for each industry engaged in the production of goods for commerce to recommend reasonable classifications within such industries necessary to fix the highest minimum wage, not in excess of 40 cents an hour, which will not substantially curtail employment therein nor give a competitive advantage to any group in the industry. The Administrator may thereupon define the industries and classifications in an order establishing such minimum wages.
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 within its scope the following:
"(a) The manufacture, from any material, of headwear for men and boys, except caps and cloth hats;
"(c) The manufacture of felt headwear of fur for men or boys * * *.
"The manufacture of felt headwear of wool for men or boys * * *."
These definitions in terms are certainly broad enough to include the type of headwear manufactured by the defendants. Defendants make various types of hats and caps, some of which contain visors, out of various woven fabrics, leatherette, mixed cotton, wool-felt and fur-felt materials, all of which are within the definitions in the wage orders promulgated by the Administrator. Moreover, the Administrator has interpreted these orders as being applicable to "the manufacture of men's and boys' caps and cloth hats made for advertising purposes, but to be worn", and the Supreme Court has held that interpretative rulings by the Administrator are entitled to great weight. United States v. American Trucking Associations, 310 U.S. 534, at page 549, 60 S. Ct. 1059, 84 L. Ed. 1345, at page 1354; Overnight Motor Transp. Co. v. Missel, 316 U.S. 572, at page 580, 62 S. Ct. 1216, 86 L. Ed. 1682, at page 1689.
That a particular product may normally be considered in one industry rather than in another where both are subject to the Act, does not require the Administrator to adopt this classification. Nor does the fact that other products within the Administrator's definition of an industry require a higher degree of skill in their production and sell for substantially higher prices preclude such a classification. Both these points were met by Mr. Justice (now Chief Justice) Stone, in Opp Cotton Mills, Inc., v. Administrator, 312 U.S. 126, at page 149, 657, 61 S. Ct. 524, at page 535, 85 L. Ed. 624, at page 648: "The inclusion of a given product in one industry or another, where both are subject to the Act, principally concerns convenience in administering the Act. For the provisions for classification with appropriate wage differentials affords ample opportunity for fixing an appropriate wage with respect to any product whether it is placed in one industry or another."
Defendants further contend that the Administrator cannot properly include the hats manufactured by them within these wage orders because he has failed to prove that the industry in which they are normally classified, the novelty industry, had any representation on the industry committees which recommended the wage orders, or that the committees investigated conditions in that industry to consider production costs and competitive conditions, as required by the Act. I am of the opinion, however, tht no such burden is imposed on the plaintiff in this action to compel compliance with the wage orders. The procedure for attacking the validity of the promulgation of wage orders and their applicability to particular operations is set forth in Section 10(a) of the Act, 29 U.S.C.A. Sec. 210(a), which provides: "Any person aggrieved by an order of the Administrator issued under section 8 [section 208 of this title] may obtain a review of such order in the circuit court of appeals of the United States for any circuit wherein such person resides or has his principal place of business, or in the United States Court of Appeals for the District of Columbia, by filing in such court, within sixty days after the entry of such order, a written petition praying that the order of the Administrator be modified or set aside in whole or in part. A copy of such petition shall forthwith be served upon the Administrator, and thereupon the Administrator shall certify and file in the court a transcript of the record upon which the order complained of was entered. Upon the filing of such transcript such court shall have exclusive jurisdiction to affirm, modify, or set aside such order in whole or in part, so far as it is applicable to the petitioner. The review by the court shall be limited to questions of law, and findings of fact by the Administrator when supported by substantial evidence shall be conclusive. No objection to the order of the Administrator shall be considered by the court unless such objection shall have been urged before the Administrator or unless there were reasonable grounds for failure so to do. * * *"
The wage orders here involved, effective July 15, 1940, were promulgated in May of 1940 and were duly published in the Federal Register. In addition to the notice thus afforded by the language of the orders, defendants were given express notice by an investigator from the Department, that their employees engaged in the manufacture of hats and caps were within the scope of these wage orders. They made no effort, however, to challenge the validity and applicability of the orders in the manner provided in Section 10(a) of the Act. Defendants advance as their reason for failure to make such a challenge the limitation that "No objection to the order of the Administrator shall be considered by the court unless such objections shall have been urged before the Administrator or unless there were reasonable grounds for failure to do so." If it be true, as defendants contend, that the hats manufactured by them were so patently not in the Apparel Industry that there was no reason for the defendants to appear before the Administrator, this would appear to constitute reasonable grounds for their failure to do so and would entitle them to be heard before the court on the validity of the Administrator's attempt to include their operations within those wage orders. A transcript of the record upon which the orders complained of were entered would then have been duly before the Circuit Court of Appeals, which would have jurisdiction to affirm, modify or set them aside so far as they were applicable to defendants. Not having challenged the validity or applicability of the wage orders before the Administrator or the Circuit Court of Appeals, despite notice that those orders included hat manufacturing operations, defendants cannot cast upon the plaintiff in this proceeding for the enforcement of those orders the burden of establishing the scope of the investigation leading to their promulgation.
I therefore make the following conclusions of law:
1. The hats and caps manufactured by hats and caps contained in the hat wage order and the wage order for the Caps and Cloth Hats Division of the Apparel Industry effective July 15, 1940.
2. Since July 15, 1940 defendants have violated Sections 15(a) (1) and 15(a) (2) of the Fair Labor Standards Act of 1938 with respect to employees engaged in the production of hats and caps.
3. In an action to compel compliance with a wage order promulgated under the Fair Labor Standards Act of 1938 the Administrator is not required to establish affirmatively the scope of the investigation leading to its promulgation.
4. An injunction may issue.
Counsel may submit a form of decree.