In recent news, Ecolab faces allegations that its standard overtime pay calculations violate the labor code.

The Case: Lemm v. Ecolab

The Court: Los Angeles County Superior

The Case No.: 19STCV21322

The Plaintiff: Lemm v. Ecolab

The plaintiff in the case, Lemm, worked for Ecolab for several years before being promoted to route sales manager on April l5, 2018. As an Ecolab route sales manager, Lemm was the primary contact with customers on his. He visited them regularly to install, repair, and maintain Ecolab equipment, provide continuous training and customer service, and sell additional or supportive Ecolab products and parts. Route sales managers are nonexempt employees who are entitled to overtime compensation. Lemm regularly worked more than 12 hours daily and more than 40 hours weekly in 2018 and 2019. Lemm's payment was calculated according to an annual Incentive Compensation Plan with compensation comprised of hourly wages and a nondiscretionary monthly bonus earned by meeting specific metrics. On June 19, 2019, Lemm filed a PAGA suit, alleging Ecolab improperly calculated the overtime due on the nondiscretionary bonus paid to Plaintiff and other similarly situated employees.

The Defendant: Lemm v. Ecolab

The defendant in the case, Ecolab, provides sanitation and pest control services and supplies, commercial kitchen equipment and appliance maintenance, and food safety services. On July 25, 2019, Ecolab responded, denying Lemm's allegations.

The Case: Lemm v. Ecolab

About two months later, on October 2, 2019, Lemm filed an amended PAGA notice, asserting additional claims for civil penalties associated with Ecolab's failure to pay all required wages, including reporting time and split shift wages. However, Ecolab successfully moved for summary judgment because its formulation of the overtime payment comported with the Fair Labor Standards Act of 1938 (FLSA). On appeal, Lemm argued that the method by which Ecolab calculated overtime compensation owed on the monthly bonuses failed to comply with California law and that state law supersedes federal law because Lemm's claim was a state claim, and California provides greater protection for employees. However, the Second Appellate District confirmed the trial court's decision, explaining they weren't required to use the exact formula set down in Section 49 2.4 when using the nondiscretionary bonus for overtime calculations. Ecolab demonstrated to the court that as long as the overtime calculations did not include overtime on overtime, the amount of overtime pay was the same regardless of which overtime calculation option they used: the section 49.2.4 formula or the CFR 778.210 formula.

If you have questions about how to file a California overtime lawsuit, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in various law firm offices in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.