US SUPREME COURT DECISIONS

The Fair Labor Standards Act of 1938 requires employers to pay to every employee engaged in interstate commerce not less than the prescribed minimum hourly wage. When the Act became effective, the respondent terminal companies gave notice to redcaps in their employ of the establishment of a so-called accounting and guarantee system, whereby each redcap was required to account for the tip he received and was guaranteed a compensation which, including tips, would not be less than the statutory minimum.

Held:

1. The employment of the redcaps, prior to the notice, was at will. Their continuing to work, after the notice, created a new contract. P. 315 U. S. 397.

2. The establishment of the accounting and guarantee system was not inconsistent with provisions of the Railway Labor Act forbidding (except as provided) changes of pay or working conditions of employees "as a class as embodied in agreements," since those provisions apply only to collective bargaining agreements. P. 315 U. S. 398.

3. Redcaps were not embraced in a certain collective bargaining agreement relied on in one of these proceedings. P. 315 U. S. 400.

4. There having been no collective bargaining agreement previously in effect, the establishment of the accounting and guarantee system did not violate § 2 of the Railway Labor Act, even though the company had received from the accredited representative of the redcaps a request to negotiate such an agreement. P. 315 U. S. 402.

5. The accounting and guarantee system, as applied to the specific situations here involved, constituted compliance with the minimum wage requirements of the Fair Labor Standards Act. P. 315 U. S. 403. chanrobles.com-red

Page 315 U. S. 387

6. The words "pay wages" in § 6 of the Act are not to be interpreted as limited to money passing from the terminal company to the redcap. P. 315 U. S. 407.

7. The petitioners here are without standing to assert that in its operation the accounting and guarantee system violate §§ 2 and 6(7) of the Interstate Commerce Act. P. 315 U. S. 408.

8. A temporary modification of the accounting practice of the terminal company in one of these cases, during which period redcap were not required to report tips unless they amounted to less than the statutory minimum wage, did not show that the accounting and guarantee system had been abandoned in favor of the former system of nonaccountability for tips. P. 315 U. S. 409.

118 F.2d 324, 328, affirmed.

In No. 112, certiorari was granted, 314 U.S. 590, to review the affirmance of an order (35 F.Supp. 267) granting the defendant's motion for summary judgment in a suit to recover wages and liquidated damages under the Fair Labor Standards Act.

In No. 1023, certiorari was granted, 314 U.S. 701, on petition for rehearing of an order denying certiorari, 313 U.S. 591, to review the reversal of a judgment for the plaintiffs in a suit to recover wages and liquidated damages under the Fair Labor Standards Act, 33 F.Supp. 244. chanrobles.com-red

Page 315 U. S. 388