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New Jersey Restaurant Association Inc. v. Holderman

Decided: May 13, 1957.


On appeal from the Department of Labor and Industry.

For affirmance -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Wachenfeld, Burling, Jacobs and Weintraub. For reversal -- None. The opinion of the court was delivered by Weintraub, J.


Plaintiffs filed a petition in the Appellate Division under R.R. 4:88-10 for a declaratory judgment invalidating Minimum Fair Wage Standards Mandatory Order No. 9 relating to restaurant occupations, promulgated by the Commissioner of Labor and Industry under the Minimum Wage Act, R.S. 34:11-34 et seq. Additional testimony was taken before the Commissioner pursuant to an order under R.R. 4:88-11. We certified the matter on our motion prior to consideration of it by the Appellate Division.

The statute declares the employment of a woman or minor in an occupation in this State at an oppressive and unreasonable wage to be contrary to public policy, R.S. 34:11-36, and provides that if the Commissioner is of the opinion that a substantial number of women or minors in any occupation are receiving oppressive and unreasonable wages, he shall appoint a wage board to report upon the establishment of minimum fair wage rates for women and minors in such occupation. R.S. 34:11-39. The Commissioner appointed a board of nine, consisting of three representatives each of employers, employees and the public pursuant to R.S. 34:11-40. After the required hearings, the Commissioner accepted the report and made the order here under attack.

Appellants urge the order is invalid in that (1) it differentiates between hotel restaurants and other restaurants, being applicable only to the latter; (2) there is no basis for the differential in rates between waitresses and so-called "carhops"; and (3) it is arbitrary to provide for a minimum wage differential where two meals are furnished the employee and to permit no differential where but one meal is furnished.

Appellants also challenged so much of the order as requires the overtime rate to be based upon the regular hourly rate rather than upon the minimum. It was stipulated that the issue be concluded by the decision in Lane v. Holderman, 23 N.J. 304 (1957), then pending before us. The use of

the regular rate was there upheld, and hence the issue in the present case has been determined.

Appellants do not question the monetary reasonableness of the minimum rates fixed. The attack is confined to the validity of the classifications described above and rests upon the equal protection clause of the 14th Amendment to the Federal Constitution and the concept of equality in our State Constitution. Washington National Insurance Co. v. Board of Review of New Jersey Unemployment Compensation Commission, 1 N.J. 545 (1949).


The major question is whether a rational basis exists for the differentiation of employments in independent restaurants from like employments in hotel restaurants. The issue implicates the constitutionality of the statute or its application here, for it is the statute which creates the classification, providing in R.S. 34:11-34:

"'Occupation' means an industry, trade or business or branch thereof or class of work therein in which women or minors are gainfully employed but shall not include domestic service in the home of the employer or labor on a farm or employment in a hotel."

The Commissioner was initially of the view that the statutory exclusion of "employment in a hotel" did not embrace employment "in a restaurant operated in a hotel catering to non-resident guests," and the order was framed accordingly. In another proceeding, the effort to include hotel restaurants catering to non-resident guests was found to conflict with the legislative exclusion and hence to be beyond the Commissioner's authority, but the invalidity as to hotel restaurants was held not to impair the vitality of the order as to independent restaurants. Hotel Suburban System v. Holderman, 42 N.J. Super. 84 (App. Div. 1956). None of the parties to that action sought a further review. The Commissioner accepts the conclusion there reached and the parties to the present action do not quarrel with the proposition that the Legislature intended to exclude employment

in hotel restaurants whether or not they cater to non-resident clientele. We here accept that premise.

The burden of demonstrating that a statute contravenes the equal protection clause is extremely formidable, as is attested by the long trail of failure. In addition to the strong presumption of constitutionality with which all organic challenges are approached, one who assails a statute on this ground must contend with principles of unusual elasticity. It is easily stated that the classification (1) must not be palpably arbitrary or capricious, and (2) must have a rational basis in relation to the specific objective of the legislation. But the second proposition is qualified by limitations which compound the difficulties of one who assails the legislative decision. Thus it is not enough to demonstrate that the legislative objective might be more fully achieved by another, more expansive classification, for the Legislature may recognize degrees of harm and hit the evil where it is most felt. Railway Express Agency v. People of State of New York, 336 U.S. 106, 69 S. Ct. 463, 93 L. Ed. 533 (1949); Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 57 S. Ct. 868, 81 L. Ed. 1245 (1937); Charles C. Steward Machine Co. v. Davis, 301 U.S. 548, 57 S. Ct. 883, 81 L. Ed. 1279 (1937); West Coast Hotel Co. v. Parrish, 300 U.S. 379, 57 S. Ct. 578, 81 L. Ed. 703 (1937); Radice v. People of State of New York, 264 U.S. 292, 44 S. Ct. 325, 68 L. Ed. 690 (1924); Dominion Hotel, Inc., v. State of Arizona, 249 U.S. 265, 39 S. Ct. 273, 63 L. Ed. 597 (1919); Guill v. Mayor and Council of City of Hoboken, 21 N.J. 574 (1956). The Legislature may thus limit its action upon a decision to proceed cautiously, step by step, or because of practical exigencies, including ...

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