Case leads to more workers being labeled contractors
Four years ago, a federal judge in Victoria rejected an overtime case brought by the government and in doing so changed the way many oil field workers are paid.
The U.S. Department of Labor sued Gate Guard Services, alleging the Corpus Christi company misclassified its employees as independent contractors and shorted them on overtime pay. Senior U.S. District Judge John Rainey dismissed the government’s arguments, ruling in 2013 that the workers were independent business owners because they work without supervision, can do what they want when there are no vehicles to log, and can hire substitute gate watchers.
Even though the facts were specific to Gate Guard, Rainey’s decision spurred other energy services providers to reexamine their own workplace relationships. Some security companies have converted their gate watchers to independent contractors, who are typically cheaper to hire because they don’t get health insurance, retirement benefits or vacation time, workplace experts say.
Other companies are relying on the Gate Guard case to defend their own employment practices, including one involving directional drillers. More on that later.
David Moulton, a Houston employment lawyer, points to one security firm to show the impact of the Gate Guard case. Guard 1 Services used to treat its gate guards as employees but switched them to independent contractors after its competitor prevailed against the Labor Department.
Moulton is familiar with the company’s employment history because he is representing a former guard, Espirion Mendoza, who sued Guard 1 recently in Houston federal court on behalf of himself and other guards who controlled traffic in and out of oil drilling sites in South Texas. Mendoza claimed that he and his colleagues worked 168 hours a week, since they’re on duty 24/7, but were only paid for 75 hours.
He is seeking back wages for the other 93 hours.
Jennifer G. Black, the Houston lawyer representing Guard 1, declined to comment .
But Mendoza doesn’t have to fight over employment status because he and his colleagues were still classified as employees when he left his job last year, Moulton said. Other workers don’t have it so easy.
Some of the lawyers who successfully defended Gate Guard are using the same arguments to defend Premier Directional Drilling of Houston, which was sued last year in San Antonio by drillers — called consultants by the company — who claim they were misclassified as independent contractors. The drillers, who are paid a day rate, work at least 84 hours a week but do not receive overtime, according to court documents.
Premier’s lawyer, Annette Idalski, was among the lawyers representing Gate Guard. Neither she nor Premier returned calls seeking comment.
Drillers are like gate guards, according to Premier’s request to the court to throw out the case, in that both work periodically, are free to reject jobs and can work for competitors. The case is ongoing, as is the debate over the responsibilities companies have for the people who work for them.
Other companies are relying on the Gate Guard case to defend their own employment practices.