The opinion of the court was delivered by: Robson, District Judge.
The United States of America seeks to enjoin defendant from
paying less than the statutory overtime wages to its employees*fn1
for hours over forty in a work week, pursuant to the requirements
of the Federal Fair Labor Standards Act (29 U.S.C.A. § 201 et
seq.). The defendant is a general contractor engaged in the
construction of a new tunnel, which is to be a part of the
Chicago Waterworks System. The parties have stipulated the facts
and the cause is submitted for decision on briefs. The Court
hereby adopts the stipulation of facts as its special findings of
fact required by Rule 52(a) of the Federal Rules of Civil
Procedure, 28 U.S.C.
The stipulation of facts reveals that the 79th Street tunnel,
which defendant by contract of July 8, 1956, undertook to
construct for the sum of $7,852,050, is to be 4.6 miles in
length; that it is to be a 16-foot tunnel to extend from the
filter plant reservoir in Lake Michigan at 79th Street in Chicago
to connections with the existing State Street and Stewart Avenue
tunnels; that the tunnel is being constructed to provide greater
amounts of water for the City's increased population and for
industrial use, the industrial use being 30% of the daily average
pumpage; that the defendant's employees worked on the tunnel from
July 16, 1956, and will continue to work on it until at least
The defendant's answer denies that its employees are engaged in
commerce or in the production of goods for commerce,
and accordingly contends the Act is inapplicable to its
activities, which, on the contrary are alleged to be "limited
wholly to the construction of new and distinct tunnels and shafts
incident to a filtration plant."
The Fair Labor Standards Act prescribes rates of pay applicable
"* * * employees * * * engaged in commerce or in
the production of goods for commerce * * *." 29
U.S.C.A. § 206.
It defines "commerce" to mean
"* * * trade, commerce, transportation,
transmission or communication among the several
States or between any State and any place outside
thereof." Sec. 203(b).
It defines "produced" thus:
"`Produced' means produced, manufactured, mined,
handled, or in any other manner worked on in any
State; and for the purposes of this chapter an
employee shall be deemed to have been engaged in the
production of goods if such employee was employed in
producing, manufacturing, mining, handling,
transporting, or in any other manner working on such
goods, or in any closely related process or
occupation directly essential to the production
thereof, in any State." Sec. 203(j).
The wording of this last quoted provision was changed in 1949 by
adding the words "closely related" and substituting the words
"directly essential" for the word "necessary."
The Government quotes from the Report of the Majority of Senate
Conferees at 95 Cong.Rec. 14875, indicative of Congressional
"* * * employees repairing, maintaining, improving
or enlarging the buildings, equipment, or facilities
of producers of goods are within the coverage of the
Act whether they are employed by the producer of
goods or by someone else who has undertaken the
performance of particular tasks for the producer."
The Department of Labor has issued an Interpretative Bulletin,
Subpart B, Part 776,