Starbucks Agreed to Pay up to $3M Settlement for Mileage Reimbursement Suit

An agreement is in place for Starbucks to pay up to $3 million to settle the lawsuit based on allegations that the popular coffee house did not reimburse named California employees for mileage related expenses incurred while on the job. Employers who typically incur mileage expenses while on the job include: store managers, assistant managers, and shift supervisors. These employees working at Starbucks stores located in California employed from March 2003 through March 2008 are eligible for payments of $30-75 each.

Attorney’s fees are included in the $3 million settlement as well as an undisclosed amount given to the representative plaintiff as an incentive award and a payment to the California Labor and Workforce Development Agency of $25,000.

In the documentation, Starbucks agreed to class-action status for settlement purposes along – they do not accept liability. Within the settlement paperwork it was agreed that the plaintiff and plaintiff’s attorneys are not to respond to questions from the media. The only exception is to allow them to refer to court documents on file. Jonelle Lewis filed the lawsuit in March 2007. She had worked at Starbucks since December of 2005. She resigned within one month of filing the lawsuit. The lawsuit filed by Lewis claimed that she consistently used her personal vehicle for work purposes (i.e. bank deposits, obtaining supplies, etc.) She also claimed that she attempted to request reimbursement for the mileage, but that Starbucks’ response was not to reimburse as a matter of “policy.”

If you feel you that company “policy” in your workplace is conflicting with your rights as outlined in employment law, get in touch with the experts at Blumenthal, Nordrehaug & Bhowmik.

Arguing the Professional Exemption

The Obama administration recently took a closer look at the Professional Exemption. Their scrutiny was followed by instructions to the Department of Labor to narrow the definition of the exemption. Changes are set to take effect in 2015, but Courts may begin utilizing the new definitions and strictures immediately if recent activity is any indication. 

Court cases that involve the proper classification of employees are generally the most contentious. This makes sense as the stakes are higher than cases involving potential repayment of back wages and/or penalties for overtime. They can also require complete reclassification of employees listed in the case with overtime required from that point forward. In proper classification cases, a ruling against the employer often means a complete change in the way the company runs their business.

Many employers have been cutting corners to save money on overtime. Some say it’s due to the Labor Code coming across as complex. But it’s more likely a combination of complexity allowing for loose interpretations/purposeful misinterpretations embraced during low cash flow points in a troubled economy. Employers feel they need to save the money and many are deciding to do whatever they can (legal or not) to save money on overtime costs.

A recent case involving day rate employees being classified under the labor code as professionals exempt from overtime pay seems to support the idea that the courts will consider changes to the Professional Exemption now rather than waiting until 2015. Workers in the recent case were working 12-hour shifts, sometimes 7 days a week leaving them totaling in excess of 84 hours some weeks. Their work was compensated by a day rate. Some weeks their total pay (if they worked only a couple days) was less than $455/week. Legal representation for the plaintiffs in the case argued that claiming an employee is a salaried professional, but paying them less than $455/week some weeks does not meet the requirements of the Professional Exemption’s first prong.

The case was concluded on March 27, 2014. The Federal Middle District of Pennsylvania court clerk recorded judgment for wage and hour violations in the case (3:14-cv-00042-RDM). Allegations accused the employer of failing to pay workers overtime for their hours that exceeded the full time 40. The court supported the claims. We can most likely expect to see more decisions leaning towards the new understanding of the Professional Exemption.

If you feel that you may be due past overtime or know someone who is in an untenable work environment, get in touch with the experts at Blumenthal, Nordrehaug & Bhowmik today.

Employees and Their Smartphones: Is Your Smartphone Overworking You?

In modern American culture most people are hopelessly attached to their smartphones. If that’s not the case, the remaining few (with rare exceptions) can’t deny that they have an extremely close relationship with other technology (i.e. their computer, laptop, tablet, etc.) There are a multitude of benefits that come from living in this technological day and age, but because of smartphones and all the other beloved technology, work is bleeding into employees’ personal time.

The recession put a lot of pressure on employers to get the most of their employees. As a result, American business owners are squeezing their workers and cutting costs at the same time. One way in which many American employers are doing so is by accessing their workers after hours through all of the convenient technology that leaves employees available 24/7. Vacations are often unrecognizable as such due to the fact that contact is never severed with the employer. Many employees find it hard to differentiate between hours worked and hours off due to the easy and frequent access employers avail themselves of freely.

Experts agree that if employers had to bear the actual expense of paying for the overtime hours they are demanding, they would have actively sought a different solution such as hiring more workers during the economic recovery.

In response to the seemingly never ending after hours access provided by technology, employees are asking the courts to find a solution. It’s a changing time as courts attempt to reconcile laws that have been in place for decades with technological trends that have drastically altered the workplace landscape. Never before have employees been so irrevocably connected to their employers without break.

In 2011, there were 7,006 wage-and-hour suits filed (many of them class action suits) in federal court. This was nearly quadruple the total in the year 2000. In 2011, the Labor Department was able to recover $225 million in employee back wages. This was up 28% from the previous year. 300 wage-and-hour investigators were added in 2010 and 2011 alone which resulted in a 40% staff increase (to a total of 1,050). This was done in what was openly declared and effort to protect America’s workers.

Consider the facts and then consider your employer/employee relationship. If you feel that you are stuck in a 24/7 job with 40-hour/week pay, get in touch with the experts at Blumenthal, Nordrehaug & Bhowmik today. Don’t let your smartphone take the blame. 

Unpaid Overtime: What Type of Plaintiff Are You?

With the continued increase in unpaid overtime lawsuits in almost every industry, employees may find it useful to consider the various types of plaintiffs simply to get an idea of where their own workplace situation lies.

What Type of Plaintiff Are You?

1. Do you find yourself a slave to your handheld device? When you leave work, do you continue to answer questions, delve through documents and conduct brainstorming sessions? Do you often find yourself in arguments with your significant other because they simply want you to attend a family function, complete a household chore or actively involve yourself in a conversation from beginning to end without being interrupted by someone at work that needs you? If so, you could be a “worker with a handheld device” plaintiff. You go to work and you come home, but you never seem to be off the clock. You answer calls, check emails, and basically continue working into the night. Many would classify all this “after hour” work as unpaid overtime.

2. Does your job require a lot of in-office prep in order to go “on the clock?” Do you have to arrive early in order to complete a series of log ins, paper pushing, or mandatory meetings before you can actually “go to work?” If so, you might be an “off the clock work in the office” plaintiff. Many are asking the question (in court) whether or not they should be able to clock in when they get to work to prepare to work or if they are donating the time it takes to perform necessary functions prior to starting the job duties employers are willing to pay for.

3. Do you enjoy the use of a fancy title without the fancy job duties? Many employers have turned to the non-promotion promotion as a solution to overtime. “Promoting” employees without actually giving them managerial responsibilities is a game plan used by employers looking to keep labor costs down. Many managerial positions are exempt from overtime pay laws and requirements. If you found yourself impressed with an empty title at first, don’t feel bad, you aren’t the only one and you could be a “fancy title” plaintiff.

If you have more questions now that you understand the basics behind many of the employment law related suits you’ve been reading about in the news, get in touch with the attorneys at Blumenthal, Nordrehaug & Bhowmik today and get the right answers. 

Getting Paid: Bonuses, Wages and Commissions

Under California statutory law, “wages” enjoy a very broad definition. Case law has included “bonuses” in the definition. Why does that matter to California employees?

If you are discharged, any wages you have earned up to and including the date of termination are due and payable – immediately on the date of termination. Employees who find themselves in the regrettable situation of being let go or fired (or even in need of quitting) should expect payment in full of all wages earned prior to signing any release, etc. California employers who fail to pay wages in a timely manner (that is, on the date of termination) can find themselves subject to waiting time penalties, interest and/or attorney’s fees.

Waiting Time Penalties: California employers who fail to pay wages due an employee on the date of their termination “willfully,” the wages of said employee will continue as a penalty from date of termination (at the same rate) until paid or other appropriate action is taken.

Interest: The court awards interest on all due and unpaid wages at an annual rate of 10% accruing from the date wages were due/payable.

Attorney’s Fees: When action is brought for nonpayment of wages, benefits, etc. reasonable attorney’s fees can be awarded to the prevailing party by the court.

California law has employees leaving a job covered. There should be no reason to lose wages already earned. There should not even be a reason to wait for wages already earned.

To resolve non-payment issues with previous employers quickly and professionally, contact Blumenthal, Nordrehaug & Bhowmik. 

Unpaid Commission: Can it Be Recovered?

Most feel they have a solid understanding of overtime pay and whether or not they are receiving what they deserve, but when it comes to commissions, there seems to be additional confusion. What is unpaid commission and when is an employee able to recover unpaid commission?

What is Unpaid Commission?

Before we can define unpaid commission, it’s important to define commission wages in general. Commission wages are common in many industries, but prevalent in the computer and technology industries particularly. According to California wage law, commission wages refers to compensation that is paid as a percentage of the price of the product or service that is being sold. Commissions can also be based on the number of items sold. Disputes regarding commission wages and unpaid commissions are often resolved under the same legal principles as bonuses.

When are commissions “unpaid?” The easy answer is that commissions are classified as unpaid when they have been earned and never received. Technically the commission is earned by the employee who “procures cause” for the sale or other event resulting in commission pay. Disputes often arise when management intervenes during the sales process. When management is involved at some point during a sale, it is important to note the point at which someone procures cause for the sale and who was handling the customer at that point in time. This is the individual who has technically earned the agreed upon commission.

Obtaining Unpaid Commission:

If you feel you are entitled to commission that you never received, seek legal counsel. Employers frequently change compensation plans, utilize unfair provisions and/or adopt a very narrow interpretation of a commission agreement or plan. In some cases, employers are forced to seek unpaid commission post-employment. It’s important to note that employees who no longer work for a company can still be due commission on sales procured during their employment. Employers can’t reap the benefit of your efforts while simultaneously ignoring the agreement to provide you with a commission for those same efforts.

Employers will often work their compensation plans in various ways in order to justify commission forfeiture with little to no cause. Examples include employers who add verbiage making commission payment “exclusive” to current employees or allowing the employer to alter the commission agreement in certain situations, etc. California wage laws can help former and current employees recover commissions. The courts may see the commission agreement differently than your employer.

Call Blumenthal, Nordrehaug & Bhowmik today and find out how your unique circumstances can be taken into consideration when attempting to obtain unpaid commissions. 

When Should Employees Get Overtime Pay?

Federal law regulates overtime pay requirements. According to federal law, employees who work more than 40 hours in one week should receive one and a half times their normal pay rate for the “overtime” hours. As is often the case, there are exceptions to this law, but it’s important for employees to question their situation due to the fact that employers often misunderstand the rules or misapply them in specific circumstances – most often at the employee’s expense.

If you are an employee that works more than 40 hours and week without overtime pay, your employer could be in violation of the Fair Labor Standard Act. If an employer is in violation of this law, you could be entitled to the amount owed to you as well as additional funds to cover liquidated damages and attorney’s fees.

Define Your Employee Classification and Job Duties:

There are two categories of employees: exempt and nonexempt. The Fair Labor Standard Act (FLSA) doesn’t cover exempt employees. Federal law does not require employers to provide exempt employees with overtime pay. Exempt employees are often in managerial positions. They can receive pay on a salary basis or as an hourly wage. They have independence in their job duties and authority over their own work. Exempt employees are involved with creating/applying workplace policies and have some responsibility for making decisions within the company framework.

It’s important to consider exempt status because employers will often categorize employees as exempt inaccurately. For example, an employer could provide an employee with the title of Assistant Manager, but fail to provide the employee with any authority or responsibility for other employees. Another example is when employers categorize an employee as an independent contractor, but their day-to-day job duties more closely resemble those of a normal employee.

If you are an employee who does not receive overtime pay it’s important to define your status: exempt or non-exempt. This will determine whether or not your situation is governed by the FLSA. If you are misclassified as exempt, you can fight to get the compensation to which you are entitled by federal law.

Employers subject to the Fair Labor Standard Act aren’t permitted to exchange personal days or other extra benefits for overtime pay. Employers are also not allowed to have mandatory meetings that occur when employees are officially “off.” As an employee, you are entitled to the pay you have earned. When you put in extra hours, you are entitled to extra pay. If your employer doesn’t pay you overtime (to which you are legally entitled through the Fair Labor Standard Act), contacting an expert in unpaid overtime is the most appropriate step towards resolution.

Blumenthal, Nordrehaug & Bhowmik helps you enforce your overtime rights. If your employer is knowingly and willingly refusing to pay you earned overtime pay, you are entitled to the amount owed. Call today to discuss your employment situation and see how you can get paid past due overtime wages.