Trusted For

What the recent Supreme Court ruling means for overtime pay

There is just enough nuance in overtime law for workers to find the rules confusing. Typically, hourly workers have a right to overtime wages, but those paid on a salary basis often do not receive overtime pay. Of course, there are exceptions to this rule, as those who receive a low salary are not always exempt from overtime pay requirements.

Companies frequently try to find ways to get as much work as possible for the least amount of pay. Finding ways to avoid overtime wages is a common corporate practice. Managers and those in human resources might also outright lie to workers about their eligibility for overtime wages. The company may also have a strict policy forbidding overtime or requiring written permission for it.

Many workers experience wage theft conducted by employers, and such financial misconduct often involves unpaid overtime. A recent federal Supreme Court ruling could have major implications for those putting in long hours at a company that offers them daily wages.

The Court rules that daily pay is similar to hourly pay

The contract between a worker and a company determines how much compensation the worker receives and the basis on which the company calculates their wages. Although many non-salaried workers receive pay on an hourly basis, some will instead receive a flat rate for pay for every day that they work.

Many businesses treat a daily pay rate like a salary and act as though their employees are exempt from overtime requirements. However, that exact situation led to a wage claim against a company operating an offshore oil rig.

The case ended up going all the way to the Supreme Court, and the ruling was in favor of the workers rather than the business. Those paid a daily rate do not receive the same wages weekly but rather different pay depending on how much they work. Therefore, they typically have the right to overtime pay.

What this ruling means for workers

This case could help set the stage for many future wage claims. Employees in many industries may recognize that they have a right to pursue an overtime claim because of their daily pay arrangements. Recognizing when an employer has failed to comply with fair wage standards could help workers pursue a wage claim successfully.