MEMORANDUM OPINION & ORDER
Bеfore the Court is Defendant Redland Energy Services, LLC’s (“Redland”) Motion for Summary Judgment (Doc. 16), Memorandum Brief in Support (Doc. 17), and Statement of Facts (Doc. 18); Plaintiffs’ Response in Opposition (Doc. 26) and Memorandum Brief (Doc. 27); and Defendant’s Supplement to Motion and Reply to Plaintiffs’ Response (Doc. 28). For the reasons discussed herein, Defendant’s Motion (Doc. 16) is GRANTED.
I. Background
This matter was instituted on behalf of Plaintiffs Roy Abshire, David L. Cole, William McMurray, J.C. Greenbush, and Steve Trent, individually, and as representatives of all those similarly situated, for alleged violations of the wage and hour requirements of the Fair Labor Standards Act (“FLSA”). Plaintiffs are hourly employees of Redland who worked on oil drilling rigs. Their shift schedule consisted of 12-hour shifts each day, seven days per week from Tuesday through Monday, every other week. Prior to June 2009, Plaintiffs worked according to this schedule aрproximately 84 hours per workweek, of which 44 hours were overtime hours paid at a rate of time-and-a-half.
In June of 2009, Redland distributed a memorandum to Plaintiffs and all other oil rig workers informing them that the payroll рeriod would be changed to run from Sunday to Saturday rather than Tuesday to Monday. Even though the payroll period changed, Redland kept the rig workers’ Tuesday to Monday shift schedule the same.
Plaintiffs filed a Complaint (Doc. 1), followed by an Amended Complaint (Doc. 3) in November 2010, alleging that Redland’s decision to change the payroll period with
It is undisputed that both before and after the payroll period change rig employees each worked at least 84 hours over a seven-day period, every other week; but after implementation of the new payroll policy, rig employees received less overtime compеnsation than before the policy went into effect. It is Redland’s position that it changed the payroll policy for rig workers in order to create uniform payroll administration so that all Redland employees would be on the same payroll schedule.
In January 2011, a few months after Plaintiffs filed the instant lawsuit, the Department of Labor (“DOL”) conducted an onsite FLSA investigation into whether Redland violated the apрlicable overtime laws. The DOL investigator concluded that Redland had not violated the FLSA in aligning its rig employees’ pay period with that of the rest of the company. The investigator’s Narrative Report (Dоc. 16-3) noted that no violations of the FLSA had occurred based on her review of the employer’s records and employee interview statements. Further, the investigator specifically addressed Plaintiffs’ сomplaint about the company pay period differing from the oil rig crews’ work schedule of Tuesday through Monday each week. The investigator observed in her report: “Overtime is based on the emplоyer’s established work week Sunday through Saturday and not the employee’s work schedule.” She also observed that even though the drilling crews worked Tuesday through Monday, the other Red-land employees, including the “wоrk over crew” and the office staff, worked Sunday through Saturday, which matched the company-wide payroll schedule.
The DOL investigator did not include the named Plaintiffs in her investigation because their lawsuit against Rеdland was then pending; however, the investigator interviewed other rig workers by telephone who worked the same job and had the same work schedule as the named Plaintiffs. Ultimately, DOL found that Defendant Redland had nоt committed any violation of the FLSA, including the overtime compensation violation that is the subject of the instant lawsuit.
II. Legal Standard
Summary judgment should be granted “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). In reviewing a summary judgment motion, the court must view thе facts and inferences from the facts in the light most favorable to the non-moving party, and the burden is placed on the moving party, to establish both the absence of a genuine issue of material fact аnd that it is entitled to judgment as a matter of law. See Fed. R.Civ.P. 56(c); Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
In order to withstand Defendant’s motion for summary judgment, Plaintiffs must substantiate their allegations with “sufficient probative evidencе that would permit a finding in his favor on more than mere speculation, conjecture, or fantasy.” Gregory v. Rogers,
III. Discussion
Federal regulations state that an employer’s designation of a work week may not be “designed to evаde the overtime requirements of the [Fair Labor Standards] Act.” 29 C.F.R. § 778.105. There is little legal authority generally, and none in Arkansas specifically, regarding whether an employer’s decision, to change its employees’ pay period violates the FLSA when that decision results in a decrease in employee overtime compensation.
In Seymore v. Metson Marine, Inc.,
California is not the only jurisdiction to interpret the FLSA’s overtime requirements in this way. The general rule appears to be that an employer may establish a pay week that differs from its employees’ work week if it is for a legitimate, or bona fide, business reason. This is true even when a change in the payroll schedule results in decreased payments of overtime compensаtion to employees. See Pappas v. The Kerite Co.,
In the instant case, Redland provided a legitimate business reason for changing its work week for payroll purposes. Company officers and staff testified in depositions that the change in the work week was
Although Plaintiffs argue that the true motivating factor behind the pay period change is Redland’s desire to avoid paying overtime to rig workers, this inference is not borne out by the deposition testimony and other documentary proof submitted to the Court. To be clear, the FLSA’s requirements are satisfied onсe a defendant shows that its policy change was made for a legitimate business purpose. That business purpose need not be the exclusive reason for the policy change.
The Court is also рersuaded by the findings of the DOL investigator who examined the particular work week change objected to by Plaintiffs. The investigator found no violations of the FLSA when interviewing Redland’s employees and inspecting payroll records and practices. Generally, an agency’s interpretation of law and its conclusions after investigation are not controlling; nevertheless, such determinations should be given deferеnce “proportional to their power to persuade.” Madden v. Lumber One Home Center of Stuggart,
IV. Conclusion
Accordingly Defendant Redland Energy Services, LLC’s Motion for Summary Judgment (Doc. 16) is GRANTED, and this case is dismissed with prejudice. Plaintiffs’ Motion to Certify Class or for Collective Action (Doc. 21) is DENIED AS MOOT. The parties are to be responsible for their own fees and costs.