The Third Circuit has revived a case brought by transit workers against SEPTA seeking overtime pay under the federal Fair Labor Standards Act.

In its decision, the panel said the arbitration clause in the transit agency's collective bargaining agreements with workers did not require that the statutory claims be arbitrated.

A federal judge in the Eastern District court had dismissed the suit, ruling an arbitrator would have to interpret provisions of three collective-bargaining agreements between the Southeastern Pennsylvania Transportation Authority and various workers.

Now, the U.S. Court of Appeals for the Third Circuit held that the employees' claims arose strictly under the FLSA and should be heard by the court.

"The minimum protections the FLSA provides to individual workers … 'take precedence over conflicting provisions in a collectively bargained compensation arrangement,'" Senior Judge Maryanne Trump Barry wrote on behalf of a unanimous three-judge panel. "An employee's right to relief under the FLSA, therefore, is distinct from an employee's contractual rights as provided in a collective bargaining agreement," she said.

U.S. District Judge Joel H. Slomsky of the Eastern District of Pennsylvania had agreed with SEPTA and looked to the Third Circuit's 1990 opinion in Vadino v. A. Valey Engineers when he dismissed the case.

But, Barry distinguished the circumstances faced by bus and trolley drivers, who claim that they are required to do paperwork before their shifts begin and light maintenance after their shifts end without being paid overtime wages, from the Vadino case, which included FLSA overtime-wage claims but turned on a threshold question of the level of wage to which the workers were entitled in order to calculate the overtime wage.

So, the Vadino case set the Third Circuit standard for sending a wage case to arbitration in order to settle threshold issues before going to court.

"In other words, if an FLSA claim depends on the disputed interpretation of a CBA provision, an employee must first go to arbitration — through the representative union — before vindicating his or her rights in federal court under the FLSA," Barry said.

But, in the case brought by SEPTA workers, no such threshold issue exists.

"Unlike the employee in Vadino, the operators do not contend that they are entitled to additional payment under a CBA. Neither do they contend that SEPTA fails to compensate them in the amounts set forth in the CBAs for time spent performing their duties prior to the scheduled starting time," Barry said.

"Rather, resolution of the FLSA claim requires a factual determination of the amount of time operators are required to work prior to their scheduled start, and a legal determination regarding whether this time is (1) compensable and (2) subject to the overtime provisions of the FLSA," she said. "Unlike Vadino, neither of these determinations depends on the resolution of a disputed reading of the CBAs."

In this case, Barry said, there would be no use in sending it first to arbitration since there could be no determination made that would have an effect on the FLSA claim.

"If, for instance, an arbitrator were to determine that the pre-trip vehicle inspections are 'covered' by the CBA provisions, the operators would still have a claim that their payments under the CBA violate the FLSA," Barry said.

Also on the panel were Judge Joseph A. Greenaway Jr. and Senior Judge Dolores K. Sloviter.

Bruce Bodner, of Kaufman, Coren & Ress, represented the employees and called it a "decision which vindicates the rights of employees … to vindicate their rights under the statute."

Jo Bennett, of Stevens & Lee, represented SEPTA and referred requests for comment to the transit agency.

Saranac Hale Spencer can be contacted at 215-557-2449 or sspencer@alm.com. Follow her on Twitter @SSpencerTLI.

(Copies of the 11-page opinion in Bell v. SEPTA, PICS No. 13-2457, are available from The Legal Intelligencer. Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information.)