Ronald Schilling, Jr. v. Schmidt Baking Company, Inc.
876 F.3d 596
4th Cir.2017Background
- Plaintiffs (three former district sales managers) often worked >40 hours/week for Schmidt Baking and were paid straight salary with no overtime.
- They spent 65–85% of their time making deliveries; 70–90% of those deliveries were in their personal vehicles weighing less than 10,000 pounds.
- Schmidt operated a mixed fleet: some company and contract trucks weighed over 10,000 lbs and some under 10,000 lbs.
- Plaintiffs sued under the FLSA, the Maryland Wage and Hour Law (MWHL), and the Maryland Wage Payment and Collection Law (MWPCL), alleging unpaid overtime.
- District court dismissed the complaint under Rule 12(b)(6); plaintiffs appealed to the Fourth Circuit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiffs are “covered employees” under the TCA amendment to the FLSA (entitling them to overtime) | Plaintiffs: "covered employee" includes those who work on vehicles under 10,000 lbs "in whole or in part"; they drove small vehicles majority of the time | Schmidt: Mixed-fleet employees who spend time on large vehicles remain subject to the MCA Exemption; any more-than-de minimis time on large vehicles excludes TCA protection | Held: Plaintiffs are covered employees under the TCA and entitled to FLSA overtime; mixed-fleet status does not defeat the TCA’s "in whole or in part" language |
| Proper interpretation of the TCA phrase "in whole or in part" | Plaintiffs: Plain meaning includes partial work on small vehicles; no bright-line threshold needed | Schmidt: "In part" should be constrained so mixed-fleet drivers remain exempt if they spend meaningful time on >10,000 lb vehicles | Held: Court follows plain meaning and McMasters — "in part" covers employees who spend any portion of work affecting small vehicles; no strict quantitative cutoff imposed |
| Whether to adopt a test requiring exclusive or majority use of <10,000 lb vehicles | Plaintiffs: Majority of delivery time was in <10,000 lb vehicles, satisfying the statute | Schmidt: Requires exclusion if work includes larger vehicles | Held: Not necessary to define precise percentage; factual allegations (70–90% small-vehicle use) suffice to plead coverage at dismissal stage |
| Whether Maryland law claims survive given the TCA-based FLSA result | Plaintiffs: State claims should mirror FLSA result | Schmidt: Maryland statutes do not contain the TCA exception; state exemption applies | Held: MWHL and MWPCL claims properly dismissed because Maryland law lacks the TCA exception that overrides the MCA Exemption |
Key Cases Cited
- McMasters v. Eastern Armored Servs., Inc., 780 F.3d 167 (3d Cir. 2015) (held a mixed-fleet driver who spent part of her time in <10,000 lb vehicles qualified as a "covered employee" under the TCA)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: complaint must state a plausible claim)
- Tenn. Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590 (1944) (FLSA’s remedial purpose and interpretation guidance)
- Tony & Susan Alamo Found. v. Sec'y of Labor, 471 U.S. 290 (1985) (FLSA construed broadly; exemptions narrow)
- Arnold v. Ben Kanowsky, Inc., 361 U.S. 388 (1960) (exemptions to FLSA narrowly construed)
- Hall v. DIRECTV, LLC, 846 F.3d 757 (4th Cir. 2017) (noting general alignment between FLSA and Maryland wage-hour claims)
- Levinson v. Spector Motor Serv., 330 U.S. 649 (1947) (discussing MCA’s safety/regulatory purpose)