Matco Ends Wage Theft Class Action with $15.8M Settlement

Matco Tools Corp., a tool company, recently agreed to pay their franchisees $15.8 million to resolve a class action alleging the corporation misclassified them as independent contractors to avoid paying overtime and other benefits.

The Case: Fleming v. Matco Tools Corporation et al.

The Court: U.S. District Court for the Northern District of California

The Case No.: 3:19-cv-00463

Plaintiffs in the Case: Fleming v. Matco Tools Corporation et al.

The specified settlement between the two parties in Fleming v. Matco Tools Corporation et al. stemmed from Matco franchisee John Fleming suing the Ohio-based mechanic tools manufacturer (and its parent company, Fortive Corp) in Jan. 2019. Fleming claimed he and other franchisees were misclassified as independent contractors. Fleming was a Matco franchise owner from 2012 to 2018. The defendant argued the case should be dismissed as Fleming was not a franchise owner at the time of the filing, but the court disagreed and certified the class action. The allegations included in the complaint will be resolved by the proposed settlement, which will see plaintiffs (the affected franchisees) each receiving over $40,000 in cash/debt relief.

Defendant in the Case: Fleming v. Matco Tools Corporation et al.

Matco Tools Corp. has agreed to a $15.8 million settlement with franchisees. The settlement would resolve claims that the company misclassified their franchisees as independent contractors to skimp on costs associated with fulfilling California labor law benefits requirements like overtime, meal and rest breaks, accurate wage statements, and timely payment of wages upon termination.

The Case: Fleming v. Matco Tools Corporation et al.

The franchisees claimed that the tools company wrongly classified them as independent contractors when they were employees, denying them the right to overtime pay and other benefits. After a years-long battle, the parties agreed to a settlement with the plaintiffs stating that going to trial could be a risk, so settling before trial was their preferred option. Under the settlement terms, Matco will pay the class of about 273 franchisees $13.5 million and relieve more than $2.3 million worth of debt.

If you have questions about California labor law violations or how to file an overtime class action, please contact 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.