SemiTruckWhen analyzing the so-called motor carrier exemption under the Fair Labor Standards Act, 29 USC 213(b)(1), controversies often arise as to whether the drivers are involved in “interstate commerce.” This is because, as a rule, the safety sensitive nature of the driver’s job and the fact that the employer-defendant is a “motor carrier” are often not in dispute.
There are many variations on this interstate commerce theme/issue and the Third Circuit Court of Appeals (in a case litigated by my partner, Randy Schauer) has sought to clarifiy the circumstances under which drivers are deemed to be involved in interstate commerce for purposes of the exemption. In this case, the Court held that the possibility that any of Krapf’s Coaches Inc. drivers could be called to cross state lines on certain bus routes placed them in the stream of interstate commerce and therefore, exempt from overtime under the FLSA. The case is entitled Resch v. Krapf’s Coaches Inc.

In an interesting twist, the district court judge granted conditional certification for a class, but then, subsequently, granted summary judgment for the employer on the applicability of the motor carrier exemption. This was based on evidence that showed that although the routes at issue were but a small component of the Company’s revenue, i.e. 10 percent annually, maximum, this nevertheless qualified the work as interstate. Put differently, drivers only crossed state lines a total of 178 of the 13,956 total trips the plaintiffs drove in the three-year statute of limitations period encompassed by the suit, but this was enough.

The appellate court rejected the plaintiffs’ argument that only the opt-ins should be considered and rather focused on the issue of whether there was a reasonable expectation that a given driver might have to cross state lines while performing his regular duties. The Third Circuit noted that “with regard to distribution of interstate routes, KCI had a company policy of training its drivers on as many routes as possible, retaining discretion to assign drivers to drive either interstate or intrastate routes — at any time — on which they had been trained, and disciplining any driver who refused.” The Court was also impressed that all drivers were trained, tested and required to comply with DOT regulations for commercial drivers.

The Takeaway

The motor carrier exemption can be highly nuanced. As these employees usually work so-called overtime hours on a weekly basis, if they do not fall with Section 213(b)(1), there can be considerable liability for the employer. What this case highlights is the relatively small amount of interstate work or the “possibility” of interstate work that it takes to qualify the activity as “interstate.” Employers can defend and win such a case by showing a tiny component of their business is interstate and, most importantly, that any driver, at any time, can be asked to drive such an interstate route.

Randy, again, kudos…