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Alice v. GCS

September 14, 2006


The opinion of the court was delivered by: Marvin E. Aspen, District Judge


Plaintiff John Alice filed a complaint against defendants GCS, Incorporated, and Gregory Skonie on July 7, 2005, alleging, inter alia, a violation of the Fair Labor Standards Act's overtime provision, 29 U.S.C. § 207(a). Presently before us are plaintiff's and defendants' cross-motions for summary judgment on that claim. For the reasons described below, we deny defendants' motion and grant plaintiff's motion in part.


Plaintiff John Alice worked as a truck driver for GCS, Incorporated ("GCS") from March 27, 2003 to March 3, 2004 as a salaried employee and April 2, 2004 to May 27, 2005 as an hourly employee.*fn1 (Pl. Statement of Uncontested Material Facts ("Pl. Facts") ¶ 4.) Defendant Gregory Skonie, GCS's president, hired Alice on both occasions and "set his compensation and hours of employment." (Id.) During his tenure at GCS, Alice delivered drop boxes at construction sites in Illinois, collected the boxes once they were full of debris, transported the waste to Heartland Recycling, L.L.C. ("Heartland"), and then returned the empty boxes to GCS. (Id. ¶ 5.) Heartland, a recycling center in Forest View, Illinois, sorted the debris and then commingled the waste with like-kind materials. (Id. ¶¶ 5, 8.) Heartland delivered all of the recyclable materials it salvaged to various companies within Illinois. (Id. ¶ 9.) The non-recyclable refuse got dumped in either the Forest Lawn Landfill in Three Oaks, Michigan or the Livingston Landfill in Pontiac, Illinois. (Id. ¶ 11.) GCS had no input or control over where the non-recyclable waste was transported. (Id. ¶ 12.)

During the course of his employment, Alice regularly worked more than forty hours per week, but was not compensated at a rate of time and a half for the overtime hours. (Id. ¶¶ 14-16, 19.) Between March 27, 2003 and March 3, 2004, Alice "worked 447 hours in excess of forty hours per week for which he was not compensated as a salaried employee." (Id. ¶ 15.) As a result, Alice seeks $14,751.00 in overtime pay for that time period (447 hours at a rate of $33.00 per hour).*fn2 When Alice returned to GCS in April 2004, he entered into an agreement with the company whereby GCS would "bank" one overtime hour per day to be credited and compensated when Alice worked less than forty hours per week. (Id. ¶ 17.) However, "[d]uring the period of April 2, 2004 to May 27, 2005, Alice never worked less than forty hours per week, and consequently, never received any compensation for his banked hours [which totaled 269 hours] during that period of time." (Id. ¶¶ 19, 20.) After plaintiff filed the instant action, GCS tendered payment for the 269 banked hours at Alice's regular hourly rate of $22.00 per hour. (Id. ¶ 20.) In addition to the banked hours, Alice logged 1,093.25 overtime hours between April 2, 2004 and May 27, 2005, for which he was paid his regular hourly rate of $22.00 per hour. (Id. ¶ 21.) Alice seeks the balance of overtime compensation, which includes $2,959.00 for his banked hours (269 hours at $11.00 per hour) and $12,025.75 in overtime pay for the period of April 2, 2004 to May 27, 2005 (1,093.25 hours at $11.00). (Id. ¶¶ 20, 22.)

Alice filed a motion for summary judgment arguing that GCS and Skonie (in his individual capacity) are liable for violating the FLSA and owe him the balance of overtime compensation, liquidated damages, and attorney's fees and costs. GCS filed a cross-motion for summary judgment wherein they argue that Alice is exempt from the FLSA's overtime provision and thus plaintiff is not entitled to overtime compensation at a rate of time and a half.


Summary judgment is proper only when "there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law." Fed R. Civ. P. 56(c). A genuine issue for trial exists when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510 (1986). This standard places the initial burden on the moving party to identify "those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553 (1986) (quotation marks omitted). Once the moving party meets this burden of production, the nonmoving party "may not rest upon the mere allegations or denials of the adverse party's pleading" but rather "must set forth specific facts showing that there is a genuine issue [of material fact] for trial." Fed. R. Civ. P. 56(e). In deciding whether summary judgment is appropriate, we must accept the nonmoving party's evidence as true, and draw all inferences in that party's favor. See Anderson, 477 U.S. at 255.


It is undisputed that while an employee at GCS, Alice consistently worked more than forty hours per week, yet GCS did not compensate him for the overtime hours at a higher rate than his base salary. (Pl. Facts ¶¶ 14-21.) The Fair Labor Standards Act ("FLSA") provides that employees who work more than forty hours per week must "receive[] compensation ... [for the overtime hours] at a rate not less than one and one-half times the regular rate at which he is employed."*fn3 29 U.S.C. § 207(a)(1).

A. Liability Uunder the FLSA

Employers are exempted from the overtime provision of the FLSA "with respect to [] any employee ... [over whom] the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the [Motor Carrier Safety Act.]" 29 U.S.C. § 213(b)(1). The exemption is construed narrowly against employers, and defendants have the burden to establish that the exemption applies to its employees. Turk v. Buffets, Inc., 940 F. Supp. 1255, 1259 (N.D. Ill. 1996). The Motor Carrier Safety Act ("MCSA"), 49 U.S.C. § 31502, authorizes the Secretary of Transportation to "prescribe requirements for [] qualifications and maximum hours of service of employees of, and safety of operation and equipment of, a motor carrier [] and ... a motor private carrier, when needed to promote safety of operation." 49 U.S.C. § 31502(b)(1),(2). Defendants argue that they qualify as a motor private carrier under the MCSA, and thus, they need not comply with Section 207(a)(1) of the FLSA. (Def. Mot. for Summ. J. at 2.) A motor private carrier is defined as "a person ... transporting property by commercial motor vehicle ... when -- (A) the transportation is [in interstate commerce]; (B) the person is the owner, lessee, or bailee of the property being transported; and (c) the property is being transported for sale, lease, ... or bailment or to further a commercial enterprise." 49 U.S.C. § 13102(15).

GCS claims that it qualifies as a private motor carrier by virtue of the non-recyclable, non-hazardous waste that it transports across Illinois highways, which ultimately is dumped in Michigan. Plaintiff counters that the waste does not qualify as "property" under the MCSA. The definition of a private motor carrier, the section granting the Department of Transportation jurisdiction over regulation of motor carriers, and part II of the Interstate Commerce Act ("ICA") each include references to "property."*fn4 49 U.S.C. §§ 13102, 13501. While garbage is not listed among the exempt commodities regulated by the MCSA, 49 U.S.C. § 13506, the Interstate Commerce Commission ("ICC") has previously held that non-nuclear, non-recyclable waste does not constitute "property" under the ICA. Wilson v. IESI N.Y. Corp., No. 04C1271, 2006 WL 2136307, at *5-9 (M.D. Pa. July 28, 2006). The Department of Transportation ("DOT") currently oversees regulation of motor carriers, 49 U.S.C. § 13501, so "it is not clear what, if any, deference the opinions of the ICC ... should have on the question whether garbage is property under the current version[] of ... § 13501 ... Nevertheless, it appears that the DOT continues to view garbage not to be property subject to § 13501." Id. at *9. Therefore, the non-hazardous, non-recyclable waste that Alice transports to Heartland likely does not qualify as property under the MCSA.

Assuming arguendo the waste constitutes "property," defendants cannot establish that such property was being transported in interstate commerce. The regulations emphasize that the FLSA exemption only applies where the activities of the motor private carrier "relate directly to the transportation of materials moving in interstate or foreign commerce within the meaning of the Motor Carrier Act." 29 C.F.R. § 782.7(a); see also 49 U.S.C. §§ 13102(15), 13501. Defendants claim that Alice transported goods in interstate commerce because the non-reusable waste products that he delivered to Heartland were subsequently dumped in Three Oaks, Michigan (and Illinois). (Def. Mot. for Summ. J. at 1-2.) Intrastate transportation of goods qualifies as interstate commerce "if what is being transported is actually moving in interstate commerce within the meaning of [the FLSA and the MCSA]; the fact that other carriers transport it out of or into the State is not material." 29 C.F.R.§ 782.7(b)(1). However, the intrastate transportation must "form part of a 'practical continuity of movement' across State lines from the point of origin to the point of destination." Id.; see also Goldberg v. Faber Indus., Inc., 291 F.2d 232, 234 (7th Cir. 1961) (finding that interstate commerce exists "where the motor vehicle is operated wholly upon the highways of a single state, but the transportation performed is part of a through movement originating in or destined to a point in another state."); McGee v. Corporate Express Delivery Systs., No. 01 C 1245, 2003 WL 22757757, at *3-7 (N.D. Ill. Nov. ...

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