Transportation Exemption No Longer Routinely Applies
Employers who operate businesses that involve courier, messenger, or delivery services, vending equipment stocking, on-site repairs of various types of equipment, and household moving and storage companies, as well as other employment that involves driving vehicles to transport "property" in interstate commerce, have traditionally been able to claim the "motor carrier" exemption. These employers could legally refrain from paying overtime compensation to drivers and other "safety-affecting" employees. Legislation enacted in 2005 and 2008 limits the ability to apply this overtime exemption when the actual or gross vehicle weight rating of some of the vehicles is at least 10,001 pounds. Many employers, such as typical courier and messenger services, are now obligated to pay overtime compensation to all drivers (including those on commission and, usually, owner-operators). See "TRANSPORTATION EXEMPTION."
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Child Labor FLSA Penalty Assessment
Effective May 21, 2008, the maximum penalty for a child labor law violation resulting in death or serious injury to an employee under the age of eighteen is $50,000. The penalty may be doubled to a maximum of $100,000 if the violation is repeated or willful.
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DOL Wage and Hour Division Regulatory Revisions, Effective May 5, 2011
New rules became effective on May 5, 2011 regarding the application of the following Title 29 regulations: 29 CFR Parts 4, 516, 531, 553, 778, 779,780, 785, 786, and 790
See http://webapps.dol.gov/FederalRegister/PdfDisplay.aspx?DocId=24847
The revisions conform the regulations to Fair Labor Standards Act (FLSA) amendments passed in 1974, 1977, 1996, 1997, 1998, 1999, 2000, and 2007, and Portal Act amendments passed in 1996.
The most significant repercussions of these regulatory changes are with respect to:
Service advisors - automobile or truck dealerships (see note below)
Tipped employees
Compensatory time (public agencies)
Fire protection employees (clarification of definition)
Meal credits (against the minimum wage)
Salaried employees paid in accordance with 29 CFR Part 778.114 ("fluctuating workweek" pay plan) - see explanation below
Service advisors: A claim of exemption under FLSA section 13(b)(10) for automobile or truck dealer service advisors will now be very difficult to sustain, based on the confirmation of terminology in a regulation that had long lay dormant because of adverse court rulings. The DOL asserts that the exemption will be enforced in accordance with how it is worded in the statute.
Fluctuating workweek pay plan: While DOL did not make substantive changes in 29 CFR Part 778, the agency explained in the "preamble" that it agrees with several court rulings (primarily in the northeastern United States) that invalidate the use of this pay plan when there are supplements (such as bonuses or commissions). This pay plan (guaranteed salary plus half-time for overtime hours) is often found to be invalid for various technical reasons. The new DOL position is one more reason for an employer to avoid the use of this pay plan or to at least be very cautious in its application.
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