Employer successfully raised MCA exemption defense

Finding that questions of material fact remained as to whether an employer was entitled to exempt its employees from the overtime provisions of the FLSA under the Motor Carrier Act exemption, a federal district court in Texas denied the employees’ motion for summary judgment. Additionally, the employer raised material issues of fact as to whether the employees actually worked in excess of 40 hours per week, and whether bonuses they received were discretionary such that they were properly excluded from the calculation of overtime pay.
The employer was an on-site oil well pumping service, which used two-man crews consisting of an engineer/supervisor and an operator. The crews traveled to the site, often in a Ford-250, which they used to haul necessary equipment. Crews could use the Ford trucks to haul equipment, travel between sites, travel to lodging, and to run errands. The employer required all employees to have a commercial drivers’ license and to know how to operate the Ford trucks and 18-wheelers.
The employees filed suit, alleging that the employer failed to pay them overtime in violation of the FLSA. A district court conditionally certified two classes of employees, both of which covered operators. The employees moved to amend their complaint to add new defendants, but the judge denied the motion. The case was reassigned and the employees moved for leave to amend again and for summary judgment.

Complaint amendment

The court granted the motion to amend the complaint to add new defendants. The employees were not able to ascertain whether officers of the employer qualified as employers until deep into the discovery process. Because the employees showed no bad faith in seeking to amend and because the case was quite far from trial, the court granted the motion.

Motor carrier exemption

The employer opposed the employees’ motion for summary judgment, contending that the employees were exempt under the Motor Carrier Act exemption. It alleged that the employees were required to maintain a commercial drivers’ license, to comply with DOT regulations, and to regularly drive large trucks weighing more than 10,001 pounds. The employer further alleged that the employees fell under the MCA exemption because it owned the equipment that the employees transported on public highways, and provided evidence that the operators were assigned to trucks and were required to drive them. The court found that through this evidence the employer raised the MCA exemption. However, the employees argued that they were still non-exempt employees because they were covered by the SAFETEA-LU Technical Corrections Act (TCA)’s Small Vehicle Exception.

Small vehicle exemption

Under the SVE, the FLSA’s overtime requirements apply to workers employed by a motor carrier, whose work in whole or in part, affects the safety of motor vehicles weighing 10,000 pounds or less. The court noted that courts have struggled to define how much work an employee must do with small vehicles in order to be covered under the SVE. Here, it held that in order to be covered, an employee must perform some work affecting the safety of small vehicles as part of their regular duties and that the work must rise above a de minimis level.
The court further ruled that it was the employer’s burden to show that the SVE did not apply. The employer argued that because it is ordinarily the employee’s burden to prove that they are covered by the FLSA, the employees in this case needed to prove that the SVE exception to the MCA exemption applied. The court, however, noted that under the TCA employees who operate vehicles weighing 10,000 pounds or less must be paid overtime and that such employees are covered by the FLSA. Thus, the court ruled that the employer had the burden of showing that the MCA, and not the SVE, applied.
However, the court found that the employer raised a question of material fact as to whether the employees’ work with small vehicles was de minimis. The employees showed that they drove Ford trucks weighing less than 10,000 pounds across state lines as part of their regular duties. The employer countered that the travel time between employee lodging and a job site could not be counted under the Portal-to-Portal Act and raised questions as to the amount of time the employees spent driving the Ford vehicles, specifically pointing to employees who drove 18-wheelers. The court thus found that material issue of fact regarding the extent of the employees work with small vehicles existed and denied summary judgment.

Hours worked

The court also found that an issue of material fact existed over whether the employees worked in excess of 40 hours per week. The employees presented general evidence, including vague answers to interrogatories, that they worked an average of 12 to 14 hours a day. The employer countered with time-sheets showing that many of the employees not only did not work that many hours, but may not even have been working at all during the relevant time period. Thus, the court denied summary judgment.

Bonuses

Lastly, the court found that an issue of material fact regarding the nature of bonuses existed. The employer did not include bonuses when calculating regular pay rates and the employees presented evidence that bonuses were paid regularly if certain criteria were met. The employer, however, claimed that the bonuses were discretionary, noting that the employees admitted they had not right to bonuses and employment documents stated that bonuses were discretionary. (Moore v. Performance Pressure Pumping Services, LLC, , WDTex., 167 LC 36,520.)

Visit our News Library to read more news stories.