In Mazzarella v. Fast Rig Support, LLC, May 23, 2016 – no. 15-3116), the United States Court of Appeals for the Third Circuit considered whether employees who were employed as truck drivers and often worked more than forty hours in a week, but were paid overtime only for work performed above forty-five hours per week were entitled to overtime pay for all hours worked over 40 per week.
Generally, when an employee works in excess of 40 hours per week, the employee must be compensated for all hours worked over 40 at the hourly rate of one and one-half times the employee’s regular rate of pay unless a recognized exception to the federal or state overtime law applies. The burden of proving that a purportedly exempt employee satisfies an exemption under the Fair Labor Standards Act (FLSA) lies with the employer and FLSA exemptions must be construed narrowly against the employer. Certain exemptions such as the executive, administrative, professional and outside sales employees apply to particular categories of jobs, others apply more broadly as to certain industries.
The Motor Carrier Act provides an exemption for certain interstate (between two different states) employment activity that is subject to the jurisdiction of the United States Department of Transportation. The exemption applies if the employer engages[s] in activities of a character directly affecting the safety of operation of motor vehicles in the transportation on the public highways of passengers or property in interstate or foreign commerce. When the transportation takes place within a single state, the interstate commerce requirement may still be met by demonstrating that the employee’s work involves a “‘practical continuity of movement’ across State lines. Assessing whether “continuity of movement” exists focuses on the “essential character of the movement. The employer bears the burden of proving plainly and unmistakably that employee drivers qualify for the Motor Carrier exemption.
In assessing application of the Motor Carrier exemption, Courts look to a number of factors to assess whether employees and their activities are sufficiently involved in interstate commerce, including: (1) whether and to what extent a product pauses in a warehouse or other location during transport before reaching its final destination; (2) whether the product is altered in any way during its transport; (3) the employer’s intent concerning the delivery of the product at the time the transportation commences; and (4) whether the employer’s business “involve[s] an integrated system of interstate shipments.” While no single factor is required or controlling, a factor’s presence or absence may reveal the employer’s “fixed and persisting intent” at the time the shipment commenced, which is important to showing the existence of practical continuity of movement in interstate commerce.
In Mazzarella, the Court considered application of the Motor Carrier exemption to a situation where the employee truck drivers drove trucks that transported water from “retention ponds” to drill sites for hydraulic fracking as part of contractor which the employer had with gas-drilling companies. The employer argued that its contract with gas-drilling companies to transport water from “retention ponds” to drill sites for hydraulic fracking involved the Motor Carrier exemption for interstate transportation.
The question at issue before the Court was whether the employer was engaged in transportation between a State and a place in another State, if so, then the employer would be exempt from the FLSA’s overtime provisions. In order for the Motor Carrier exemption to apply, the Court held that the employer must demonstrate that the employees must show that the truck drivers’ transportation of water is part of a “continuous stream of interstate travel.” While the Court held that the water the employees were transporting constituted property for purposes of applying the Motor Carrier exemption, there was no evidence that the water and truck drivers were engaged in a “continuous stream of interstate travel” as the water involved in the fracking process becomes “contaminated ” and “substantially modified.” As a consequence the Court held that the employer was actually engaged in “two separate commercial transactions,” one before the water becomes “tainted” and one after the fracking process is complete, which lead to the conclusion that there was no “continuous movement” of an unaltered item across state lines so that there was “insufficient evidence of interstate intent” to apply the Motor Carrier exemption as none of this evidence shows that the drivers or water were part of the practical continuity of movement in interstate commerce.
Abramson Employment Law represents employees who have FLSA claims for unpaid wages and overtime pay. For more information, see http://www.job-discrimination.com/lawyer-attorney-1126494.html