With the Fair Labor Standards Act’s new overtime regulation going into effect starting Dec. 1, 2016, companies across the U.S. are taking steps to ensure compliance. Among the many industries impacted by these changes, truckers face new challenges set forth by the expanded FLSA. PTM has a closer look at what motor carrier business should know about the FLSA:
“The majority of trucking employees are exempt from overtime pay.”
The new rule
Under the FLSA’s new rule, employers are required to pay their employees overtime if they work more than 40 hours in a single workweek. This regulation doesn’t apply to all employees, however. Instead, only those people who make less than $913 per week, or $47,476 annually, are eligible for additional compensation. Workers who exceed this salary cap or who perform specific duties are not qualified for overtime pay.
Additionally, the FLSA’s new standard does not apply to certain types of employees even if they do work more than 40 hours per week. The overtime rule breaks down these exempt workers, including some members of educational institutions and the transportation industry.
The majority of employees who operate within the transportation field are exempt from the FLSA’s overtime regulation. Those who don’t qualify include airline and railroad workers as well as taxicab and local drivers and their helpers. Motor carriers are also ineligible, yet the rule has some specifics directly related to this field.
What trucking employees need to know
The FLSA’s overtime regulation deems motor carrier employees exempt from receiving overtime pay if the U.S. Secretary of Transportation creates and manages the minimum qualifications and maximum working hours under the Motor Carrier Act.
The Department of Labor lists the following responsibilities as elements that exempt motor carrier employees from FLSA overtime pay:
- The performance – whether regular or sporadic – of safety affecting activities on a motor vehicle used in transportation on public highways in interstate or foreign commerce.
- Employees who operate as drivers, driver’s helpers, loader or mechanic.
- Transportation must be interstate commerce – which crosses state or international lines – or connect with an intrastate terminal to continue an interstate course of goods that haven’t come to rest at the final destination.
Motor carrier employees who have not made an interstate trip may still be exempt from the overtime rule. This eligibility is once again based on their duties. If their employer has involvement in interstate commerce, or the worker could reasonably partake in interstate travel or has worked on the vehicle in a way that affects its safety, that employee would be disqualified from receiving additional compensation. This exemption will be passed down according to the Secretary of Transportation’s jurisdiction. This federal leader will base their decision over a four-month time frame which begins on the date when trucking workers could have been called to – or did engage in – motor carrier operations.
Non-safety affecting workers qualify
While the FLSA deems many motor carrier workers ineligible for overtime compensation, there are other types of trucking employees who don’t fit under this umbrella. The distinction is whether or not people have a hand in the safety of the vehicle. Those not engaged in safety affecting activities – including office personnel, dispatchers, employees who unload trucks or workers who do load vehicles, but are not responsible for the proper technique and mechanics who work on vehicles that will transport passengers or property in interstate commerce – qualify for overtime pay.
Small vehicle employees eligible for overtime
While the majority of motor carrier workers do not qualify for overtime pay, certain operators of small vehicles can receive extra income. According to the FLSA, the overtime regulation does apply to trucking employees in any workweek when the person’s duties include that of driver, driver’s helper, loader or mechanic whose position affects the safety of a motor vehicle weighing 10,000 pounds or less during transportation on public highways in interstate or foreign commerce.
There are certain exemptions to the small vehicle exception, however. Employees who operate the following examples of motor carriers are not eligible for overtime pay:
- Vehicles designed or used to carry more than eight passengers, including the driver, for compensation.
- Vehicles designed or used to transport 15 passengers, including the driver, and not used to carry passengers for compensation.
- Vehicles used to transport hazardous materials, requiring placarding under Secretary of Transportation-prescribed regulations.
PTM can help trucking companies with all their payroll needs. From figuring out overtime compliance to controlling your payroll budget and much more, motor carriers have a true partner in PTM.