North Dakota Minimum Wage and Overtime Laws
North Dakota has enacted its own state laws regarding overtime pay and minimum wages. As a result, workers in North Dakota are protected by both the federal wage and hour laws (Fair Labor Standards Act – FLSA) and state law.
North Dakota’s overtime pay laws are similar in many respects to federal law but do vary on several points. Non-exempt employees (including those paid a day rate) must be paid 1.5 times their regular hourly rate for all hours worked over 40 in a single workweek. Daily overtime is not required under North Dakota state law. Overtime is calculated on a weekly basis, regardless of the length of the pay period. Also, overtime hours may not be “banked” and used for time off in a later week.
Overtime is based only on hours actually worked – paid holidays, PTO, or sick leave do not have to be counted in computing overtime hours.
Comp time in lieu of payment for overtime is not permitted, except by governmental employers.
State and federal wage law prohibits employers from retaliating against any employee for filing any complaint or starting any proceeding under or related to the wage and hour laws. Employees are protected regardless of whether the complaint is made orally or in writing.
OVERTIME IN THE OIL PATCH
The recent boom in oil and gas fracking activity in North Dakota’s Bakken Shale has created a labor shortage in towns such as Williston, Stanley, Watford City, Belfield, New Town, Tioga, Dickinson and Minot and has led to countless hours of overtime work. The oil and gas drilling industry is one in which overtime pay violations have routinely been found and from which millions of dollars have been recovered for unpaid / underpaid workers. The following are a few examples of common violations:
- Oilfield workers who are paid straight time for overtime (eg $17/hour for all hours worked, including hours over 40 per week)
- Workers paid a set day-rate and no overtime, even though they work over 40 hours per week (common for inspectors, mud loggers / mud engineers /surface loggers)
- Workers who are treated as “independent contractors” instead of employees to avoid paying them time and a half for overtime
- Non-exempt workers who are paid a “salary” and no overtime, even though they work over 40 hours per week and are not involved in management or operations of the company.
- IT / Tech Support workers who are not computer programmers or systems analysts
The following is a sampling of the oil and gas industry jobs that have been subject to overtime wage law violations:
- Pipeline Inspectors
- Top Drive Technicians
- Top Drive Assistants
- Top Drive Mechanic
- Service Supervisors
- Field Office Clerks
- Field Engineers
- Water Truck Drivers
- Pumpers / Field Operators / Lease Operators
- Tool Pushers
- Mud Loggers and Mud Logging Technicians
Employers must follow both the North Dakota state labor laws and United States federal law, which require employers to pay all “employees” a minimum wage and increased rate for overtime. However, there are exceptions that “exempt” certain types of workers. The following is a partial listing of exempt jobs, meaning they are not required to be paid overtime:
- Persons employed in a bona fide Executive, Administrative, or Professional capacity.
- Employees who work for certain motor carriers – including drivers who operate vehicles over 10,000 lbs GVWR in interstate commerce.
- An employee engaged in an agricultural occupation – growing, raising, preparing, or delivering agricultural commodities for market.
- A mechanic paid on a commission basis off a flat rate schedule.
- A straight commission salesperson in retail automobile, trailer, boat, aircraft, truck, or farm implement dealerships unless that salesperson is required to be on the premises for more than forty hours per week.
- A computer professional exercising discretion and independent judgment when designing, developing, creating, analyzing, testing, or modifying computer programs or who is paid hourly at a rate of at least $27.63.
- An employee of a retail establishment if the employee’s regular rate of pay exceeds 1.5 times the minimum hourly rate applicable if more than half of the employee’s compensation for a period of not less than one month is derived from commission on goods or services sold.
The following types of travel time are considered work time under North Dakota wage laws for which an employee must be compensated: 1) Travel during regular work hours, 2) Travel on non-work days during regular work hours (regular work hours are those typically worked by an employee on work days), 3) Travel time from job site to job site or from office to job site, 4) The driver of a vehicle is working at anytime when required to travel by the employer, 5) One-day assignments performed at the employer’s request (regardless of driver or passenger status).
The minimum wage in North Dakota is $7.25 per hour, as of January 2009.
Employees who customarily receive at least $30 per month in tips must receive at least $4.86 per hour (66% of the minimum wage) from the employer, and the employee’s wage and tips must combine to equal at least $7.50 per hour. Tip pooling is only allowed among tipped employees and must be approved by a majority vote (50% +1).
Under North Dakota law, the reasonable value (not more than the employer’s cost and not more than $18 per day) of lodging, board and other facilities provided by the employer for the benefit of employees can be treated as part of the worker’s pay. This must be agreed to in writing and voluntary on the part of the employee.
HOLIDAYS / VACATION
North Dakota does not have a state law requiring additional pay for work done on holidays or weekends. Employers are also not required to offer vacation, holiday or other pay for time not worked. These policies are at the discretion of the employer.
MEAL BREAKS / REST PERIODS
North Dakota wage law provides that a minimum 30-minute meal period must be provided in shifts exceeding 5 hours when there are two or more employees on duty. This may, however, be waived by agreement. Breaks of thirty minutes or more can be without pay as long as the employee is fully relieved of his duties.
REPORTING TIME PAY
Neither North Dakota nor the Federal law requires payment if an employee reports to work expecting to work for a certain number of hours but does not get to work their full schedule.
Employers in North Dakota must set regular paydays at least once each month.
STATUTES OF LIMITATIONS
Employees seeking unpaid overtime wages under state law have 2 years to file suit. Under federal law, overtime claims can recover pay going back either 2 or potentially 3 years from the date a lawsuit is filed.
REMEDIES / PENALTIES / RETALIATION
North Dakota employers who unlawfully withhold wages are liable for interest on unpaid wages and double the amount of unpaid wages if the employer has, on separate occasions, been found liable for 2 prior wage claims. Failure to pay appropriate wages is also a crime. In addition to civil penalties, violators can face Class B misdemeanor charges.
North Dakota law allows workers to bring class action lawsuits against employers for failure to properly pay employees, and there are no opt-in requirements.
North Dakota specifically prohibits retaliation against any employee seeking payment under the wage and hour laws. Employers may not discharge, demote, deny promotion, or discriminate in any way against an employee asserting a claim or right under the law.