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Overtime compensation for Oilfield workers

Understanding the Fair Labor Standards Act (“FLSA”) and how that plays a role in calculating overtime compensation especially in the oilfield industry can be challenging and frustrating at times; however, if compensation is calculated correctly, it can be extremely rewarding. Essentially, the FLSA was passed in an effort to “protect all covered workers from substandard wages and oppressive working hours.” Meza v. Intelligent Mexican Mktg., Inc., 720 F.3d 577, 581 (5th Cir. 2013). FLSA requires that employers pay employees “at a rate not less than one and one-half times the regular rate” of pay for any hours the employees work in excess of forty during the workweek. 29 U.S.C. § 207(a)(1).

The FLSA broadly defines ‘regular rate’ as the hourly rate actually paid the employee for ‘all remuneration for employment.’ Gagnon v. United Technisource, Inc., 607 F.3d 1036, 1041 (5th Cir.2010) (citing 29 U.S.C. § 207(e). Federal law imposes an obligation on employers to keep adequate record keeping of an employees hours. See 29 U.S.C. § 211(c). Failure to do so does not place blame on the plaintiffs and as such, plaintiffs are entitled to provide any evidence they may have (including their own recollections) showing the number of hours they worked and in turn how much they may be owed in unpaid overtime.

For example, a district court in Texas certified a class of “current and former employees of Defendants who delivered sand to Defendants’ oilfield customers for use in fracking operations.” Olibas v. Native Oilfield Services, LLC, 104 F. Supp. 3d 791 (ND Tex. 2015). The Plaintiffs argued that Defendants violated the FLSA by failing to pay Plaintiffs overtime compensation for their off-the-clock overtime hours waiting to be assigned a truck or for their trucks to be loaded/unloaded. Trucks trigger an exemption under the FLSA called the Motor Carrier Act Exemption, which provides overtime exemption for employees…who are drivers, driver’s helpers, loaders, or mechanics whose duties affect the safety or operation of motor vehicles in transportation on public highways in interstate or foreign commerce. 29 U.S.C. § 213; 29 U.S.C. § 13(b)(1).

On August 5, 2014, the jury returned a verdict in favor of the Plaintiffs, which included a number of findings. Olibas, 104 F. Supp. 3d at 795.

  1. First, the jury concluded that Plaintiffs proved “that Defendants failed to pay” each Named Plaintiff “one and one-half time his or her regular rate of pay for `hours worked’ over forty during any 7-day workweek at Native Oilfield.” Id.
  2. Second, the jury found that Plaintiffs had also established “that the Defendants failed to pay Plaintiffs overtime pay in accordance with the FLSA.” Id.
  3. Third, the jury next determined that Plaintiffs proved that they worked different “number of unpaid overtime hours… on average during the workweeks in which [they were] employed as truck drivers.” Id. at 19.
  4. Next, the jury found that Defendants failed to establish “each essential element of the Motor Carrier Act Exemption as applied to the Plaintiffs as a group.” Id. at 17.
  5. Lastly, the jury concluded that Plaintiffs additionally proved “that Defendants’ FLSA violations were `willful.’ Id.

The district court found that the Plaintiffs were entitled to a final judgment on their FLSA claims, awarding them well over $2 million dollars in unpaid overtime compensation and liquidated damages. The court reasoned and said because the plaintiffs did not have evidence from which the Court may precisely compute their regular rates of pay, the plaintiffs could offer approximates drawn primarily from the testimony offered at trial. Olibas was ultimately affirmed on appeal. This case is illustrative of the fact that oilfield workers are denied rightful overtime compensation for tasks and duties performed outside their usual 40 hour workweek. Employers who fail to keep adequate records of their employees’ hours may find themselves shoveling out loads of money in order to adequately repay their employees their wages for any hours worked overtime.

If you or a family member or friend have questions regarding whether you might be entitled to additional overtime pay, consider speaking with an experienced overtime attorney. Josh Borsellino is an overtime attorney licensed in Texas that represents workers who have been paid unfairly because of their fluctuating hours. Josh fights for the rights of workers that have been denied overtime pay. Josh accepts overtime cases on a contingency basis, meaning that he only gets paid if money is recovered from the company being sued. Josh provides free consultations for anyone with questions about overtime pay. He may be reached at 817.908.9861 or 432.242.7118.