Global Employment Law - Global News & Commentary on Labor and Employment Issues Worldwide

The employee in this matter, Michael Truman, worked for DeWolff, Boberg & Associates, a management consulting firm, for approximately 16 months.  During that period, Truman, a resident of Pennsylvania, worked in England for 6 months and in Canada for one week.  He claimed to have worked more than 40 hours per week for each week he worked in both countries without being paid overtime, which would not have been prohibited by employment legislation in those jurisdictions.  Truman acknowledged that the federal Fair Labor Standards Act (FLSA) expressly excludes work performed in foreign countries from overtime pay requirements.  However, he alleged that Pennsylvania law, specifically the Pennsylvania Minimum Wage Act (PMWA), contained no such exemption, and thus he was entitled to time and one-half pay for work performed after 40 hours per week under the PMWA.

In reaching its decision, the court reviewed cases holding that state wage statutes are not limited by the FLSA unless the statutory language at issue is incorporated in the state statute.  Accordingly, the court held that it "cannot find an implied foreign work exemption in the PMWA to remove coverage from Pennsylvania residents who have been given assignments outside of Pennsylvania."  The court also noted that the FLSA does not preempt state minimum wage laws that afford greater protections than those offered under federal law.  Therefore, the court concluded, "[n]othing within the language of the [PMWA] implies that work performed in a foreign country by a Pennsylvania resident does not deserve the same protections as work performed within Pennsylvania by the same resident and for the same company."

The repercussions of this decision are uncertain.  At a minimum, companies that send employees who are Pennsylvania residents on work assignments in other countries should evaluate those employees' work hours and maintain careful records.  Two potentially important issues were not discussed in this case: (1) the impact on the outcome had Truman had been covered by a carefully drafted contract--at least during his 6-month stay in England--providing that English law applied to his employment during that period; and (2) the method for determining an employee's residency in circumstances where, as here, the nature of the foreign assignment requires the employee to physically relocate for an extended period of time.  In other words, the decision does not address how someone who lived and worked in England for six months could be characterized as a Pennsylvania resident during that period of time.

This entry was written by John Kloosterman.