OT case fits an energy pattern
A former oil field worker at EOG Resources has sued the Houston oil and gas company, alleging that it shorted him and others on overtime pay, in addition to misclassifying employees as independent contractors.
The EOG case is the latest wage dispute to hit the energy industry as oil prices have plummeted and companies have come under increased financial pressure. After uncovering a pattern of questionable pay practices, government regulators stepped up oversight into the industry’s pay practices about four years ago.
Since 2012, the Labor Department has recovered more than $40 million in back wages for oil and gas workers.
That trend has only accelerated with the recent spate of layoffs in the industry as more displaced workers, with nothing to lose, have come forward to complain of underpayments. When times were good, blue-collar employees were working seven days a week and earning as much as $500 a day, said Gavin B. Kennedy, an employment lawyer in Houston.
“They didn’t want to rock the boat,” said Kennedy. But that changed when workers realized they should have been paid overtime, he said, estimating that half of his wage cases involve oil and gas employees.
In a lawsuit filed last week in U.S. District Court in Houston, Derrick Gabrielson, a water operations coordinator, alleged that EOG paid its workers a flat day rate for each 12-hour shift. They often worked seven days a week but were
not paid overtime, according to the lawsuit.
Gabrielson, whose job included rigging oil field equipment and preparing work sites for hydraulic fracturing operations, typically worked more than 40 hours a week, without receiving time-and-half for the additional hours, as required by federal law, according to the lawsuit.
Gabrielson worked for EOG from November 2013 to June 2015, according to the lawsuit. He argued in court documents that by classifying him and his coworkers as independent contractors, EOG Resources sought to get around federal overtime rules that apply to employees. In the lawsuit, Gabrielson said he was never an independent worker, citing the tight control EOG Resources exerted over his job duties.
He is seeking class action status for other oil field workers.
EOG spokeswoman K. Leonard said she couldn’t comment on pending litigation.
Last year, Halliburton paid $18.3 million in back wages to more than 1,000 field workers nationwide, including 380 in Texas, after a federal inquiry found the Houston-based energy company misclassified employees in 28 occupations as salaried professionals and didn’t pay them overtime. The jobs included field service representatives, pipe recovery specialists, drilling tech advisers, perforating specialists and reliability tech specialists.
Halliburton’s payment in the wage case was a record for a Houston-based employer, according to the Labor Department. The average payout was $18,000, with one employee receiving $96,000.
As part of its oil and gas initiative, the Labor Department also recovered $600,000 in back wages last year from a drilling supply company for 121 employees who were paid a flat day rate rather than by the hour. In another instance, more than 2,000 employees at an industrial services provider in Louisiana received $1.9 million because their per diem payments — money generally designed to cover travel expenses but have become a substitute for wages at many energy companies — were not included in overtime calculations. And an oil drilling company paid $600,000 to 133 roughnecks and crane operators who were misclassified as independent contractors.