Energy Industry And Wage And Hour Compliance Issues

On February 22, 2023, the United States Supreme Court issued a ruling, in Helix Energy Sols. Grp., Inc. v. Hewitt, No. 21-984, that despite earning in excess of $200,000 annually, an oilfield rig worker was improperly paid and entitled to overtime. The case highlights the struggle of employers to comply with the requirements of the federal Fair Labor Standards Act, despite it having been in effect for 85 years. While this issue regularly appears across numerous industries, it can be of particular concern in the energy sector. Energy companies often pay their workers significant compensation which translates into large overtime liability, if the workers are not properly classified. For example, energy companies often pay their workers on a day rate or classify their regular workers as independent contractors in the mistaken belief that the workers' agreement to be paid in that manner means there is no exposure for overtime. Obviously, the cost savings can be