SCOTUS to decide if day-rate employee making $200K a year entitled to overtime

Those familiar with the oil and gas industry know workers are often paid a day rate. For some, the pay can be lucrative. One such worker was Michael Hewitt, a tool pusher for Helix Energy Solutions Group. He was paid $963 each day he worked on a “hitch”—usually a period of two weeks on and two weeks off—and made more than $200,000 annually. Hewitt sued Helix, alleging he wasn’t paid a “salary” as defined by the Fair Labor Standards Act (FLSA) and was therefore entitled to overtime. The U.S. Supreme Court announced it will now determine if his day rate can be considered a salary.

What is a salary?

As a reminder, employees are exempt from receiving overtime pay under the FLSA’s white-collar exemptions if they perform exempt duties and receive a salary. A “salary” is a guaranteed amount that doesn’t change based on the quality or quantity of work.

Currently, an employee must be paid a guaranteed salary of at least $684 a week. Further, the guaranteed salary must bear a “reasonable relationship” to the total amount of compensation the worker regularly receives.

Hewitt’s and Helix’s arguments

Hewitt’s lawsuit is one of the many similar lawsuits, often filed as class or collective actions, that have kept federal courts busy for more than a decade. The tool pusher, as well as litigants in similar lawsuits, argued: