Generally, under the Fair Labor Standards Act (FLSA), workers must be paid overtime if they work more than 40 hours in a work week, but there are many exceptions to this general rule. Overtime laws do not apply to some types of employees. Those employees are known as "exempt," and will not receive overtime pay, even if they work more than their scheduled hours, more than eight hours a day, or more than 40 hours a week.
Whether or not you can receive overtime pay usually depends on the kind of work you do. Employees who are not covered by overtime laws usually have a lot of responsibility within a company and have significant input into how that company is run. The exemption from overtime most commonly applies to various sectors of the transportation industry, which is an industry that is generally not exempt from the minimum wage provisions.
Generally, employees in the following transportation industries are exempt from the FLSA overtime laws:
- Motor carriers
- Local drivers and their helpers
- Employees in intrastate transportation of fruits, vegetables and harvesters
- Taxicab drivers
- Partial exemption for certain local transit employees
Details on the specific transportation industry exemptions are included below.
The FLSA overtime pay requirements do not apply to any employee of an air carrier that is subject to the provisions of the Railway Labor Act. If an air carrier is engaged in interstate or foreign commerce or in the transportation of the United States mail, it is subject to the Railway Labor Act and, therefore, it is within the overtime exemption.
Carrier affiliates who do not fly aircraft to transport freight or passengers fall within the exemption if their functions are, nevertheless, related to air transportation. Air freight forwarders are subject to the exemption if they are owned or controlled by, or under common control with, a company that is actually engaged in air transportation and if the freight forwarder performs services in connection with property transported by such other company.
Although the exemption requires that the employer be an air carrier, it is not an industry or establishment exemption. Rather, it applies to individual employees of the air carrier when they engage in air transportation activities. The performance of nonexempt work will defeat the exemption where such work constitutes more than 20% of the employee's workweek.
Employees of motor carriers are exempt from overtime under the FLSA if the U.S. Secretary of Transportation has the power to regulate their minimum qualifications and maximum hours of service under the Motor Carrier Act.
In addition, the employee must be employed by a motor carrier to perform activities that directly affect the safety of operations of motor vehicles, as long as, the motor vehicles involved are used for transportation on the "public highways" in interstate or foreign commerce.
Whether the vehicle used by the carrier is, in fact, owned by that carrier is irrelevant to carrier status and qualification for exemption. The Department of Labor generally presumes that motor carrier employees in safety-affecting activities are engaged in commerce and, thus, within the scope of the exemption.
Employees of an employer engaged in the operation of a common carrier by rail and subject to the provisions of Part I of the Interstate Commerce Act are exempt from overtime. The provisions of Part I of the Interstate Commerce Act apply only to common carriers engaged in interstate commerce in the transportation of passengers or property wholly by railroad, or partly by railroad and partly by water when both are under common control, management or arrangement for continuous carriage or shipment. Employers within this category include railroad carriers, express companies, sleeping car companies and refrigerator car companies.
Local Drivers and Their Helpers
Another transportation industry exemption operates to exempt certain local drivers and their helpers from the statutory overtime requirements. To qualify for exemption, local delivery employees must be compensated on the basis of trip-rates, or other delivery payment plan, if the Secretary finds that such plan has the general purpose and effect of reducing hours worked by such employees to, or below, the maximum workweek applicable to them.
The purpose of the exemption is to treat local delivery employees who are not under regulation of the Secretary of Transportation the same as interstate drivers and their helpers who are. Prior approval of a plan to operate under this overtime exemption must be obtained from the Secretary of Labor.
Employees in Intrastate Transportation of Fruits, Vegetables and Harvesters
An overtime exemption is granted to employees engaged in the preparation and transportation of fruits or vegetables from the farm to a place of first processing or first marketing within the same state. The exemption also applies to the intrastate transportation of harvest hands employed or to be employed in the harvesting of fruits or vegetables. These exemptions apply whether or not a farmer transports the fruits, vegetables or harvest laborers.
Taxicab drivers are also exempt from the statutory overtime requirement. Any driver working for an employer engaged in the business of operating taxicabs is exempt from the overtime requirement.
The non-driving employees of taxicab companies fail to qualify for the exemption. The wage-hour exemption for dispatchers, supervisors and clerical workers employed by a taxicab business must, therefore, be based on other statutory provisions, such as the exemption from both minimum wages and overtime applicable to administrative employees. Even taxicab drivers must be paid overtime in all workweeks in which they spend more than 20% of their time in the performance of nonexempt work.
Partial Exemption for Certain Local Transit Employees
Charter activities of employees engaged in the operation of street, suburban or interurban electric railways, local trolleys or motorbus carriers are excluded from the "hours worked" for overtime purposes if the following are true:
- The employee's work in such activities was pursuant to an agreement or understanding with his employer arrived at before engaging in such employment
- Employment in charter activities is not part of such employee's regular employment
Thus, only time spent in charter activities that begin outside the employee's ordinary workday or workweek is excludable from overtime. Where such activities extend beyond a workday or workweek, they continue to be excludable if the employee is relieved from duty at the conclusion of the charter until the next workday begins. On the other hand, any charter activity that is performed as part of a regular workday must be included in "hours worked" for overtime purposes.