Ohio Refinery Ordered to Pay Nearly $1 Million in Owed Overtime Pay

Lima, OHHusky Energy has agreed to pay refinery workers in Lima, Ohio, nearly one million dollars in back wages to resolve an employee overtime pay dispute. The US Department of Labor (DOL) ruled that 173 workers will collect from a fund totaling $969,182.

It should be noted that Husky Energy was continuing the wage practices already put in place by Valero Energy, from whom Husky purchased the refinery in May 2007. Husky spokesperson Graham White told the Lima News on 3/5/10 that the company believed the wage practices to be fair and within the law.

"It is Husky's view that the Valero system and the Husky system of compensating 12-hour shift employees are proper under the Fair Labor Standards Act," White said.

According to the Lima News, the DOL initiated a two-year investigation in March 2007 that ended in March 2009. During that time, the department noted that Husky Energy Corp. initiated a switch from eight-hour shifts to 12-hour shifts for some of its workers. What resulted were workweeks alternating between 60 and 24 hours.

Rather than paying employees the standard overtime rate of time and one-half for any hours beyond 40 per week, the company established an "adjusted" rate, whereby all hours were compensated equally.

The Department of Labor ruled that the practice was a violation and contravention of overtime laws. It further noted that the employer failed to include a shift differential in overtime pay. An employer is not required by law to provide a shift differential, but if it does, the employer must include it as part of the employee's regular rate of pay for purposes of computing overtime.

"Employers must give their workers the fair and proper compensation to which they are entitled," said Hilda L. Solis, the US Secretary of Labor. "That is the law. My department is committed to ensuring that it is followed, and we will continue to hold violators accountable."

The ruling, announced on March 4 by the Department of Labor's Wage and Hour Division, determined that the company violated the overtime pay provisions of the Fair Labor Standards Act. The Lima News reported that the company was notified of the ruling prior to the announcement and that it duly paid the back wages.

Husky also agreed to establish bone fide rates for the calculation of overtime in the future. He agreed to include shift differentials in the regular rate of pay for the purposes of calculating overtime going forward.