?A highly compensated employee is eligible for overtime pay, the Supreme Court ruled today in a case that clarifies when highly paid employees are exempt from overtime pay.
In Helix Energy Solutions Group v. Hewitt, the Supreme Court ruled 6-3 that a former employee who made more than $200,000 a year was eligible for overtime pay, as he was paid on a daily basis.
The case hinged on whether being paid at least a minimum amount per day can count as a salary. The court ruled that the defendant company was not paying a salary as defined by the Fair Labor Standards Act and therefore a highly compensated employee was not exempt.
Helix Energy Solutions Group, an offshore oil and gas company based in Houston, claimed its former employee, Michael Hewitt, was exempt from overtime pay because he was a highly paid executive, earning more than $200,000 per year. He claimed he should get retroactive overtime pay because Helix calculated his pay by using a daily rate, and the Supreme Court agreed.
The salary basis requirement is met solely to employees paid by the week or longer, the court stated. “It is not met when an employer pays an employee by the day, as Helix paid Hewitt,” the court said.
From 2015 to 2017, Hewitt worked 28-day “hitches,” living on an offshore oil rig for 28 days at a time and being on-duty for 12 hours each day. His pay ranged from $963 to $1,341 per day. He earned $248,053 in 2015 and $218,863 in 2016, according to court records.
More detailed analysis of the decision will be provided later today.
