In the case of Snow v. Silver Creek Midstream Holdings, LLC., Mike Snow filed a lawsuit against Silver Creek Midstream Holdings, LLC and Silver Creek Midstream Services, LLC (collectively, Silver Creek). Snow argued that he was an employee of Silver Creek and regularly worked unpaid overtime. He also sought to represent other similarly situated workers who were inspectors at Silver Creek and were paid a day rate with no overtime in the past three years.
Applied Consultants, Inc. (Applied), Snow’s employer, argued that he was bound by an arbitration agreement he signed, which covered all claims arising from his employment. Applied contended that Snow’s claim against Silver Creek should be compelled into arbitration, as the agreement extended to such claims. Applied asserted that allowing Snow to avoid arbitration would deprive it of the benefits of its arbitration agreement and undermine the agreed-upon dispute resolution process.
Snow argued that the arbitration agreement only applied to claims between him and Applied, not Silver Creek. He claimed that Applied was attempting to rewrite the agreement and compel arbitration against Silver Creek. Snow claimed that there was no employment agreement between him and Applied on record, and the arbitration agreement specifically covered claims related to his employment with Applied, not third parties like Silver Creek. He argued that he should be allowed to pursue his claims against Silver Creek in court.
The court analyzed the arbitration agreement and found it to be clear and unambiguous. It determined that the agreement covered all claims arising from Snow’s employment with Applied, including the claim against Silver Creek. It concluded that Snow was bound by the arbitration agreement and ordered the parties to submit their dispute to binding arbitration, granting Applied’s motion to compel arbitration.
Key lessons from this case:
- Employers cannot evade their obligations under the FLSA by using day-rate pay practices that do not account for overtime hours worked.
- An arbitration agreement is a legally binding contract that allows parties to resolve disputes through arbitration instead of going to court.
- An employee must abide by the arbitration agreement when looking to seek overtime back wages.
If you want to know more about overtime regulations, read our guide on Wyoming Overtime Laws.
