Laws Affecting Foreign Commerce Guerra Everett, Chief, Division of Commercial Laws District Offices to be Informed of Wage Law Provisions Fair Labor Standards Act of 1938 (Wages Public No. 718, 75th Congress-Résumé of the Important Features Harold DeCourcy, Division of Commercial Laws The act was approved June 25, 1938; it became effective October 24, 1938. The following résumé must not be regarded as official as the Department of Labor is alone charged with the administration of the law. HOURS The standard workweek for industries engaged in interstate I. From October 24, 1938, to October 24, 1939-44 hours. In general, the hours may be increased, but employees must WAGES There are two methods of increasing to 40 cents per hour. II. From October 24, 1939, to October 24, 1945-30 cents per hour. (B) Where (A) would substantially curtail employment, the act provides for wage determination by industry committees representing equally employers, employees, and the public. INDUSTRY COMMITTEES Are appointed by the Administrator, given informational, I. Will not substantially curtail employment in each classification. APPLICATION IN GENERAL Wage and hour provisions apply to: I. Employees engaged in producing, manufacturing, mining, handling, transporting, or in any manner working on goods moving in interstate commerce. II. Employees engaged in any process or occupation necessary to the production of such goods. III. Employees engaged in interstate transportation, transmission, or communication. EXEMPTIONS IN GENERAL Neither wage nor hour provisions apply to: I. Agricultural workers, seamen and employees of airlines, street car, motorbus, interurban railways, and employees of weekly or semiweekly newspapers with a circulation of less than 3,000, the major part of whose circulation is in the county of publication. II. Persons employed in a bona fide executive, administrative, professional, or local retailing capacity, or as outside salesmen. III. Persons employed in any retail or service establishment, the greater part of whose selling or servicing is in intrastate commerce. IV. Persons employed in fishing and the fishing industry. V. Persons employed in the area of production to handle or prepare or can agricultural or horticultural commodities for market or to make dairy products. EXEMPTIONS FROM HOUR PROVISIONS 1. Employees of railway, motorbus, and truck carriers which are regulated by the Interstate Commerce Commission. 2. Employees of employers engaged in the first processing of milk, whey, skimmed milk, or cream into dairy products, in the ginning and compressing of cotton, in the processing of cotton seed, and in the processing of sugar beets, sugar beet molasses, sugar cane, or maple sap into raw sugar or sirup. Persons partially exempt from the maximum hour provisions include: 1. Employees in industries designated by the Administrator as seasonal who may work up to 12 hours a day or 56 hours a week for not more than 14 weeks each year. For work over 12 hours a day or 56 hours a week, the overtime rate applies. 2. Employees of employers engaged in the first processing, canning, or packing of fresh fruits and vegetables, or in the first processing within the area of production of agricultural or horticultural commodities during seasonal operations or in dressing poultry or slaughtering livestock, are exempt from all maximum hour provisions for a total of not more than 14 weeks each year. 3. Employees working under an agreement, made as a result of collective bargaining by representatives of employees certified as bona fide by the National Labor Relations Board which provides for a maximum of 1,000 hours' work in 26 weeks or which provides on an annual basis for a maximum of 2,000 hours' work in 52 weeks. However, for work over 12 hours a day or 56 hours in a week, they must be paid at the rate of time and one-half. LEARNERS, APPRENTICES, AND HANDICAPPED WORKERS The act permits the Administrator to issue permits to work at a lower wage for learners, apprentices, messengers employed exclusively in delivering letters and messages, and handicapped workers. CHILD LABOR No producer, manufacturer, or dealer, after October 24, 1938, may ship or deliver for shipment in interstate commerce any goods produced in an establishment which has employed "op pressive child labor" within 30 days of the removal of the goods. "Oppressive Child Labor" defined as— I. Employment of children under 16 years of age in any occupation, except for employment of children of 14 or 15 years old at work, other than manufacturing or mining, which the Chief of the Children's Bureau has determined not to interfere with schooling, health, or well being. II. Employment of children 16 or 17 years of age in any occupation found and declared by order of the Chief of the Children's Bureau to be particularly hazardous, or detrimental to health, or well being. Exemptions from child labor provisions: I. Child actors in motion pictures or theatrical productions. II. Children under 16 employed by their parents in non-manufacturing and non-mining occupations. III. Children employed in agriculture while they are not legally required to attend school. HAZARDOUS OCCUPATIONS Chief of Children's Bureau to declare occupations to be particularly hazardous or detrimental to health or well being of children, 16 or 17 years of age, after careful study, investigation and hearing both employer and employee. Reasonable time for readjustment will be allowed. COURT REVIEW AND ENFORCEMENT Recourse to courts authorized in three ways— I. Employees, themselves or through an agent, may sue to recover unpaid minimum or overtime wages. Employers found violating act liable for unpaid sums plus an equal amount as damages plus court costs and reasonable attorneys fees. II. Employers or employees aggrieved by a wage order may obtain a review of the Administrator's order in a United States Court of Appeals or the District of Columbia Circuit Court of Appeals. Court limited to review questions of law; Administrator's findings of fact are conclusive. III. Federal Government may prosecute criminally for violations of the act, or discharging, or discriminating against an employee who has filed a complaint under the act. The Administrator may ask a Federal district court to restrain violations of the act by injunction. PENALTIES In addition to right of employee to recover twice amount of unpaid minimum or overtime wages, law provides a fine of $10,000 or not more than 6 months' imprisonment (imprisonment only where employer convicted of a prior offense). STATE LAWS This act does not excuse compliance with State laws fixing higher minimum wages or shorter maximum hours. REGULATIONS Rules and regulations are required under section 11 (c) prescribing the records which employers must keep; also under section 14 with reference to learners, apprentices, messengers, and handicapped persons. Under section 7 (b) (3) special treatment is accorded industries found by the Administrator to be of a seasonal nature. Under section 3 (m) the Administrator must set up a procedure for the determination of the reasonable cost of board, lodging, and other facilities customarily furnished the employee as part of his wages. Under section 13 (a) (1) the Administrator must define and delimit the terms, "bona fide executive, administrative, professional, or local retailing capacity, or in the capacity of outside salesman," to which classes of employees the benefits of the wage and hour sections do not apply. The Administrator must define "area of production" for the purpose of applying sections 7 (c) and 13 (a) (10). It is expected that the Administrator will issue shortly a book of rules and regulations. The Division of Commercial Laws will endeavor to supply each District and Cooperative Office of the Bureau with a copy. As to individual inquiries presenting problems more or less peculiar to the inquirer, and not covered by any general interpretative bulletin, many of these inquiries are susceptible of answer without much difficulty and the Administrator will eventually undertake to answer them, subject to the physical limitations of the size of the staff. The extent to which the Administrator may go in this direction will no doubt be determined largely as a result of accumulating experience in administering the law. It must be made clear, however, that such answers as are given to individual inquiries are subject to discount, (1) because they are based upon ex parte and often meager statements of facts, and (2) are rendered without the benefit of argument by persons who may represent an interest conflicting with that of the inquirer; and the caution cannot be made too emphatic that such answers by the Administrator cannot confer upon an employer immunity from private suit by an employee under section 16. Eventually the larger part of specific inquiries will be decentralized. Some 12 District Offices are now contemplated paralleling the District Office service of the Social Security Board. There will be four Regional Directors, two of whom 1) (Far West) 2) (South) have already been appointed. The Division of Commercial Laws will endeavor to supply the District and Cooperative Offices of the Bureau with such information as is released from time to time by the Department of Labor, until the installation of that Department's local establishments. Reprint from "Commerce Reports" of October 29, 1938 THE DIVISION OF COMMERCIAL LAWS IS PREPARED TO FURNISH YOU WITH INFORMATION ON FOREIGN BUSINESS LAWS AND TAXES ARGENTINA FOREIGN LAW COMMENT Commercial Law and Legal Notes.* Real Property, Fixtures, Mortgages. The right to auction chattels located on mortgaged property was the subject of a recent decision of the Supreme Court. In the city of Rosario, the National Mortgage Bank wished to auction some printing machinery upon which it held a chattel mortgage. The right to do so was contested on the grounds that the machinery was located on mortgaged property, also up for auction. The court of first instance as well as the appellate court sustained the point of view of the defendant, namely that the machinery could not be sold at auction, but the Supreme Court reversed the opinion, and recognized the right of the bank to sell the machinery, even though it was installed upon mortgaged property. Bankruptcy, Fraud. In a recent bankruptcy case, the petitioner, a very small shopkeeper, did not keep books covering his business. This is a common practice of many shopkeepers whose businesses are not extensive and apparently has been a basis of avoiding taxes and other obligations. The court, in this case, held the failure to keep books, as prescribed by law, sufficient proof that the declaration of bankruptcy was fraudulent and it was so declared. * Taxation, Income, Liability of Assets. A local company in 1933 sold all of its stocks, property, mines, and machinery for the sum of 11,000,000 besos. As a result of the sale, there was a total profit of almost 5,000,000 pesos for the year's operations. The Internal Revenue Bureau insisted upon income tax payment for the entire amount. Payment was made under protest, the company filing suit for recovery of the amount assessed. The court of first instance decided against the firm, but on appeal, this decision was reversed and the Government was required to return the tax collected. The majority of the court held that the purpose of income tax is to tax net profits covering operations but not profits accruing from the sale of property by means of which such operations were conducted. Labor, Claims for Compensation, Law 9688. In the Federal Capital, the court of first instance has declared that the labor accident law 9688, does not include rural laborers, and the appellate court affirmed this decision. The case in question was a claim for indemnity for a labor accident occurring on a farm. The appellate court held that the case was not one of the industrial organization but sgrictly agricultural, and that Law 9688 covered agricultural laborers only when engaged in transportation or in the operation of motors or engines. To offset this decision, the government of the Province of Mendoza has taken action by way of a decree which amends Law 9688, in so far as it applies to that province, to include within its scope all agricultural laborers. *From the Office of the American Commercial Attache, Buenos Aires. |