Can Geico Employees Keep their Wage Suit Alive?

In recent news, Geico attempted to have an overtime pay lawsuit tossed, but in this instance, auto claim adjusters alleging the company forced workers to work off the clock, and failed to provide meal breaks and rest periods as required by law.

Details of the Case: Saul Gonzalez et al. v. Government Employees Insurance Company Inc.

Court: U.S. District Court for the Central District of California

Case No.: 2:20-cv-11722

Workers Filed a Collective and Class Action:

In December 2020, workers filed a collective and class action alleging Geico employees were required to work off the clock, and work through breaks without appropriate compensation. The push to work through breaks and off the clock was allegedly a company effort to meet inspection quotas and employees claim they feared refusing could result in poor performance evaluations. Plaintiffs Alexander Rieske and Saul Gonzalez filed the suit alleging violations of California and New York state laws, and violations of the Fair Labor Standards Act. According to the motion, thirteen other adjusters have already joined the plaintiffs.

Defendant Files a Motion to Dismiss Claiming Lack of Jurisdiction:

In March 2021, Geico filed a motion to dismiss the suit claiming that there was no practical reason to litigate out-of-state claims in California and indicating the court lacked jurisdiction to decide the claims in the case. In their opposition filing, plaintiffs asserted that the U.S. Supreme Court decision the insurer relied on to push for dismissal of the nationwide collective action (and the New York state class action) doesn’t apply because unlike the Supreme Court case, Saul Gonzalez et al. v. Government Employees Insurance Company Inc. involves federal claims brought in federal court.

Does the 2017 Bristol-Myers Squibb v. Superior Court Decision Apply?

When filing for dismissal, Geico cited the Supreme Court’s 2017 decision in Bristol-Myers Squibb v. Superior Court. However, plaintiffs in the suit claim this decision does not apply to the current case since Bristol-Myers Squibb v. Superior Court pertained to state jurisdiction finding that California state courts could not adjudicate mass tort claims when plaintiffs were not from California. The Saul Gonzalez et al. v. Government Employees Insurance Company Inc. action is different because it concerns federal claims in federal court. Plaintiffs further argued that if the court accepted the position presented by Geico that federal courts cannot hear out-of-state claims brought under FLSA, it would effectively eliminate the collective nature of the FLSA.

California Federal Court Finds Bristol-Myers Decision Does Not Apply:

In October 2020, the California federal court’s decision stated that the Bristol-Meyers decision does not apply to FLSA claims brought in federal court (including the current action).

If you need to discuss California state labor laws or if you need to file FLSA claims, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.