When piece-rate workers work more than forty hours, the Fair Labor Standards Act has developed a formula for determining and computing their overtime pay. It is first essential, however, to realize that such workers are due overtime and to understand that workers who work “with their hands” such as mechanics or technicians, are entitled to overtime.

The failure to comprehend these truisms has been demonstrated in a class action involving satellite television technicians, where a federal judge has just confirmed a $2.33 million settlement in an overtime collective action for such employees in Wisconsin and Michigan. The case is entitled Wilcox v. Alternative Entertainment, Inc. and was filed in the Western District of Wisconsin.

The satellite installers claimed overtime and also alleged that their wages suffered improper deductions The workers claimed that they were paid per installation, which is a piece rate, but when they worked in excess of forty hours, they received no additional compensation. Thus, their theory is not only were they not paid overtime, but there were weeks when they worked so many hours in that particular week that their hourly rate did not even meet the federal minimum wage standard.

To add supposed insult to alleged injury, the workers also charge that the Company improperly deducted monies for poor workmanship, lost/stolen property or damage to the property of the homeowner where the satellite dish was being installed. Not only was there no written authorization to do so, but the law in many States is clear that such deductions are illegal (although the employer may take disciplinary action against the offending employee).

There are approximately 900 employees who might be involved in the class. Given that figure, the potential liability is/was geometrical, as the settlement shows. Significantly, the judge awarded an attorneys' fees award of $776,666. This is the other big danger in FLSA class actions—the law is a fee shifting statute, meaning that the employer must pay the plaintiffs’ attorney fees, which (as here) is often a large sum.

There has been a sharp rise in lawsuits in the cable and satellite industries. The lesson to learn is that technicians or installers or similarly titled employees are non-exempt and if they work in excess of forty hours, they are owed overtime, regardless of the mode of their compensation (e.g. piece-rate, hourly, commission).