Texas court expands administrative exemption to FLSA

Recall that all employees are entitled to overtime compensation under the Fair Labor Standards Act (FLSA) unless their duties fall within an exemption. An often-misunderstood exemption is the administrative exemption—in particular, the aspect of the exemption dealing with employees whose duties include “quality control” (QC). Texas employers wondered what QC entails. Wonder no more.

‘Drill, baby, drill!’

Or so goes an expression in the Texas oil patch. Schlumberger Technology helps companies drill oil and natural gas wells in the Texas oil patch. To that end, it employed measurements-while-drilling (MWD) field specialists—yes, a long title for a business card, but the company had its reasons, as we will see—assigned to a customer’s wells.

Two former MWDs sued Schlumberger for unpaid overtime under the FLSA, but the company claimed they were exempt. On appeal, the U.S. 5th Circuit Court of Appeals (whose ruling apply to all Texas employers) looked at whether MWDs qualify for an overtime exemption.