Section 12(a) of the Act provides as follows: No producer, manufacturer, or dealer shall ship or deliver for shipment in commerce any goods produced in an establishment situated in the United States in or about which within 30 days prior to the removal of such goods therefrom any oppressive child labor has been employed: Provided, That any such shipment or delivery for shipment of such goods by a purchaser who acquired them in good faith in reliance on written assurance from the producer, manufacturer, or dealer that the goods were produced in compliance with the requirements of this section, and who acquired such goods for value without notice of any such violation, shall not be deemed prohibited by this subsection: And provided further, That a prosecution and conviction of a defendant for the shipment or delivery for shipment of any goods under the conditions herein prohibited shall be a bar to any further prosecution against the same defendant for shipments or deliveries for shipment of any such goods before the beginning of said prosecution. In determining the applicability of this provision, consideration of the meaning of the terms used is necessary. These terms are discussed in Sec. Sec. 570.105 to 570.111, inclusive. Sec. 570.105 ``Producer, manufacturer, or dealer''.
It will be observed that the prohibition of section 12(a) with respect to certain shipments or deliveries for shipment is confined to those made by producers, manufacturers, and dealers. The terms ``producer, manufacturer, or dealer'' used in this provision are not expressly defined by the statute. However, in view of the definition of ``produced'' in section 3(j), for purposes of this section a ``producer'' is considered to be one who engages in producing, manufacturing, handling or in any other manner working on goods in any State. \5\ Since manufacturing is considered a specialized form of production, the word ``manufacturer'' does not have as broad an application as the word ``producer.'' Manufacturing generally involves the transformation of raw materials or semifinished goods into new or different articles. A person may be considered a ``manufacturer'' even though his goods are made by hand, as is often true of products made by homeworkers. Moreover, it is immaterial whether manufacturing is his sole or main business. Thus, the term includes retailers who, in addition to retail selling, engage in such manufacturing activities as the making of slip-covers or curtains, the baking of bread, the making of candy, or the making of window frames. The word ``dealer'' refers to anyone who deals in goods (as defined in section 3(i) of the Act), \6\ including persons engaged in buying, selling, trading, distributing, delivering, etc. It includes middlemen, factors, brokers, commission merchants, wholesalers, retailers and the like.---------------------------------------------------------------------------
\5\ For a discussion of the definition of ``produced'' as it relates to section 12(a), see Sec. 570.108.
\6\ See Sec. 570.107.--------------------------------------------------------------------------- Sec. 570.106 ``Ship or deliver for shipment in commerce''.
(a) Section 12(a) forbids producers, manufacturers, and dealers to ``ship or deliver for shipment in commerce'' the goods referred to therein. A producer, manufacturer, or dealer may ``ship'' goods in commerce either by moving them himself in interstate or foreign commerce or by causing them to so move, as by delivery to a carrier. \7\ Thus, a baker ``ships'' his bread in commerce whether he carries it in his own truck across State lines or sends it by contract or common carrier to his customers in other States. The word ``ship'' must be applied in its ordinary meaning. For example, it does not apply to the transmission of telegraphic messages. \8\---------------------------------------------------------------------------
\7\ Section 3(b) of the Act defines ``commerce'' to mean ``trade, commerce, transportation, transmission, or communication among the several States or between any State and any place outside thereof.''
\8\ Western Union Telegraph Co. v. Lenroot, 323 U.S. 490.---------------------------------------------------------------------------
(b) To ``deliver for shipment in commerce'' means to surrender the custody of goods to another under such circumstances that the person surrendering the goods knows or has reason to believe that the goods will later be shipped in commerce. \9\ Typical is the case of a Detroit manufacturer who delivers his goods in Detroit to a distributor who, as the manufacturer is well aware, will ship the goods into another State. A delivery for shipment in commerce may also be made where raw materials are delivered by their producer to a manufacturer in the same State who converts them into new products which are later shipped across State lines. If the producer in such case is aware or has reason to believe that the finished products will ultimately be sent into another State, his delivery of the raw materials to the manufacturer is a delivery for shipment in commerce. Another example is a paper box manufacturer who ships a carton of boxes to a fresh fruit or vegetable packing shed within the same State, with knowledge or reason to believe that the boxes will there be filled with fruits or vegetables and shipped outside the State. In such case the box manufacturer has delivered the boxes for shipment in commerce.---------------------------------------------------------------------------
\9\ Tobin v. Grant, N. D. Calif., 79 Sup. 975 which was a suit for injunction by the Secretary of Labor against a manufacturer of books and book covers employing oppressive child labor. The facts showed that the manufactured articles sold by defendant to purchasers in the same State had an ultimate out-of-State destination which was manifest to defendant. The court construed the words ``deliver for shipment in commerce'' as sufficiently broad to cover this situation even though the purchasers acquired title to the goods.--------------------------------------------------------------------------- Sec. 570.107 ``Goods''. \10\---------------------------------------------------------------------------
\10\ The term goods is discussed in more detail in part 776 of this title (Interpretative Bulletin on the coverage of the wage and hours provisions) issued by the Administrator of the Wage and Hour Division.---------------------------------------------------------------------------
(a) Section 12(a) prohibits the shipment or delivery for shipment in commerce of ``any goods'' produced in an establishment which were removed within 30 days of the employment there of oppressive child labor. It should be noted that the statute does not base the prohibition of section 12(a) upon the percentage of an establishment's output which is shipped in commerce.
(b) The Act furnishes its own definition of ``goods'' in section 3(i), as follows: Goods means goods (including ships and marine equipment), wares, products, commodities, merchandise, or articles or subjects of commerce of any character, or any part or ingredient thereof, but does not include goods after their delivery into the actual physical possession of the ultimate consumer thereof other than a producer, manufacturer, or processor thereof. The term includes such things as food-stuffs, clothing, machinery, printed materials, blueprints and also includes intangibles such as news, ideas, and intelligence. The statute expressly excludes goods after their delivery into the actual physical possession of an ultimate consumer other than a producer, manufacturer, or processor thereof. Accordingly, such a consumer may lawfully ship articles in his possession although they were ineligible for shipments (commonly called ``hot goods'') before he received them. \11\---------------------------------------------------------------------------
\11\ For a discussion of the exclusionary clause in section 3(i) of the Act, see Powell et al. v. United States Cartridge Co., 70 S. CT. 755.--------------------------------------------------------------------------- Sec. 570.108 ``Produced''.
The word ``produced'' as used in the Act is defined by section 3(j) to mean: * * * produced, manufactured, mined, handled, or in any other manner worked on in any state; * * * \12\---------------------------------------------------------------------------
\12\ The remaining portion of section 3(j) provides: ``* * * and for the purposes of this Act 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.''
(a) The prohibition of section 12(a) cannot apply to a shipment of goods unless those goods (including any part or ingredient thereof) were actually ``produced'' in and removed from an establishment where oppressive child labor was employed. This provision is applicable even though the under-age employee does not engage in the production of the goods themselves if somewhere in the establishment in or about which he is employed goods are ``produced'' which are subsequently shipped or delivered for shipment in commerce. In contrast to this restrictive requirement of section 12(a), it will be noted that the employees covered under the wage and hours provisions as engaged in the production of goods for commerce are not limited to those in or about establishments where such goods are being produced. If the requisite relationship \13\ to production of such goods is present, an employee is covered for wage and hours purposes regardless of whether his work brings him in or near any establishment where the goods are produced. \14\---------------------------------------------------------------------------
\13\ See footnote 12.
\14\ See part 776 of this title (interpretative Bulletin on the coverage of the wage and hours provisions) issued by the Administrator of the Wage and Hour Division. Also, see Sec. Sec. 570.112 and 570.113.---------------------------------------------------------------------------
(b) Since the first word in the definition of ``produced'' repeats the term being defined, it seems clear that the first word must carry the meaning that it has in everyday language. Goods are commonly spoken of as ``produced'' if they have been brought into being as a result of the application of work. The words ``manufactured'' and ``mined'' in the definition refer to special forms of production. The former term is generally applied to the products of industry where existing raw materials are transformed into new or different articles by the use of industrial methods, either by the aid of machinery or by manual operations. Mining is a type of productive activity involving the taking of materials from the ground, such as coal from a coal mine, oil from oil wells, or stone from quarries. The statute also defines the term ``produced'' to mean ``handled'' or ``in any other manner work on.'' \15\ These words relate not only to operations carried on in the course of manufacturing, mining, or production as commonly described, but include as well all kinds of operations which prepare goods for their entry into the stream of commerce, without regard to whether the goods are to be further processed or are so-called ``finished goods.'' \16\ Accordingly, warehouses, fruit and vegetable packing sheds, distribution yards, grain elevators, etc., where goods are sorted, graded, stored, packed, labeled or otherwise handled or worked on in preparation for their shipment out of the State are producing establishments for purposes of section 12(a). \17\ However, the handling or working on goods, performed by employees of carriers which accomplishes the interstate transit or movement in commerce itself, does not constitute production under the Act. \18\---------------------------------------------------------------------------
\15\ For a more complete discussion of these words, see Sec. 776.16 of part 776 (bulletin on coverage of the wage and hours provisions) of chapter V of this title.
\16\ In Western Union Telegraph Co. v. Lenroot, 323 U.S. 490, the Supreme Court stated that these words bring within the statutory definition ``every step in putting the subject of commerce in a state to enter commerce,'' including ``all steps, whether manufacture or not, which lead to readiness for putting goods into the stream of commerce'' and ``every kind of incidental operation preparatory to putting goods into the stream of commerce.''
\17\ Lenroot v. Kemp and Lenroot v. Hazlehurst Mercantile Co., 153 F. 2d 153 (C.A. 5), where the court directed issuance of injunctions to restrain violations of the child labor provisions by operators of vegetable packing sheds at which they bought, then washed, sorted, crated, and packed cabbage and tomatoes for shipment in interstate commerce.
\18\ Western Union Telegraph Co. v. Lenroot, 323 U.S. 490.--------------------------------------------------------------------------- Sec. 570.109 ``Establishment situated in the United States''.
(a)(1) The statute does not expressly define ``establishment.'' Accordingly, the term should be given a meaning which is not only consistent with its ordinary usage, but also designed to accomplish the general purposes of the Act. As normally used in business and in Government, the word ``establishment'' refers to a distinct physical place of business. This is the meaning attributed to the term as it is used in section 13(a)(2) of the Act. \19\ Since the establishments covered under section 12(a) of the Act are those in which goods are produced, the term ``establishment'' there refers to a physical place where goods are produced. Typical producing establishments are industrial plants, mines, quarries, and the like. The producing establishment, however, need not have a permanently fixed location as is the case with a factory or mine. A boat, for instance, where productive activities such as catching or canning fish are carried on is considered a producing establishment for purposes of section 12(a).---------------------------------------------------------------------------
(1) The statute does not expressly define ``establishment.'' Accordingly, the term should be given a meaning which is not only consistent with its ordinary usage, but also designed to accomplish the general purposes of the Act. As normally used in business and in Government, the word ``establishment'' refers to a distinct physical place of business. This is the meaning attributed to the term as it is used in section 13(a)(2) of the Act. \19\ Since the establishments covered under section 12(a) of the Act are those in which goods are produced, the term ``establishment'' there refers to a physical place where goods are produced. Typical producing establishments are industrial plants, mines, quarries, and the like. The producing establishment, however, need not have a permanently fixed location as is the case with a factory or mine. A boat, for instance, where productive activities such as catching or canning fish are carried on is considered a producing establishment for purposes of section 12(a).---------------------------------------------------------------------------
\19\ A. H. Phillips, Inc. v. Walling, 324 U.S. 490. See part 779 (bulletin on the retail and service establishment exemption from the wage and hours provisions) of chapter V of this title.---------------------------------------------------------------------------
(2) Frequently, questions arise as to what should be considered a single establishment. No hard and fast rule can be laid down which will fix the area of all establishments. Accordingly, a determination of the area contained in a single establishment must be based upon the facts of each individual situation. Facts which are particularly pertinent in this connection, however, are those which relate to the physical characteristics and the manner of operation and control of the business. Sometimes, an establishment may extend over an area of several square miles as is common with farms, logging enterprises, mines, and quarries. On the other hand, it may be confined to a few square feet. A typical illustration of this is a loft building that houses the workshops of hundreds of independent manufacturing firms. Each of the workshops is, for purposes of this section, a separate establishment.
(3) Similar principles are applicable in determining whether several buildings located on the same premises constitute one establishment or more than one. For example, where several factory buildings are located on the same premises and owned and operated by the same person, they are generally to be considered as a single establishment. On the other hand, factory buildings located on the same premises, but owned and operated by different persons, will not ordinarily be treated as a single establishment. Where the several factories, however, are engaged in a joint productive enterprise, they may constitute a single establishment. This is the case, for example, where a large shipyard contains the plants of a number of subcontractors who are engaged in making parts or equipment for the boats that are built in the yard.
(b) The phrase ``situated in the United States'' is construed to include any of the 50 States or the District of Columbia or any Territory or possession of the United States. Sec. 570.110 ``In or about''.
(a) Section 12(a) excludes from the channels of interstate commerce goods produced in an establishment ``in or about'' which oppressive child labor has been employed. In a great many situations it is obviously easy to determine whether a minor is employed ``in'' an establishment. Thus, he is so employed where he performs his occupational duties on the premises of the producing establishment. Furthermore, a minor is also considered as employed in an establishment where he performs most of his duties off the premises but is regularly required to perform certain occupational duties in the establishment, such as loading or unloading a truck, checking in or out, or washing windows. This is true in such cases even though the minor is employed by someone other than the owner or operator of the particular establishment. On the other hand, a minor is not considered to be employed in an establishment other than his employer's merely because such establishment is visited by him for brief periods of time and for the sole purpose of picking up or delivering a message or other small article.
(b) If, in the light of the statements in paragraph (a) of this section, the minor cannot be considered as employed in the establishment, he may, nevertherless, be employed ``about'' it if he performs his occupational duties sufficiently close in proximity to the actual place of production to fall within the commonly understood meaning of the term ``about.'' This would be true in a situation where the foregoing proximity test is met and the occupation of the minor is directly related to the activities carried on in the producing establishment, in this connection, occupations are considered sufficiently related to the activities carried on in the producing establishment to meet the second test above at least where the requisite relationship to production of goods exists within the meaning of section 3(j) of the Act. \20\ By way of example, a driver's helper employed to assist in the distribution of the products of a bottling company who regularly boards the delivery truck immediately outside the premises of the bottling plant is considered employed ``in or about'' such establishment, without regard to whether he ever enters the plant itself. On the other hand, employees working entirely within one establishment are not considered to be employed ``in or about'' a wholly different establishment occupying separate premises and operated by another employer. This would be true even though the two establishments are contiguous. But in other situations the distance between the producing establishment and the minor's place of employment may be a decisive factor. Thus, a minor employed in clearing rights-of-way for power lines many miles away from the power plant cannot well be said to be employed ``in or about'' such establishment. In view of the great variety of establishments and employments, however, no hard and fast rule can be laid down which will once and for all distinguish between employments that are ``about'' an establishment and those that are not. Therefore, each case must be determined on its own merits. In determining whether a particular employment is ``about'' an establishment, consideration of the following factors should prove helpful:---------------------------------------------------------------------------
\20\ See part 776 (bulletin on coverage of the wage and hours provisions) of this title.---------------------------------------------------------------------------
(1) Actual distance between the producing establishment and the minor's place of employment;
(2) Nature of the establishment;
(3) Ownership or control of the premises involved;
(4) Nature of the minor's activities in relation to the establishment's purpose;
(5) Identity of the minor's employer and the establishment's owner;
(6) Extent of control by the producing establishment's owner over the minor's employment.