Employer Guide

Pay and Overtime for Oilfield Crews: FLSA Basics

Payroll mistakes on oilfield crews usually come down to three questions: what counts as hours worked, who is exempt from overtime, and what records hold up when a wage claim is filed. This article covers the FLSA basics an employer or payroll manager needs.

The FLSA baseline

The Fair Labor Standards Act sets the federal floor for pay. It applies to most employers doing business across state lines, which covers nearly every oilfield operation. Two rules matter most. Employees must be paid at least the federal minimum wage for every hour worked. Nonexempt employees must get overtime at one and a half times their regular rate for every hour over 40 in a workweek.

A workweek is a fixed, recurring seven-day period the employer chooses; it need not match the calendar week or pay period. Hours cannot be averaged across two weeks: a crew that works 60 hours one week and 20 the next owes overtime on the 20 extra hours; the light week does not cancel them.

Coverage is broad: enterprises that reach a certain level of annual business, and individual employees engaged in interstate commerce. In practice, almost every oilfield employer and employee falls under the law.

What counts as hours worked

The Department of Labor's rules for counting hours live in 29 CFR Part 785. The principle is simple: hours worked is all time an employee is suffered or permitted to work, plus time they are required to be on duty or at the worksite.

Waiting time counts when the waiting is part of the job. A roustabout sitting at the shop waiting for a crew assignment is usually working; entirely free time generally does not count.

Travel during the workday counts as hours worked; commuting from home to the first job site, and back, does not. That is where oilfield shifts get tricky. A crew that reports to the yard, loads up, and drives two hours to location is working during that drive; a crew that drives straight from home to location and back is commuting.

On-call time counts when the employee is so restricted they cannot use the time for themselves. A pumper who checks in by phone every few hours is likely not working between calls; one who must stay at the facility, minutes from a well, likely is.

Meal breaks count as hours worked unless they run at least 30 minutes and the employee is completely relieved of duty. A crew eating in the truck while the supervisor drives to the next location is not relieved.

Oilfield shifts blur these lines. Rotations, standby pay, travel between wells, waiting on weather, waiting on cement: the question is always whether the employee is engaged to wait or waiting to be engaged.

Who is exempt from overtime

The white collar exemptions under 29 CFR Part 541 remove executive, administrative, and professional employees from the overtime rules. The tests are strict, and the employer carries the burden of proving an exemption applies.

Three things must line up: the employee is paid on a salary basis at or above the salary level set by the Department of Labor; the primary duty matches the exemption; and the actual work, not the job title, drives the result.

Executive: primary duty is managing the enterprise or a recognized department, with authority to direct the work of two or more employees and real say over hiring and firing. Administrative: primary duty is office or non-manual work tied to management or general business operations, done with discretion and independent judgment on significant matters. Professional: primary duty requires advanced knowledge in a field of science or learning, usually earned through a degree.

A working supervisor who spends most of the shift on the tools is usually not exempt; the primary duty is the manual work. Exempt employees must also be paid a full salary for any week they perform work; docking pay for partial-day absences can break the exemption for everyone in the same classification.

The drivers question

Trucking has its own corner of FLSA law. Section 13(b)(1) exempts employees whose hours are subject to the Secretary of Transportation's motor carrier jurisdiction. When it applies, the driver sits outside the overtime rules, though minimum wage protection stays.

The test depends on the driver's duties and the class of vehicle, not the employer's industry. An oilfield water hauler in a qualifying truck is treated differently from a frac crew member who never drives. Many oilfield drivers are therefore paid by the mile or by the load rather than by the hour, and that is legal when the exemption applies.

Drivers who do not qualify get overtime like everyone else, so classify each driver by what they haul and drive and write down the basis. DOT hours of service rules govern how long a driver may stay behind the wheel; they are not pay law. See our guide to DOT hours of service for oilfield trucking for that side of the clock.

Records you should keep

The FLSA requires time and pay records for each employee, kept for at least three years. The records need not be elaborate, but they must be complete: name, address, occupation, hours each day and each workweek, regular rate of pay, overtime earnings, and deductions.

A good timesheet is the cheapest insurance in payroll. When a wage claim is filed, the agency asks for the records, not for your word. If the records are missing or sloppy, the hours the employee claims can become the starting point.

Record what matters: start time, stop time, breaks, and the job or ticket each shift is tied to. A crew member who clocks in at 5 a.m., eats in the truck, and works three locations should have a record that shows the whole day. Field tickets and timesheets are the same event from two sides; when they line up, billing and payroll get easier. See the field ticket to invoice workflow for that flow.

A timesheet that captures start, stop and break times, attached to the shift, is what software like OpsFlo does well.

OSHA recordkeeping is separate, but the two paper trails overlap: a recordable injury is often a day when the hours worked are also in dispute. See OSHA recordkeeping for oilfield employers for the injury side.

Sources and further reading

• eCFR 29 CFR Part 785: Hours worked
• eCFR 29 CFR Part 541: Overtime exemptions