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News | Aug 08, 2020

Today’s Highlighted Overtime Decision: Noll v. Flowers Foods, Inc., 1:15-cv-00493-LEW (D. Me. Aug. 3, 2020) — “Pulling Stales” and Seeking Overtime Pay in the Food Distribution Industry

Some of the Nation’s biggest FLSA lawsuits involve the overtime rights of “distributors” who work in the bread and snack food industries.  These distributors are usually required to form closely-held corporations (usually LLCs) and sign contracts classifying them as non-employee “independent contractors.”  Of course, whether these distributors really are independent contractors depends on an assessment of their employment under the FLSA’s multi-factor “economic reality” test.  See, e.g., Razak v. Uber Technologies, Inc., 951 F.3d 137 (3d Cir. 2020).  A putative employer cannot escape scrutiny under the economic reality test by simply making a worker sign an independent contractor agreement.  That would put form over substance.

Anyway, today’s blog is not about the economic reality test.  Instead, let’s assume the food distributor is deemed an employee under the FLSA.  The next step will be to decide whether, as an employee, he/she is entitled to overtime pay.  The employer is likely to argue that the distributor is exempt under the FLSA’s motor carrier exemption, which covers employees “with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service . . . .”  See 29 U.S.C. 213(b)(1).  In response, the distributor is likely to argue that he/she falls outside the confines of the motor carrier exemption due to the SAFTEA-LU Technical Corrections Act of 2008, which, among other things, amended the FLSA’s motor carrier exemption to exclude employees “who perform[] duties on motor vehicles weighing 10,000 pounds or less.”  See Public Law 110-244 at sec. 306(c)(3).  We will call this provision the “TCA small vehicle exception.”  For a good discussion of the TCA small vehicle exception, you should read the Third Circuit’s opinion in a case handled by our firm:  McMaster v. Eastern Armored Services, Inc., 780 F.3d 167 (3d Cir. 2015).

All of the above brings us to our featured decision:  Noll v. Flowers Foods, Inc., 1:15-cv-00493-LEW (D. Me. Aug. 3, 2020).  In Noll, Maine District Court Judge Lance E. Walker addressed whether the TCA’s small vehicle exception applies if the bread distributor’s uses his personal, sub-10,000 vehicle to “‘pull[] stales’ from the [grocery store] shelves and transport[] them to another location in a small vehicle.”  The Judge held that such activity does bring the distributor into the TCA small vehicle exception’s reach:  “Here, the transportation of stales, when performed in a small vehicle, comes within the TCA’s small vehicle exception because it substantially affects interstate commerce, even though it is entirely intrastate transportation.”  Thus, a distributor who uses his/her personal vehicle to “pull stales” can be eligible for overtime pay.  -PW

 

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