Colorado Department of Labor Makes a U-Turn on Motor Carrier Exemption

On November 10, 2020, the Colorado Department of Labor and Employment, Division of Labor Standards and Statistics (Division) published the final Colorado Overtime and Minimum Pay Standards Order Number 37 (COMPS Order 37), which takes effect on January 1, 2021.  COMPS Order 37 significantly expands the state Motor Carrier Exemption (MCE) in Colorado, although it remains more limited than under federal law. 

Specifically, new Rule 2.4.6 provides that drivers and drivers’ helpers who are subject to the Federal Motor Carrier Act (MCA) are exempt from COMPS Order 37’s overtime and meal and rest period requirements when they are:

  • Working on MCA-covered non-passenger vehicles, or on MCA-covered passenger vehicles qualifying as “commercial motor vehicles” requiring a commercial driver’s license (CDL); and
  • Paid compensation equivalent to at least 50 hours at the Colorado minimum wage with overtime, i.e., $677.60 per week in 2021, regardless of whether the pay is hourly, salaried, piece rate, or on another basis.

Colorado’s minimum wage adjusts annually for inflation, so this minimum can be expected to increase in subsequent calendar years.

In addition to setting this heightened minimum wage requirement, COMPS Order 37 differs from the federal MCE in that it excludes from exemption:

  • Loaders and mechanics of motor carriers; and
  • Drivers and driver’s helpers on “passenger vehicles” that do not qualify as “commercial motor vehicles” requiring a CDL (e.g., vehicles that transport workers to and from manual work jobs).

COMPS Order 37 is a significant departure from the Division’s interpretation earlier this year of “interstate transportation workers” in COMPS Order 36, issued in March 2020.  COMPS Order 36 only exempted interstate transportation workers from Colorado’s wage and hour provisions if they crossed state lines.  The Division noted this rule was meant to codify a recent decision from the Colorado Court of Appeals.1  However, Colorado employers had generally understood the state to follow the federal MCE before COMPS Order 36 was issued, as the Tenth Circuit had consistently held.2  Indeed, just days before COMPS Order 37 was issued, a separate Colorado Court of Appeals acknowledged this and created a split of authority by holding interstate transportation workers did not have to cross state lines to qualify for this exemption under the yearly minimum wage orders issued prior to COMPS Order 36.3

When the Division’s Proposed COMPS Order 37 continued to include the requirement to cross state lines from COMPS Order 36, industry groups, including Littler on behalf of the National Armored Car Association, submitted comments to the Division emphasizing the financial and operational burden that this inconsistent regulatory regime would impose on motor carriers.  Citing these comments, the Division reversed course by eliminating the requirement to cross state lines in COMPS Order 37. 

While the new rule will provide significant relief for the motor carrier industry, employers should be mindful of the areas where COMPS Order 37 differs from the MCE.  Moreover, employers should continue to comply with COMPS Order 36 until COMPS Order 37 takes effect on January 1, 2021.

See Footnotes

1 Brunson v. Colorado Cab Co., 2018COA17 (Feb. 8, 2018) (analyzing Colorado Minimum Wage Order 35 and holding it required employees to cross state lines to qualify as an “interstate transportation worker”).

2 Deherrera v. Decker Truck Line, Inc., 820 F.3d 1147, 1161 (10th Cir. 2016); Combs v. Jaguar Energy Servs., LLC, 683 F. App'x 704, 705–07 (10th Cir. 2017).

3 Gomez v. JP Trucking, Inc., 2020COA153 (Nov. 5, 2020) (analyzing Colorado Minimum Wage Order 35 and holding it did not require employees to cross state lines to qualify as an “interstate transportation worker”).

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.