Oil Workers’ Overtime Class-Action Lawsuit a Wake-up Call for Businesses

A federal appellate court ruling last week resurrected a class-action lawsuit filed by a group of oilfield workers who say their employer failed to pay them the overtime they are entitled to under the law. The Fifth Circuit opinion in Dewan v. MI LLC found that the overtime lawsuit filed by the employees of Schlumberger subsidiary M-I SWACO had been wrongly dismissed by a lower court. According to the opinion, jurors should ultimately determine whether the workers are allowed overtime pay under a series of tests spelled out in the Federal Labor Standards Act (FLSA).Overtime lawsuits have spiked in recent years, particularly in the energy sector, and the Fifth Circuit ruling in this case should cause businesses to take a close look at their payroll practices and ensure that they are in compliance with the FLSA wage-and-hour guidelines, says employment law attorney Audrey Mross of Dallas’ Munck Wilson Mandala.The FLSA’s administrative exemption is routinely misapplied by employers, and this case is a wake-up call to businesses that use a loose interpretation of the ‘duties test’ in order to obtain the desired outcome of exempt status,” said Ms. Mross. Employers may have breathed a sigh of relief when the planned December 2016 doubling of the minimum salary for most FLSA white-collar exemptions was put on hold via an injunction. And they may be assuming that agency enforcement of FLSA classification will wane as the DOL faces a 20 percent cut in its annual budget under the new Trump administration. But this case is a good reminder that individuals and groups of employees can still file lawsuits and the judiciary will hear their plea. The biggest take-away here is that these FLSA classification disputes may not be resolved via summary judgment, meaning employers leave their fate in the hands of a jury, who are often pre-disposed to favor employees in these types of cases.


For more information, please contact Robert Tharp at 800-559-4534 or robert@androvett.com.

Are you ready to get started?