Petitioner Foundation is a nonprofit religious organization that
derives its income largely from the operation of commercial
businesses staffed by the Foundation's "associates," most of whom
were drug addicts, derelicts, or criminals before their
rehabilitation by the Foundation. These workers receive no cash
salaries, but the Foundation provides them with food, clothing,
shelter, and other benefits. The Secretary of Labor filed an action
in Federal District Court against the Foundation and petitioner
officers thereof, alleging violations of the minimum wage,
overtime, and recordkeeping provisions of the Fair Labor Standards
Act (Act). The District Court held that the Foundation was an
"enterprise" within the meaning of 29 U.S.C. § 203(r), which
defines that term as "the related activities performed . . . by any
person or persons for a common business purpose," that the
Foundation's businesses serve the general public in competition
with ordinary commercial enterprises, and that, under the "economic
reality" test of employment, the associates were "employees" of the
Foundation protected by the Act. The court rejected petitioners'
arguments that application of the Act to the Foundation violated
the Free Exercise and Establishment Clauses of the First Amendment.
The Court of Appeals affirmed as to liability.
Held:
1. The Foundation's businesses constitute an "enterprise" within
the meaning of the Act, and are not beyond the Act's reach because
of the Foundation's religious character. This Court has
consistently construed the Act liberally in recognition that broad
coverage is essential to accomplish the goal of outlawing from
interstate commerce goods produced under conditions that fall below
minimum standards of decency. The Act contains no express or
implied exception for commercial activities conducted by religious
or other nonprofit organizations, and the Labor Department has
consistently interpreted the Act to reach such businesses. And this
interpretation is supported by the legislative history. Pp.
471 U. S.
295-299.
2. The Foundation's associates are "employees" within the
meaning of the Act, because they work in contemplation of
compensation.
Walling v. Portland Terminal Co.,
330 U. S. 148,
distinguished. The fact that
Page 471 U. S. 291
the associates themselves protest coverage under the Act is not
dispositive, since the test of employment under the Act is one of
"economic reality." And the fact that the compensation is primarily
in the form of benefits, rather than cash, is immaterial in this
context, such benefits simply being wages in another form. Pp.
471 U. S.
299-303.
3. Application of the Act to the Foundation does not infringe on
rights protected by the Religion Clauses of the First Amendment.
The Free Exercise Clause does not require an exemption from a
governmental program unless, at a minimum, inclusion in the program
actually burdens the claimant's freedom to exercise religious
rights. Here, since the Act does not require the payment of cash
wages and the associates received wages in the form of benefits in
exchange for working in the Foundation's businesses, application of
the Act works little or no change in the associates' situation;
they may simply continue to be paid in the form of benefits. But
even if they were paid in cash and their religious beliefs
precluded them from accepting the statutory amount, there is
nothing in the Act to prevent them from voluntarily returning the
amounts to the Foundation. And since the Act's recordkeeping
requirements apply only to commercial activities undertaken with a
"business purpose," they would have no impact on petitioners' own
evangelical activities or on individuals engaged in volunteer work
for other religious organizations. Pp.
471 U. S.
303-306.
722 F.2d 397, affirmed.
WHITE, J., delivered the opinion for a unanimous Court.
JUSTICE WHITE delivered the opinion of the Court.
The threshold question in this case is whether the minimum wage,
overtime, and recordkeeping requirements of the Fair Labor
Standards Act, 52 Stat. 1060, as amended, 29 U.S.C. § 201
et
seq., apply to workers engaged in the commercial
Page 471 U. S. 292
activities of a religious foundation, regardless of whether
those workers consider themselves "employees." A secondary question
is whether application of the Act in this context violates the
Religion Clauses of the First Amendment.
I
The Tony and Susan Alamo Foundation is a nonprofit religious
organization incorporated under the laws of California. Among its
primary purposes, as stated in its Articles of Incorporation, are
to
"establish, conduct and maintain an Evangelistic Church; to
conduct religious services, to minister to the sick and needy, to
care for the fatherless and to rescue the fallen, and generally to
do those things needful for the promotion of Christian faith,
virtue, and charity. [
Footnote
1]"
The Foundation does not solicit contributions from the public.
It derives its income largely from the operation of a number of
commercial businesses, which include service stations, retail
clothing and grocery outlets, hog farms, roofing and electrical
construction companies, a recordkeeping company, a motel, and
companies engaged in the production and distribution of candy.
[
Footnote 2] These activities
have been supervised by petitioners Tony and Susan Alamo, president
and secretary-treasurer of the Foundation, respectively. [
Footnote 3] The businesses are staffed
largely by the Foundation's "associates," most of whom were drug
addicts, derelicts, or criminals before their conversion and
rehabilitation by the Foundation. These workers receive no cash
salaries, but the Foundation provides them with food, clothing,
shelter, and other benefits.
Page 471 U. S. 293
In 1977, the Secretary of Labor filed an action against the
Foundation, the Alamos, and Larry La Roche, who was then the
Foundation's vice-president, alleging violations of the minimum
wage, overtime, and recordkeeping provisions of the Fair Labor
Standards Act, 29 U.S.C. §§ 206(b), 207(a), 211(c), 215(a)(2),
(a)(5), with respect to approximately 300 associates. [
Footnote 4] The United States District
Court for the Western District of Arkansas held that the Foundation
was an "enterprise" within the meaning of 29 U.S.C. § 203(r), which
defines that term as "the related activities performed . . . by any
person or persons for a common business purpose."
567 F.
Supp. 556 (1983). The District Court found that despite the
Foundation's incorporation as a nonprofit religious organization,
its businesses were "engaged in ordinary commercial activities in
competition with other commercial businesses."
Id. at
573.
The District Court further ruled that the associates who worked
in these businesses were "employees" of the Alamos and of the
Foundation within the meaning of the Act. The associates who had
testified at trial had vigorously protested the payment of wages,
asserting that they considered themselves volunteers who were
working only for religious and evangelical reasons. Nevertheless,
the District Court found that the associates were "entirely
dependent upon the Foundation for long periods." Although they did
not expect compensation in the form of ordinary wages, the District
Court found, they did expect the Foundation to provide them "food,
shelter, clothing, transportation and medical benefits."
Id. at 562. These benefits were simply wages in another
form, and, under the "economic reality" test of employment, see
Goldberg v. Whitaker House
Cooperative, Inc., 366 U. S.
28,
Page 471 U. S. 294
366 U. S. 33
(1961), [
Footnote 5] the
associates were employees. The District Court also rejected
petitioners' arguments that application of the Act to the
Foundation violated the Free Exercise and Establishment Clauses of
the First Amendment, and the court found no evidence that the
Secretary had engaged in unconstitutional discrimination against
petitioners in bringing this suit. [
Footnote 6]
The Court of Appeals for the Eighth Circuit affirmed the
District Court's holding as to liability, but vacated and remanded
as to the appropriate remedy. 722 F.2d 397 (1984). [
Footnote 7] The Court of Appeals emphasized
that the businesses operated by the Foundation serve the general
public, in competition with other entrepreneurs. Under the
"economic reality" test, the court held,
"it would be difficult to conclude that the extensive commercial
enterprise operated and controlled by the foundation was nothing
but a religious liturgy engaged in bringing good news to a pagan
world. By entering the economic arena and trafficking in the
marketplace, the foundation has subjected itself to the standards
Congress has prescribed for the benefit of employees. The
Page 471 U. S. 295
requirements of the Fair Labor Standards Act apply to its
laborers."
Id. at 400. Like the District Court, the Court of
Appeals also rejected petitioners' constitutional claims. We
granted certiorari, 469 U.S. 915 (1984), and now affirm.
II
In order for the Foundation's commercial activities to be
subject to the Fair Labor Standards Act, two conditions must be
satisfied. First, the Foundation's businesses must constitute an
"[e]nterprise engaged in commerce or in the production of goods for
commerce." 29 U.S.C. § 203(s). [
Footnote 8] Second, the associates must be "employees"
within the meaning of the Act. While the statutory definition is
exceedingly broad,
see United States v. Rosenwasser,
323 U. S. 360,
323 U. S.
362-363 (1945), it does have its limits. An individual
who,
"without promise or expectation of compensation, but solely for
his personal purpose or pleasure, worked in activities carried on
by other persons either for their pleasure or profit,"
is outside the sweep of the Act.
Walling v. Portland
Terminal Co., 330 U. S. 148,
330 U. S. 152
(1947). [
Footnote 9]
A
Petitioners contend that the Foundation is not an "enterprise"
within the meaning of the Act, because its activities are
Page 471 U. S. 296
not performed for "a common business purpose." [
Footnote 10] In support of this assertion,
petitioners point to the fact that the Internal Revenue Service has
certified the Foundation as tax-exempt under 26 U.S.C. § 501(c)(3),
which exempts "any . . . foundation . . . organized and operated
exclusively for religious, charitable, scientific, testing for
public safety, literary, or educational purposes." [
Footnote 11]
The Court has consistently construed the Act "liberally to apply
to the furthest reaches consistent with congressional direction,"
Mitchell v. Lublin, McGaughy & Associates,
358 U. S. 207,
358 U. S. 211
(1959), recognizing that broad coverage is essential to accomplish
the goal of outlawing from interstate commerce goods produced under
conditions that fall below minimum standards of decency.
Powell
v. United States Cartridge Co., 339 U.
S. 497,
339 U. S. 516
(1950). [
Footnote 12] The
statute contains no express or implied exception for commercial
activities conducted by religious or other nonprofit organizations,
[
Footnote 13]
Page 471 U. S. 297
and the agency charged with its enforcement has consistently
interpreted the statute to reach such businesses. The Labor
Department's regulation defining "business purpose," which is
entitled to considerable weight in construing the Act, explicitly
states:
"Activities of eleemosynary, religious, or educational
organization [
sic] may be performed for a business
purpose. Thus, where such organizations engage in ordinary
commercial activities, such as operating a printing and publishing
plant, the business activities will be treated under the Act the
same as when they are performed by the ordinary business
enterprise."
29 CFR § 779.214 (1984).
See also Marshall v. Woods Hole
Oceanographic Institution, 458 F.
Supp. 709 (Mass.1978);
Marshall v. Elks Club of Huntington,
Inc., 444 F.
Supp. 957, 967-968 (SD W.Va.1977).
Cf. Mitchell v. Pilgrim
Holiness Church Corp., 210 F.2d 879 (CA7),
cert.
denied, 347 U.S. 1013 (1954).
The legislative history of the Act supports this administrative
and judicial gloss. When the Act was broadened in 1961 to cover
"enterprises" as well as individuals, the Senate Committee Report
indicated that the activities of nonprofit groups were excluded
from coverage only insofar as they were not performed for a
"business purpose." [
Footnote
14] Some illumination of congressional intent is provided by
the debate on a proposed floor amendment that would have
specifically excluded from the definition of "employer,"
see 29 U.S.C. § 203(d), organizations qualifying for tax
exemption under 26
Page 471 U. S. 298
U.S.C. § 501(c)(3). [
Footnote
15] The floor manager of the bill opposed the amendment because
it might have been interpreted to "g[o] beyond the language of the
[Committee] report" by excluding a "profitmaking corporation or
company" owned by "an eleemosynary institution." [
Footnote 16] The proponent of the failed
amendment countered that it would not have excluded "a church which
has a business operation on the side." [
Footnote 17] There was thus broad congressional
consensus that ordinary commercial businesses should not be
exempted from the Act simply because they happened to be owned by
religious or other nonprofit organizations. [
Footnote 18]
Petitioners further contend that the various businesses they
operate differ from "ordinary" commercial businesses because they
are infused with a religious purpose. The businesses minister to
the needs of the associates, they contend, both by providing
rehabilitation and by providing them with food, clothing, and
shelter. In addition, petitioners argue, the businesses function as
"churches in disguise" -- vehicles
Page 471 U. S. 299
for preaching and spreading the gospel to the public.
See Brief for Petitioners 27-28. The characterization of
petitioners' businesses, however, is a factual question resolved
against petitioners by both courts below, and therefore barred from
review in this Court "absent the most exceptional circumstances."
[
Footnote 19] The lower
courts clearly took account of the religious aspects of the
Foundation's endeavors, and were correct in scrutinizing the
activities at issue by reference to objectively ascertainable facts
concerning their nature and scope. Both courts found that the
Foundation's businesses serve the general public in competition
with ordinary commercial enterprises,
see 722 F.2d at 400;
567 F. Supp. at 573, and the payment of substandard wages would
undoubtedly give petitioners and similar organizations an advantage
over their competitors. It is exactly this kind of "unfair method
of competition" that the Act was intended to prevent,
see
29 U.S.C. § 202(a)(3), and the admixture of religious motivations
does not alter a business' effect on commerce.
B
That the Foundation's commercial activities are within the Act's
definition of "enterprise" does not, as we have noted, end the
inquiry. An individual may work for a covered enterprise and
nevertheless not be an "employee." In
Walling v. Portland
Terminal Co., 330 U. S. 148
(1947), the Court held that individuals being trained as railroad
yard brakemen -- individuals who unquestionably worked in "the kind
of activities covered by the Act" [
Footnote 20] -- were not "employees." The trainees
enrolled in a course lasting approximately seven or eight days,
during which time they did some actual work
Page 471 U. S. 300
under close supervision. If, after completion of the training
period, the trainees obtained permanent employment with the
railroad, they received a retroactive allowance of four dollars for
each day of the course. Otherwise, however, they neither received
or expected any remuneration.
Id. at
330 U. S. 150.
The Court held that, despite the comprehensive nature of the Act's
definitions, [
Footnote 21]
they were
"obviously not intended to stamp all persons as employees who,
without any express or implied compensation agreement, might work
for their own advantage on the premises of another."
The trainees were in much the same position as students in a
school. Considering that the trainees' employment did not
"contemplate . . . compensation," and accepting the findings that
the railroads received "
no immediate advantage' from any work
done by the trainees," the Court ruled that the trainees did not
fall within the definition of "employee." Id. at
330 U. S.
153.
Relying on the affidavits and testimony of numerous associates,
petitioners contend that the individuals who worked in the
Foundation's businesses, like the trainees in
Portland
Terminal, expected no compensation for their labors. It is
true that the District Court found that the Secretary had
"failed to produce any past or present associate of the
Foundation who viewed his work in the Foundation's various
commercial businesses as anything other than 'volunteering' his
services to the Foundation."
567 F. Supp. at 562. An associate characterized by the District
Court as typical "testified convincingly that she considered her
work in the Foundation's businesses as part of her ministry," and
that she did not work for material rewards.
Ibid. This
same
Page 471 U. S. 301
associate also testified that "no one ever expected any kind of
compensation, and the thought is totally vexing to my soul." App.
79.
Nevertheless, these protestations, however sincere, cannot be
dispositive. The test of employment under the Act is one of
"economic reality,"
see Goldberg v. Whitaker House
Cooperative, Inc., 366 U.S. at
366 U. S. 33,
and the situation here is a far cry from that in
Portland
Terminal. Whereas, in
Portland Terminal, the training
course lasted a little over a week, in this case, the associates
were "entirely dependent upon the Foundation for long periods, in
some cases several years." 567 F. Supp. at 562. Under the
circumstances, the District Court's finding that the associates
must have expected to receive in-kind benefits -- and expected them
in exchange for their services -- is certainly not clearly
erroneous. [
Footnote 22]
Under
Portland Terminal, a compensation agreement may be
"implied" as well as "express," 330 U.S. at
330 U. S. 152,
and the fact that the compensation was received primarily in the
form of benefits, rather than cash, is in this context immaterial.
These benefits are, as the District Court stated, wages in another
form. [
Footnote 23]
Page 471 U. S. 302
That the associates themselves vehemently protest coverage under
the Act makes this case unusual, [
Footnote 24] but the purposes of the Act require that it
be applied even to those who would decline its protections. If an
exception to the Act were carved out for employees willing to
testify that they performed work "voluntarily," employers might be
able to use superior bargaining power to coerce employees to make
such assertions, or to waive their protections under the Act.
Cf. Barrentine v. Arkansas-Best Freight System, Inc.,
450 U. S. 728
(1981);
Brooklyn Savings Bank v. O'Neil, 324 U.
S. 697 (1945). Such exceptions to coverage would affect
many more people than those workers directly at issue in this case,
and would be likely to exert a general downward pressure on wages
in competing businesses. As was observed in
Gemsco, Inc. v.
Walling, 324 U. S. 244,
324 U. S.
252-254 (1945), it was there essential to uphold the
Wage and Hour Administrator's authority to ban industrial homework
in the embroideries industry, because,
"if the prohibition cannot be made, the floor for the entire
industry falls and the right of the homeworkers and the employers
to be free from the prohibition destroys the right of the much
larger number of factory workers to receive the minimum wage."
the Foundation's business activities will lead to coverage of
volunteers who drive the elderly to church; serve church suppers,
or help remodel a church home for the needy.
See Brief for
Petitioners 24-25. The Act reaches only the "ordinary commercial
activities" of religious organizations, 29 CFR § 779.214 (1984),
and only those who engage in those activities in expectation of
compensation.
Page 471 U. S. 303
Ordinary volunteerism is not threatened by this interpretation
of the statute. [
Footnote
25]
III
Petitioners further contend that application of the Act
infringes on rights protected by the Religion Clauses of the First
Amendment. Specifically, they argue that imposition of the minimum
wage and recordkeeping requirements will violate the rights of the
associates to freely exercise their religion [
Footnote 26] and the right of the Foundation to
be free of excessive government entanglement in its affairs.
Neither of these contentions has merit.
It is virtually self-evident that the Free Exercise Clause does
not require an exemption from a governmental program unless, at a
minimum, inclusion in the program actually burdens the claimant's
freedom to exercise religious rights.
See, e.g., United States
v. Lee, 455 U. S. 252,
455 U. S.
256-257 (1982);
Thomas v. Review Board, Indiana
Employment Security Div., 450 U. S. 707,
450 U. S.
717-718 (1981). Petitioners claim that the receipt of
"wages" would violate the religious convictions of the associates.
[
Footnote 27] The Act,
however, does not require
Page 471 U. S. 304
the payment of cash wages. Section 203(m) defines "wage" to
include "the reasonable cost . . . of furnishing [an] employee with
board, lodging, or other facilities."
See n 23,
supra. Since the associates
currently receive such benefits in exchange for working in the
Foundation's businesses, application of the Act will work little or
no change in their situation: the associates may simply continue to
be paid in the form of benefits. The religious objection does not
appear to be to receiving any specified amount of wages. Indeed,
petitioners and the associates assert that the associates' standard
of living far exceeds the minimum. [
Footnote 28] Even if the Foundation were to pay wages in
cash, or if the associates' beliefs precluded them from accepting
the statutory amount, there is nothing in the Act to prevent the
associates from returning the amounts to the Foundation, provided
that they do so voluntarily. [
Footnote 29] We therefore fail to perceive how
application of the Act would interfere with the associates' right
to
Page 471 U. S. 305
freely exercise their religious beliefs.
Cf. United States
v. Lee, supra, at
455 U. S.
257.
Petitioners also argue that application of the Act's
recordkeeping requirements would have the "primary effect" of
inhibiting religious activity and would foster "
an excessive
government entanglement with religion,'" thereby violating the
Establishment Clause. See Lemon v. Kurtzman, 403 U.
S. 602, 403 U. S.
612-613 (1971) (quoting Walz v. Tax Comm'n,
397 U. S. 664,
397 U. S. 674
(1970)). [Footnote 30] The
Act merely requires a covered employer to keep records "of the
persons employed by him and of the wages, hours, and other
conditions and practices of employment maintained by him." 29
U.S.C. § 211(c). Employers must also preserve these records and
"make such reports therefrom from time to time to the Administrator
as he shall prescribe." Ibid. These requirements apply
only to commercial activities undertaken with a "business purpose,"
and would therefore have no impact on petitioners' own evangelical
activities or on individuals engaged in volunteer work for other
religious organizations. And the routine and factual inquiries
required by § 211(c) bear no resemblance to the kind of government
surveillance the Court has previously held to pose an intolerable
risk of government entanglement with religion. [Footnote 31] The Establishment Clause does
not exempt religious organizations from such secular governmental
activity as fire inspections and building and zoning regulations,
see Lemon, supra, at 403 U. S. 614,
and the recordkeeping requirements of the Fair Labor Standards Act,
while
Page 471 U. S. 306
perhaps more burdensome in terms of paperwork, are not
significantly more intrusive into religious affairs. [
Footnote 32]
IV
The Foundation's commercial activities, undertaken with a
"common business purpose," are not beyond the reach of the Fair
Labor Standards Act because of the Foundation's religious
character, and its associates are "employees" within the meaning of
the Act because they work in contemplation of compensation. Like
other employees covered by the Act, the associates are entitled to
its full protection. Furthermore, application of the Act to the
Foundation's commercial activities is fully consistent with the
requirements of the First Amendment. The judgment below is
accordingly
Affirmed.
[
Footnote 1]
App. to Brief for Petitioners 2.
[
Footnote 2]
The District Court found that the Foundation operates 4
businesses in California, 30 businesses in Arkansas, 3 businesses
in Tennessee, and a motel in Tempe, Arizona.
See 567 F.
Supp. 556, 559-561 (WD Ark.1983). The Foundation also receives
income from the donations of its associates.
Id. at
562.
[
Footnote 3]
Susan Alamo was named as a defendant and as a petitioner in this
Court, but died after the suit was filed.
[
Footnote 4]
The Secretary also charged petitioners with failing to pay
overtime wages to certain "outside" employees. The District Court
made findings regarding these claims, all but one of which were
upheld by the Court of Appeals. The parties have not sought review
of that portion of the judgment.
[
Footnote 5]
See also United States v. Silk, 331 U.
S. 704,
331 U. S. 713
(1947);
Rutherford Food Corp. v. McComb, 331 U.
S. 722,
331 U. S. 729
(1947).
[
Footnote 6]
The District Court enjoined petitioners from failing to comply
with the Act and ordered that all former associates and others who
had worked in the businesses covered by the Act be advised of their
eligibility to submit a claim to the Secretary. The Secretary was
to submit a proposed finding of back wages due each claimant, "less
applicable benefits" that had been provided by the Foundation.
567 F.
Supp. at 577. The Secretary appealed the remedial portions of
the District Court's order.
[
Footnote 7]
See n 6,
supra. The Court of Appeals held that the District Court
should have calculated back wages due, instead of requiring
associates to initiate backpay proceedings. 722 F.2d at 404-405. On
remand, in an unpublished order, the District Court identified
specific associates due back wages and ordered the Secretary to
submit a proposed judgment. Following this Court's grant of a writ
of certiorari, the District Court "administratively terminate[d]"
the action pending this Court's decision. Brief for Respondent 12,
n. 8.
[
Footnote 8]
Employment may be covered under the Act pursuant to either
"individual" or "enterprise" coverage. Prior to the introduction of
enterprise coverage in 1961, the only individuals covered under the
Act were those engaged directly in interstate commerce or in the
production of goods for interstate commerce. Enterprise coverage
substantially broadened the scope of the Act to include any
employee of an enterprise engaged in interstate commerce, as
defined by the Act. The Secretary did not proceed on the basis that
the associates are within the scope of individual coverage.
[
Footnote 9]
The Court of Appeals omitted this second step of the inquiry,
although it mentioned in passing that the associates expected to
receive and were dependent on the in-kind benefits. 722 F.2d at
399. The District Court's findings on this question are
sufficiently clear, however, that a remand is unnecessary.
[
Footnote 10]
Section 203(r) defines "enterprise" in pertinent part as
"the related activities performed (either through unified
operation or common control) by any person or persons for a common
business purpose, and includes all such activities whether
performed in one or more establishments or by one or more corporate
or other organizational units including departments of an
establishment operated through leasing arrangements, but shall not
include the related activities performed for such enterprise by an
independent contractor."
Petitioners do not dispute that the Foundation's various
activities are performed "through . . . common control." Nor do
they quarrel with the District Court's finding that the
Foundation's annual gross volume of sales exceeds $250,000, as
required by § 203(8)(1).
See 567 F. Supp. at 561.
[
Footnote 11]
The Internal Revenue Service has apparently not determined
whether petitioners' commercial activities are "unrelated business"
subject to taxation under 26 U.S.C. §§ 511513.
See App. to
Brief for Petitioners 14; Tr. of Oral Arg. 30.
[
Footnote 12]
See also Goldberg v. Whitaker House Cooperative, Inc.,
366 U. S. 28
(1961);
Rutherford Food Corp. v. McComb, 331 U.
S. 722 (1947);
United States v. Rosenwasser,
323 U. S. 360
(1945).
[
Footnote 13]
Cf. Powell v. United States Cartridge Co., 339 U.S. at
339 U. S. 517
(exemptions from the Act are "narrow and specific," implying that
"employees not thus exempted . . . remain within the Act").
[
Footnote 14]
The Senate Committee Report, in discussing the "common business
purpose" requirement, states:
"[T]he definition would not include eleemosynary, religious, or
educational organizations not operated for profit. The key word in
the definition which supports this conclusion is the word
'business.' Activities of organizations of the type referred to, if
they are not operated for profit, are not activities performed for
a 'business' purpose."
S.Rep. No. 1744, 86th Cong., 2d Sess., 28 (1960).
[
Footnote 15]
106 Cong.Rec. 16704 (1960).
[
Footnote 16]
Ibid. (remarks of Sen. Kennedy).
[
Footnote 17]
Id. at 16703 (remarks of Sen. Goldwater). The following
year, when the expansion of the Fair Labor Standards Act was again
considered and this time enacted, Senator Curtis proposed the same
amendment that Senator Goldwater had unsuccessfully introduced. The
amendment was once more rejected. Senator McNamara, Chairman of the
Senate Education and Labor Committee, opposed the amendment on the
ground that it would remove from the protection of the Act
employees of nonprofit organizations who were engaged in
"activities which compete with private industry to such a degree
that the competition would have a very adverse effect on private
industry. . . . [W]hen such industry comes into competition in the
marketplace with private industry, we say that their work is not
charitable organization work."
107 Cong.Rec. 6255 (1961).
See also H.R.Rep. No. 75,
87th Cong., 1st Sess., 8 (1961); S.Rep. No. 145, 87th Cong., 1st
Sess., 41 (1961).
[
Footnote 18]
Because we perceive no "significant risk" of an infringement on
First Amendment rights,
see infra at
471 U. S.
303-306, we do not require any clearer expression of
congressional intent to regulate these activities.
See NLRB v.
Catholic Bishop of Chicago, 440 U. S. 490,
440 U. S. 500
(1979).
[
Footnote 19]
Branti v. Finkel, 445 U. S. 507,
445 U. S. 512,
n. 6 (1980).
[
Footnote 20]
330 U.S. at
330 U. S. 150.
Since
Walling was decided before the advent of "enterprise
coverage,"
see n 8,
supra, the Court's remark must have been premised on the
fact that railroad brakemen work directly in interstate
commerce.
[
Footnote 21]
The Act defines "employ" as including "to suffer or permit to
work" and "employee" as (with certain exceptions not relevant here)
"any individual employed by an employer." 29 U.S.C. §§ 203(g), (e).
See Rutherford Food Corp., 331 U.S. at
331 U. S. 728;
Rosenwasser, 323 U.S. at
323 U. S.
362-363, and n. 3 (quoting Sen. Black as stating that
the term "employee" had been given "the broadest definition that
has ever been included in any one act," 81 Cong.Rec. 7657
(1935)).
[
Footnote 22]
Former associates called by the Secretary as witnesses testified
that they had been "fined" heavily for poor job performance, worked
on a "commission" basis, and were prohibited from obtaining food
from the cafeteria if they were absent from work -- even if the
absence was due to illness or inclement weather. App. 148-149, 146,
153, 218-219. These former associates also testified that they
sometimes worked as long as 10 to 15 hours per day, 6 or 7 days per
week. This testimony was contradicted in part by petitioners'
witnesses, who were current associates.
See 567 F. Supp.
at 562. Even their testimony, however, was somewhat ambiguous. Ann
Elmore, for example, testified that the thought of receiving
compensation was "vexing to [her] soul." But in the same paragraph,
in answer to a question as to whether she expected the benefits,
she stated that "the benefits are just a matter of -- of course, we
went out and we worked for them." App. 78-79.
[
Footnote 23]
The Act defines "wage" as including board, food, lodging, and
similar benefits customarily furnished by the employer to the
employees. As the District Court recognized, an employer is
entitled to credit for the reasonable cost of these benefits. 567
F. Supp. at 663, 577;
see 29 U.S.C. § 203(m).
[
Footnote 24]
Cf. Van Schaick v. Church of
Scientology, 535 F.
Supp. 1125 (Mass.1982);
Turner v. Unification
Church, 473 F.
Supp. 367 (RI 1978),
aff'd, 602 F.2d 458 (CA1 1979)
(FLSA claims brought by former church members).
[
Footnote 25]
The Solicitor General states that, in determining whether
individuals have truly volunteered their services, the Department
of Labor considers a variety of factors, including the receipt of
any benefits from those for whom the services are performed,
whether the activity is a less than full-time occupation, and
whether the services are of the kind typically associated with
volunteer work. The Department has recognized as volunteer services
those of individuals who help to minister to the comfort of the
sick, elderly, indigent, infirm, or handicapped, and those who work
with retarded or disadvantaged youth.
See Brief for
Respondent 4-5, and n. 3.
[
Footnote 26]
Petitioner Larry La Roche is an associate and a former
vice-president of the Foundation. The Foundation also has standing
to raise the free exercise claims of the associates, who are
members of the religious organization as well as employees under
the Act.
See NAACP v. Alabama ex rel. Patterson,
357 U. S. 449,
357 U. S.
458-459 (1958).
But cf. Donovan v. Shenandoah
Baptist Church, 573 F.
Supp. 320, 325-326 (WD Va.1983).
[
Footnote 27]
Petitioners point to the following testimony by two associates
deemed representative by the District Court:
"And no one ever expected any kind of compensation, and the
thought is totally vexing to my soul. It would defeat my whole
purpose."
App. 79 (testimony of Ann Elmore).
"I believe it would be offensive to me to even be considered to
be forced to take a wage. . . . I believe it offends my right to
worship God as I choose."
Id. at 62-63 (testimony of Bill Levy). Petitioners also
argue that the recordkeeping requirements of the Act, 29 U.S.C. §
211, will burden the exercise of the associates' religious beliefs.
This claim rests on a misreading of the Act. Section 211 imposes
recordkeeping requirements on the employer, not on the
employees.
[
Footnote 28]
See App. 62, 89 (testimony of Bill Levy and Edward
Mick); Brief for Petitioners 33. The actual value of the benefits
provided to associates -- a matter of heated dispute below -- was
determined by the District Court to average somewhat over $200 a
month per associate. 567 F. Supp. at 566-570.
[
Footnote 29]
Counsel for petitioners stated at oral argument that the
associates would either fail to claim the backpay that was due them
or simply return it to the Foundation. Tr. of Oral Arg. 25, 46.
Counsel argued that this fact undermined the Secretary's argument
that he had a "compelling interest" in applying the Act, but it is
also indicative of how slight a change application of the Act would
effect in the current state of affairs.
[
Footnote 30]
Under the
Lemon test, the criteria to be used in
determining whether a statute violates the Establishment Clause are
whether the statute has a secular legislative purpose; whether its
primary effect is one that neither advances nor inhibits religion;
and whether it fosters excessive government entanglement with
religion. 403 U.S. at
403 U. S.
612-613. No one here contends that the Fair Labor
Standards Act has anything other than secular purposes.
[
Footnote 31]
See Meek v. Pittenger, 421 U.
S. 349 (1975);
Lemon v. Kurtzman, 403 U.
S. 602 (1971).
Cf. NLRB v. Catholic Bishop of
Chicago, 440 U. S. 490
(1979).
[
Footnote 32]
Petitioners also argue that application of the Act to them
denies them equal protection of the laws because the Foundation's
treatment of its associates is no different from the Government's
treatment of its own volunteer workers, such as those enrolled in
the ACTION program. The respondent aptly characterizes this claim
as "frivolous." Brief for Respondent 46. The activities of federal
volunteers are directly supervised by the Government, unlike the
activities of those alleged to be volunteering their services to
private entities. Furthermore, work in Government volunteer
programs is "limited to activities which would not otherwise be
performed by employed workers and which will not supplant the
hiring of or result in the displacement of employed workers." 42
U.S.C. § 5044(a). Thus, Congress could rationally have concluded
that minimum wage coverage of such volunteers is required neither
for the protection of the volunteers themselves nor for the
prevention of unfair competition with private employers.
Petitioners have identified no reason to scrutinize the
Government's classification under any stricter standard. The
District Court found no evidence that the Department was acting on
the basis of hostility to petitioners' religious beliefs. 567 F.
Supp. at 574.