The opinion of the court was delivered by: BARD
This is an action by the Administrator of the Wage and Hour Division of the Department of Labor to restrain the defendants from violating Sections 15(a) (1), 15(a) (2) and 15(a) (5) of the Fair Labor Standards Act of 1938, c. 676, 52 Stat. 1060, 29 U.S.C.A. § 201 et seq. I make the following special findings of fact:
1. Defendants are, and for many years have been, engaged in the manufacture of novelties for interstate commerce, in the course of which they manufacture advertising hats and caps.
2. These hats and caps include, skull caps, sailor hats, guard hats, baseball caps and yacht caps, some of which contain visors, and they are made from woven fabrics, leatherette, mixed cotton, wool-felt and fur-felt materials.
3. There is less skill necessary in the manufacture of these hats and caps than of conventional dress hats and caps and they are less expensive.
4. In May of 1940 the plaintiff promulgated a wage order for the Caps and Cloth Hats Division of the Apparel Industry and a wage order for the Hat Industry, both effective July 15, 1940, which wage orders established a minimum wage rate of 40 cents an hour.
5. In June of 1940 defendants were advised that these wage orders might be applicable to their manufacture of hats and caps, and on August 19, 1940 they were formally notified that the Administrator interpreted these orders as being applicable thereto.
6. Since July 15, 1940 defendant has failed to pay all of its employees engaged in the production of hats from the materials enumerated in these wage orders a minimum wage of 40 cents an hour.
In accordance with the Fair Labor Standards Act of 1938 committees were appointed which recommended certain wage orders subsequently adopted and promulgated by the plaintiff in May 1940 for the Caps and Cloth Hats Division of the Apparel Industry and for the Hat Industry. By reason of these orders the minimum wage of 40 cents per hour, which is established by the Act to become effective not later than 1945, was accelerated and became effective July 15, 1940. The sole issue is whether these accelerated wage orders are applicable to defendants and whether defendants' admitted noncompliance therewith is therefore a violation of the Act.
The contentions of the defendants in the present case are all based on the fact that they are novelty manufacturers and that therefore the novelty hats which they manufacture cannot be considered within the scope of the wage orders for the Caps and Cloth Hats Division of the Apparel Industry and for the Hat Industry. It is a fact that the hats manufactured by defendants are used for advertising or novelty wear and that, industrially speaking, the defendants regard themslves and are regarded as members of the novelty, rather than of the hat, industry. This is, however, not necessarily conclusive of the question whether, to the extent that they do manufacture hats, they are within the scope of the wage orders in question.
Section 574.4 of the wage order for the Apparel Industry defines the Caps and Cloth Hats Division as follows: "The manufacture of men's and boys' hats or caps (except men's and boys' fur-felt, wool-felt, straw, and silk and opera hats and bodies) from any woven material, any purchased knitted material, leather, leatherette, or any combination of such materials, including but without limitation, uniform caps, aviation caps, and shop and railroad caps; and including the manufacture of cap visors, bands, and brims, and the manufacture of sweat bands from any material other than leather."
Section 557.4 of the wage order for the Hat Industry includes in the definition of the Hat Industry ...