Helix Energy Solutions Group, Inc. v. Hewitt
598 U.S. 39
SCOTUS2023Background
- Michael Hewitt worked as a toolpusher on an offshore rig (2014–2017), typically 12-hour days, 7 days/week during 28‑day hitches; paid a high daily rate ($963–$1,341/day) with no overtime, earning >$200,000/year.
- Hewitt sued under the Fair Labor Standards Act seeking overtime; Helix asserted the "bona fide executive" exemption under 29 U.S.C. § 213(a)(1).
- The applicable regulations require three things for the executive exemption: salary‑basis test, salary‑level test ($455/week), and duties test; the HCE rule (§541.601) eases the duties test for employees earning ≥$100,000.
- Two regulatory provisions define "salary basis": §541.602(a) (main rule: pay on a weekly or less frequent predetermined amount, not reduced for variations in days/hours worked) and §541.604(b) (special rule allowing hourly/daily/shift pay to count as salary only if employer guarantees a weekly amount roughly equivalent to usual earnings).
- District Court: granted Helix summary judgment finding Hewitt salaried; Fifth Circuit (en banc) reversed, holding daily‑rate workers fall outside §541.602(a) and qualify as salaried only under §541.604(b), which Helix conceded it did not meet.
- Supreme Court: affirmed the Fifth Circuit—daily‑rate employees are not paid on a salary basis under §541.602(a); such workers can qualify as salaried only by satisfying §541.604(b), which Hewitt’s pay did not satisfy, so he is entitled to overtime.
Issues
| Issue | Plaintiff's Argument (Hewitt) | Defendant's Argument (Helix) | Held |
|---|---|---|---|
| Whether a daily‑rate employee is paid on a "salary basis" under §541.602(a) | Daily pay by day is not a salary; §541.602(a) requires a predetermined weekly (or less frequent) amount | Hewitt received paychecks biweekly that always contained at least the weekly salary threshold, so §541.602(a) is satisfied | Held: §541.602(a) requires a preset weekly (or less frequent) salary and does not cover daily‑rate pay; Hewitt was not salaried under §541.602(a). |
| Whether daily/hourly/shift paid employees can qualify as salaried and, if so, how | §541.604(b) supplies the path for daily/hourly workers; Hewitt’s scheme did not meet §604(b) so he is not salaried | HCE rule (§541.601) stands alone for highly compensated employees and thus §604(b) should not apply to them | Held: §541.604(b) provides a distinct alternative route applicable to both the general and HCE rules; daily‑rate workers qualify as salaried only if §604(b)’s conditions are met. |
| Whether the HCE regulation requires only §541.602(a) or also §541.604(b) to be satisfied | HCE employees must still meet the salary‑basis requirement as defined by the regulations (both §602(a) and §604(b)) | HCE (§541.601) is independent and should not incorporate §541.604(b) | Held: Both §602(a) and §604(b) define the salary‑basis requirement and apply to both the general and HCE rules; §604(b) is not excluded. |
| Whether policy concerns (windfalls, industry costs, retroactivity) justify departing from the regulations | FLSA aims and regulations support overtime coverage for non‑salaried pay; policy arguments do not override clear text | Applying the regulations will impose operational costs, retroactive liability, and purportedly anomalous results for high earners | Held: Policy concerns cannot override clear regulatory text; employers may comply by adopting §604(b) guarantees or converting pay to a true salary. |
Key Cases Cited
- Barrentine v. Arkansas‑Best Freight Sys., 450 U.S. 728 (1981) (FLSA's purposes: eliminate substandard wages and oppressive hours)
- Overnight Motor Transp. Co. v. Missel, 316 U.S. 572 (1942) (overtime protections apply even where regular compensation exceeds statutory minimum)
- Jewell Ridge Coal Corp. v. Mine Workers, 325 U.S. 161 (1945) (high pay does not alone remove FLSA protections)
- Caterpillar Inc. v. Lewis, 519 U.S. 61 (1996) (courts may decide necessary predicate questions even if not the precise question presented)
- Christopher v. SmithKline Beecham Corp., 567 U.S. 142 (2012) (comments on reliance and retroactivity in administrative‑law contexts)
- Helix Energy Sols. Grp. v. Hewitt, 15 F.4th 289 (5th Cir. en banc 2021) (court below holding daily‑rate workers fall outside §541.602(a) and may qualify only under §541.604(b))