$2 Million Settlement to End Terranea Resort Workers’ Wage Lawsuit

Court documents filed on April 30th, 2019 outlined a settlement of $2.15 million paid by Terranea Resort to resolve claims made in a significant wage and hour class action lawsuit. This settlement follows another class action lawsuit the Lowe Enterprises-owned hotel settled in 2013. The previous lawsuit resulted in a $1.125 million settlement.

The recent lawsuit was filed on behalf of hundreds of employees, both current and former, all eligible to receive compensation.  

Allegations Included in the Complaint: Various Forms of Wage Theft

•    Off-the-Clock-Work

•    Missed Rest Breaks

•    Missed Meal Periods

•    Failure to Reimburse Employees for Basic Tools Needed on the Job

•    Falsified Record Keeping to Avoid Paying Meal Break Penalties

The lawsuit also claimed that the resort failed to provide employees with payment for the time they were required to spend shuttling back and forth between the resort and off-site parking lots per company bus. According to allegations made in the complaint, it added an hour or more to employees’ travel each day. Plaintiffs also claim that workers were required to arrive early for shifts to change into their uniforms before clocking in for their shift (constituting off-the-clock-work).

Expenses that the resort failed to reimburse included the cost of essential kitchen items cooks used in the luxury resort kitchen. For instance, cooks claim they purchased their own knives, graters, etc. because the resort did not provide even the most necessary tools.

If you have questions about wage and hour law or if you are not paid the compensation you are due, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP today.

Recent Suit Claims Fresenius Left On-Call Time Out of OT Calculations

When Fresenius Medical Care Holdings Inc. calculated employee pay rates at their Ohio hospitals, they allegedly failed to include a stipend for on-call hours. In doing so, they effectively robbed their employees of overtime they were legally obligated to pay. As a result, Fresenius is now facing a proposed class action that was filed in Boston federal court (Freeman v. Fresenius Medical Care Holdings Inc. et al., case number 1:19-cv-10439).  

Fresenius Medical Care Holdings, a German company with North American headquarters in Massachusetts, is the world’s largest provider of dialysis products and services. David M. Freeman, plaintiff in the suit, was employed as a nurse by the company in 2009. During his time with the hospital, he worked at a number of their various facilities throughout Northern Ohio. As payment for his work, Freeman claims he received flat-rate stipends for time he spent on call on top of his hourly rate of pay. According to the lawsuit, Fresenius company policy does not recognize on-call time as hours worked and Freeman claims that this policy defies the Fair Labor Standards Act (FLSA) by excluding the on-call pay from the regular rate for the purposes of overtime calculations.

Freeman believes that the company knew that on-call pay and other, similar forms of payment for employment must be included according to employment law when computing an employee’s regular rate of pay for overtime calculations. Due to the obvious disregard of the illegality of their policy, Freeman alleges that Fresenius acted in reckless disregard for the illegality of their actions when excluding on call pay. The plaintiff argues that the practice of excluding on call pay in this manner runs counter to both longstanding U.S. Department of Labor regulations and case law.

For example, an agency regulation that was issued in the early 1980s states that on-call payment is “clearly paid as compensation for performing a duty involved in the employee’s job.” The regulation goes on to say that as on-call payment is payment for a job duty, it must be included as part of the employee’s regular rate of pay.

The lawsuit brings claims for OT violations under both federal and state law and seeks declatory and injunctive relief. It also establishes a putative class of individuals employed by Fresenius Medical Care North America during the last two years. In addition to naming Fresenius as a Defendant in the suit, Freeman named its subsidiary, Renal Care Group Inc. due to the claim that they issued checks on behalf of Fresenius.

If you have concerns about how your employer calculates your overtime pay or if you are not receiving overtime pay, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP today.

California Court Rules On-Call Tilly’s Workers Should Receive Pay

Some employers require workers to call in in order to find out if they have to work their shifts. Some employees are required to call in just hours before they may need to start work. This practice triggered California’s requirement that workers be given “reporting time pay.” A split California appeals panel recently brought this up when reviving a proposed wage class action against Tilly’s Inc. In doing so, they potentially opened up many other California retailers to similar (potentially expensive) suits.

The Second Appellate District said Tilly’s on-call policy triggers California State’s Wage Order 7, in which it states that employers must provide workers with pay when they report to work but are not put to work or provided with at least half of their usual/scheduled day’s work. Since workers are “reporting” when they call in, Wage Order 7 means employers must pay them between 2-4 hours worth of wages depending on the length of the scheduled shifts being referenced.

Tilly’s practice of having their workers call in to see if they need to work their shifts just hours before they would need to start work, is exactly the type of policy that reporting time pay was intended to stop. The appellate court decision overturned a lower court ruling that tossed the suit when they concluded that the on-call scheduling alleged in the case against Tilly’s triggers Wage Order 7’s reporting time pay requirements. They noted that on-call shifts are a burden to employees who cannot take other employment, attend school or make plans socially because they may need to work, but simultaneously may not receive payment for the time they have set aside unless they are ultimately called in to work.

Tilly’s argues that workers “report” for work under Wage Order 7 only if they physically show up for the start of a scheduled shift. The appellate court concluded that the requirement should be read to include those required to check in before physically arriving on the job before granting worker Skylar Ward’s appeal.

The appellate court noted that while policies like Tilly’s call-in requirement probably didn’t exist when Wage Order 7 was adopted by the state, the reporting time requirement covers situations other than those specifically considered by the drafters.

If you have questions about what is covered by Wage Order 7 or if you are required to call in to report before a shift, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP so we can help you protect your rights in the workplace.

Do After Hours Phone Calls Qualify for Overtime Pay?

The fact that the majority of workers carry a cell phone 24/7means that employers have the ability to reach workers at any time on any day. The problem is that some employers actually expect workers to respond at any time on any day (or night) as well. So, what about that random 1am phone call from the manager on duty? Does that count towards overtime hours?

24/7 access to their employee workforce is going to come at a cost to employers as they will need to pay for the time or risk potential class litigation regarding unpaid wages. Starbucks Corp. and Evolution Fresh (a Starbucks subsidiary) recently settled an overtime suit that delivery drivers brought against the company claiming that they were not compensated for company calls they took outside of their scheduled shifts. Another major corporation, ABM Industries, is facing similar problems. It looks like ABM will probably be settling (to the tune of $5.4M) to resolve claims that they failed to reimburse cleaners for data and cell phone costs. ABM employees claim they were required to use their cell phones for clocking in, clocking out, and other work necessities and job duties.

So, when do employers need to pay workers for after hour calls? What about after-hours emails? How is “compensable time” determined?

Determining compensable time depends on which law is at play: the federal Fair Labor Standards Act or an equivalent state law. Once this is determined, the question becomes whether or not the employees are covered by the law. If the employee is covered by the law, is their work considered “de minimis” or too infrequent or insignificant to require payment?

This type of overtime case depends heavily on the facts and details of the specific case. How the details are presented can be crucial and the court’s decision has been known to fall on both ends of the spectrum. Nearly everyone has a cell phone and this makes it easy to reach an employee with a phone call, text message or email during a break or after they are off work and off the clock. Some employees feel pressured to respond to employer contacts even though they aren’t clocked in – others may be required by company policy or expectations to respond.

If you have questions about why you aren’t paid overtime or if you need to talk about what constitutes off the clock work, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP today.

The California Supreme Court’s Dynamex Decision Impacts Standards

The California Supreme Court’s decision on Dynamex Operations West, Inc. v. Superior Court of Los Angeles is affecting legal standards determining whether a worker should be legally classified as an employee or an independent contractor. The company in the case, Dynamex, put a test in place as a standard determining classification that made it more difficult for businesses to classify workers as independent contractors.

For example, Lawson v. Grubhub, Inc. was a case heard before U.S. Magistrate Judge Jacqueline Scott Corley. It was a closely watched case out of California federal court. The judge on the case noted in a new order that her decision on the case may have been different if the Dynamex opinion had already been recorded. While Judge Corley declined to vacate her earlier finding, it is likely the order will be reversed upon appeal.

In Lawson v. Grubhub, Inc. the plaintiff, Raef Lawson was a GrubHub driver who claimed he was misclassified as an independent contractor. When GrubHub moved to dismiss the suit in early 2018, the district court found the company did not “control” Lawson’s work – siding with the company. Lawson appealed. After the Dynamex decision, Lawson filed a motion. He sought relief from the judgment on record. Lawson argued that his case would have had a different outcome if the California Supreme Court had adopted a new legal standard for use when determining the classification of workers as employee or independent contractor. The court responded by allowing that a careful consideration of the issues and with the benefit of an oral argument, the motion raises substantial issue, but they declined to definitively rule on vacating the judgment. They court noted that deciding whether or not the Dynamex ruling should apply retroactively is a decision to be made by the U.S. Court of Appeals for the Ninth Circuit.

If you have questions about misclassification or if you need to discuss how you can seek justice when your employer refuses to provide you with overtime pay, please get in touch with one of the experienced employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.