- An electrical subcontractor for ExxonMobil Corp. and Freeport McMoRan Oil & Gas has agreed to pay $2.3 million to settle allegations that workers were due back pay because they were always on duty and could not leave offshore oil and gas platforms. The settlement resolved both Fair Labor Standards Act (FLSA) and California law claims and affects 102 workers (Orozco v. Ardent Co. Inc., No. 2:18-CV-02763 (C.D. Calif., Feb. 19, 2019)).
- The proposed class action lawsuit alleged that Ardent Companies, Inc., required employees to remain on-call during meal breaks, rest breaks and after the end of their shifts. The lead plaintiff also said that, although he and the rest of the class were provided meals and lodging as a condition of their employment, the value of those benefits was not included in their "regular rate" used to calculate overtime pay.
- Ardent had argued that the employees were properly compensated, that California wage-and-hour laws did not apply because the platforms are in federal waters and that employees could leave the platform upon request.
The plaintiffs' attorneys noted that a case pending before the U.S. Supreme Court had an impact on the settlement negotiations. The ruling, Newton v. Parker Drilling Mgmt. Servs., Ltd., 881 F.3d 1078 (9th Cir. 2018), in which the 9th U.S. Circuit Court of Appeals reversed the lower court's dismissal, held that California's minimum wage and overtime laws — as opposed to the FLSA — apply to oil platform workers on the Outer Continental Shelf. The case will be heard on April 16, with a decision expected in June, the attorneys said.
California employment laws often provide more protection to employees than federal employment laws, and on-call work is no exception. Under the FLSA, an employee is generally considered "on call" only if he or she is required to remain on the employer's premises. "An employee who is required to remain on call at home, or who is allowed to leave a message where he/she can be reached, is not working (in most cases) while on call," according to a U.S. Department of Labor fact sheet; however, "additional constraints on the employee's freedom could require this time to be compensated."
Employees in California, on the other hand, are entitled to pay under more circumstances, as described in a Department of Industrial Relations document. And a California state court recently expanded those requirements, finding that on-call workers can be entitled to pay even when not scheduled to work (Ward v. Tilly's, Inc., B280151 (Cal. App. Ct. Feb. 4, 2019)). In that suit, retail employees were assigned shifts but were not told whether they were actually working until they called in two hours ahead of time. They were not paid unless they were actually told to come in to work, and the court agreed with the plaintiff that employees were "reporting for work" within the meaning of state law when they called in and were therefore entitled to pay even though they were ultimately not required to come in and work that day.