Tag Archives: Motor Carrier Act Exemption

D.Md.: Although Defendant Is A Motor Carrier, Factual Issues Preclude SJ On Motor Carrier Exemption, Where School Bus Drivers Drive No More Than 2 Interstate Charter Trips Per Year On Average

Hoffman v. First Student, Inc.

In this FLSA case, both the Plaintiffs, school bus drivers, and Defendant, a motor carrier, who employed them, moved for summary judgment as to whether Plaintiffs were exempt employees under the motor carrier act (MCA) exemption to the FLSA. The Court denied both motions, finding that factual issues precluded a finding one way or another.

“Under the FMCSR, First Student was a “for-hire” private motor carrier of passengers, and its school bus drivers were subject to the federal safety regulations contained in 49 C.F.R. Parts 382, 383, 387, 390-96. The FMCSR’s regulatory guidance, which can be found on the Federal Motor Carrier Safety Administration’s (“FMCSA”) website at http://www.fmcsa.dot.gov, sets forth the types of school bus services covered by the regulations. The FMCSA mandates that “anyone operating school buses under contract with a school is a for-hire motor carrier,” and when a “for-hire motor carrier transports children to school-related functions other than ‘school bus operation’ (as defined in 49 C.F.R. § 390.5), such as for “sporting events, class trips, etc., and operates across State lines,” the carrier is covered by the safety regulations. See FMCSR Regulatory Guidance Part 390.3, Question 14, available at http://www.fmcsa.dot.gov. Normal “school to home and home to school” driving activities are not covered. Id. In full accordance with this guidance, it was Defendant’s policy to pay its Baltimore bus drivers pursuant to the FLSA for “school to home and home to school” trips, but not for charter trips.

The U.S. Department of Transportation has determined that “if in the regular course of employment a driver is, or could be, called upon to transport a shipment in interstate commerce the driver would be subject” to the Department of Transportation’s jurisdiction and “even a minor involvement in interstate commerce as a regular part of an employee’s duties will subject that employee to the jurisdiction” of the Department of Transportation. See FMCSR Regulatory Guidance, Part 390.3, Question 24, at http://www.fmcsa.dot.gov. Furthermore, the U.S. Department of Labor states that:

Where safety affecting employees have not made an actual interstate trip, they may still be subject to DOT’s jurisdiction if: (1) the employer is shown to have involvement in interstate commerce; and (2) it can be established that the employee could have, in the regular course of employment, been reasonably expected to make an interstate journey. See U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, Fact Sheet # 19: The Motor Carrier Exemption Under the Fair Labor Standards Act (FLSA), available at http://www.dol.gov.

Thus, First Student posits that the drivers who volunteer to join its “charter pool” are categorically ineligible for overtime pay under the statutory and regulatory regime described above because: (1) FLSA’s overtime provisions do not apply to “any employee with respect to whom the Secretary of Transportation has power to establish qualifications and hours of service,”29 U.S.C. § 213(b) (1), and (2) the Secretary of the Department of Transportation is authorized to prescribe the “qualifications” and “hours of service” of drivers in the “charter pool.”

Plaintiffs seek to avoid this result with two arguments. First, they point to an exception set out in the Motor Carrier Act which plausibly creates a categorical exclusion for school bus drivers from the jurisdiction of the Secretary of Transportation. Second, plaintiffs contend that even if they are not categorically excluded from coverage under the Motor Carrier Act, First Student has not established the motor carrier defense as a matter of law (and summary judgment must be denied) because defendant has failed to demonstrate that, as a matter of law, plaintiffs’ involvement with interstate commerce is other than “trivial” and de minimis, or that interstate travel was a “natural, integral and … inseparable part of the position plaintiffs held,” Dauphin v. Chestnut Ridge Transportation, Inc., 544 F.Supp.2d 266, 275 (S.D.N.Y.2008), and that proper evaluation of that defense must await trial.

As explained herein, I conclude that while defendant correctly contends that the motor carrier exemption defense is available, the record does not establish the elements of that defense as a matter of law. Accordingly, defendant’s motion for summary judgment as to the overtime claims is granted in part and denied in part 2.

The Motor Carrier Act (hereafter, “the MCA”) is found at 49 U.S .C. § 13501 et seq.Section 13501 gives the Secretary of the Department of Transportation (hereafter, “the Secretary”) jurisdiction over interstate motor carriers, and a separate section, 49 U.S.C. § 31502(b)(2), empowers the Secretary to set “qualifications” and “hours of service” for employees of interstate motor carriers. As a matter of law, First Student is a form of “motor carrier” within the jurisdiction of the MCA. However, certain types of interstate travel are not within the Secretary’s jurisdiction because they are exempted from the MCA.

One exemption excludes from the Secretary’s jurisdiction “a motor vehicle transporting only school children and teachers to or from school.”49 U.S.C. § 13506(a)(1). On its face, this exemption from the Act seems to mean that the routine carriage of students by the drivers employed by contract motor carriers such as defendant on behalf of local school districts renders the drivers eligible for overtime under the FLSA, i.e., that such employees are not within the class of employees “with respect to whom the Secretary of Transportation has power to establish qualifications and hours of service.”29 U.S.C. § 213(b)(1). And, the statutory term “to or from school” could reasonably be interpreted to include not only transportation “to or from [home to] school [and back],” but also “to or from school[, including any trips from school to other locations related to the educational mission of the school, such as school-sponsored field trips, and back to school."] Put differently, one might justifiably infer that students on field trips and/or being transported to and from athletic contests almost always depart from and return to the school location at the beginning and end of such transportation.

Mielke v. Laidlaw Transit, Inc., 102 F.Supp.2d 988, 992 (N.D.Ill.2000), essentially adopted the above interpretation of the term “to or from school” in the MCA and reasoned that, categorically, “school bus operation” (which is the Secretary’s regulatory term, meaning “the use of a school bus to transport school children and/or school personnel from home to school and from school to home,”49 C.F.R. § 390.5), is outside of the Secretary’s jurisdiction and thus is not encompassed by the FLSA’s motor carrier exception. Specifically, the Mielke court concluded that “the phrase ‘to and from school’ includes transportation to or from school sponsored events.” 102 F.Supp.2d at 990 (citation omitted).

In reaching its conclusion that school bus drivers who drove on so-called “charter trips” were entitled to overtime notwithstanding the FLSA’s motor carrier exception, the Mielke court flatly rejected defendant’s argument that the MCA’s exception for “a motor vehicle transporting only school children and teachers to or from school” applied “only to tariff, licensing, and rate regulations” governing motor carriers, and not to the Secretary’s authority to prescribe school bus drivers’ “qualifications and maximum hours of service.”Id.

At the time the case at bar was filed in June 2006, Mielke was the sole opinion by a federal court interpreting and harmonizing the FLSA motor carrier exception with the MCA’s exclusion from the Secretary’s authority “a motor vehicle transporting only school children and teachers to or from school.”In Mielke, the former gave way to the latter and school bus drivers were deemed by the court entitled to overtime pay under the FLSA.

There is now a second case elucidating this somewhat convoluted statutory and regulatory regime treating school bus drivers’ entitlement to overpay pay under the FLSA. Dauphin v. Chestnut Ridge Transportation, Inc., 544 F.Supp.2d 266 (S.D.N.Y.2008). In Dauphin, the court declined to follow Mielke and reached a contrary conclusion, namely, that the FLSA motor carrier exception potentially applied to school bus drivers (essentially on a week-by-week, employee-by-employee basis, see 544 F.Supp.2d at 275 (“However, because this testimony fails to establish whether interstate travel was part of either plaintiff’s job duties during the entire period at issue in this litigation, the Court cannot determine whether the motor carrier exemption applies to them for all the relevant workweeks.”)). Thus, the motor carrier exception would exonerate the defendant in Dauphin provided that it could show “either that the activities of the individual plaintiffs involved interstate travel of a character that was more than de minimis or that interstate travel was a ‘natural, integral and … inseparable part’ of the position plaintiffs held.”Id.

Specifically, the Dauphin court concluded, contrary to Mielke, that the limitation on the Secretary’s jurisdiction to regulate “school bus operations” had no bearing on the Secretary’s ability to set “qualifications and maximum hours of service” for school bus drivers who operated school buses in interstate commerce. Id. at 272.That is, the court reasoned that § 13506‘s limitation on the Secretary’s jurisdiction applies only to the economic and licensing authority (found in Subtitle IV of the MCA), and not to the issue of qualifications and maximum hours of service (found in Subtitle VI of the MCA).Id. (citing Bilyou v. Dutchess Beer Distribs., Inc., 300 F.3d 217, 229 (2d Cir.2002)).

Dauphin readily acknowledged that, consistent with the statutory language in the MCA, the Federal Motor Carrier Safety Regulations except from certain regulations “[a]ll school bus operations,” pursuant to 49 C.F.R. § 390.3(f).See 544 F.Supp.2d at 274. Nevertheless, the court concluded that this regulatory exclusion is not an indication that the Secretary does not have the authority to regulate school bus transportation; rather, it concluded, the exclusion reflects the Secretary’s determination that regulating home-to school and school-to-home transportation is not necessary for public safety. Id. (citing 53 Fed.Reg. 18,043 (May 19, 1988)).

I have carefully considered the conflicting approaches of the only two federal courts to have examined this awkward statutory regime. To be sure, Mielke’s approach is fully consistent with the well-settled doctrine that FLSA exemptions and exceptions are to be construed narrowly against the employer seeking to assert them, e.g., Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392, 80 S.Ct. 453, 4 L.Ed.2d 393 (1960) (citing Mitchell v. Kentucky Fin. Co., 359 U.S. 290, 295, 79 S.Ct. 756, 3 L.Ed.2d 815 (1959)). Nonetheless, I am persuaded that some deference is owed to the Secretary’s interpretation of his authority, acquiesced in by the Department of Labor, see29 C.F.R. § 782.2(a), to regulate the qualifications and hours of service of interstate school bus drivers. Furthermore, I am persuaded by Judge Stein’s analysis in Dauphin that the broadly-worded exception set forth in the MCA does not extend to the qualifications and hours of service of interstate school bus drivers employed by motor carriers within the jurisdiction of the Secretary. Accordingly, as in Dauphin, and contrary to Mielke, I conclude that the motor carrier defense is potentially applicable here.

Nevertheless, again as in Dauphin, the motor carrier exception defense cannot be applied on this record as a matter of law. Because an employee’s exempt status is an affirmative defense to a claim for non-payment at an overtime rate, the employer bears the burden of proving the exemption by clear and convincing evidence. Stricker v. Eastern Off Road Equip., Inc., 935 F.Supp. 650, 654 (D.Md.1996). Viewed in the light most favorable to plaintiffs, the evidence in the record shows that fewer than two interstate trips per year, on average, were worked by the employees in the First Student “charter pool” during the pendency of defendant’s contracts in Maryland. Moreover, as disclosed during the hearing in this case, each such driver seems to have had the option whether to accept an assignment to operate a vehicle outside of Maryland. See Dauphin, 544 F.Supp.2d at 274-76. Thus, to paraphrase Dauphin”whether the activities of [First Student's] [former] drivers involve[d] interstate transportation of passengers in a way that would bring them within the scope of the motor carrier exemption from the FLSA” cannot be determined as a matter of law. Id. (alterations added).

Accordingly, I conclude that, as a matter of law, although the Secretary of Transportation is authorized to regulate the qualifications and hours of service of those members of the plaintiff class who volunteered for the “charter pool,” genuine disputes of material fact preclude a determination as a matter of law whether the FLSA motor carrier exception applies to any particular member of the plaintiff class for any particular work week. Therefore, as to the motor carrier exception, plaintiffs’ motion for partial summary judgment is denied, and defendant’s motion for partial summary judgment is granted in part and denied in part.”


Leave a comment

Filed under Exemptions

S.D.Ind.: Tow Truck Driver Exempt Under Motor Carrier Act (MCA), Because Might Be Called To Perform Interstate Wrecking Services

Johnson v. Hix Wrecker Service, Inc.

The case was before the Court on several motions for summary judgment. The Court granted Defendant’s motion for summary judgment, finding that the Plaintiff was exempt from the FLSA’s overtime provisions pursuant to the Motor Carrier Act (MCA) exemption. This case contrasts the proof (and result) of a similar case discussed here yesterday.

The Court explained, “Defendant Hix Wrecker Service, Inc., (“HWS”) is an Indianapolis business that, as its name suggests, performs wrecker services; the remaining Defendants are individuals who manage and operate HWS. Plaintiff Bobby J. Johnson, Jr., worked for HWS for several months in 2006 as a tow truck driver. Johnson asserts several claims in his complaint. At issue in the instant motion is his claim that HWS violated the Fair Labor Standards Act, 29 U.S.C. § 201 et seq., (“FLSA”), by failing to pay him overtime wages for occasions in which he worked more than forty hours in a given week. HWS argues that the FLSA overtime provisions were inapplicable to Johnson because the motor carrier exemption applied to him during his employment with HWS. The Court agrees.

The motor carrier exemption is found at 29 U.S.C. § 213(b)(1) and provides that “any employee with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the provisions of section 31502 of Title 49″ is exempt from the overtime provisions of the FLSA. Among other things, 49 U.S.C. § 31502 extends the Secretary of Transportation’s power to “employees of, and safety of operation and equipment of, a motor carrier” that transports property across state lines. “The Secretary has the power to set maximum hours for drivers if the company engages in more than de minimis interstate commerce, and that includes a company that holds itself out as an interstate company and solicits that business even though its prospect of obtaining much of that business is poor and some of its drivers never drive in interstate commerce.” Garcia v. Pace Suburban Bus Service, 955 F.Supp. 75, 77 (N.D.Ill.1996) (citing Morris v. McComb, 332 U.S. 422, 68 S.Ct. 131, 92 L.Ed. 44 (1947); Reich v. American Driver Service, Inc., 33 F.3d 1153 (9th Cir.1994); Marshall v. Aksland, 631 F.2d 600 (9th Cir.1980); Brennan v. Schwerman Trucking Co. of Virginia, Inc., 540 F.2d 1200 (4th Cir.1976)).”That does not mean, however, that the Secretary of Transportation has automatic jurisdiction over all drivers of an interstate carrier. Pursuant to a notice of interpretation, 46 Fed.Reg. 37,902, 37,903 (1981)… jurisdiction extends only to drivers who reasonably could be expected to make one of the carrier’s interstate runs, and that means more than a remote possibility.” Garcia, 955 F.Supp. at 77. Thus, as explained in the relevant Department of Labor regulation:

In a situation considered by the U.S. Supreme Court, approximately 4 percent of the total trips made by drivers employed by a common carrier by motor vehicle involved in the hauling of interstate freight. Since it appeared that employer, as a common carrier, was obligated to take such business, and that any driver might be called upon at any time to perform such work, which was indiscriminately distributed among the drivers, the Court considered that such trips were a natural, integral, and apparently inseparable part of the common carrier service performed by the employer and driver employees. Under these circumstances, the Court concluded that such work, which directly affected the safety of operation of the vehicles in interstate commerce, brought the entire classification of drivers employed by the carrier under the power of the Interstate Commerce Commission to establish qualifications and maximum hours of service, so that all were exempt even though the interstate driving on particular employees was sporadic and occasional, and in practice some drivers would not be called upon for long periods to perform any such work. ( Morris v. McComb, 332 U.S. 422, 68 S.Ct. 131, 92 L.Ed. 44)

29 C.F.R. § 782.2. In other words, it does not matter whether the driver in question actually has made an interstate run; as long as the driver is subject to being assigned to such a run at any time, the exemption applies to that driver.

HWS has the burden of demonstrating that the exemption applied to Johnson during the time it employed him. Klein v. Rush-Presbyterian-St. Luke’s Medical Center, 990 F.2d 279, 283 (7th Cir.1993). To demonstrate the application of the exemption to Johnson, HWS has submitted evidence, in the form of the affidavit of Defendant Gail Neal, the corporate secretary of HWS, which establishes the following:

1. HWS has at all relevant times held a common-carrier certificate of authority from the Department of Transportation that permits it to transport property for hire in interstate commerce.

2. Since 1973, HWS has provided its customers with both intrastate and interstate wrecker services.

3. HWS routinely provides interstate wrecker services for several of its customers.

4. All HWS drivers are subject to being assigned to an out-of-state run, either as a driver or as a helper, as needed.

5. Johnson was subject to being assigned to an out-of-state run at all times during his employment with HWS.

Thus, HWS has submitted evidence sufficient to establish that the motor carrier exemption to the FLSA was applicable to Johnson during his employment with HWS.” Therefore the Court granted Defendant’s motion.

Leave a comment

Filed under Exemptions

N.D.Tex.: Absent Proof Of Likelihood Of Interstate Trips, Plaintiff Truckdrivers Not Subject To Motor Carrier Act (MCA) Exemption; Summary Judgment Held In Abeyance

Songer v. Dillon Resources, Inc.

Here, the parties moved by cross Motions for Summary Judgment for a determination as to whether the Plaintiff-truckdrivers were subject to the so-called Motor Carrier Exemption of the FLSA, based on the nature of their duties driving for Defendant, an interstate motor carrier. The Court held the Motions in abeyance, questioning the quality of proof offered by the Defendant.

After acknowledging the parties agreed Defendant was a “motor carrier” the Court examined the necessary proof the Defendant was required to come forward with in order to meet its burden of proof on the exemption, and concluded Defendant had failed to do so, “[c]oncluding that plaintiffs, as truck drivers, are subject to the Motor Carrier Act exemption, however, does not end the court’s inquiry. The court is not persuaded that the exemption bears the unlimited scope and duration defendants have suggested. In support of their respective positions, the parties argue regarding the application and authority of a number of interpretive guides, including an Interpretive Bulletin of the Department of Transportation, Federal Highway Administration, 46 Fed.Reg. 37902, 1981 WL 115508; the DOL Field Operations Handbook; and Opinion Letters of the DOL’s Wage and Hour Division. All of these sources, while not controlling or entitled to deference, are “entitled to respect” to the extent they are persuasive or offer guidance. Christensen v. Harris County, 529 U.S. 576, 587-88 (2000); Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). All of these sources lead to the same conclusion: a driver is subject to the jurisdiction of the Secretary, and thus under the Motor Carrier Act exemption, for a “4-month period from the date of the proof” that he was, or could have been, called upon to engage in interstate commerce. 46 Fed.Reg. 37902, 37903.

Although the court concludes that plaintiffs, as drivers for at least one motor carrier, are subject to the Motor Carrier Act exemption to some extent, defendants have failed to adduce summary judgment evidence of the specific application of the exemption as to each plaintiff for these defendants. The summary judgment evidence submitted by defendants sets forth generally the dates of plaintiffs’ employment and states generally the number of interstate trips made by that plaintiff. However, defendants have adduced nothing as would show, as to each plaintiff, proof of when he or she was, or could have been, called upon to transport goods in interstate commerce such that the exemption clock began ticking as to that plaintiff.

Defendants submitted summary judgment evidence that purports to be bills of lading or similar types of work tickets showing that various plaintiffs transported goods across state lines or within Texas in the intrastate flow of interstate commerce. Insofar as the court can tell, none of these items show any of the defendants as the employer or trucking company of record. For example, many of the work tickets, under the heading “Carrier,” list “Sunset Transp” or, in some cases, “Sunset Trucking.” Neither of these entities is a party to this action, nor have defendants pointed the court to any summary judgment evidence explaining the relationship, if any, between them and either of those entities.

The court also has concerns about defendants’ summary judgment evidence generally. Defendants’ appendices as assembled do not correspond to either the tables of contents or to internal citations to exhibits within affidavits. By way of example, in volume I of the appendix, the affidavit of Edward Brady refers to exhibits A, B, C, etc., attached thereto. The exhibits themselves, however, are tabbed as number 1, 2, 3, etc., making it difficult for the court to identify exactly to which exhibit the affidavit refers. This pattern is repeated as to each affidavit with exhibits. Further, the affidavits contain many conclusory assertions and do not properly authenticate the documents attached thereto as exhibits. As the court would find it helpful for the parties to provide additional briefing and evidence on the limited issues set forth below, it is expected that any additional evidence submitted will be properly assembled and identified and internally consistent. Therefore,

The court ORDERS that plaintiffs’ partial motion for summary judgment, and defendants’ motion for summary judgment, be, and are hereby, held in abeyance pending further consideration by the court of the parties’ supplemental filings ordered below.”

Leave a comment

Filed under Exemptions