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August 2015 Archives

Zannikos and the Fifth Circuit: Highly Compensated Oil Workers May be Exempt from the FLSA

Over the winter, our firm wrote an article about various FLSA exemptions and used the case of Zannikos v. Oil Inspections to illustrate the application of the highly compensated employee exemption. To summarize, in 2012, Vasilios Zannikos, on behalf of all similarly situated employees, filed suit in the United States District Court for the Southern District of Texas against his employer, Oil Inspections U.S.A. He alleged his employer failed to pay him overtime wages pursuant to the Fair Labor Standards Act. Oil Inspections U.S.A. specializes in loss control operations in connection with oil cargo transfers. Zannikos was employed as a marine superintendent. This job required the Plaintiff to monitor and observe oil transfer operations, ensuring they were performed accurately, legally and safely. Plaintiffs served as quality control by inspecting loading and discharge equipment, identifying problems with equipment, safety or calibration, and then recommending remedies to the customers or Oil Inspections. Oil Inspections responded to this suit by filing for summary judgment, alleging marine superintendents were exempt from the requirements of the FLSA because their some of their duties were administrative and they were highly compensated employees. Both parties moved for summary judgment. On January 30, 2014, the District Court entered an order that Vasilios Zannikos was exempt from the FLSA due to the fact he was highly compensated, however the court did not find marine superintendents to be administrative employees. Both parties filed appeals and the Fifth Circuit Court of Appeals affirmed this ruling. Zannikos v. Oil Inspections (U.S.A.), Inc., 14-20253, 2015 WL 1379882, at *1 (5th Cir. Mar. 27, 2015).

The New Overtime: Proposed Rules from the Department of Labor

On July 6, 2015, the Department of Labor (DOL) proposed a new set of requirements for workers who may receive overtime wages. The proposed rule expands the class of overtime eligible employees. The DOL's proposed rules are in direct response to President Obama's executive request to review and revise the current overtime regulations, which currently prevent certain classes of salaried workers from receiving overtime compensation. Specifically, Obama asked the DOL to reevaluate the salary threshold at which employers are no longer obligated to pay employees overtime.

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