Established 1958 ~ Hardball Business Litigation & Complex Negotiations

Pa District Court Rules That Employer Who Paid Its Employees One-And-One-Half Times the Minimum Wage Rate Was Still Required to Pay Overtime Compensations

In Gonzalez v. Bustleton Service, Inc., the Eastern District of Pennsylvania held that an employer who paid its employees one-and-one-half times the minimum wage was still obligated to pay overtime compensation. 2010 WL 1813487 (E.D.Pa. 2010). Plaintiffs were landscape laborers who worked for a varying hourly rate. The “base” wage for each employee ranged from $8.00 – $13.50, but when the Plaintiffs were working on jobs for a government entity that set the applicable wage rate (“prevailing wage jobs”), they were paid nearly double their hourly rate. When Plaintiffs were working on normal jobs and receiving their “base” wage, they were all paid overtime wages in accordance with the FLSA, but Employer failed to pay them overtime when they were working on a prevailing wage job.

Employer argued that the overtime compensation should be based on the employees’ “base” wages, and when the employees were working on the prevailing wage jobs, they were paid above the necessary 150% of their base wage. Plaintiffs’ on the other hand argued that overtime is based on the weighted average of the rates the employee received during the workweek. For example, when an employee worked two different types of work, and received a different hourly rate for each, the overtime rate should be calculated on the average between the two hourly rates.

The Court agreed with Plaintiffs’ arguments and found that the Plaintiffs’ calculation was in accordance with the governing regulation by the Department of Labor. The Court refused to accept the employer’s calculation because, if accepted, this theory could allow employers to withhold overtime compensation if employees are paid one and one-half times the minimum wage.

If you have been denied overtime wages, the experienced Philadelphia employment lawyers at the Law Office Of Sidkoff, Pincus & Green will fight to get you the compensation you deserve. To schedule a consultation, call us at 215-574-0600 or contact us online today. With offices conveniently located in Philadelphia, we serve clients throughout Southeastern Pennsylvania and South Jersey.