Court Drills Company Over Bonus Pay

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Bristol Excavating entered into an agreement with Talisman Energy. Talisman paid all workers on its drilling sites bonuses for safety, efficiency and completion of work.

At some point, Talisman and Bristol agreed that Bristol’s workers were eligible to receive the bonuses; however, this arrangement was never codified. The Labor Department found Bristol should have included the bonuses in workers’ regular rate of pay for purposes of overtime compensation. In rejecting this, the Third Circuit emphasized an employee’s regular rate of pay is between the employer and employee.

Then it assessed the employer’s involvement in the bonus program: (1)

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