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Moore v. Universal Coordinators Inc.

decided: March 10, 1970.

WILLIAM MOORE BY AND ON BEHALF OF HIMSELF AND ALL OTHER EMPLOYEES OF UNIVERSAL COORDINATORS, INC., SIMILARLY SITUATED, HOWARD ARTRIP, ROBERT MAIBACH, CLYDE C. SNYDER, AND HARRY HARPSTER
v.
UNIVERSAL COORDINATORS, INC.



Ganey, Seitz, and Aldisert, Circuit Judges.

Author: Seitz

SEITZ, C. J.

Plaintiffs were employed as truck drivers by defendant Universal Coordinators, Inc. (Universal) and were "leased" to International Paper Company, a private motor carrier. They appeal from an order of the district court granting summary judgment in favor of defendant Universal in an action brought under § 16(b) of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 216(b) to recover overtime wages for hours worked in excess of 40 hours per week.

Universal's sole defense is that the overtime pay requirements of the FLSA do not apply to plaintiffs because of the following exemption in § 13(b)(1) of the FLSA, 29 U.S.C. § 213(b)(1):

"The provisions of section 7 [relating to overtime pay] shall not apply with respect to . . . any employee with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the provisions of section 204 of the Motor Carrier Act . . ."

Section 204(a)(3) of the Motor Carrier Act, 49 U.S.C. § 304(a)(3), in turn, permits the Secretary of Transportation:*fn1

"To establish for private carriers of property by motor vehicle, if need therefor is found, reasonable requirements to promote safety of operation, and to that end prescribe qualifications and maximum hours of service of employees . . ."

The sole issue on this appeal is the correctness of the district court's determination that the FLSA overtime pay provisions do not apply to plaintiffs because the Secretary of Transportation had power to establish their qualifications and maximum hours.

There is no dispute as to the facts. Universal's business is described in the affidavit of its President, Louis Kalmar, as follows:

"Its principal operation is in the supplying of labor to other corporations, particularly truck drivers to private carriers.

"In the operation of the defendant's business, we recruit and administratively employ competent truck drivers. In turn, we lease the drivers on a long term basis to other companies who wish to perform their own transportation as private carriers.

"When the drivers are leased to a private carrier, the major function which the defendant corporation performs with relation to such drivers is the preparation of payrolls and the actual payment of wages.

"All operational control over the drivers is exercised by the private carrier who, so long as the employment lasts, supervises exclusively the day to day use of the drivers including such matters as routing, scheduling, loading, unloading and general dispatch. The carrier in addition, is solely responsible for all instructions to the driver relating to governmental safety regulation compliance. As an example of the latter, the carrier arranges for and pays all costs involved in physical examinations required by the Department of Transportation and the Interstate Commerce Commission.

"With specific reference to the drivers who are the plaintiffs in this action, they were all employed by International Paper Company as over the road drivers under the same ...


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