Want to cut overtime pay? OK to alter workweek–as long as change is permanent

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in Human Resources,Overtime Labor Laws

Good news for cost-conscious employers: The 8th Circuit Court of Appeals has ruled that an employer is free to change how it designates the workweek as long as it does so “permanently”—even if the sole reason is to reduce overtime pay.

Recent case: Roy and four others worked for Redland Energy Services, which drills natural gas wells. They operated drilling rigs, working 12-hour shifts for seven consecutive days, followed by seven days off.

At first, the company designated their workweek as running from Tuesday to Monday, which meant that Roy and his co-workers earned overtime for some of the hours during their long weeks.

Redland then designated their workweek as running from Sunday to Saturday.

Their actual schedule didn’t change, but now their hours were split over two workweeks, resulting in less overtime pay.

The employees sued, alleging that Redland had manipulated the workweek to deprive them of overtime pay.

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The court said nothing in the Fair Labor Standards Act makes it illegal to change the workweek, even if the result is the reduction of overtime pay. If the change is permanent, it is legal. (Abshire, et al., v. Redland Energy Services, No. 11-3380, 8th Cir., 2012)

Final note: Don’t take this as permission to regularly change your workweek to avoid overtime. The change has to be “permanent,” which is subject to interpretation. Frequent changes aren’t likely to meet the permanency requirement.

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