Plouffe v. Farm & Ranch Equipment Co.

                         No. 13725
         IN THE SUPREMI3 COURT OF THE STATE OF MONTANA




AMOS A. PLOUFFE,
                   Plaintiff and Appellant,


FARM & RANCH EQUIPMENT COMPANY,
a corporation,
                   Defendant and Respondent.


Appeal from:   District Court of the Eighth Judicial
                District,
               Honorable R. J. Nelson, Judge presiding.
Counsel of Record:
     For Appellant:
          McKittrick and Duffy, Great Falls, Montana
          Joseph Duffy argued, Great Falls, Montana
     For Respondent:

          Burton and Waite, Great Falls, Montana
          Charles M. Cruickshank, I11 argued, Great Falls,
           Montana


                              Submitted:     September 13, 1977
                                Decided :   N T 2 5 1977

Filed:   ?CT 2 5   !QV
Mr. Justice Frank I. Haswell delivered the opinion of the Court.

         A former employee filed a civil action against his em-
ployer to recover overtime wages and vacation pay, statutory
penalties, attorney fees and costs.    The district court of Cascade
County denied him summary judgment and dismissed his complaint.
He appeals.
         Plaintiff is Amos A. Plouffe who was employed for over
three years as a farm equipment mechanic by defendant Farm     &

Ranch Equipment Company, a corporation, engaged in sales and
repair of farm equipment.    Plouffe claims that between July 15,
1971 and July 28, 1972, he worked a total of 438-3/4 hours in
excess of 40 hours per week for which he was paid straight time
rather than the overtime rate of time and a half.    He claims he
is entitled to an additional $669.39 overtime pay, a statutory
penalty in an equal amount, attorney fees of $350 and costs.       He
bases his overtime pay claim on Montana's Minimum Wages and Hours
Act, section 41-2301 et seq., R.C.M.   1947.   He bases his civil
suit for collection of the overtime pay, statutory penalties,
attormy fees and costs on Montana's Wage Payment Act, section
41-1301 et seq., R.C.M.   1947.
         Plouffe also claims an additional 80 hours vacation pay
in the sum of $240, a statutory penalty in an equal amount, and
costs.
         On August 5, 1972, Plouffe filed his claim with the
Montana Department of Labor and Industry, Labor Standards ~ivision.
Subsequently, at a date unclear from the record before us, the
department denied his claim.
         On February 23, 1973, Plouffe filed his complaint in the
district court of Cascade County seeking recovery by civil suit
of the amounts set forth above.   His employer answered by a general

denial and plead the affirmative defenses of (1) exemption from
payment under the federal Fair Labor Standards Act, 2 9 USCA,
Sec. 201 et seq. as amended, and (2) the bar of the statute
of limitations.    His employer also sought an award of $ 3 5 0
attorney fees as the prevailing party.
          Following pretrial discovery, plaintiff Plouffe moved
for summary judgment.      Thereafter the district court entered
findings of fact, conclusions of law and judgment to the effect
that defendant employer, by the nature of its business, is ex-
empt from the wage and overtime provisions of Montana's Mini-
mum Wages and Hours Act and dismissed plaintiff's entire complaint.
Plaintiff now appeals.
          The ultimate issue for review is whether the judgment of
the district court is correct.     The underlying issues can be
summarized as follows:
          (1) Is the employer exempt from payment of overtime wages
under the federal Fair Labor Standards Act?
          (2) Is the employer exempt from payment of overtime

wages under Montana's Minimum Wages and Hours Act?
          ( 3 ) Does the federal Fair Labor Standards Act preempt

the field of wage and hour regulation to the exclusion of Montana's
Minimum Wages and Hours Act?
          ( 4 ) Should plaintiff's entire complaint have been dis-

missed?
          We hold that the federal Fair Labor Standards Act expressly
exempts the employer in this case from paying overtime wages to
plaintiff.    Section 207 of the Fair Labor Standards Act provides
that no employer shall employ any of his employees for a work-
week longer than 40 hours unless such employee receives time and
a half his regular rate of pay for the excess.      Section 2 1 3 pro-
vided :
          "Exemptions   * * *
         " (b) The provisions of Section 207 of this title
         shall not apply with respect to-- * * *

         "(10) Any salesman, partsman, or mechanic primarily
         e n g a q e d n selling or servicing automobiles, trailers,
         trucks, farm implements, or aircraft if employed by
         a nonmanufacturinq establishment primarily engaged
         in the business of sellinq such vehicles to ultimate
         purchasers." (Emphasis added.) Act of September 23,
         1966, P.L. 89-601, 80 Stat. 836 (1966) (Current
         version at 29 U.S.C. S 213(b) (10) (Supp.1V 1974)).
 This exemption from payment of overtime wages clearly applies
 under the admitted facts of this case.
         We further hold that the employer in this case is not
 exempt from the payment of overtime wages under Montana's Mini-
 mum Wages and Hours Act.   This Act provides:
         "41-2303. Compensation. (a) Except as may other-
         wise be provided pursuant to this act, every
         employer shall pay to each of his employees wages
         at a rate not less than provided in subsection (1)
         and (2) save and except for farm workers as herein
         defined:


        "(b) No employer shall employ any of his employees
        for a work week longer than forty (40) hours, unless
        such employee receives for his employment in excess
        of forty (40) hours in a work week at a rate of not
        less than one and one-half (1-1/2) times the hourly
        wage rate at which he is employed. No overtime pro-
        vision shall apply for farm workers * * *."
Farm worker as defined in section 41-2302(f) "    * * *   means any
person employed to do any service performed on a farm or ranch."
         Thus the situs of the work performed is the basis of
the exemption.   Here the work was not performed on a farm or
ranch; the exemption does not apply; and the employee is entitled
to overtime wages at the rate of 1-1/2 times his regular hourly
rate of pay for the hours worked in excess of 40 hours per week.
         The employer argues that it is exempt from Montana's
Minimum Wages and Hours Act because:
         (1) The employer is subject to all the provisions of the
Fair Labor Standards Act except the overtime pay provisions indi-
cating a congressional intent to substantially cover him by its
provisionsand grant him an exemption therein, (2) the Minimum
Wages and Hours Act exemption of "farm workers", and (3) the Mont-
ana Labor Department ruling that the employer is not covered by
our Minimum Wages and Hours Act.
          The first argument is answered hereafter in our discus-
sion of preemption.   The second argument has already been answered
by the definition of "farm worker" in our Minimum Wages and Hours
Act.   The short answer to the third argument is that the Montana
Labor Department's ruling that the employee is not covered by
Montana's Minimum Wages and Hours Act is incorrect.    As heretofore
noted, the language of the Minimum Wages and Hours Act requires
payment of overtime wages to all employees and there is no exemp-
tion covering this case.
          The exemption of overtime wages under the federal Fair
Labor Standards Act and the absence of such exemption under Mon-
tana's Minimum Wages and Hours Act posits the principal issue on
appeal:   Does the federal Fair Labor Standards Act preempt the entire
field of wage and hour regulation precluding state legislation on
this subject?
          It is conceded that Congress has the power to preempt
under the commerce clause of the United States Constitution.      It
is equally clear that where Congress preempts the field, state
laws to the contrary must yield.    The supremacy clause, Art. VI,
United States Constitution provides:
          "This constitution and the laws of the United
          States which shall be made in pursuance thereof,
          and all treaties made, or which shall be made,
          under the authority of the United States, shall
          be the supreme law of the land; and the judges in
          every state shall be bound thereby, anything in
          the constitution or laws of any state to the
          contrary notwithstanding."
 The question in this case is whether Congress did in fact preempt
 the entire field of wage and hour regulation by enactment of
 the Fair Labor Standards Act.     The issue turns on the legislative
intent of Congress.
           The employer asserts that when Congress moved to regulate
commerce by enactment of the Fair Labor Standards Act it pre-
empted the entire field of wage and hour regulation and the
states are precluded from enacting legislation concerning the
same subject matter.       The employer argues that it is covered by
all provisions of the Fair Labor Standards Act except the over-
time pay provision indicating an intention by Congress to occupy
the whole field and in so preempting to grant it a specific
exemption from payment of overtime wages based on a legislative
policy to protect agriculture, a financially fragile industry.
           The time is long past for this contention to prevail.   The
language of the Fair Labor Standards Act itself indicates a con-
gressional intent not to preempt to the exclusion of state wage
and hour laws.
           "Section 218.   Relation to other laws.
        "(a) No provision of this chapter or of any order
        thereunder shall excuse noncompliance with any
        Federal or State law or municipal ordinance es-
        tablishing a minimum wage higher than the minimum
        wage established under this chapter or a maximum
        workweek lower than the maximum workweek es-
        tablished under this chapter * * *."
           Case law interpreting the Fair Labor Standards Act like-
wise destroys the employer's contention of congressional pre-
emption.    Maneja v. Waialua Agri. Co., 349 U.S. 254, 99 L ed 1040,
75 S.Ct. 719 (1955); Divine v. Levy, 36 F.Supp. 55 (1940);
Eastern Sugar Associates v. Pena, 222 F.2d 934 (1955), cert.den.
355 U.S. 900.    Perhaps the best example of denial of the employer's
preemption argument and at the same time establishing state power
to eliminate exemptions granted in the Fair Labor Standards Act,
is the following holding:
           "This section [Sec. 218, FLSA] expressly contem-
           plates that workers covered by state law as well as
           the FLSA shall have any additional benefits pro-
           vided by state law--higher minimum wages; or lower
        maximum work week. By necessary implication it
        permits state laws to operate even as to workers
        exempt from the FLSA." Williams v. Transit Co.,
        472 F.2d 1258 (1972)
        State courts have similarly held no federal preemption by
the Fair Labor Standards Act:
        "Anticipating such an apparent conflict between
        the federal act and similar state legislation,
        the congress provided in 29 USCA Section 218(a)
        * * * for enforcing compliance with a state mini-
        mum wage higher and a state 'maximum workweek'
        lower than that established by the federal act,
        i-e., the statute specifically prohibits preenp-
        tion, by the federal act, of any state minimum wage
        or maximum hour/overtime ('maximum workweek') pro-
        vision more favorable to the employee than that
        prescribed by the federal act." State v. Comfort
        Cab, Inc., 118 N.J. Super. 162, 286 A.2d 742.
To the same effect see Hendrix v. Delta Airlines, La.App. 234 So.2d
93; Yellow Cab Co. v. New Jersey, 126 N.J.Super.   81, 312 A.2d 870.
        The Montana attorney general has ruled likewise:
        "Since the Montana Constitution and statutes enacted
        pursuant thereto set a lower maximum hour standard
        than does the Federal Act it follows as a matter
        of course that the Montana Eight Hour Law takes
        precedence and must be complied with regardless of
        the provisions of the Fair Labor Standards Act."
        Opinion 89, Opinions of the Attorney General, Feb.
        8, 1950.

        In summary, we hold that the Fair Labor Standards Act does
not preempt the subject of wage, hour or overtime regulation to
the exclusion of Montana's Minimum Wages and Hours Act; that the
employer here is not exempt from payment of overtime wages under
either the Fair Labor Standards Act exemption or Montana's
Minimum Wages and Hours Act; and that the employee is entitled
to overtime pay of $669.39 pursuant to our Minimum Wages and
Hours Act under the admitted facts of this case.   Accordingly,
the district court was in error in dismissing plaintiff's complaint.
        The findings of fact, conclusions of law and judgment of
the district court are vacated.   The case is remanded to the
district court with directions to reinstate plaintiff's complaint;
grant plaintiff partial summary judgment in the amount of $669.39
for overtime wages; for a hearing and determination of the amount
to be awarded plaintiff as reasonable attorney fees; for such
further proceedings as may be necessary to determine plaintiff's
right to vacation pay and the statutory penalties in section 41-
1302, R.C.M.,   on his overtime pay award and his claim for vaca-
tion pay, and for the determination and award of such costs and
disbursements to plaintiff as are authorized by statute.



                                          Justice