COVID-19 has the potential to create a variety of wage and hour complications and may put employers at risk for violations under the Fair Labor Standards Act (FLSA). This is especially true for oil and gas companies, given the industry’s unique reliance upon both skilled field workers and knowledgeable office staff.
Oil extraction cannot be done remotely. It is a very complex operation requiring considerable determination and sophistication to be combined in very specific locations. Yet, the precautions taken to prevent COVID-19 outbreaks in these complicated environments may have consequences under the FLSA and other wage and hour laws. Understanding these complications is the first step towards developing strategies for avoiding costly wage and hour litigation.
Many of the precautions used to protect workers are commonly cited by the Center for Disease Control (CDC). These mitigation risks include: limiting the number of people in a given area, accommodating frequent hand sanitation and providing personal protective equipment (PPE) to ensure a sanitary work environment. While these precautions have obvious impacts on office workers, field workers, too, are impacted, but differently. For instance, limiting building capacity might mean fewer workers accessing dressing or staging facilities — which leads to a line of workers waiting outside. Prohibiting workers from sharing tools might mean that every worker has to wait in line to be fully outfitted before each shift. Requiring everyone to wear PPE means each worker has to stop and apply or replace their mask and gloves each time they anticipate coming into contact with another.
These examples of what appear to be small delays can add up over the course of a full workweek. But, understanding the potential wage and hour ramifications of those delays is important because minor errors can lead to catastrophic liability under the FLSA. For instance, in Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1044 (2016), the employer had a policy requiring workers to apply company-issued equipment that was meant to protect workers from cutting themselves while processing hog carcasses. It only took workers approximately eighteen minutes to apply and remove the protective equipment. (Id. at 1039.) The time it took employees to put on and remove protective gear was ultimately deemed compensable. The employer’s failure to pay employees for the time spent on PPE led to a $2.9 million jury verdict. See id. at 1044.
While every situation is different, cases like Tyson Foods show that time spent applying protective equipment might be considered compensable. In the past, the Supreme Court of the United States required compensating workers for time spent on hygienic measures necessary to protect themselves from “compounds [that] are toxic to human beings” because those measures were integral to the completion of principal activities. Steiner v. Mitchell, 350 U.S. 247, 249-53 (1956). So, it is plausible that courts could deem time spent by workers on hygienic measures necessary to protect themselves from a virus to be compensable under the FLSA as well.
What measures can companies take to avoid serious wage and hour complications while adhering to COVID-19 safety requirements? These measures are worksite specific. The starting point is to determine whether the COVID-19 precautions in use at any given worksite are causing delays that might require workers to arrive earlier or leave later than they normally would. For instance, field workers may have to stay late to sanitize tools, or office workers might need to arrive early to get their temperature checked. In either scenario, it might be possible to revise the precautions to minimize FLSA exposure while providing legally sufficient COVID-19 precautions. Extensive delays might warrant revisiting clock-in procedures to provide compensation instead of risking litigation. The COVID-19 pandemic has brought a great deal of uncertainty. The oil industry is particularly sensitive to its impact because it relies upon concentrated worksites featuring a great deal of interdependence between office and field workers.
Proactively partnering with legal counsel can help clarify some of the wage and hour issues that will likely result from the COVID-19 pandemic. Experienced legal counsel can help develop strategies to mitigate the wage and hour exposure created by this workplace interruption.
About the authors: Annette A. Idalski is a shareholder and the National Chair of Chamberlain Hrdlicka’s Labor & Employment Practice. She may be reached at [email protected] James Fielding is an associate in the practice.