Fifth Circuit Affirms DOL's Authority to Increase Salary Threshold for Overtime Exemptions

On appeal, the Fifth Circuit Court of Appeals affirmed the Department of Labor's (DOL) authority to raise the overtime exemption salary threshold for overtime exemptions (Mayfield v. United States Dep't of Labor). A significant ruling, the decision could directly impact Fair Labor Standards Act (FLSA) employee protections under the Fair Labor Standards Act (FLSA).

Case Details: Mayfield v. U.S. Department of Labor

Court: United States Court of Appeals, Fifth Circuit

Case Number: 117 F.4th 611 (5th Cir. 2024)

Challenging Overtime Rules & Taking the DOL to Court:

The plaintiffs in the case (Mayfield v. U.S. Department of Labor) case were employers who challenged the Department of Labor's (DOL) authority to establish minimum salary thresholds for executive, administrative, and professional employee overtime exemptions (EAP Exemptions). The plaintiffs are challenging the DOL's regulations, saying the agency went beyond its legal authority and interfered with their business and employment decisions.

Department of Labor Fights to Maintain Worker Protections

The defendant in the case was the U.S. Department of Labor. The federal agency responsible for enforcing labor standards and FLSA protections, the DOL issued regulations updating the minimum salary threshold for overtime exemptions, which would extend overtime protections to more salaried employees, which led the plaintiffs to seek legal clarification defining the extent of the DOL's legal authority.

Battling Over Overtime Pay: How Did the Courts Weigh In?

The key question in Mayfield v. United States Dep't of Labor was whether the DOL had the authority to change the salary levels used to determine which executive, administrative, and professional (EAP) employees are exempt from overtime. The Fifth Circuit Court of Appeals affirmed the DOL's power to set and adjust salary thresholds for overtime exemptions. This ruling upheld the 2019 Minimum Salary Rule, allowing the DOL to increase the minimum salary required for employees to be classified as exempt.

What Makes it a Landmark Decision: Mayfield v. DOL

In a landmark decision, the Fifth Circuit Court upheld the federal government's authority to enforce stricter wage and hour rules. This decision significantly affects overtime pay calculations for many workers. Therefore, employers must stay up-to-date with changing federal rules to avoid lawsuits and ensure fair pay for their employees.

California's Overtime Rules and the Federal Standard

California employers should remember that while the Mayfield decision clarifies the federal government's power to set overtime exemption salary thresholds, California often has stricter wage and hour laws in place. California's minimum salary for exempt employees is typically higher than the federal minimum. As of January 1, 2025, the minimum wage for California's exempt employees is $16.50 (applicable to all employers regardless of size). This means that even if an employee meets the federal salary threshold under the Mayfield ruling, they might still be entitled to overtime pay under California law. Employers in California must always comply with the law that provides the greatest benefit to the employee, which is often California law in this context.

If you have questions about filing a California overtime class action lawsuit, please contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Knowledgeable employment law attorneys are ready to assist you in various law firm offices in Riverside, San Francisco, Sacramento, San Diego, Los Angeles, and Chicago.

Carl’s Jr. Employees Claim the Popular Burger Joint Didn’t Pay Overtime Wages

In recent news, former Carl’s Jr. employees claim that the popular burger joint did not pay them overtime wages in compliance with labor law.

The Case: Esther Sigala vs. Sun Gir Incorporated dba Carl’s Jr.

The Court: Los Angeles County Superior Court

The Case No.: 24STCV27980

The Plaintiff: Sigala vs. Carl’s Jr.

The plaintiff, Esther Sigala, worked for the defendant at a California Carl’s Jr. location from 2006 to November 2023 as a non-exempt hourly employee. She filed the overtime class action alleging she and other employees in similar positions at the company were not fully compensated for their work due to uniform practices and policies in place at Carl’s Jr. According to Sigala, Carl’s Jr. retained (and continues to retain) wages she and other employees are due for the time they worked at the restaurant.

The Defendant: Sigala vs. Carl’s Jr.

The defendant, Sun Gir Incorporated, operates fast food franchises like Carl’s Jr. throughout California (including Los Angeles County). The class action complaint alleges the company failed to provide employees with legally compliant:

• meal breaks

• rest periods

• minimum wage

• overtime pay

• sick pay

• wage statements

• personnel files

• reimbursement for business expenses

How Are Overtime Pay Rates Determined for Eligible California Employees?

Overtime pay rates for eligible California employees are calculated using specific regulations set by the Labor Code. (California Labor Code is more protective than federal standards). For regular overtime, non-exempt employees are entitled to one and one-half times their regular pay rate for all hours worked over 8 (and up to 12) in one work day. This rate also applies for the first 8 hours an employee puts in on the seventh consecutive day working in one workweek. Employees earn double their regular pay rate for double time when they work more than 12 hours in one workday (for hours in excess of 12). Double-time rates also apply to hours over eight on the seventh consecutive day of work in one workweek. The employee’s “regular rate of pay” includes their hourly wage and other forms of remuneration like piecework earnings, commissions, etc. Expense reimbursements, gifts, discretionary bonuses, etc., are excluded from the “regular rate of pay” for overtime pay calculations.

The Case: Sigala vs. Carl’s Jr.

The plaintiff filed the case, Sigala vs. Carl’s Jr., in the Los Angeles County Superior Court where it is currently pending.

If you need to discuss filing a California employment law complaint, contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP for guidance. Their seasoned employment law attorneys from their San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago offices can assist you.

Amazon Settles for $3M in California Wage and Hour Class Action Lawsuit

In recent news, Amazon settled a California wage and hour class action lawsuit for $3 million.

The Case: Kryzhanovskiy et al. v. Amazon.com Services Inc., et al.

The Court: California Eastern U.S. District Court

The Case No.: 2:21-cv-01292-BAM

The Allegations: Kryzhanovskiy et al. v. Amazon.com Services Inc., et al.

The plaintiffs in the case, Leilani Kryzhanovskiy and Patricia Salazar, filed a California class action lawsuit alleging that Amazon violated California wage and hour laws. The lawsuit was filed on behalf of Amazon’s California employees who worked overtime between July 22, 2017, and November 7, 2023, during the same workweek they received a signing bonus. In the original wage and hour complaint, the plaintiffs claimed Amazon violated California labor laws when they failed to include the signing bonus to determine the regular pay rate when calculating overtime pay. As a result, the workers were allegedly underpaid for their overtime.

The Defendant: Kryzhanovskiy et al. v. Amazon.com Services Inc., et al.

The defendant in the case, Amazon.com Services Inc., et al., is a multinational tech company and the largest online retailer in the U.S. (selling many products, including books, music, movies, electronics, apparel, etc.).

The Case: Kryzhanovskiy et al. v. Amazon.com Services Inc., et al.

The California Eastern District U.S. District Court approved a $3 million settlement to resolve the overtime violation claims in September 2024. The class counsel’s $1 million attorneys’ fees were included in the settlement amount. The settlement was intended to return alleged unpaid overtime wages to eligible California workers.

If you have questions about filing a California wage and hour class action lawsuit, please contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Knowledgeable employment law attorneys are ready to assist you in various law firm offices in Riverside, San Francisco, Sacramento, San Diego, Los Angeles, and Chicago.

Host Healthcare Faces California Overtime Class Action

Host Healthcare faces allegations of California labor law violations in a recently filed California overtime class action lawsuit.

The Case: Samantha Brodish v. Host Healthcare, Inc.

The Court: San Diego County Superior Court of the State of California

The Case No.: 24CU001979C

The Plaintiff: Samantha Brodish v. Host Healthcare, Inc.

The plaintiff in the case, Samantha Brodish, filed a class action complaint against Host Healthcare, Inc. and Host Healthcare, LLC. Brodish alleges that rigorous work schedules at the company resulted in numerous California Labor Code violations, including failing to provide appropriate meal breaks and rest periods.

The Defendant: Samantha Brodish v. Host Healthcare, Inc.

The defendant in the case, Host Healthcare, Inc., faces numerous allegations of employment law violations, including failing to:

• pay minimum wages

• pay overtime wages

• provide required meal and rest periods

• reimburse workers for required business expenses

• provide wages when due

• provide accurate itemized wage statements

The allegations constitute violations of California Labor Code Sections §§ 201, 202, 203, 204, 210, 226.7, 510, 512, 558, 1194, 1197, 1197.1, 1198, and 2802.

The Case: Samantha Brodish v. Host Healthcare, Inc.

According to the plaintiff, Host Healthcare workers were subjected to rigorous work schedules that regularly prevented them from taking off-duty rest breaks. When employees did take their breaks and meal periods, they were allegedly often not fully relieved of their job duties. The lawsuit specifically alleges that due to overburdened work duties, inadequate staffing, and poor scheduling, Host Healthcare employees were regularly required to:

• Work more than four hours without a break

• Work through their first break (aka rest period) during 2-4 hour shifts

• Work through their first and second rest periods during 6-8 hour shifts

• Work through their first, second, and third breaks during ten-hour+ shifts

Additionally, Brodish claims the company did not provide workers one hour of wages to compensate them for the missed breaks as required by labor law. Brodish filed the class action in San Diego County Superior Court, and the case is currently pending.

If you have questions about how to file a California class action overtime lawsuit or need to discuss company policies that violate overtime law, please don't hesitate to get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Their experienced employment law attorneys are ready to assist you in various law firm offices in Chicago, San Diego, San Francisco, Sacramento, Riverside, and Los Angeles empowering you to take action.

Joe’s Pizza on Sunset Faced Overtime Pay and Minimum Wage Violation Allegations

California pizza delivery driver sues for overtime and minimum wage pay violations and wins but ends up seeking an appeal when the trial court denies the attorney fees and costs request.

The Case: Gramajo v. Joe's Pizza on Sunset, Inc.

The Court: California Court of Appeals, Second District, Eighth Division

The Case: 03-25-2024

The Plaintiff: Gramajo v. Joe's Pizza on Sunset, Inc.

The plaintiff in the case, Gramajo, worked as a pizza delivery driver for Joe's Pizza from February 2014 to June 2015. In February 2018, Gramajo sued Joe's Pizza for failure to pay minimum and overtime wages, citing multiple California Labor Code violations.

The Defendant: Gramajo v. Joe's Pizza on Sunset, Inc.

The defendant in the case, Joe's Pizza on Sunset, Inc., faced numerous employment law violation allegations in the case including:

• Failure to pay minimum and overtime wages (Lab. Code, §§ 510, 558, 1194)

• Failure to provide rest and meal periods (Lab. Code, §§ 512, 226.7)

• Failure to pay wages due (upon termination) (Lab. Code, §§ 201, 202, 203)

• Failure to reimburse for business expenses (Lab. Code, § 2802)

• Unfair business practices (Bus. & Prof. Code, § 17200).

The Case: Gramajo v. Joe's Pizza on Sunset, Inc.

The trial for Gramajo v. Joe's Pizza on Sunset, Inc. was set after close to four years of litigation and discovery, with Gramajo seeking $26,159.33 in unpaid minimum and overtime wages, missed meal and rest breaks, waiting time penalties, and unreimbursed expenses. After completing a seven-day trial, the jury found in favor of Gramajo on both the minimum wage and overtime causes of action and awarded Gramajo $2.17 in unpaid minimum wages and $3,340 in unpaid overtime wages. In total, Gramajo recovered:

• $7,659.63 (of unpaid minimum and overtime wages)

• $2,115.59 in statutory interest

• $2,100 in waiting time penalties (at a daily wage rate of $70 per day for thirty days according to Labor Code section 203)

• $2.17 in liquidated damages

• $100 in statutory penalties

Following the verdict, Gramajo moved for attorney fees totaling $296,920 and $26,932.84 in costs. The trial court denied Gramajo's fee request, granting Joe's Pizza's motion to tax costs, ultimately awarding Gramajo nothing, claiming the plaintiff acted in bad faith by inflating his damages figure, including claims he had no intention to pursue to justify the filing of an unlimited civil proceeding. The trial court also argued that the case was severely over-litigated.

Seeking Attorney Fees and Costs On Appeal: Gramajo v. Joe's Pizza on Sunset, Inc.

On appeal, the plaintiff argued the law entitled him to reasonable litigation costs (Labor Code section 1194, subdivision (a)) and that the trial court abused its discretion when turning to Code of Civil Procedure section 1033, subdivision (a), to support their denial of his litigation costs. The appeals court found the plaintiff was entitled to an award of reasonable litigation costs (Labor Code section 1194, subdivision (a)), and denying all costs by relying on Code of Civil Procedure section 1033, subdivision (a) was in error. The order denying the plaintiff's motion for attorney fees and costs and granting the defendant's motion to tax costs was reversed and remanded to the trial court. The trial court will determine a "reasonable" attorney fee and costs award for the plaintiff. The appellate court did not express an opinion on the reasonableness of the plaintiff's attorney fees and costs requests or whether or not the case should have been filed in limited jurisdiction.

If you need to discuss filing a California employment law complaint, contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP for guidance. Their seasoned employment law attorneys can assist you from their San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago offices.

A Critical Analysis of the Uber and Lyft Overtime Lawsuit

In a landmark decision that has stirred the legal landscape of California employment law, the California Supreme Court recently cited Proposition 22 when they ruled that rideshare drivers for companies like Uber and Lyft can legally be classified as independent contractors. The California Supreme Court ruling reaffirms the gig economy's business model in California, emphasizing the constitutional validity of the recently approved state ballot measure.

The Case: Castellanos v. State of California

The Court: Supreme Court of California

The Case No.: 3:19-cv-06462-JCS

The Plaintiff: Castellanos v. State of California

The plaintiffs in the case were rideshare drivers supported by various labor groups, who challenged the classification of drivers. They argued that classifying rideshare app drivers as independent contractors deprived them of critical labor protections provided by California employment law, including minimum wage, overtime compensation, and other benefits.

The Defendant: Castellanos v. State of California

The defendants, prominent rideshare companies Uber and Lyft (along with food delivery service DoorDash), defended their model by supporting Proposition 22. They argued that the proposition provides flexibility for drivers to operate as independent contractors, thus allowing them the freedom to decide when and how they work. The companies maintained that this setup benefits both the drivers for its flexibility and the companies for maintaining a cost-effective operational model.

History of the Case: Castellanos v. State of California

This legal battle reached the California Supreme Court after a three-year contest in lower courts, including a 2021 decision by a state Superior Court judge that deemed Proposition 22 "unenforceable" and a reversal by the state Appeals Court in 2023. The Supreme Court's ruling not only overturned previous lower court decisions but also marked a significant victory for the gig economy, solidifying drivers' employment status as independent contractors under state law.

The Case: Castellanos v. State of California

The Supreme Court's decision is pivotal for workers across California, particularly those in the gig economy. It underlines the ongoing tension between evolving business models and traditional employment protections. While the ruling secures the status quo for rideshare companies, it also highlights the need for continuous dialogue and potential legislative adjustments to ensure fair treatment and adequate protections for all workers in the state. The case serves as a crucial precedent in understanding and navigating the complexities of violating California overtime laws and the broader implications of labor classification in California's dynamic labor market.

If you have questions about filing a California misclassification lawsuit, please contact 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.

Amazon Workers Receive Payout to Resolve Overtime Lawsuit

Recently, Amazon.com Services reached a settlement agreement to resolve a lawsuit alleging violations of overtime regulations.

The Case: Leilani Kryzhanovskiy and Patricia Salazar v. Amazon.com Services

The Court: U.S. District Court, Eastern District of California

The Case No.: 2:21-cv-01292-BAM

The Plaintiffs: Leilani Kryzhanovskiy and Patricia Salazar v. Amazon.com Services

The plaintiffs in the case, Leilani Kryzhanovskiy, and Patricia Salazar, filed a class action overtime lawsuit. The lawsuit claimed that Amazon workers did not receive overtime pay between 2017 and 2023. The plaintiffs filed suit on behalf of anyone who worked at Amazon during the past six years and received a sign-on bonus in the same week they worked overtime. According to the plaintiffs, Amazon violated California Labor Law by underpaying overtime wages earned during the same week a sign-on bonus was issued. The overtime pay was allegedly calculated at the regular rate of pay when they should have considered the bonus payment when determining the “regular rate of pay.”

The Defendant: Leilani Kryzhanovskiy and Patricia Salazar v. Amazon.com Services

The defendants in the case, Amazon.com Services, are paying up in response to the class action overtime lawsuit. To settle the complaints, Amazon.com Services agreed to pay Amazon workers in the class over $500. While Amazon agreed to settle, it also denied the allegations of wrongdoing. Amazon.com Services has committed to a $3M payout for class members.

The Case: Leilani Kryzhanovskiy and Patricia Salazar v. Amazon.com Services

The Leilani Kryzhanovskiy and Patricia Salazar v. Amazon.com Services case resulted in a settlement agreement. Amazon workers can easily determine if they are eligible for a portion of the settlement. The criteria are: 1. Current or former Amazon employee; 2. Located in California; 3. Employed between July 22, 2017, and November 7, 2023; and 4. Received a sign-on bonus and worked overtime the same week.

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