Hospital San José, Inc. v. Minimum Wage Board
Hospital San José, Inc. v. Minimum Wage Board
Opinion of the Court
delivered the opinion of the court.
Upon stipulation of the parties approved by the court, these eighteen petitions for review were joined and the legal questions raised were argued and submitted in only one hearing and by virtue of one written brief. In fact they, involve only one fundamental question, to wit: whether the Minimum Wage Board created by Act No. 8, 1941, (Laws of 1941, p. 302) has the authority or power to fix the minimum wage that the clinics and hospitals of .Puerto Rico, as employers, have to pay to their non-technical employees, as it did by virtue of the Mandatory Decree No. 4, issued on May 18, 1943, and amended on November 15, 1943.
Before we consider and decide this question, it seems advisable to say that we only have before ns as petitioners the institutions mentioned in the title and that, therefore, we can not consider the contention of the petitioners to the effect that the Minimum Wage Board- lacks- power to fix
' We shall begin by the definitions contained in §30 of the Act of the words ‘‘employer,’’ “occupation,” “business,” “laborer,” “employee,” and “worker,” in order to connect them with certain other Sections of the Act and thus determine what was the legislative purpose as to the extent of the powers conferred on the Minimum Wage Board. In its pertinent part, §30 provides that:
“The following definitions of words and phrases in this Act shall be accepted, unless otherwise deduced from the context thereof:
“ ‘Employer’ includes every natural or artificial person engaged in industrial, commercial, business, agricultural, or public-service activities, who employs laborers, employees, or workers, for pay, wage, salary, or any other form of compensation.
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“ ‘Occupation’ includes every work or labor in factories, mills, centrales, shops, establishments, manufactories, farms, plantations^ ranches, transportation and communication enterprises, and places of any kind where gainful work or business is done or transacted.
“ ‘Business’ includes every work or labor in warehouses, stores, establishments, or places of any kind where commercial transactions are made or services are rendered for remuneration.
“ ‘Laborer’, ‘Employee’, ‘Worker’, include every manual worker, artisan, day laborer, clerk of a store, and every person employed for remuneration in any occupation, business, or industry.
“The terms included in this section shall not exclude any other term embracing agricultural, industrial, or commercial activities.
“The provisions' of this Act shall not be applicable to persons employed as domestic servants.” (Italics ours.)
The duties imposed on the hoard and on the minimum wage committees appointed thereby and the powers conferred upon them by the Act, are primarily inspired in the wish of our Legislature to improve the health, security, and well-being of workers, after said bodies have investigated the wages, working hours, and labor conditions prevailing in the different occupations, businesses, and industries in Puerto Rico. The only persons excluded from the provisions of the Act are those employed as domestic servants. Any defect or •omission in the definitions of the different words or phrases included in §30, supra, should not be a ground for our construing the scope of the Act in such manner as would impair fundamental purpose of the same. As Mr. Justice Frankfurter said, speaking for the Federal Supreme Court, in the case of Phelps Dodge Corp. v. Labor Board, 313 U. S. 177, 185, in construing the scope of tbe National Labor Relations Act: “Unlike mathematical symbols, the phrasing of. such social legislation as this seldom attains more than approximate precision of definition. That is why all relevant aids are summoned to determine meaning. Of compelling consideration is the fact that words acquire scope and function from the history of events which they summarize.” In the Federal Act the only definition of the word “employee” in an affirmative form was to the effect that said' term “shall include any employee” and then in a negative form it excluded agricultural employees, those employed as domestic servants or any person employed by his father or husband. The Federal Supreme Court, construing the scope of the word “employee,” said in the case of National Labor Relations Board v. Hearst Publication, decided about a month ago, on April 24, 1944 (322 U. S. 111), that “the broad language of the Act’s definitions, which in terms reject conventional limitations on such conceptions as ‘employee,’ ‘em
Our statute is also susceptible of this wide and comprehensive interpretation. In defining the words “laborer,” “employee,” and “worker,” it is said that they “include every manual worker, artisan, day laborer, clerk of a store, and every person employed for remuneration in any occupation, business, or industry.” The only persons excluded are “those employed as domestic servants.”
The precarious economic situation generally prevailing among our working classes due to the inadequate wages which they have been receiving during a long time unquestionably led our legislature to pass the Act creating the board that would fix the minimum wages necessary to guarantee, up to where it is humanly possible, better conditions of life, health, and security to said working classes.
The petitioners contend, however, that they are not businesses within the meaning given to said word by the Act itself. From a mere reading of the definition above copied it appears that they are wrong, since it expressly says that the word “business” includes . . . “establishments or places of any kind where . . . services are rendered for remuneration.” They also contend that some of the petitioners are non-profit charitable institutions (Hospital Presbiteriano, Auxilio Mutuo, St. Lukes Memorial Hospital), and that the others have suffered losses as well and could not exist if they were compelled to pay the minimum wages fixed by the board and ■ that none of them can be considered as an industry.
From the evidence introduced before the respondent board at the hearings it appeared that the great majority of the petitioners have contracts with the State Insurance
It is true that the Carrasquillo case, supra, was a tori action, but we see no reason to limit the doctrine set forth therein to said class of actions. In the present controversy a question of high public interest is involved which affects a great number of workers. The low wages paid by some of the hospitals and clinics, as it appeared from the evidence, constitute an eloquent demonstration of their insufficiency so that the employees affected may improve their living conditions, health, and general well-being, to such an extent that some of the petitioners admit that said wages could be raised and that they have even accepted collective bargains with the workers, leaving them pending approval until the board fixed the minimum wages.
But the fact is that the question to be decided is not whether the physician’s professional services constitute a business, but whether the petitioners, as institutions, do engage in business.
Notwithstanding this, we can say that there are cases supporting a doctrine contrary to the one set forth in the case of Yocum v. Feld, supra, cited by the petitioners, that
The Federal Supreme Court, in the ease of American Medical Association v. U. S., 317 U. S. 519, in which the question in controversy was whether the American Medical Association had violated the Sherman Anti-Trust Act upon performing certain acts tending to deny the Croup Health Corporation, a mutual medical benefit corporation, the medical services and other facilities of said association, although it abstained from deciding whether a physician’s practice of his profession constitutes a trade, did decide the question involved in these appeals upon deciding that the Group Health was a corporation engaged in business, stating (p, 528):
"Group Health is a. membership corporation engaged in business or trade. Its corporate activity is the consummation of the cooperative effort of its members to obtain for themselves and their families medical service and hospitalization on a risk-sharing prepayment basis. The corporation collects its funds from members. With these funds physicians are employed and hospitalization procured on behalf of members and their dependents.' The fact that it is cooperative, and procures service and facilities on behalf of its members only, does not remove its activities from the sphere of business.
‘‘If, as we hold, the indictment charges a single conspiracy to restrain and obstruct this business it charges a conspiracy in restraint of trade or commerce within the statute. As the Court of Appeals properly remarked, the calling or occupation of the individual physicians charged as defendants is immaterial if the purpose and effect of their conspiracy was such obstruction and restrain of the business of Group Health.”
And on page 536, upon deciding that the Clayton and the Norris-La Guardia Acts were not applicable to the controversy, it was said as to the interest of the petitioners that
In the opinion delivered in that same case by the Court of Appeals for the District of Columbia, it is recognized that there are authorities which maintain that “for some purposes charitable hospitals are not engaged in trade, business or industry” and the Lichliter case, supra, is cited. Other cases are cited,
In opposition to the doctrine established in the Lichliter ease there are the decisions in Wisconsin Employment Relations Board v. Evangelical Deaconess Soc., 7 N. W. (2d) 590 (Wisc. 1943) and Northwestern Hospital v. Public Building Serv. Employees’ Union, 294 N. W. 215 (Minn. 1940).
In this lash case the Lichliter case was expressly cited and, although it was distinguished by reason of the fact that the Pennsylvania hospitals received assignments from- the State,it was said that in spite of that “we do not think that this relationship between the hospitals and the state is sufficient to classify the former ill the exemption granted the latter.” It was decided that a non-profit charitable corporation which operated a public hospital was- an employer within the Labor Relations Act and that its scope was not limited to industries, stating (p. 217):
*728 "The employer-employe problem is more far-reaching and to impute to the legislature a purpose to provide means for the adjustment of labor relations in industry only would be artificial. AVe are all aware that thousands are performing duties as employes in hospitals such as plaintiff which are the same as those done by employes in private industry. The position and rights of employes in a hospital are as important to the well-being of the whole community as that of a technical industrial employe. The simple fact is that employes are dependent upon their positions for a livelihood. This is true whether the- employer 'is a charitable hospital or an automobile manufacturer. ’ ’
The language used in the case of Wisconsin Employment Relations Board, supra, is not less strong and pertinent when the court says (p. 592):
"Is there any reason to suppose that the legislature, intended that kitchen help, for example, who worked in a hotel or restaurant should have the right to organize and seek better wages and conditions of work through the state board while those doing similar work in a hospital should be barred from seeking similar objects through the mechanisms' provided by the state? Problems arise between employers and employees in charitable institutions as well as in industry and there is a similar need in each for methods of arriving at a peaceful settlement of differences.”
Summarizing, we can say that, having properly focused the primary question involved in these cases, the fact that in a hospital or clinic, private or partly benevolent, medical services are rendered by professionals, is not the predominant factor. In said institution employees are used who, because of'the inadequate wage they perceive, fall within the purpose of the Minimum Wage Act. AVe sho'uld not establish a distinction or difference between the labor conditions that should prevail among the non-technical workers of hospitals and clinics and.those that should prevail in other businesses. The legislative intent was to improve the economic conditions of the workers and employees in order to benefit them in their life, health, and general well-being. We can not accept that workers in. hospitals and clinics should
The petitioners finally contend that the. minimum wage as fixed is not supported by the evidence and that said wage and the labor conditions established by Decree No. 4 as amended are contrary to the evidence, there existing none to support them. We have carefully read the record of the hearings held before the Board and also the documentary evidence admitted and it is our opinion that the argument of the- petitioners is lacking in merit. . There was not only substantial evidence introduced before the Board but from the same it appears that the wages fixed and the labor conditions established can be satisfied and fulfilled by the petitioners.
The petitions for review are dismissed and the Mandatory Decree No. 4 issued by the Minimum Wage Board of Puerto Rico on May 18, 1943, and amended by said board on Nov. 15, 1943, is affirmed.
“Section 1. — (a) The Legislature of Puerto Rico hereby finds that the existence, in the different occupations, of labor conditions detrimental to the maintenance of the minimum standard of living necessary for the health, efficiency, and general well-being of workers (1) causes commerce, agriculture, and industry to be used to spread and perpetuate such labor conditions; (2)consti-tutes an unfair method of competition in production and interchange; (3) implies the payment of wages which are insufficient to satisfy the minimum needs of workers; (4)' leads to disputes between workers and employers, obstructing the progressive development of Puerto Rican economy; and (5) represents a state of manifest social injustice.
“(b) It is hereby declared to be the policy of this Act, through the exercise by the Legislature of Puerto Rico of its power to pass laws for the protection of the life, health, and safety of workers and employees, to correct, and as rapidly as practicable to eliminate, the above-mentioned conditions in the different occupations, without substantially curtailing employment of earning power.
“(c) It is hereby declared to be the public policy of this Act to protect workers in their means of livelihood in sueh a manner that the carrying out of said purpose shall not destroy the very sources of employment and work. It is the public policy of this Act that the living standards of the workers be raised to a fair level in proportion as the economic standards of prosperity of the branches of production which employ them are maintained and grow by reason of the great earning power afforded by this very law, by any other legislation, or by the general economic conditions which may produce such results.
“ (d) It is fwriher declared to be the policy of this Act to insure the progressive development of agriculture and of the industries and businesses which operate in Puerto Rico, by endeavoring to give them assurance of conditions favorable to their economic stability and natural expansion, and, to that effect, the body created for carrying out the purposes of this Act shall fix wages, having due regard to the costs, the financial condition of industries and branches of production, the market fluctuations, and the special conditions prevailing in each locality, as well as the living and working conditions of the workmen." (Italics ours.)
See $3 which imposes on the Board “the duty .... to study the wages, working hours, and labor conditions which prevail in the different occupations, businesses, and industries in Puerto Rico, and to make investigations regarding the health, safely, and well-being of workers;” (Italics ours); §4 which grants ample powers to the Board or any of its members to make investigation and
In tlie ease of In re Dol’s Estate, 187 Pac. 428, it ivas decided that an institution of the same kind as tlie petitioner, Sociedad de Auxilio Mutuo, is not a ‘‘charitable or benevolent society.”
See pp. 88, 279, 97, 53, 231, 234, 345, 150, 165 and 169 of the record.
Semple v. Schwarz, 109 S.W. 633; People v. Garlock, 11 N.Y.S. (2d) 82; Ex parte Galusha; 195 Pac. 406. Cf. O’Neill v. United Producers & Consumers Co-op., 113 P. (2d) 645; Marsh v. Adams, 12 N.Y.S. (2d) 691; East Hill Cemetery Co. v. Thompson, 97 N.E. 1038.
In Jordan v. Tashiro, 278 U.S. 123, it was decided that the operation of a hospital is included within the meaning of the word ‘'commerce” and “trade” as used in a Treaty authorizing- Japanese subjects in the United States “to carry on trade” and “to do anything incident to or necessary for trade upon the same terms as native citizens”; Lawrence v. Missen, 173 N.C. 359, 91 S.E. 1036, 38, where it was said that “The establishment and conduct of hospitals for pay is now a recognized and established business”; in Armendarez v. Hotel Dieu, Tex. Civ. App., 145 S.W. 1030, 31, it was decided that as long as a hospital cares for patients who are charged in order to obtain income to carry out its charity work, it is carrying on a trade.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.