$1,072,061 in Back Pay for Overtime Violations by Commercial Transportation Company

Friday, August 26, 2016

One of the nation’s largest commercial transportation companies will pay driver dispatchers and trailer yard spotters for the long hours they worked, following an investigation by the U.S. Department of Labor’s Wage and Hour Division.

Division investigators determined National Freight Inc. violated the Fair Labor Standards Act when it wrongly classified dispatchers and yard spotters as exempt from the law’s overtime requirements, and failed to pay the legally required wages. The company paid dispatchers flat salaries, regardless of the number of hours they worked, creating overtime violations when they worked more than 40 hours in a week. NFI paid yard spotters by the hour, but failed to pay overtime when legally required. The division also found the global service provider – based in Cherry Hill and doing business as NFI – failed to maintain payroll records required by law.

NFI will pay $1,072,061 to 357 employees to remedy the violations. The company has also reclassified hundreds of employees working as dispatchers and yard spotters, agreeing to pay them proper overtime compensation going forward.

In addition to paying back wages, NFI has also entered into an agreement with the department to take the following steps to ensure future FLSA compliance:

  • Hire an internal compliance officer.
  • Institute and implement complaint procedures.
  • Create and publicize a complaint hotline.
  • Conduct confidential interviews with complainants.
  • Maintain a written log of complaints made to the compliance officer.
  • Provide training for all managerial employees.

Employing more than 8,000 associates, NFI operates 29 million square feet of warehouse and distribution space, and has a company-owned fleet of over 2,000 tractors and 8,200 trailers. Generating more than $1.2 billion in revenue annually, NFI serves customers around the world in a variety of industries. Its business lines include dedicated transportation, warehousing, intermodal, brokerage, transportation management, global and real estate services.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers are required to maintain accurate time and payroll records.

The FLSA provides an exemption from both minimum wage and overtime pay requirements for individuals employed in bona fide executive, administrative, professional and outside sales positions, as well as certain computer employees. To qualify for exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. Job titles do not determine exempt status. In order for an exemption to apply, an employee's specific job duties and salary must meet all the requirements of the department's regulations.

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