Being Mindful of Paycheck Abuses

November 14th, 2019 by Phil Mattera

It turns out that yoga instructors are mindful about more than poses and breathing. They also make sure they are paid properly for their work. A group of instructors in Illinois who sued CorePower Yoga for violating federal labor law recently reached a final settlement of $1.5 million to resolve allegations that the chain failed to pay them for mandatory out-of-studio work such as class preparation and communicating with students.

The yoga instructors’ case is just one of a remarkable series of settlements that continue to emerge from the courts despite the efforts by employers to thwart collective action against workplace abuses. I keep an eye on these developments as part of my work on Violation Tracker and am amazed at the quantity and variety of wage theft litigation. Here are some other examples I have been collecting to include in the next update of the database.

PetSmart agreed to pay $2.4 million to a group of dog groomers in California who alleged they were shortchanged on overtime and mandatory rest breaks and meal periods.

Zocdoc, an online medical appointment booking service, agreed to pay $1.4 million to resolve a lawsuit filed in New York alleging that the company mistakenly classified sales personnel as exempt from overtime pay.

Safelite agreed to pay $8.2 million to windshield replacement technicians in California who claimed they were not properly paid for administrative duties and time spent traveling to jobs.

Great American Financial Resources agreed to pay $1.25 million in Ohio to settle a dispute involving commissions for insurance agents.

Here are some other cases in which the parties have reached a settlement that is awaiting final court approval:

Morgan Stanley agreed to pay more than $10 million to resolve a lawsuit alleging it improperly refused to reimburse its financial advisers for work-related expenses such as client entertainment.

Pongsri Thai Restaurant in New York agreed to pay $3.7 million to a group of workers to resolve allegations that the company violated overtime and minimum wage regulations.  

FedEx agreed to pay $3.1 million to settle a suit brought by a group of drivers in western New York claiming they were misclassified as independent contractors and subject to improper pay deductions.

Not all these cases are resolved through a settlement. For example, a federal jury in Florida recently awarded $1.2 million to a group of forepersons employed by the tree service company Asplundh who alleged they were improperly denied overtime pay. It is not yet clear whether the company will appeal.  

A federal appeals court recently upheld a $4.6 million verdict won by a group of exotic dancers who had alleged that the Penthouse Club in Philadelphia misclassified them as independent contractors and thus denied them minimum wage and overtime protections.

Two things are made clear by this list. The first is that the problem of wage theft is pervasive. It is present in both old economy and new economy companies and in both highly paid and low-wage occupations. The culprits are both large employers and small ones, and the problem can be found all over the country.

The second conclusion is that, despite adverse rulings from the U.S. Supreme Court and efforts by employers to make it as difficult as possible for workers to sue, there is no sign yet that the flow of successful collective action wage and hour lawsuits is receding.

This is vital at a time when the Trump Labor Department has been seeking to replace federal enforcement with a dubious program promoting voluntary compliance by employers. For now, workers are holding their own in the ongoing battle over paycheck abuses.

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