ liability for unemployment contributions as here assessed cannot be avoided on the facts alleged in their complaint.
The judgment is affirmed.
Gibson, C. J., Shenk, J., Edmonds, J., and Traynor, J., concurred.
Now deceased, and his son, J. B. Stivers, as executor, joins as a plaintiff.
‘Agricultural labor exempted from ‘employment’ by Section 7(a) of the Act includes all services performed:
“a. On a farm, in the employ of any person, in connection with cultivating the soil, or in connection with raising or harvesting of any agricultural or horticultural commodity; the raising, feeding, and management of livestock, poultry and bees; which includes among others, the spraying, pruning, fumigating, fertilizing, irrigating and heating which may be necessary and incident thereto.
“b. In the employ of the owner or tenant of a farm on which the materials in their raw or natural state were produced, in connection with the drying, processing, packing, packaging, transporting, and marketing of such materials.
‘‘e. In the employ of the owner or tenant of a farm with respect to ordinary farming operations in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment, if substantially all of such services are performed on a farm.
“d. The provisions of subsection (b) and (e) are not applicable with respect to the services referred to unless such services are carried on as an incident to ordinary farming operations as distinguished from manufacturing or commercial operations. Nor are the provisions of said subsections applicable to services performed in commercial canning or commercial freezing.”
‘‘If the services performed during one-half or more of any pay period by an employee for the person employing him constitute employment, all the services of such employee for such period shall be deemed to be employment; but if the services performed during more than one-half of any such pay period by an employee for the person employing him do not constitute employment, then none of the services of such employee for such period shall be deemed to be employment. As used in this paragraph the term 'pay period’ means a period (of not more than thirty-one consecutive days) for which a payment of remuneration is ordinarily made to the employee by the person employing him.”
" Where employees perform services for an employer in both exempt and nonexempt employments, such employer shall maintain accurate records showing the hours worked by and the wages paid to employees in each of said employments. Such segregation must be made with *491respect to each individual employee rather than on the basis of the employer’s operations as a whole and may be made on a percentage or other basis found by the Department to be reasonable.”