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eTrends - Intrastate Van Driver Qualified for Overtime Exemption

11.30.2010

The Eleventh Circuit Court of Appeals has ruled that an airport shuttle van driver who drove only within the State of Florida is not entitled to overtime under the Fair Labor Standards Act ("FLSA") because of the application of the Motor Carrier Act exemption.

At issue in the case of Abel v. Southern Shuttle Services, Inc., No. 10-10659 (Eleventh Cir. Sept. 21, 2010), was whether the Motor Carrier Act exemption was applicable to the plaintiff, Steven Abel, even though he made no interstate trips.

Southern Shuttle Services, Inc. operates a shared ride service for three airports in South Florida. Many of the shuttle service reservations are made through internet travel arrangements that are packaged deals with air fare, hotel, and airport transportation as part of a single package. The passengers purchase the package and receive a voucher for the airport shuttle service. In addition, many of the passengers whom Mr. Abel transported had either just flown from, or were about to fly to, places outside of Florida. Mr. Abel was paid only by commission and tips and received no overtime. After he was fired for violating one of his employer's policies, Mr. Abel sued Southern Shuttle claiming he was entitled to overtime under the FLSA.

The FLSA requires that time and a half be paid for all hours over 40 in a work week unless the employee comes within one of the several exemptions provided by the FLSA. One of those exemptions applies to any employee subject to regulation by the Secretary of the Department of Transportation under the Motor Carrier Act. The Transportation Secretary has the authority to regulate the maximum hours of employees who are employed: (1) by a common carrier by motor vehicle; (2) engaged in interstate commerce; and (3) whose activities affect the safety of operations of such motor vehicles. Both the employer's business and the employee's job activities must be subject to the Motor Carrier Act in order for the exemption to apply.

Mr. Abel argued that, because he did not make any interstate trips, the Motor Carrier Act did not apply. However, the Eleventh Circuit Court of Appeals concluded that Southern Shuttle was engaged in interstate commerce because it was part of a "continuous stream of interstate travel" and there was a "practical continuity of movement in interstate commerce" by virtue of the Shuttle Services' use of the internet travel package and vouchers system. Therefore, Southern Shuttle was engaged in interstate commerce and subject to regulation by the Secretary of Transportation. The Court also concluded that Mr. Abel's job activities directly affected the safety of operations of motor vehicles in interstate commerce.

Because both Southern Shuttle and Mr. Abel were subject to regulation by the Secretary of Transportation, the Motor Carrier Act exemption applied and Mr. Abel was exempt from the overtime requirements of the FLSA.

This decision by the Eleventh Circuit (which has jurisdiction only over Alabama, Florida and Georgia) is important for all employers because it indicates that the Motor Carrier Act exemption may be applicable to claims for overtime even if the employee driver did not actually cross state lines. Employers are encouraged to carefully review all possible exemptions applicable under the FLSA.

Please contact Susan Parrott with any questions.

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Smith Anderson publishes eTrends periodically as a service to clients and friends. The purpose of this eTrends is to provide general information about a significant legal development in the field of employment law. Readers should be aware that the facts may vary from one situation to another, so the conclusions stated herein may not be applicable to the reader’s particular circumstances.

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