US Department of Labor recovers $181K in back wages for Birmingham workers after investigation finds improper claim of overtime pay exemption

BIRMINGHAM, AL – Two Birmingham delivery companies, employed by FedEx Corp. as subcontractors, shortchanged 235 workers after wrongly claiming the workers were not entitled to overtime pay under motor carrier regulations, a U.S. Department of Labor investigation has found.

The department’s Wage and Hour Division determined Steel City Couriers Inc. and Cahaba Valley Couriers Inc. paid workers straight time for all hours or a flat weekly rate without overtime compensation. They also failed to maintain accurate records of hours worked. These practices violated the Fair Labor Standards Act.

Division investigators found employers misapplied an FLSA exemption from overtime requirements when workers duties involve driving on interstate highways, operating delivery trucks weighing at least 10,000 pounds, or when working for an employer who falls under the regulations governed by the U.S. Department of Transportation.

The investigation led to the recovery of $181,379 in back wages for 235 workers.

“Misapplying overtime rules deprives workers of their legal right to be paid time-and-a-half for hours over 40 in a workweek,” said Wage and Hour Division District Director Kenneth Stripling in Birmingham, Alabama. “Employers who ignore their obligations and violate workers’ rights can find their mistakes costly and their ability to recruit and retain the people they need to run a successful business difficult, if not impossible.”

“Violations like this could have been avoided by contacting the Wage and Hour Division, whose staff can help employers understand their responsibilities under the law,” Stripling added.

The division offers multiple compliance assistance resources, including a fact sheet on the FLSA’s motor carrier exemption to provide employers the information they need to comply with the law.