First Circuit Holds Truckers’ Rest Time Spent in Sleeper Berths is For Motor Carriers’ Benefit and Therefore Compensable—Settlement Limited to Past Violations

A settlement between drivers and the motor carrier CRST was recently finalized after a court answered the question: when must a carrier pay a driver for time spent in the sleeper berth?

The First Circuit Court’s answer: carriers must pay employee drivers for the time they are required to be in the sleeper berth beyond the 8 hours reserved for sleep. The court’s decision explains the law for all motor carriers, not just CRST. However, the CRST Settlement is limited to CRST paying money to resolve the drivers’ claims that CRST did not pay them enough during their training and orientation periods with the carrier. The settlement did not contemplate CRST’s compliance with the law in the future.

Reviewing an issue of first impression, the U.S. Court of Appeals for the First Circuit ruled in December 2023 that—in the “team driving” business model used by CRST for training purposes, where one person drives a commercial truck while the other is supposedly “resting” in the sleeper berth of the vehicle—the time the non-driving individual spends in the sleeper berth beyond the allotted 8 hours of rest is “for the benefit of the motor carrier” and therefore compensable under the Fair Labor Standards Act. See Montoya v. CRST Expedited, Inc., 88 F.4th 309 (1st Cir. 2023), citing 29 U.S.C.A. § 206(a).

 The posture of the case upon appeal was unusual. The district court granted summary judgment to former CRST drivers, determining that sleeper berth time is compensable work. In May 2021, the District Court approved a settlement of all issues with one caveat. CRST reserved the right to appeal the district court’s decision on the sleeper berth issue. Should the plaintiffs win that claim on appeal, the settlement provided that the monetary relief be paid to the plaintiffs and CRST would pay them at least the applicable minimum wage for hours of orientation attended, retroactive to the January 2021 settlement date and going forward. Hence, the First Circuit reviewed the workers’ status when they were required to be present in the sleeper berth. In a face-off between the DOT Hours of Service rules (49 C.F.R. § 395.3(a)(1)-(3)), and the Department of Labor’s minimum wage standard (29 C.F.R. § 785.22), the First Circuit held that time spent in the sleeper berth by the non-driving team member beyond eight hours is compensable by the employer, because if the driver’s time in the sleeper berth exceeding eight hours counts as hours worked but not paid, the driver’s pay would fall below minimum wage.

 Notably, Congress has never defined what constitutes “work” under the FLSA. However, in adjudicating FLSA cases, the Supreme Court has described work as “physical or mental exertion (whether burdensome or not) controlled or required by the employer and pursued necessarily and primarily for the benefit of the employer and his business.” See Montoya, 88 F.4th at 315 (citing Tenn. Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590, 598 (1944)). This “exertion” can be negligible since an employer may hire someone “to do nothing, or to do nothing except wait for something to happen.” Montoya at 316, (citing Armour & Co. v. Wantock, 323 U.S. 126 (1944). In cases involving waiting, “the critical question is whether an employee is “engaged to wait’ (which is generally compensable) or ‘wait[ing] to be engaged’ (which is not compensable).” Id. (citing Skidmore v. Swift & Co., 323 U.S. 134, 137 (1944).

This requires the application of the “predominant benefit” test: whether the time spent waiting is for the benefit of the employer, which is entirely dependent on the facts of the case. Id. (citing Armour, 323 U.S. at 133; Singh v. City of New York, 524 F.3d 361, 367-69 (2d Cir. 2008) (applying the “predominant-benefit test”); Roy v. County of Lexington, 141 F.3d 533, 544-45 (4th Cir. 1998) (same)).

“’Circuit courts have applied the predominant benefit test to determine whether employee time is compensable work in a variety of circumstances, including on-call time, mealtime, and commuting time.’” Id. In doing so, one important factor is the employee’s physical location and whether the employee is required to be present at the worksite. Id. (citing Armour, 323 U.S. at 133). The First Circuit previously recognized the “FLSA’s usual rule ... that an employer must pay an employee for all time the employee is required to spend at a worksite.” Id. (citing Giguere v. Port Res. Inc., 927 F.3d 43, 47 (1st Cir. 2019).

Another factor to be considered is the employee’s ability to engage in recreational activities. One example is time spent “on call” by a firefighter.

“[T]he Supreme Court found in Armour that firefighters who were required to spend on-call time in the fire hall, where they had to respond to alarms and perform minor maintenance work but could otherwise engage in recreational activities such as playing cards and listening to the radio, were engaged in compensable work under the FLSA because their waiting time was for the employer’s benefit. Armour, 323 U.S. at 132-34, 65 S.Ct. 165.

Conversely, the Eleventh Circuit determined that on-call police officers who could remain at home or travel so long as they had a beeper were not entitled to compensation, as the employees “could do anything they normally did so long as they were able to respond to a call promptly” and the time was therefore “not used predominantly for the employer’s benefit.” Birdwell v. City of Gadsden, 970 F.2d 802, 808-10 (11th Cir. 1992). Montoya, 88 F. 4th at 317.

Concerning sleeper berth time not spent sleeping, Montoya argued that the drivers’ confinement to the (extremely small) sleeper berth meant that the time benefits the employer and thus is compensable work. In particular, Montoya said that CRST’s team-driving business model both relies on and profits from its drivers continuing to travel while taking their rest period, thus rendering this time for the employer’s benefit. CRST, on the other hand, argued that the DOT’s Hours of Service regulations require drivers to be “relieved from work and all responsibility for performing work” during the ten-hour “off-duty” period and specifically excludes “time spent resting in a sleeper berth” from “[o]n-duty time.” 49 C.F.R. § 395.2.

 The First Circuit discounted CRST’s reliance on the DOT regulations to determine what constitutes compensable work. The Court specifically noted that the DOT regulations concern driver and road safety, whereas the FLSA addresses worker compensation. Montoya at 318. The First Circuit applied the “predominant benefit” test, highlighting (1) the drivers’ confinement to the sleeper berth even when not driving (except when the truck stops); (2) the extraordinarily confining limitations of the sleeper berth, which severely restrict the activities in which the non-driving team member can engage; and (3) that the driving team member may call on the non-driving team member (who is supposedly resting) to assist in an emergency, to conclude that the “team driving” model that CRST utilizes is for its own benefit and adds to its profits, while it burdens and does not benefit the non-drivingteam member. Finally, the Court noted that the statutes and regulations must be read in context and not in isolation.

Considering these factors, Montoya holds as compensable the rest time of a non-driving team member beyond the eight hours reserved for sleeping that is spent in the sleeper berth. This decision interpreted the law for all motor carriers and was not particular to the facts of the CRST case. It means carriers are now on notice that they must compensate drivers for the non-resting time they are required to spend in the sleeper berth. However, CRST’s settlement is only monetary. It covers certain classes of drivers for their non-resting sleeper berth time during training and orientation at CRST through the end of 2023. CRST is not bound by declaratory or injunctive relief for its current or future practices.

For more information on challenging agency action, please contact CullenLaw attorneys at info@cullenlaw.com.