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Wage Claims, Overtime & Other Employee Compensation

OVERTIME VIOLATIONS CAN OCCUR IN SMALL & BIG COMPANIES

     It is a common perception that wage violations are perpetrated only on low-wage or ‘blue-collar’ workers – for example, persons who work in domestic service, retail, garment manufacturing, building services, restaurants, and hotels. People who work in offices and high-rise buildings are often seen as justly compensated employees who, when they work overtime, are then properly paid. However, any employer might violate the overtime laws and any type of employee could be victimized.

     According to recent reports, Bank of America, one of the country’s largest employers, is being sued by its employees for allegedly failing to pay overtime and other wages under the law. The lawsuit is seeking to become a class action on behalf of the bank’s employees who are working or have worked at the bank’s retail branches and call centers in the last three years and may impact about 180,000 employees. Although the lawsuit was filed and consolidated in a federal court in Kansas, the lawsuit affects the bank’s employees who also work in California.

     The Complaint alleges that the bank required its employees to work more than 8 hours per day or more than 40 hours per week and yet failed to pay them, not only for overtime worked, but even for some of the regular hours worked. The Complaint also alleges that the bank required its employees to work during their meal and rest breaks but failed to compensate them for doing so. The Complaint further alleges that the bank failed to timely pay terminated employees their earned vacation benefits at the time of termination.

     If the lawsuit is certified as a class action and if the employees are able to prove their claims, the employees may recover hundreds of millions of dollars, particularly if a typical class member employee is owed at least $1,000 in back pay. This is just for actual overtime compensation owed (also known as compensatory damages). Actual overtime compensation is computed at 1.5 times the employee’s regular rate and is multiplied by the number of hours in excess of 8 hours per day. If the overtime hours exceeds 12 hours per day or exceeds 8 hours on the seventh day, overtime compensation is computed 2 times the regular rate.

     Aside from compensatory damages, the employees generally recover from employers the following items of damages:

     1) Legal Interest – In any action brought for the nonpayment of wages (overtime compensation is such a wage), the court shall award interest on all due and unpaid wages at the rate of interest specified by law. This interest shall accrue from the date the overtime payment is due and payable.

     2) Statutory Penalties – A statutory penalty is a penalty imposed for the violation of a law, such as the failure to pay overtime as required by law. In California, these penalties are usually recoverable in the event the wage statements or pay stubs do not contain the information required by the Labor Code. These penalties are also recoverable if the employer failed to pay within 72 hours all wages due after termination.

     3) Attorney’s Fees and Costs – The Labor Code specifically provides the right of employees to recover reasonable attorney’s fees and costs incurred by the employees in seeking to recover unpaid overtime and other wages.

     Moreover, employer violations of the Labor Code may lead to the prosecution of a Private Attorney General Act (PAGA) cause of action. In this case, the employees can seek to recover civil penalties on behalf of the government. These penalties are separate and apart from the statutory penalties explained above.

     While simple on its face, the pursuit of wage claims may involve complex procedural rules, especially if the claims also affect other employees. If employees wished to protect their rights, it would be smart for them to inquire with an experienced employment attorney.
 

© Law Offices C. Joe Sayas, Jr.