How A Missing Comma Cost An Employer $10 Million

On Behalf of | May 3, 2017 | Contract Disputes |

A contract between two entities is meant to remove ambiguity and clearly spell out the agreed upon terms. Lawyers often spend hours and even days on contracts, examining every detail, down to each comma and period. While this may seem like overkill to some, a Maine company recently realized the importance of that everyday punctuation—the comma—when a judge ruled that they must pay $10 million to employees due to unclear language in a wage and hour statute.

Delivery drivers for the company Oakhurst maintained that they were unlawfully denied overtime. Oakhurst, however, alleged that there was a legal exemption in place for overtime relating to delivery drivers, and did not pay overtime pay. The case ended up hinging on a linguistic ambiguity.

“Packing for shipment or distribution”

The Maine statute provided an overtime exemption for employees who work with “the canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution of: (1) agricultural produce; (2) meat and fish products; and (3) perishable foods” (our emphasis).

Drivers argued that “distribution” in that context described “packing,” while Oakhurst argued that “distribution” was a standalone activity, not connected with “packing,” and that the “or” between “shipment” and “distribution” could have been replaced with a comma. In other words, Oakhurst argued that “shipment” and distribution” are synonyms. However, drivers vehemently disagreed, claiming that the two words refer to different parts of the transportation process, and are not synonymous.

The attorneys on each side argued about linguistic convention and everyday usage, and the judge eventually sided with the drivers, though not before spending 29 pages worth of explanation to decry the ambiguity on both sides.

The importance of unambiguous wording

Contracts are essential for establishing guidance and expectation between employer and employee, or between two entities. However, even the most supposedly ironclad contracts can be argued over. In situations involving contract disputes, the work of an attorney is critical, and should not be overlooked.

Source: Society For Human Resource Management, “Law’s Missing Comma Costs Employer Millions,” March 22, 2017