Transportation Law Update: The Motor Carrier Act Exception to the Fair Labor Standards Act

09.15.2020

Burlaka v. Contract Transport Servs. L.L.C., No. 19-1703, 2020 WL 4915630 (7th Cir. Aug. 21, 2020)

The United States Court of Appeals for the Seventh Circuit recently decided a case on potential violations of the Fair Labor Standards Act (“FLSA”). The Plaintiffs in this case (collectively “Plaintiffs”), who are all truck drivers, brought an action against Contract Transport Services (“CTS”), their former employer, for failure of CTS to pay overtime pay in violation of the FLSA. If an employee works over forty hours during their workweek, the FLSA requires overtime pay unless an exception applies to the Act. There is an exception in the Act for individuals who are subject to the regulations of the Secretary of Transportation (commonly known as the “Motor Carrier Act” [“MCA”]). The district court granted CTS’s motion for summary judgment. The Seventh Circuit affirmed this decision and found that the Plaintiffs “were subject to performing spotting duties that comprised one leg of a continuous interstate journey.”

In order to fall under the MCA exemption, the Plaintiffs have to be under the jurisdiction of the Secretary of Transportation, which requires the driver to be driving in interstate commerce or that they are “employed by a carrier that ‘has engaged in interstate commerce and that the driver could reasonably have been expected to make one of the carrier’s interstate runs.’”

CTS is a motor carrier based in Wisconsin. It provides transportation services to clients mainly to Wisconsin, Minnesota, Illinois, Michigan, and Iowa. Their drivers can have any type of driving assignment from spotting duties to over-the-road. In this case, the Plaintiffs were working with Green Bay Packaging, one of CTS’s clients. Even though they were spotters, it was possible for them to carry goods out-of-state, therefore “driving in interstate commerce.”

This case demonstrates that the MCA can apply to drivers who have spotting assignments. This is especially the case when there is a reasonable chance of interstate travel. At the same time, the employee need not leave to the state to qualify for the exception. If the employer can prove the driver works on “part of the good’s continuous interstate journey,” the exception to the FLSA applies and the driver is not entitled to overtime pay under the FLSA.

Contact John F. Fatino for more information at (515) 288-6041 or fatino@whitfieldlaw.com. Elaina J. Steenson, J.D. Candidate, Drake University Law School, assisted in the preparation of these materials.

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