Working Overseas or Outside of the Country? Make sure you have an Employment Contract Valid in US
Judge Chen of the US District Court for the northern District of California recently dismissed, with prejudice, most of the federal and California state wage and hour allegations made against Ropes & Gray client, Adventures Rolling Cross-Country (ARCC). ARCC is a tour and camp guide for international travel. Wright v. Adventures Rolling Cross Country, Inc. No. C-12-0982 EMC (N.D. Cal.).
The trip leaders, former employees of ARCC, believed they were entitled to further compensation because they were on-call for 24 hours a day while leading campers on outdoor activities in places like Costa Rica, Belize, Italy and Greece. The plaintiffs were asking for minimum wage and overtime for their services. When Judge Chen agreed to grant the defendants motion for dismissal he was agreeing that federal Fair Labor Standards Act (FLSA) exempts from coverage any work performed in a foreign workplace and that the California labor code also had relating provisions that would make minimum wage and overtime inapplicable to work preformed out of the country.
In Judge Chen’s decision he pointed out the three major reasons he was unable to rule in favor of the plaintiffs, further explaining why California labor laws would not apply to work preformed out of the country.
• California Supreme Court has referred to the presumption against extraterritorial application for almost a century, and the California legislature has yet to detail that there should be extraterritorial application for the wage and hour laws.
• Even though California legislature specifically allows for extraterritorial application in other requirements of the Labor Code, “the fact that the provisions at issue do not include any statement about extraterritorial application is doubly telling.”
• There is “no competing presumption that would nullify the presumption against extraterritoriality.” While there is a presumption that a wage earner in California enjoys the protections of the Industrial Welfare Commission regulations, the wage earner is presumably an employee who “resides in California, receives pay in California, and works exclusively, or principally, in California.” (Cal. Lab. Code §§ 3600.5, 5305).
In basic terms there is no labor law requiring that employees working abroad be paid under California state labor laws. The absence of this law leaves this decision up to the courts to make and so far the courts have generally ruled that without the specific law requiring it, they will not have anything to enforce. This is not to say that the law could not be created later.
Labor law is complex; if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.
Photo Credit: Shutterstock/Anthony Ricci