U.S. Supreme Court
Walling v. Harnischfeger Corp., 325 U.S. 427 (1945)
Walling v. Harnischfeger Corporation
Argued May 1, 1945
Decided June 4, 1945
325 U.S. 427
A wage agreement, arrived at by collective bargaining, provided for compensation at a specified base rate or "regular rate." On "time studied" jobs, "incentive bonuses" or "piecework earnings" normally resulted in employees' receiving compensation, exclusive of overtime payments at a rate higher than the base rate. The hourly rate actually paid on many jobs not "time studied" was at least 20% higher than the base.
1. As to employees who received hourly rates higher than the base rate, the computation of overtime on the basis of such rate, rather than on the rate actually received violated § 7(a) of the Fair Labor Standards Act. P. 325 U. S. 430.
2. As to employees who received incentive bonuses, such payments must enter into the computation of the statutory regular rate for purposes of the overtime provisions of § 7(a), regardless of any contract provision to the contrary. P. 325 U. S. 431.
3. Where, as here, the facts do not permit it, the Court cannot arbitrarily divide bonuses or piecework wages into regular and overtime segments, thereby creating artificial compliance with § 7(a). P. 325 U. S. 432.
4. It is not sufficient that the employer pays for overtime a premium which makes the overtime rate somewhat higher than the piecework earnings per hour; section 7(a) requires that that premium be not less than 50% of the actual hourly rate received from all regular sources. P. 325 U. S. 432.
5. Where the correct overtime compensation cannot be determined until after the regular payday, § 7(a) requires only that the employee receive such compensation as soon as convenient or practicable under the circumstances. P. 325 U. S. 432.
145 F.2d 589, reversed.
Certiorari, 324 U.S. 837, to review the reversal of an order of the District Court, 54 F.Supp. 326, enjoining violations of the Fair Labor Standards Act. chanroblesvirtualawlibrary