California Exxon Subcontractor On-Call Claim Settled for $2.3M

In recent news, an electrical subcontractor for ExxonMobil Corp. and Freeport McMoRan Oil & Gas agreed to a settlement to resolve employment law violation claims related to on call workers without pay. The $2.3 million settlement will resolve allegations that workers were due back pay after they were on duty at all hours and were not allowed to leave the offshore oil and gas platforms.

102 workers were involved in the claims based on both the Fair Labor Standards Act (FLSA) and California law. The proposed class action lawsuit listed Ardent Companies, Inc. as the Defendant. Allegations were made that the Defendant in the case required their employees to remain on-call at all times: during meal breaks, during rest periods, when they were not scheduled for a shift. The lead plaintiff in the case claimed that while employees were provided meals and lodging as a condition of their employment, the value of those benefits wasn’t included in their “regular rate” of pay when calculating any overtime pay due to workers.

The Defendant, Ardent, argued that the workers were appropriately compensated for their time and that California state wage and hour law requirements were not applicable to the situation because the platforms where the employees fulfilled their job duties were located in federal waters and that employees were able to leave the platform upon request.

The plaintiffs’ case was supported by a pending case scheduled to be heard by the U.S. Supreme Court in April. The 9th U.S. Circuit Court of Appeals reversed the lower court’s dismissal of the case, Newton v. Parker Drilling Mgmt. Servs, Ltd. They held that state minimum wage and overtime law were applicable to the case rather than FLSA in reference to the oil platform workers involved in the case working on the Outer Continental Shelf. A decision on this case is expected in June.

This is good news for California workers as California employment laws tend to offer more protection to employees than their federal counterparts – and on-call work is no exception to this trend. Under FLSA, employees are generally considered on call if they are required to remain on the job site/the employer’s premises. Employees who are to remain on call at home or who are required to leave a message where they can be reached, are not (in most cases) considered on call according to federal law. Exceptions may occur in situations where there are additional constraints on the employee’s freedom.

California state employment law, on the other hand, entitles employees to pay under a wider scope of circumstances. For instance, California state court recently expanded the requirements with the finding that on-call workers may be entitled to pay even when they are not scheduled to work (see Ward v. Tilly’s, Inc., B280 151 (Cal. App. Ct. Feb. 4, 2019)). In the Tilly’s case, workers who were required to call in hours before their shift to verify if they were scheduled or not, were not paid unless they were actually called in to work. The court agreed with the plaintiffs in the case that employees calling in hours before their shift constituted “reporting for work” and as such, they were entitled to pay under state law even though, ultimately, they were not required to work their shift.

If you have questions about California wage and hour law or if you need to discuss wage and hour or overtime requirements, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

$4M Settlement in Rangoon Ruby Chain Restaurant Wage Theft Suit

Workers at Rangoon Ruby chain restaurant who claimed they were on call but denied overtime wages will receive a settlement. The Burmese restaurant agreed to pay $4 million to about 300 workers to settle the California wage theft lawsuit. The settlement amount represents the money owed in unpaid wages plus penalties to workers.

What is Overtime? The federal overtime provisions are included in the Fair Labor Standards Act (FLSA). Unless an employee is exempt, they are covered by the Act and employers should provide them with overtime pay for hours worked over 40 in a workweek at a rate not less than time and one-half their regular rate of pay.

The workers who filed suit against Rangoon Ruby described their unpaid overtime work as being “on call.” The restaurant chain owners, Max Lee and John Lee, operates in San Francisco, San Carlos, Burlingame, Belmont, and Palo Alto (where the same management team also runs Burma Ruby Burmese Cuisine). The workers alleged the work requirements left them frustrated and tired and working extra hours without extra pay.

Another plaintiff in the case claimed that the working conditions at Rangoon Ruby left her feeling ill. When she sought time off to see a doctor, Rangoon Ruby management denied her time off request. When she went to the doctor anyway, the restaurant docked her pay even though state law requires employers to provide workers with one hour of paid sick leave for every 30 hours worked. Other workers claimed they were summoned for unscheduled shifts without overtime pay in order to cover delivery orders. Since many of the workers were housed in dormitories by Rangoon Ruby, the situation was particularly sensitive because they relied on the restaurant not only for work, but for housing as well.

This settlement agreement is one in a string of victories for restaurant workers in the Bay Area. If you are not being paid overtime wages or if you need to discuss what your rights are in the workplace, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.