Dan Prokott Comments on Overtime Wages With Minnesota Lawyer

In “Workers Paid Daily Rate Entitled to Overtime Pay, High Court Rules,” Minnesota Lawyer turned to labor and employment partner Dan Prokott for his commentary on overtime wages under the Fair Labor Standards Act following a U.S. Supreme Court ruling that a highly compensated offshore oil rig worker was entitled to overtime pay.

Prokott commented, “Employers who have been paying employees on a daily rate basis, including ‘highly compensated employees’ earning at least $107,432 annually, without paying overtime for hours worked in excess of 40 hours in a workweek, should review their pay practices.”

"Importantly, the Fair Labor Standards Act permits an employer to pay an exempt employee — one who otherwise satisfies the salary-basis test and an applicable duties test to qualify as an exempt employee — additional compensation beyond the employee’s regular salary, including for extra hours or days worked in a workweek, without losing the exemption or violating the salary basis requirement,” explained Prokott.

Prokott also noted, “Therefore, it’s possible one effect of the Supreme Court’s decision could be that certain employers who have been paying workers based on a daily rate without overtime pay could pivot to paying a guaranteed minimum salary of at least $684/week (perhaps significantly higher than this amount in some industries) plus additional compensation based on the number of days worked by the employee during the workweek or other criteria.”