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Car services are exempt from the 40-hour workweek rule for requiring overtime to employees under the Fair Labor Standards Act, a federal judge has ruled. Addressing what she said appears “surprisingly” to be a case of first impression, Southern District of New York Judge Colleen McMahon found that car services have the same status as taxis under the act, and are therefore not required to pay overtime to their drivers. The ruling came in Cariani v. D.L.C. Limousine Service, 03 Civ. 8383, where driver Enzo Cariani claimed he was entitled to overtime. He earns $7 an hour plus commissions of between 9 percent and 10 percent. Cariani claimed that D.L.C., which operates from a location at the Westchester County Airport, was not a bona fide taxi service and therefore could not assert the statutory exemption from the maximum hours rule of 29 U.S.C. �207. The maximum hours rule requires employers to pay time and a half for any time worked over 40 hours per week. Section 213(b)(17) of the Fair Labor Standards Act states that �207 shall not apply with respect to any driver employed by someone in the business of operating taxicabs. As an alternative to claiming the benefit of the taxi exemption under �207, D.L.C. said it qualified for the “motor carrier” exemption of �213(b)(1), which states that the act does not apply to any employee “with respect to whom the Secretary of Transportation has the power to establish qualifications and maximum hours of service.” McMahon, sitting in White Plains, N.Y., said the Fair Labor Standards Act does not define the term “taxicab” or “taxicab operator.” She also said the Revised Interstate Commerce Act, formerly the Motor Carrier Act, does not define the term “bona fide taxicab service.” “And it appears that there is scant case law on the subject — much of it ancient, none of it emanating from this Circuit,” the judge said. While exemptions under the act are to be narrowly construed, she said, several factors weigh toward D.L.C.’s qualifying for the exemption, including the fact that it does not cover fixed routes and offers door-to-door service with passengers determining pick-up times and destinations. On the other hand, McMahon said, D.L.C. is not under contract with an airline or any other company and its fares are roughly equivalent to those charged by two other taxi companies operating in the same area. But, she said, D.L.C. is not regulated by the Westchester Taxi and Limousine Commission. “It does not advertise itself as a taxi company: its drivers do not organize their own time or cruise for passengers,” she said, and “although fares are mileage-based they are predetermined, not metered; and the cars sometimes carry more than one fare.” However, the nature of D.L.C.’s advertising is not determinative, she said, and therefore D.L.C. falls within the definition of the “business of operating taxicabs” as set forth by the Department of Labor. Because D.L.C. was not subject to the maximum hours rule of the Fair Labor Standards Act, the judge dismissed the case for lack of subject matter jurisdiction. Having found that D.L.C. qualifies for the exemption, McMahon said it was unnecessary for her to address whether D.L.C. qualifies for the second exemption under the old Motor Carrier Act and its successor, the Revised Interstate Commerce Act, for “bona fide taxicab” services. Nonetheless, in the event she was wrong about the first exemption, McMahon went on to find that D.L.C. qualified for the second. Jeffrey I. Carton of Meiselman, Farber, Packman & Eberz in White Plains represented D.L.C. Robert David Goodstein of Goodstein & West in New Rochelle, N.Y., represented Cariani.

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