Will Wage and Hour Rumbles... Affect You?

G/MAN · Nov 5, 2014

Surfer Joe said: ↑

By all means, set me straight Gman.
I do know that the FBI was involved in the original investigation, but the fact that anybody has actually received any prison sentence is news to me.
Mind telling me who and where I can check out the info? So far, all I come up with are civil and criminal charges with no actual criminal convictions, let alone sentences actually being imposed.
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I believe there were 2 or 3 Pilot employees who were arrested and charged. I believe at least one of them did plead guilty for a lesser sentence and cooperation to help them with the investigation. Knoxville Police were also involved with the raid on Pilot headquarters. I would check the newspapers in Knoxville, TN. The town newspaper is the Knoxville News Setinel. I believe Landline Magazine also had several articles about Pilot. Now, back to the subject at hand.

G/MAN · Nov 5, 2014

I read something earlier today about a court ruling in Massachusetts concerning the classification of independent contractors. Apparently, the states passed a bill that classified truckers and others as employees, even though they were considered independent contractors. The court came along and rules that they could not classify drivers as employees since they were exempt from state law concerning how they were compensated. I tried to find the link, but can't seem to find it. I must have deleted it in my email. In this case, the court ruled against the state. There was more to the article, but that is mostly what I remember. Perhaps someone else may be able to find the link. This ruling might have an impact on this lawsuit in California.

Victor_V · Nov 6, 2014

Interesting if you can find that, G/MAN.

Would matter whether a State or Federal court. To have an impact on Quezada would be an unlikely reach from MA, at least directly. State matters work their way up from local courts to appellate to state supremes and from there to US Supreme, affecting that state internally and don't bind other states but are 'sometimes' referred to--uh, rather lightly in other state appeals.

Kinda like 'my cousin says' or 'my cousin did this or that'... not quite a 'so what', kinda.

Quezada v Con-way started in State of California Superior Court (San Mateo) was removed to US District Court of California, Northern District and combined there with another case Pina v Con-way for class action. Had Con-way gone to trial, lost and chosen to appeal, the next step would be the US Ninth Circuit Court of Appeal and these Circuit Courts of Appeal have a lot of clout because they are regional.

It's not unusual for one regional US Circuit Court to have a ruling in conflict with another US Circuit Court of Appeal because the District Courts below rely on state law. A California case that moved up the Ninth Circuit would have been bound to California law, for example. When you have US Circuit Courts of Appeal in conflict, that CAN (but doesn't have to) move a case to the US Supreme to resolve the conflict among states and Federal regions.

Con-way chose to settle (we think, there was preliminary settlement approval Oct 3 and finalization is EXPECTED on Jan 9, 2015--dun dun-dunt-dun dun). The matter stops there. Not subject to appeal. Over. Closed.

The Con-way case is not 'precedent' because it will be a settled case. A precedent is a ruling from an appellate court that other lower courts have to follow. But it will matter, especially because Con-way is a billion-dollar player and is surrendering to current California law.

A smaller carrier might risk going the appeal route. Could still happen. For now, means the California Labor Board will likely take complaints from drivers, hold hearings and rule without the driver having to take his/her employer to State court and the cost of an attorney, yada, yada.

Much easier to make a claim. Basically, a piece of paper, a form to fill out.

Victor_V · Nov 6, 2014

Continued--Some Minimum Wage History from Dept of Labor Web Site
Fair Labor Standards Act of 1938 http://www.dol.gov/dol/aboutdol/history/flsa1938.htm
Excerpts from DOL official history written by Jonathan Grossman

Roosevelt tries again

Again, Roosevelt returned to the fray. In his annual message to Congress on January 3, 1938, he said he was seeking "legislation to end starvation wages and intolerable hours."

He paid deference to the South by saying that "no reasonable person seeks a complete uniformity in wages." He also made peace overtures to business by pointing out that he was forgoing "drastic" change, and he appeased organized labor, saying that "more desirable wages are and should continue to be the product of collective bargaining."

The day following Roosevelt's message, Representative Lister Hill, a strong Roosevelt supporter, won an Alabama election primary for the Senate by an almost 2-to-1 majority over an anti-New Deal congressman. The victory was significant because much of the opposition to wage-hour laws came from Southern congressmen.

In February, a national public opinion poll showed that 67 percent of the populace favored the wage-hour law, with even the South showing a substantial plurality of support for higher standards.

Reworking the bill.

In the meantime, Department of Labor lawyers worked on a new bill.

Privately, Roosevelt had told Perkins that the length and complexity of the bill caused some of its difficulties. "Can't it be boiled down to two pages?" he asked.

Lawyers trying to simplify the bill faced the problem that, although legal language makes legislation difficult to understand, bills written in simple English are often difficult for the courts to enforce. And because the wage-hour, child-labor bill had been drafted with the Supreme Court in mind, Solicitor Labor Gerard Reilly could not meet the President's two-page goal; however, he succeeded in cutting the bill from 40 to 10 pages.

In late January 1938, Reilly and Perkins brought the revision to President Roosevelt. He approved it, and the new bill went to Congress.
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Victor_V · Nov 6, 2014

Continued--Some Minimum Wage History from Dept of Labor Web Site
Fair Labor Standards Act of 1938 http://www.dol.gov/dol/aboutdol/history/flsa1938.htm
Excerpts from DOL official history written by Jonathan Grossman

Roosevelt and Perkins prepared for rugged opposition.

Roosevelt put pressure on Congressmen who had ridden his coattails to election victory in 1936 and who then knifed New Deal legislation. Perkins added to her staff Rufus Pole, a young lawyer, to follow the bill through Congress.

Pole worked resourcefully pinpointed the issues that bothered some Congressmen, and identified a large number of Senators and Representatives who could be counted on to vote favorably.

Norton appointed Representative Robert Ramspeck of Georgia to head a subcommittee to bridge the gap between various proposals. The subcommittee's efforts resulted in the Ramspeck compromise which Perkins felt "contained the bare essentials she could support."

The compromise retained the 40-cent minimum hourly wage and the 40-hour maximum workweek. It did not provide for an administrator as had the previous bill which had been voted back to the committee by the House. Instead, the compromise allowed for a five-member wage board which would be less powerful than those proposed by the Black-Connery bill.
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Victor_V · Nov 6, 2014

Continued--Some Minimum Wage History from Dept of Labor Web Site
Fair Labor Standards Act of 1938 http://www.dol.gov/dol/aboutdol/history/flsa1938.htm
Excerpts from DOL official history written by Jonathan Grossman

Congress-the final round

The House Labor Committee voted down the Ramspeck compromise, but, by a 10-to-4 vote, approved an even more "barebones" bill presented by Norton.

Her bill following the AFL proposal, provided for a 40-cent hourly minimum wage, replaced the wage boards proposed by the Ramspeck compromise with an administrator and advising commission, and allowed for procedures for investigation into certain cases.

A message from the voters.

Again, the House Rules Committee (under Rep. John J. O'Conner of New York, whom Roosevelt called an "obstructionist" who "pickled" New Deal programs) prevented discussion of the bill on the House floor by a vote of 8 to 6.

The President then put his prestige on the line. On April 30, 1938, for the sixth time since taking office, he communicated with Congress over wages and hours through a letter to Mrs. Norton. He said he had no right whatsoever as President to criticize the rules but suggested as an ex-legislator and as a friend that "the whole membership of the legislative body should be given full and free opportunity to discuss [exceptional measures] which are of undoubted national importance because they relate to major policies of Government and affect the lives of millions of people."

He avoided judgement of the bill but noted that the Rules Committee, by a narrow vote, had prevented 435 members from "discussing, amending, recommitting, defeating or passing some kind of a bill." He concluded: "I still hope that the House as a whole can vote on a wage and hour bill. ...I hope that the democratic processes of legislation will continue."

Three days later, May 3, 1938, Congressman Claude Pepper won a resounding victory over anti-New Dealer J. Mark Wilcox in the Florida Senate primary.

Wilcox had made New Deal programs the major issue and had labeled Pepper "Roosevelt rubber stamp."

Nothing impresses Congressmen more than election returns. The January and May victories of New Deal advocated in the South brought home to Southern Congressmen the message of how their constituents felt about fair labor standards.

A petition to discharge the bill from the Rules Committee was placed on the desk of the Speaker of the House on May 6, at 12 noon. In 2 hours and 20 minutes, 218 members has signed it, and additional members were waiting in the aisles.
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Victor_V · Nov 6, 2014

Continued--Some Minimum Wage History from Dept of Labor Web Site
Fair Labor Standards Act of 1938 http://www.dol.gov/dol/aboutdol/history/flsa1938.htm
Excerpts from DOL official history written by Jonathan Grossman

Braving the floor battle.

Proponents of the wage-hour, child-labor bill pressed the attack. They continued to point to "horror stories." One Congressman quoted a magazine article entitled "All Work and No Pay" which told how, in a company that paid wages in scrip for use in the company store, pay envelopes contained nothing for a full week's work after the deduction of store charges.

The most bitter controversy raged over labor standards in the South. "There are in the State of Georgia," one Indiana Congressman declaimed, "canning factories working ... women 10 hours a day for $4.50 a week. Can the canning factories of Indiana and Connecticut of New York continue to exist and meet such competitive labor costs?"

Southern Congressmen, in turn, challenged the Northern "monopolists" who hypocritically "loll on their tongues" words like "slave labor" and "sweat-shops" and support bills which sentence Southern industry to death.

Some Southern employers told the Department of Labor that they could not live with a 25-cent-an-hour minimum wage. They would have to fire all their people, they said. Adapting a biblical quotation, Representative John McClellan of Arkansas rhetorically asked, "What profiteth the laborer of the South if he gain the enactment of a wage and hour law -- 40 cents per hour and 40 hours per week -- if he then lose the opportunity to work?"

Partly because of Southern protests, provisions of the act were altered so that the minimum wage was reduced to 25 cents an hour for the first year of the act. Southerners gained additional concessions, such as a requirement that wage administrators consider lower costs of living and higher freight rates in the South before recommending wages above the minimum.
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Victor_V · Nov 6, 2014

Continued--Some Minimum Wage History from Dept of Labor Web Site
Fair Labor Standards Act of 1938 http://www.dol.gov/dol/aboutdol/history/flsa1938.htm
Excerpts from DOL official history written by Jonathan Grossman

Though the revised bill had reduced substantially the administrative machinery provided for in earlier drafts, several Congressmen singled out Secretary Perkins for personal attack.

One Perkins detractor noted that, although Congress had "overwhelmingly rebelled" against delegation of power, 'We delegate to Madam Perkins the authority and power to 'issue an order declaring such industry to be an industry affecting commerce.'

"Now section 9 is ...one of the 'snooping' sections of the bill. Imagine the feeling of the merchant or the industry up in your district when a 'designated representative'...of Mme. Perkins' enter and inspect such places and such records'...I know no previous law going quite so far."

A resulting compromise modified the authority of the administrator in the Department of Labor.

The bill was voted upon May 24, 1938, with a 314-to-97 majority. After the House had passed the bill, the Senate-House Conference Committee made still more changes to reconcile differences. During the legislative battles over fair labor standards, members of Congress had proposed 72 amendments.

Almost every change sought exemptions, narrowed coverage, lowered standards, weakened administration, limited investigation, or in some other way worked to weaken the bill.

The surviving proposal as approved by the conference committee finally passed the House on June 13, 1938, by a vote of 291 to 89. Shortly there-after, the Senate approved it without a record of the votes.

Congress then sent the bill to the President. On June 25, 1938, the President signed the Fair Labor Standards Act to become effective on October 24, 1938.

~~~~~~~ End Article~~~~~~

Jonathan Grossman was the Historian for the U.S. Department of Labor. Henry Guzda assisted. This article originally appeared in the Monthly Labor Review of June 1978.
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Victor_V · Nov 6, 2014

Battle for Minimum Wage and Overtime

If you took time to read Grossman's 'official' DOL (US Department of Labor) history, the battle for minimum wage and overtime, which initially achieved 25-cent/hour minimum wage and 44-hour/week with overtime after 44, pretty much rode on a public that wanted to end the exploitation of child labor, a willing Congress (not entirely... ), a determined President (FDR) and for a long time, a Supreme Court determined to block minimum wage and overtime until FDR threatened to pack the court.

The 1938 FLSA (Fair Labor Standards Act) changed the landscape. But we were left out. And when trucking was deregulated in 1980, our work rules were not updated, either.

The truckload carriers have had it pretty good. Under the claim of 'driver shortage', we train countless new drivers every year who take lowest-rate seats that will typically change again in 6 months or so. The slogan 'ALL WORK AND NO PAY' pretty well describes the life of many a new trucker.

When that driver's door opens for the last time for a driver with 6 months to a year of experience, finally able to move on to something better, there's another brand new driver ready to climb into the seat at the same low rate as before.

The only thing preventing carriers from working you 24/7 is the FMCSA (Federal Motor Carrier Safety Administration) HOS (Hours of Service). And for all practical purposes, OTR drivers far exceed the HOS because they bury much of their 'non-piece-rate' work in off-duty, despite that it's not.

Some here ardently defend the status quo, arguing that you knew what the pay was and didn't have to take the job, for example. Or that rich (Heartland/GTI has a mere $23-million in cash, almost no debt, owns its 4,000-5,000-seat fleet outright, billion-dollar Con-way has $457-million in cash) carriers CAN'T AFFORD to pay you more.

100% turnover and 100-hour weeks for $400-$600 is exploitive. Sorry, it is.

As FDR MIGHT HAVE said, "Don't let some howling $1,000/day executive tell you that the country can't afford a fair wage for interstate truck drivers. A responsible democracy cannot afford to allow wealthy companies to exploit interstate truck drivers as they do." (Well, somewhat paraphrased.)

I figure somewhere FDR is welcoming Quezada v Con-way right now.

Victor_V · Nov 6, 2014

A Look Back at Some More Trucking History

If the FLSA (Fair Labor Standards Act) changed the landscape in 1938 (and left interstate truck drivers by the side of the road), the Motor Carrier Act of 1980 again changed the landscape and maybe we'll look back at Quezada v Con-way as the beginning of another major landscape change.

Dunno.

Back in 1998, Cynthia Engel surveyed changes in the trucking industry up to that time in the Monthly Labor Review (April, 1998). http://www.bls.gov/mlr/1998/04/art3full.pdf

Engel said that the country's freight bill hit an all-time low in 1996, only 6% of gross domestic product compared with 7.6% in 1980. And that those cost savings came at the expense of for-hire truck drivers. That between 1978 and 1996, truck driver wages dropped 40%, despite that the demand for our services continued to increase.

Sounds counter-intuitive, doesn't it? Where's that old supply/demand relationship? Why would our wages drop 40% while demand for our services increased? One reason is that between 1980 and 1994, 586,000 new truck driver jobs were added. New drivers. Coming into the industry at the lowest entry-level piece-rate (mileage) pay, I figure.

In 1980, the Motor Carrier Act of 1980 deregulated interstate trucking without protecting driver pay and working conditions that remained exempt from the FLSA (Fair Labor Standards Act).

Then in 1995, the Trucking Industry Regulatory Reform Act deregulated intrastate (trucking within a state). States could no longer regulate routes, rates or services.

These were huge, structural changes in the trucking industry.

Union outfits with once-protected authorities found themselves hugely vulnerable and what had been long-established firms were shuttered.

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