I continue to blog about working time cases because these are the kind of lawsuits that can sneak up on an employer who does not realize that a certain pre-shift activity may in fact constitute working time under the Fair Labor Standards Act. This is again illustrated by a trucking company case where the Company will pay $3.8 million dollars to settle a FLSA collective action alleging non-payment for orientation and training time. The case is entitled Cormier et al. v. Western Express Inc. and was filed in federal court in the Middle District of Tennessee.
This was a major case, with more than four thousand drivers opting in to the case. The plaintiffs have requested that the Court approve the settlement, filing an unopposed motion, which stated that the agreement was a “fair compromise of the claims asserted.” Each opt-in will receive an average of $450. The motion papers asserted that “the settlement was not the result of a backdoor agreement but instead the result of the parties and their counsel fully evaluating the risks of continued litigation and the benefits of settlement under the auspices of an experienced class action, employment law mediator.”
The lawyers will receive more than one million dollars in fees. The seven named plaintiffs will also receive so-called incentive awards of up to $7,500 and those opt-ins who were deposed will also receive these incentive awards.
The drivers claimed that they were not paid, at least the minimum wage, for their time spent in orientation and the Company training program. The Company also paid drivers based on miles driven, which, the drivers alleged, caused them not to receive the minimum wage when the compensation was averaged out over the week. The Company denied liability and asserted the damages claimed were inflated when it agreed to settle the case.
The key here is that wherever there is an element, any element, of employer compulsion, like mandated orientation or mandated training, the odds are very good that this will be found to be compensable work time. I am sure this employer was not aware of that and this is the real problem facing employers, i.e. not knowing when certain activities are compensable. Now, this employer has learned a lesson.
An expensive one…