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                                                                    Exhibit 10.8


      EMPLOYMENT AGREEMENT dated as of January 21, 1997 (the "Agreement")
between Atlantic Express Transportation Corp., a New York corporation with an
office at 7 North Street, Staten Island, New York 10302 (the "Company"), and
Nathan Schlenker, presently residing at 136 Bushnell Road, Mayfield, New York
12117 (the "Executive").

      WHEREAS, the Executive is presently employed by Atlantic Express
Transportation Group Inc. ("Atlantic") under an employment agreement entered
into as of February 28, 1994 (the "1994 Agreement");

      WHEREAS, Atlantic has agreed to transfer (the "Transfer") to the Company,
all of the capital stock of the subsidiaries of Atlantic engaged in the
transportation business (the "Transportation Subsidiaries"); and

      WHEREAS, in connection with the Transfer, the Company will become the
primary employer of the Executive and will provide all compensation and benefits
to Executive, although the Executive will continue to act for Atlantic
hereunder;

      NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth, the parties hereto agree as follows:

            1.    EMPLOYMENT AND DUTIES

            1.1. General. The Company hereby employs the Executive, and the
Executive agrees to serve, as Chief Financial Officer of the Company upon the
terms and conditions herein contained, and in such capacities the Executive
agrees to serve the Company faithfully and to the best of his ability under the
direction of the Board of Directors of the Company (the "Board"). The Executive
also agrees to serve, if elected, at no compensation in addition to that
provided for in this Agreement, in the position of officer or director of
Atlantic and any subsidiary of the Company; provided, however, that such
position shall be of no less status relative to such subsidiary as the position
that the Executive holds pursuant to the first sentence of this Section 1.1 is
with respect to the Company. Both the Company and the Executive acknowledge that
the 1994 Agreement with Atlantic is terminated as of January 15, 1997 and
neither party shall have rights under it thereafter.

            1.2. Exclusive Services. For so long as the Executive is employed by
the Company, he shall devote his full-time working hours to his duties
hereunder. Except for financial consulting services offered to Ronald
Richardson, RTA Corp. and its affiliates and services rendered on behalf of
Atlantic or non Transportation Subsidiaries of Atlantic, the Executive shall
not, directly or indirectly, render services to any other person or organization
for which he receives compensation without the unanimous consent of the Board or
otherwise 
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engage in activities which would interfere significantly with his faithful
performance of his duties hereunder.

            1.3. Term of Employment. The Executive's employment under this
Agreement shall commence on January 15, 1997 (the "Effective Date") and shall
terminate on the earliest of (i) the first anniversary of the Effective Date,
(ii) the death of the Executive or (iii) the termination of the Executive's
employment pursuant to this Agreement; Provided, however, that the term of the
Executive's employment under this Agreement may be extended for a period of up
to three years subject to the approval of the Executive by notice of approval
from the Board to the Executive at least six months prior to the expiration of
the then effective Employment Term (the period commencing on the Effective Date
and ending on the first anniversary of the Effective Date, or such later date to
which the term of the Executive's employment shall have been extended is
hereinafter referred to as the "Employment Term".)

            2.    SALARY

            2.1. Base Salary. From the Effective Date, the Executive shall be
entitled to receive a base salary ("Base Salary") at a rate of $191,227 per
annum, payable in eual installments not less freuently than monthly in
accordance with the Company's payroll practices, with such increases as may be
provided in accordance with the terms hereof. Once increased, such higher amount
shall constitute the Executive's annual Base Salary.

            2.2. Annual Increases. Commencing one year from the Effective Date,
and annually on each anniversary thereafter, the Executive's base salary shall
be increased by the same percentage by which the regional consumer price index
as of the June immediately preceding such anniversary date shall have increased
over such consumer price index as of June of the prior year; provided, however,
that in no event shall such annual increase be more than five percent (5%) nor
less than three percent (3%) of such base salary. Regional consumer price index
shall mean the index as determined by the United States Department of Labor for
the New York, New York - Northeastern New Jersey area based upon the index for
all urban consumers.

            3.    EMPLOYEE BENEFITS

            3.1. General Benefits. The Executive shall receive the following
benefits during the Employment Term:

            (a) the Executive will be eligible to participate in benefit
programs of the Company consistent with those benefit programs provided to other
senior executives of the Company;

            (b) a disability insurance policy providing $6,000 in monthly
benefits commencing six months after a disability which prevents the Executive
from performing the 


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ordinary and necessary functions and duties of his employment; Provided that the
premium therefore shall not exceed the usual and customary rates charged by
underwriters for such a policy for a person of the Executive's age in good
health. At the option of the Executive and in the place of the disability
policy, the Company shall pay the cash euivalent of the premium for such policy
to the Executive (the "Disability Euivalent Payment");

            (c) an automobile allowance of $250 per month plus a company car (as
approved by the Board);

            (d) a life insurance premium allowance of $2,500 payable annually in
February of each year of the term hereof; and

            (e) a travel allowance not to exceed $7,500 annually.

            3.2. Vacation. The Executive shall be entitled to 15 days' paid
vacation each year in accordance with the applicable policies of the Company;
provided, however, that the Executive must utilize at least five (5) vacation
days per contract year during the month of August.

            3.3. Reimbursement of Expenses. The Company will reimburse the
Executive for reasonable, ordinary and necessary business expenses incurred by
him in the fulfillment of his duties hereunder upon presentation by the
Executive of an itemized account of such expenditures, in accordance with
Company practices consistently applied.

            3.4. Severance Payment Upon Termination. Upon expiration of the term
of the Executive's employment, the Executive shall be entitled to severance pay
in the amount of $2,000 per month for a total of 96 consecutive months. In
addition thereto, in the first sixty months following expiration of the term,
the Company shall pay to the Executive an amount which shall eual 50% of the
annual premiums paid by the Executive for major medical health insurance for his
family, provided that in no event shall the Company's payment for such medical
insurance exceed $3,000 per year.

            4.    TERMINATION OF EMPLOYMENT

            4.1. Termination for Cause: Resignation.

            4.1.1. General. If, prior to the expiration of the Employment Term,
the Executive's employment is terminated by the Company for Cause, the Executive
shall be entitled only to twelve months of his Base Salary as severance, payable
in arrears in eual installments not less freuently than monthly, unless such
termination is for a Disloyalty Termination Event, in which case the Executive
shall be entitled only to payment of his Base Salary as then in effect through
and including the date of termination. If the Executive resigns from his
employment hereunder, the Executive shall be entitled only to payment of his
Base Salary as then in effect through and including the date of resignation. The
Executive shall 


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have no further right to receive any other compensation, or to participate in
any other plan, arrangement, or benefit, after such termination or resignation
of employment, subject to the terms of such plans or arrangements.

            4.1.2. Date of Termination/Resignation. The date of termination for
Cause shall be the date of the written Notice of Termination provided for in
Section 4.1.3. The date of resignation shall be the date specified in the
written notice of resignation from the Executive to the Company, or if no date
is specified therein, 10 business days after receipt by the Company of written
notice of resignation from the Executive.

            4.1.3. Notice of Termination. Termination of the Executive's
employment for Cause shall be effected by delivery of a written notice of
termination from the Board to the Executive, which notice shall specify the
event or events set forth in Section 4.2 giving rise to such termination (the
"Notice of Termination")

            4.2. Cause. Termination for "Cause" shall mean termination of the
Executive's employment because the Executive (a) has engaged in fraudulent or
criminal conduct in connection with the performance of his duties hereunder,
which conduct materially and adversely affects the ComPany (a "Conduct
Termination Event"), (b) admits to or has been convicted of a crime punishable
by imprisonment for more than one year (a "Felony Termination Event"), (c) has
failed to perform in all material respects (following a written warning
specifying such deficiency) the normal and customary duties reuired of his
position of employment (a "Performance Termination Event"), (d) has been
disloyal to the Company by assisting competitors of the Company to the
disadvantage of the Company by a breach of Section 6 or by otherwise actively
assisting competitors to the disadvantage of the Company (a "Disloyalty
Termination Event"), or (e) has been identified by the Board of Education of the
City of New York in a notice to the Company (a "BOE notice") that the Board of
Education has elected either not to extend an existing transportation contract
or that it will not accept bids from the Company for a new transportation
contract unless the employment of the Employee is terminated together with
divestiture of the Employee's stock ownership (a "BOE Termination Event")

            4.3. Termination Without Cause. If the Executive is terminated
without Cause, he shall be entitled to the severance provided for in Section
3.4.

            5.    PERMANENT DISABILITY

            In the event the Executive shall fail because of illness, physical
or mental disability or other incapacity, for a period of six consecutive
months, or for shorter periods aggregating six months during any 12-month
period, to render the services provided for by this Agreement, then the Company
shall, by written notice to the Executive after the last day of the six
consecutive months of disability or the day on which the shorter periods of
disability eual an aggregate of six months, reduce the Executive's compensation
hereunder for "Permanent Disability" as follows:


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            First Six Months         No Reduction

            Following 18 months      50% of compensation

            The Executive will use his reasonable best efforts to cooperate with
any physician referred to the Company by the physicians referral service of the
Columbia Presbyterian Medical Center of 622 West 168th Street, New York, New
York, to determine whether or not Permanent Disability exists, and the
determination of such physician made in writing to the Company and the Executive
shall be final and conclusive for all purposes of this Agreement; Provided that
if such physician declines to make a determination as to medical disability, the
matter will be referred to ENDISPUTE of 300 Park Avenue, New York, New York for
resolution, whereby ENDISPUTE shall select a single arbitrator to make a
determination based upon the evidence and testimony submitted by such physician
and no other expert testimony or medical evidence shall be permitted or
considered by such arbitrator. Any payments provided for in this Section 5 shall
be reduced to the extent that such payments, together with any disability
payments received by the Executive under any plan, program or arrangements
including any payment to the employee under Section 3.1(b) exceed the
Executive's Base Salary; provided that if disability payments are received which
are free of federal income tax, the payments provided for in this Section 5
shall be reduced by an amount eual to the pre-tax income which would have been
reuired to produce such payment free of tax based on the marginal tax rate for
the previous tax year of the Executive. Except (i) as to continue to pay the
Executive's medical insurance premiums for a period of 18 months following
delivery of the written notice of "Permanent Disability" to the Executive or
(ii) as otherwise provided in this Section 5, upon delivery of such written
notice, the Company shall have no further obligation to the Executive under this
Agreement.

            6.    NONCOMPETITION, NONSOLICITATION AND CONFIDENTIALITY

            6.1. Noncompetition/Nonsolicitation. The Executive shall not,
directly or indirectly, as a sole proprietor, member of a partnership,
stockholder or investor, officer or director of a corporation, or as an
employee, associate, consultant or agent of any person, partnership, corporation
or other business organization or entity other than the Company: (a) engage in
any business that is in competition with any business actively conducted by the
Company or any of its subsidiaries within (i) the counties then served by the
Company as well as adjacent counties, and (ii) any other counties in which the
Company has made a bid within 24 months prior to the Executive's termination and
any adjacent counties in which the Company conducts business; (b) solicit or
endeavor to entice away from the Company or any of its subsidiaries any person
who is, or was during the then most recent 24-month period, employed by or
associated with the Company or any of its subsidiaries; or (c) solicit or
endeavor to entice away from the Company or any of its subsidiaries any person
or entity who is, or was within the then most recent 24-month period, a
customer, client or prospect of the Company or any of its subsidiaries. The
obligations of this Section 6.1 shall apply for 24 months after termination of
employment of the Executive as well as during employment


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and shall be extended by a period of time eual to any period during which the
Executive shall be in breach of such obligations.

            6.2. Confidentiality. The Executive covenants and agrees with the
Company that he will not at any time, except in performance of his obligations
to the Company hereunder or with the prior written consent of the Company,
directly or indirectly, disclose any secret or confidential information that he
may learn or has learned by reason of his association with the Company or any of
its subsidiaries and affiliates. The term "confidential information" includes
information not previously disclosed to the public or to the trade by the
Company's management, or otherwise in the public domain, with respect the
Company's, or any of its affiliates' or subsidiaries', products, services,
facilities, applications and methods, trade secrets and other intellectual
property, systems, procedures, manuals, confidential reports, product or service
price lists, customer lists, technical information, financial information
(including the revenues, costs or profits associated with any of the Company's
products), business plans, prospects or opportunities.

            6.3. Exclusive Property. The Executive confirms that all
confidential information is and shall remain the exclusive property of the
Company. All business records, papers and documents kept or made by the
Executive relating to the business of the Company shall be and remain the
property of the Company.

            6.4. Injunctive Relief. Without intending to limit the remedies
available to the Company, the Executive acknowledges that a breach of any of the
covenants contained in this Section 6 may result in material and irreparable
injury to the Company or its affiliates or subsidiaries for which there is no
adeuate remedy at law, that it will not be possible to measure damages for such
injuries precisely and that, in the event of such a breach or threat thereof,
the Company shall be entitled to obtain a temporary restraining order and/or a
preliminary or permanent injunction restraining the Executive from engaging in
activities prohibited by this Section 6 or such other relief as may be reuired
specifically to enforce any of the covenants in this Section 6. If for any
reason a final decision of any court determines that the restrictions under this
Section 6 are not reasonable or that consideration therefor is inadeuate, such
restrictions shall be interpreted, modified or rewritten by such court to
include as much of the duration and scope identified in this Section 6 as will
render such restrictions valid and enforceable.

            7.    MISCELLANEOUS

            7.1. Notices. All notices or communications hereunder shall be in
writing, addressed as follows:

            To the Company:

            Atlantic Express
              Transportation Corp.


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            7 North Street
            Staten Island, NY 10302

            Attention: President

            To the Executive:

            Nathan Schlenker
            136 Bushnell Road
            Mayfield, NY 12117

Any such notice or communication shall be sent certified or registered mail,
return receipt reuested, addressed as above (or to such other address as such
party may designate in writing from time to time), and the actual date of
receipt, as shown by the receipt therefor, shall determine the time at which
notice was given.

            7.2. Severability. If a court of competent jurisdiction determines
that any term or provision hereof is invalid or unenforceable, (a) the remaining
terms and provisions hereof shall be unimpaired and (b) such court shall have
the authority to replace such invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision.

            7.3. Assignment. This Agreement shall inure to the benefit of the
heirs and representatives of the Executive and the assigns and successors of the
Company, but neither this Agreement nor any rights hereunder shall be assignable
or otherwise subject to hypothecation by the Executive.

            7.4. Entire Agreement. This Agreement represents the entire
agreement of the parties and shall supersede any and all previous contracts,
arrangements or understandings between the Company and the Executive, including
the Prior Agreement. The Agreement may be amended at any time by mutual written
agreement of the parties hereto.

            7.5. Withholding. The Company shall be entitled to withhold, or
cause to be withheld, from payment any amount of withholding taxes reuired by
law with respect to payments made to the Executive in connection with his
employment hereunder.

            7.6. Governing Law. This Agreement shall be construed, interpreted,
and governed in accordance with the laws of New York without reference to rules
relating to conflict of law.

      IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and the Executive has hereunto set his hand, as of the day and year
first above written.


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                                    ATLANTIC EXPRESS
                                     TRANSPORTATION CORP.

                                        /s/ Domenic Gatto
                                    By: ________________________________
                                    Name: Domenic Gatto
                                    Title: President and Chief
                                           Executive Officer

                                    NATHAN SCHLENKER

                                    /s/ Nathan Schlenker
                                    ____________________________________


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