While most lawsuits in the trucking sector about overtime and minimum wage tend to focus on the number of hours drivers work, and whether they are entitled to at least the federal minimum wage if their rate per mile doesn’t cover that target, logistics firm GlobalTranz is facing a different kind of lawsuit over that issue.
Two employees who worked in the company’s logistics operations have filed suit in Arizona federal District Court seeking a class action against the 3PL, arguing that they were converted to exempt employees in April 2019. When that happened, and they were no longer paid by the hour, the number of hours they worked stayed at the same rate or increased while their pay was set as a salary. They allege in the lawsuit filed Monday that at that point, they were working more than 40 hours per week and not getting paid for it.
The suit was brought by two employees, Samantha Thaler and Juliana Daklin. They are seeking class certification. Among the job titles they are seeking that certification for are logistics representatives, inside sales, carries sales representatives, account coordinators, LTL representatives or what the plaintiffs’ lawsuit said are “similar job titles.”
“Plaintiffs and those similarly situated routinely worked more than 40 hours in a workweek but were not paid an overtime premium for their overtime hours,” the lawsuit says.
Although GlobalTranz is located in Phoenix, which is why the lawsuit is in federal court in Arizona, the two plaintiffs both worked out of Minnesota. Both plaintiffs had the position of logistics representative.
The plaintiffs’ primary job duty was work that was considered non-exempt, consisting of “coordinating and scheduling pickup and/or delivery appointments for assigned customers, and tracking and tracing shipments across various modes of transit,” the suit said.
But in April 2019, according to the lawsuit, GlobalTranz changed their jobs and those “similarly situated” to salaried employees exempt from minimum wage laws. Before that, their pay was an hourly rate with overtime paid if they exceeded 40 hours per week.
The lawsuit says GlobalTranz had a “legal obligation” to track the hours that the two defendants worked, even though they were no longer getting paid by the hour. When they were deemed “on-call,” according to the lawsuit, they were “required to respond to phone calls and emails 24 hours/day, resulting in additional unpaid overtime hours.”
The suit said Daklin regularly worked 45 to 50 hours per week. She cited one week in particular when she worked “approximately” 48 hours. Thaler made the same claim about the number of hours she worked.
“GlobalTranz assigned plaintiffs a heavy workload and required them and the similarly situated individuals to work long hours, including overtime hours, to complete all of their job responsibilities,” the suit said.
The suit also said GlobalTranz was aware of the hours worked, because “plaintiffs and others complained about their long hours and the workload.” Those concerns were “generally dismissed by [GlobalTranz],” the suit said.
“Defendant’s actions, policies, and practices described above violate the FLSA’s overtime requirement by regularly and repeatedly failing to compensate Plaintiffs and the other similarly situated individuals their required overtime compensation,” the suit said.
In an email to FreightWaves, the plaintiffs’ attorney, Rachhana Srey of the firm of Nichols Kaster, said the case was “interesting and rare” because according to Srey, GlobalTranz “apparently had its logistic reps classified as exempt for a period of time, reclassified to non-exempt for a period of time, and then ultimately reverted back to its exemption classification.”
This occurred, she said, even though “nothing material has changed with respect to the workers’ primary job duties.”
“Based on our understanding of the primary duties, we believe that they should have been overtime eligible all along,” Srey wrote.
According to the suit, this is not the first such action against GlobalTranz. Srey said the two others settled out of court.
Emails to GlobalTranz for comment had not been returned by publication time.
While classification suits for drivers often focus on minimum wage pay, that is not raised in this litigation. Minimum wage for drivers being paid a rate per mile comes into issue when the compensation rate per mile transaction fails to cover the amount of money that minimum wage — if it were available — would provide. That is not the case here, though the classification issues raised in the suit do have echoes of those minimum wage battles.