Common Overtime Violation- Oil & Gas Industry

Kayla Moreland , May 13, 2015

Common Overtime Violation- Oil & Gas Industry
Common Overtime Violation- Oil & Gas Industry

Workers frequently work over 40 hours a week in this rapidly growing industry, sometimes even up to 100 hours per week.  With much of the work sub-contracted out to smaller companies, the structure of the oil and gas industry certainly makes it “an industry ripe for noncompliance,” as stated by Dr. David Weil, administrator of the Wage and Hour Division.  Investigators for both state and federal government agencies have specifically targeted this industry over the past few years.  By August of last year, the Department of Labor’s investigations resulted in over $13 million in back wages to over 9,100 employees.  There are numerous jobs in this industry that may be entitled to overtime pay, including compressor operators, roustabouts, pumpers, directional drillers, service supervisors, oilfield delivery specialists, rig operators, instrument fitters, electricians, mechanics, and truck drivers.

Employers can use many different tactics to avoid paying the required minimum wage and overtime pay to employees.  You should be aware of 3 common violations:

1. Misclassification.  One major issue facing oil and gas workers is misclassification—where employers treat full-time nonexempt employees as independent contractors to avoid the overtime obligations under the FLSA.   Keep in mind that your day-to-day job duties and actual employment relationship determine whether you are exempt from overtime pay, not your job title.  To make this determination, courts will look to:  the degree of control your employer exercises over you, the skill required for your job, whether the services you provide are an integral part of the overall business, and your investment in any materials or equipment.

2. Travel time.  Workers will often travel from drill site to drill site   For example, employees working in the field may be required to report to a central office location at the beginning and end of each shift, but travel to various assignment locations throughout the day.  These employees should be compensated for all travel from the time they leave the central office location until they return at the end of their shift.

3. Day-rate plans. Workers paid on a day rate basis receive a flat rate per day, regardless of the number of hours worked.  But this does not eliminate your employer’s obligation to track hours or pay overtime compensation—this common method of payment may still violate the FLSA if nonexempt employees do not receive time-and-a-half for hours worked over 40 a week.

Questions? Learn more at www.barkanmeizlish.com.
Source: WHD News Release, US Labor Department helps more than 5,300 Pennsylvania and West Virginia oil and gas workers recover $4.5M in back wages for unpaid overtime (Dec. 9, 2013) http://www.dol.gov/opa/media/press/whd/WHD20141883.htm   

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