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Wage Theft

Apr 21 2018

U.S. Supreme Court Rules Against Auto Service Advisers In Overtime Lawsuit

The United States Supreme Court has overturned a Ninth Circuit Court of Appeals ruling that would have permitted auto service advisers (employees at car dealerships who advise customers about repair work) to receive overtime.  The Supreme Court held the service advisers were exempt from the overtime benefits of the Fair Labor Standards Act (FLSA) because they are “salesmen … primarily engaged in … servicing automobiles,” according to Justice Clarence Thomas.

The lawsuit seeking overtime pay under the FLSA was filed nearly six years ago.  It has worked its way up and down the judicial system on more than one occasion.  However, the Supreme Court has finally put the case to bed.

The Supreme Court’s ruling that auto service advisors are overtime-exempt under the FLSA seemingly contradicts the longstanding legal principal that required exemptions to be narrowly construed.  In the past, Court have narrowly construed exemptions to the FLSA against the employer and limited their application to situations that are plainly and unmistakably within the exemptions terms and spirit.  Instead, the Supreme Court analyzed the exemption by employing “a fair reading” of the exemption standard.

Some experts have argued that this case is one of the most significant decisions on exemptions because it ends the narrow construction principle, which in the past was applied to every exemption case.  The Supreme Court’s analysis places less of a burden on an employer who seeks to avoid paying their employees overtime by classifying them as exempt.  Arguably, the decision allows employers to apply exemptions in situations where, in the past, they otherwise would not have been applicable.

In fact, at oral argument, when asked about whether the exemption should be narrowly construed, Paul Clement of Kirkland & Ellis LLP (attorney for the employer), responded “it may be time to put that canon to rest.”

The Supreme Court appears to have done just that.  Over the past several years, disputes between employer and employee that reach the ultra-conservative United States Supreme Court have overwhelmingly been decided in favor of the employer.


The case is Encino Motorcars LLC v. Navarro et al., case number 16-1362.

 

 

Written by Wage Authority Group · Categorized: Wage Theft

Apr 21 2018

Lyft Drivers Score Big Settlement As Gig Economy Wage & Hour Lawsuits Continue To Soar

The “GIG Economy” once referred to a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs.  However, that description is out of date.  Today, more and more people are turning to companies like Lyft or Grub Hub as their primary employment.  Moreover, the GIG companies are exercising more and more control over those employees, which has greatly diminished the number of instances when the individual can properly be classified as an independent contractor.

With more and more GIG companies treating workers as employees rather than independent contractors, claims of unlawful wage and hour practices have skyrocketed.

In March 2018, the ride sharing company Lyft, Inc. (“Lyft”) agreed to pay $1.95 million to a class of nearly 246,000 drivers.  The settlement class consists of any driver that provided at least one ride in California at peak busy times from August 2014 to April 2017, when the app had allegedly incentivized drivers to drive prime-time hours by telling customers the premium “goes entirely to your driver.”  That turned out not to be true.  Lyft was still taking a commission surcharge.

The preliminary approval papers submitted by the parties urged the court to approve the settlement as it resulted from arm’s-length negotiations between the parties.  The settlement provides $10,000 as an incentive award for the named plaintiffs and up to $650,000 in attorney fees for class counsel.  To receive a settlement payment, class members must submit a claim form and calculate the number of non-refunded commissions on prime-time rides they are eligible to receive back.

Many states, such as California, have very strict laws about deductions from employees’ pay.  The California Labor Code also requires employers to provide employees with accurate wage statements.

It is suspected that as new GIG companies form, wage and hour violations will persist in the industry.  The ever changing employment landscape continues to uncover new violations of state and federal wage and hour laws.

 

Image link: https://www.pexels.com/photo/uber-smartphone-iphone-app-34239/

Written by Wage Authority Group · Categorized: Wage Theft

Apr 21 2018

Arizona Restaurant Chain Sued for Unpaid Wages

A restaurant kitchen manager recently filed a federal lawsuit seeking overtime pay from his former employer, an operator of a restaurant chain.  The lawsuit contends that the restaurant’s pay practices violated both the Fair Labor Standards Act (FLSA) and Arizona’s wage statutes, which mandate a minimum wage of $7.25/hour and $10.50/hour, respectively.

Specifically, the plaintiff’s suit alleges that he was hired at the restaurant for a flat rate per week. However, after six weeks on the job, he had still received no pay. When the plaintiff inquired about his owed wages, the restaurant immediately fired him, the suit contends.  About one month later, the restaurant sent him a check, claiming that the check amount was “fair” compensation for all six weeks of his employment.  But when divided over six weeks, the plaintiff’s check resulted in only $2.36 per hour—well below the mandated federal and state minimum wage, the suit alleges.

Further, the plaintiff contends that the restaurant violated Arizona law by failing to pay him all wages due within seven days of termination. The state statute provides that any party violating this rule “is guilty of a petty offense.”

Wage and hour violations such as the ones described above occur quite frequently in the restaurant industry. In addition to FLSA violations, it is important to be aware that many states have additional wage laws providing further rights to workers.  If you believe you are not being paid the wages to which you are entitled, contact an experienced FLSA attorney to discuss what options may be available to you.

 

Image link: https://www.pexels.com/photo/chair-cutlery-diner-dining-941861/

Written by Wage Authority Group · Categorized: Wage Theft

Apr 20 2018

Gov’t Employees Sue Cuyahoga County for Unpaid Overtime

A group of public employees recently filed a collective action Complaint in federal court against Cuyahoga County, Ohio, their employer. Cuyahoga County contains the Cleveland metropolitan area.

Specifically, the employees allege that the County violated the Fair Labor Standards Act (FLSA) by failing to compensate them for all overtime hours worked. The FLSA requires employers to pay all non-exempt employees overtime at one and one-half times their normal rate for all hours over 40 worked in one week.

The suit also alleges that some employees did not receive their pay in a timely manner, as required by law. Further, the County was “aware of the systematic and widespread failure with its payroll system,” but knowingly and willfully chose not to address the problem, the suit contends.

The plaintiffs believe that more than 2,000 current and former hourly employees suffered from the County’s unlawful pay policies during the last three years.


The case is titled Choukalas et al. v. Cuyahoga County, No. 1:18-cv-588 in the United States District Court for the Northern District of Ohio, Eastern Division.

 

Written by Wage Authority Group · Categorized: Unpaid Overtime Pay

Apr 20 2018

DOL: Alabama Security Company Withheld Millions in Wages

The Department of Labor (DOL) recently accused ManTech International Corporation and two subcontractors of unlawfully withholding over $1.1 million in back pay and benefits from 236 employees.

The allegations stem from a DOL investigation to determine whether the companies were in compliance with the Fair Labor Standards Act (FLSA), Service Contract Act (SCA), and the Contract Work Hours and Safety Standards Act (CWHSSA).

The FLSA contains the federal minimum wage and overtime provisions. Unless exempt, employees covered by the FLSA must receive overtime compensation for hours worked over 40 in a workweek at a rate of at least one and one-half times their regular rates of pay.  In the investigation, the DOL determined that the companies not only paid employees rates and benefits below the minimum wage, but also failed to pay time-and-a-half for all overtime hours over 40 worked in one week.

Founded in 1968, ManTech describes itself as “a multi-billion-dollar public company that provides the innovation, adaptability, and critical thinking our government needs for success in defense, intelligence, law enforcement, science, administration, health, and other fields—throughout the nation and in many countries around the world.” The other two companies are also federal government defense contractors. Kenneth Stripling, the DOL’s Wage & Hour Division Director in Birmingham, criticized ManTech’s unlawful wage policies in a press statement, “Not only does this practice undercut what the workers involved are legally owed, it results in unfair competition for contractors who play by the rules.”

 

Image link: https://www.pexels.com/photo/interior-of-office-building-325229/

Written by Wage Authority Group · Categorized: Minimum Wage, Unpaid Overtime Pay

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News

  • U.S. Supreme Court Rules Against Auto Service Advisers In Overtime Lawsuit
  • Lyft Drivers Score Big Settlement As Gig Economy Wage & Hour Lawsuits Continue To Soar
  • Arizona Restaurant Chain Sued for Unpaid Wages
  • Gov’t Employees Sue Cuyahoga County for Unpaid Overtime
  • DOL: Alabama Security Company Withheld Millions in Wages

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