Reference no: EM13172527

Express Delivery Systems, Inc. is a worldwide package delivery company that specializes in fulfilling "just in time" parts and supplies to manufacturers. It provides both "overnight" and "express" deliveries, express referring to the fastest road-based delivery available 24/7. Express Delivery Systems (EDS) drivers and sorters work in 3 overlapping 8-hour shifts, M-F, so that the necessary personnel are always available to make a shipment. Therefore, some employees work 7:00 AM to 3:30 PM (with a half-hour lunch break), some work 10:00 AM-6:30 PM, some work 11:00 PM-7:30 AM, and so on. There are also two part-time "weekend" shifts, with 12-hour days Saturday and Sunday. EDS pays its full-time employees based on a 40-hour work week, M-F. These employees can then earn "overtime" pay on weekends by filling in when needed if delivery demands require supplementing the part-time "weekend" crew.

When full-timers work on the weekend, however, they agree to be "on call" in 4-hour increments. To do this, they "call in" their availability and the 4-hour "clock" begins. During that 4 hours, the employee must be reachable at all times via cell phone, and must be able to take a delivery immediately. The employee may not travel outside his or her "pick up zone" while on call, which limits mobility to approx. a 12-mile radius. If the employee gets a delivery request, he/she makes the delivery and is paid for both the "wait time" and the time taken to make the actual delivery. If the employee gets no call within the 4 hours, he/she is not paid, but can sign up for another 4-hour "on call" status at any time. No regular employee is ever required to be on call weekends; the company relies on "go getters" who want to make some OT on the weekend and are willing to be available for it.

Dennis, a full-time M-F employee, agreed to go "on call" weekends many times last year, and spent a total of 600 "overtime" hours "on call," though he was only called and paid for deliveries for 150 hours. He insists that he is owed overtime pay for the remaining 450 hours.

During school holiday periods, EDS also hires high school students (aged 14 and older) to assist in processing orders at its two national distribution centers. EDS does not allow the students to work more than 6 hours per day or more than 36 hours per week, and they may not work with the mechanical sorting equipment. The students are paid minimum wage, and the job is advertised as a "paid internship." The local high school complains that students who work at EDS over school holidays are returning exhausted, and that no one under age 16 should be permitted to work there.

Renee, a scheduling manager for EDS, worked an average of 50 hours per week last year. She is paid a salary of $50,000 plus full benefits to manage the scheduling of sorters and drivers for incoming orders. She supervises a staff of 8 scheduling assistants, who each coordinate schedules within their geographic regions. She is actively involved in hiring, training and supervising these scheduling assistants, but does not have the sole power to hire or fire them. She is claiming overtime for the excess hours worked, and EDS is claiming she is part of "management" and is exempt from being paid overtime.

What issues do you see raised by this scenario?