By Geoffrey D. Rieder, Foster, Rieder & Jackson, P.C.

Are employees who commute from home to a remote worksite entitled to minimum wage for time spent traveling to and from the worksite? The New Mexico Court of Appeals recently said "no."

Background

J.W. Drilling is an oil field drilling contractor based in Artesia. It conducts business in the Permian Basin and pays most of its workers an hourly wage as nonexempt employees. Some of the workers sued the company in an Eddy County district court, claiming they were owed wages, including overtime, for the time spent traveling between home and remote worksites.

The employees claimed that J.W. Drilling's "method of operation made travel a part of their . . . duties and a term of their employment relationship." They complained the employer "only paid employees from the time they arrived at work until they departed, despite the fact that due to travel time to the remote location, the employees 'worked' more than 40 hours a week."

The workers claimed that under the New Mexico Minimum Wage Act (NMMWA), they were entitled to compensation for their "overtime" work at 1½ times their hourly rate for all hours over 40 per week.

They relied on Section 50-4-22(D) NMSA of the NMMWA, which provides that "an employee shall not be required to work more than forty hours in any week of seven days, unless the employee is paid one and one-half times [his] regular hourly rate of pay for all hours worked in excess of forty hours." The district court dismissed the case before trial, and the employees appealed to the New Mexico Court of Appeals.

Court of appeals' decision

The parties agreed that the question before the court was "whether travel time is compensable under the [NMMWA]." The appeals court emphasized that the travel was between the employees' homes to a remote worksite and did not involve travel between jobsites, which is an entirely different issue.

The court began its analysis by addressing the workers' arguments. The workers asserted that the district court judge, who ruled on the issue without a trial, incorrectly analogized the NMMWA to the federal Fair Labor Standards Act (FLSA), which includes the Portal-to-Portal Act.

The Portal-to-Portal Act expressly excludes employees' time spent traveling between home and the place of "principal activity." The workers argued that the NMMWA was passed years after the Portal-to-Portal Act and does not have a similar limitation on travel pay, which indicates no limitation was intended. The court of appeals observed that "federal law does not answer the issue" because the language of the Portal-to-Portal Act is not similar to the NMMWA's language.

The appeals court also rejected the workers' argument that they were "traveling employees" under the New Mexico Workers' Compensation Act (NMWCA). The "traveling employee" rule is an offshoot of the "coming and going" rule.

Typically, employees are not covered by workers' compensation when traveling to and from work, but there is an exception when the travel is an "integral part of [their] duties" and is a "benefit to the employer." In that case, employees are considered to be within the course of their employment when traveling, so workers' comp may apply.

The appeals court noted that the NMWCA is "sui generis" (a unique body of law that stands on its own) and that New Mexico courts have repeatedly declined to "mingle . . . principles" rooted in workers' comp in other areas of the law. The court declined to apply the "coming and going" rule to the workers' claim "because the policies served by the two areas of law differ, and the application of the rule in each context" is materially different.

Finally, the court of appeals rejected the workers' argument that "all employee travel beyond a normal commute is compensable, regardless of who owns the vehicle." The appeals court observed that the workers were "asking [the] court to fashion out of whole cloth a new scheme" that "alters the general rule and declares some commuting time compensable."

In rejecting the workers' arguments, the court reminded them that courts must construe statutes "as written" and may not amend them "under the guise of construction." Segura v. J.W. Drilling, Inc., 2015-NMCA-085, No. 35,417, Aug. 14, 2015.

Bottom line

This case clarifies that employers are not required to pay employees for travel time under New Mexico law. However, the court did refer to a U.S. Department of Labor (DOL) opinion letter that provides that for a "lengthy commute" in the employer's vehicle—4 hours—part of the commute (3 of the 4 hours) would be considered compensable under the FLSA based on explicit language in an amendment to the Portal-to-Portal Act.

So while commuting time may not be compensable under state law, it may be compensable under federal law in some circumstances. If your business requires employees to routinely travel long distances to and from work, it is best to consult counsel regarding the applicable rules.

Geoffrey D. Rieder, an editor of New Mexico Employment Law Letter, can be reached at geoff@frjlaw.com.