Labor & Employment Law

Motor Carrier Exemption FLSA Class Action Defeated On Interstate Commerce Issue

By Mark E. Tabakman, Esq.

The federal motor carrier exemption from overtime, 29 USC 213(b)(1), which applies to safety workers (e.g. drivers) engaged in interstate commerce, has been found to exempt Ray's Trash Service, Inc. drivers from their right to overtime under the Fair Labor Standards Act even though the drivers do not cross state lines. They were held to nevertheless be in the stream of interstate commerce. The case is entitled Craft v. Rays, LLC which had been filed in the U.S. District Court for the Southern District of Indiana.

The judge held that the transportation of recyclables across state lines sufficed to bring the drivers into the 'practical continuity' of interstate commerce. As the judge noted, 'although plaintiffs never transported the recyclables across state lines, the court finds that their transportation was part of a practical continuity of movement across state lines.'

The drivers filed a class action in May 2008, alleging their pay was improperly docked, but the main thrust of their class action was a claim for overtime. The employees claimed that the interstate commerce ended when the movement of the goods was interrupted and because the employer did not have the 'fixed and persisting intent' to ship the goods out of state. That intent is necessary to show that interstate commerce still continues despite the fact that the driver drives only within a State.

The judge rejected those arguments, holding that the company did not just have a speculative intention to ship out of state, as more than half of the recyclables were, in fact, sent to out-of-state recipients. The court held that the activities the drivers engaged in – included baling and consolidating recyclables, were no more than 'repackaging,' which, under the law, did not interrupt the flow of interstate commerce.

One commentator has suggested that this ruling will have special relevance today, for FLSA motor carrier overtime cases, as all of us are living and working in a 'green economy' in which numerous recyclables will be shipped out of state. From my perspective, it means that a lot of drivers will not be seeing or getting any green.
 

Full post as published by Wage & Hour - Development & Highlights on November 11, 2009 (boomark / email).