Ray Marshall, Secretary of Labor v. The Valhalla Inn, a Corporation

The Secretary of Labor brought this action under § 17 of the Fair Labor Standards Act, 29 U.S.C. §§ 201 , et seq. (the Act), to enjoin the Valhalla Inn from violating the overtime requirements of the Act and to restrain the withholding of overtime wages found to be due Valhalla’s employees. The district court held that, by virtue of partial exemptions granted restaurants and food service establishments in §§ 13(b)(8)(A) and 13(b)(18), appellant was obligated to pay the prescribed overtime rates for hours worked in excess of 48 hours per week. The Valhalla Inn appeals from that decision.

Appellant operates a restaurant in Sausalito, California. Its employees were paid at specified hourly rates, without premium for overtime. In addition, employees were provided with a free meal during each eight-hour shift, which for tax purposes was valued at $1.00 per meal. The employees were allowed a thirty-minute meal period, during which period they were paid at the regular hourly rate. Prior to May 1, 1974, restaurant employees were exempted from the overtime requirements of the Act. Effective that date, provisions of § 13 were amended to require that restaurant and food service employees be…