On March 11, 2015, the Third Circuit in McMaster v. Eastern Armored Services,[1] held that while professional motor carriers are generally exempt from overtime under the Fair Labor Standards Act (FLSA), an exception exists for drivers of vehicles weighing less than 10,000 pounds.
The Facts. Plaintiff Ashley McMaster worked for Defendant Eastern Armored Services, Inc. (EAS) from approximately March 2010 through June 2011 as a driver and/or guard. EAS is an armored courier company, and its fleet of armored vehicles operate across several states in the mid-Atlantic region. McMaster was not assigned to one specific vehicle; rather, her vehicle assignment changed according to business needs. McMaster spent 51% of her total days working on vehicles rated heavier than 10,000 pounds and 49% of her total days working on vehicles rated lighter than 10,000 pounds. She was paid by the hour and frequently worked in excess of 40 hours per week. McMaster was paid at her regular rate for all hours worked and was paid overtime.
Procedural History. After McMaster left her employment with EAS, she filed a federal lawsuit under the FLSA, claiming that EAS was required to pay her overtime for all hours in excess of 40 in any given week. A conditional class of similarly situated employees was certified and the parties proceeded with discovery as to McMaster only. Thereafter, both parties cross-moved for summary judgment. The dispute centered on whether EAS was exempt from paying McMaster overtime under a provision in the FLSA known as the Motor Carrier Act Exemption. EAS contended that McMaster fell within the exemption and was not entitled to overtime. McMaster argued the reverse, claiming that she qualified for the Small Vehicle Exception to the Motor Carrier Exemption. The District of New Jersey granted McMaster’s motion and denied EAS’s motion, ordering that McMaster was eligible to be paid overtime wages for all hours worked in excess of 40 in any given week. EAS then filed this interlocutory appeal.
The Third Circuit’s Analysis. Section 7 of the FLSA provides that employers must pay hourly employees 1 ½ times an employee’s regular rate of pay for all hours in excess of 40 in any given work week.[2] One exemption to this general rule is the Motor Carrier Act Exemption, which provides that drivers employed by a motor carrier or motor private carrier or drivers, driver’s helpers, loaders or mechanics whose duties may affect the operational safety of motor vehicles in transportation on public highways in interstate or foreign commerce are not eligible for overtime. At issue here is the Small Vehicle Exception found in the Corrections Act of 2008, which provides that overtime pay is not required for any employee of a motor carrier whose job, in whole or in part, affects the safe operation of vehicles lighter than 10,000 pounds (except for those transporting hazardous materials or larger numbers of passengers).[3]
Finding that the text of the Corrections Act was clear and unambiguous, the Court affirmed the District Court’s holding that McMaster qualified for overtime even though she was responsible for vehicles lighter than 10,000 pounds only 49% of the time.
The Bottom Line. The Third Circuit is the first circuit court which has held a motor carrier driver is entitled to overtime under the Small Vehicle Exception under the Corrections Act. All motor carriers would be wise to carefully review the exempt status of any employees who operate vehicles weighing less than 10,000 pounds, even if they do so for only half of their working time.