It is not news that class action lawsuits for unpaid overtime are on the rise. A settlement agreement approved recently by the United States District Court for the Southern District of Ohio shows just how costly those claims can be.

In Thorn v. Bob Evans Farms, Inc. the U.S. District Court in Columbus, Ohio approved a settlement between Bob Evans Farms, Inc. (BEF) and a class of 1,566 current and former assistant restaurant managers. The assistant managers had been treated by BEF as exempt from overtime requirements under federal and state law. In the class action lawsuit, the assistant managers argued that they had performed non-exempt duties, including operating cash registers, food preparation and clean-up to such an extent that they were not genuinely exempt from overtime pay requirements.
Continue Reading Assistant managers’ wage hour battle with Bob Evans Farms settled for $16.5 million

Think for a moment about all of the employment law obligations you face as a Human Resources professional or employment legal counsel. As extensive as those are, there is actually very little that you have to report to the federal or state government on a regular basis about your employment activity. You have very few obligations to report to the government on your personnel actions, including compensation – at least as of now. In fact, about the only obligation to report information to the federal government is the annual federal EEO-1 report, which must be filed by companies with 100 or more employees and by federal contractors with 50 or more employees. As you know, the federal EEO-1 currently requires only that you report the number of employees at each covered establishment and corporate-wide, by ten broadly defined job categories and broken down by race, gender, and ethnicity. If adopted, the EEOC’s recently-announced proposed wage reporting rules will require that compensation data be added to the EEO-1 report. In addition to the administrative burden this will cause, employers have real concerns about the ways in which the EEOC promises to use the data.

Continue Reading EEOC proposed wage reporting rules: could be a major problem

According to the American Association of University Women (AAUW), female workers earn 79 cents for every dollar earned by their male counterparts. For women of color or women with children, this number is even lower. There are many movements across the country demanding equal pay for women, including one right here in Ohio. On Jan. 1, 2016, California’s Fair Pay Act (The Act) became effective, and many employers are wondering- is my state next?

Continue Reading Fair pay laws on the horizon?

In June, we told you about Moran v. Al Basit LLC, 14-2335 (6th Cir. 2015), a new decision from the Sixth Circuit Court of Appeals demonstrating how easy it is to get to trial on a claim of unpaid overtime. Last month, in Garcia v. SAR Food of Ohio, Inc., 1:14-cv-01514 (N.D. Ohio 2015), a district court in Ohio relied on that decision to deny summary judgment to an employer that did most things right with regard to its Fair Labor Standards Act compliance.

Jose Garcia and Raymond Sutton were employed by SAR Food of Ohio, Inc. (“SAR”), which owns and operates several restaurants, in a variety of hourly positions. These positions, including cook, were not exempt from the overtime requirements of the FLSA and applicable state law. Garcia and Sutton worked varying hours based on work schedules set for them by SAR, but claim that they were frequently required to continue working beyond their scheduled shifts and that these additional hours usually amounted to several hours each week.

SAR used the work schedules to keep track of the hours employees worked. Employees were instructed to make changes to the schedules to reflect the hours that they actually worked and to initial the schedules to confirm their accuracy before payroll was processed. Other SAR employees testified that, when they made changes to their schedules to reflect their actual hours worked, they were paid appropriately. Garcia and Sutton, however, never made any changes to their schedules, but generally initialed them anyway (some schedules, they claim, were initialed by their supervisors on their behalf). As a result, they were paid for only the hours that they were scheduled to work.
Continue Reading Another FLSA case gets to trial based only on uncorroborated testimony

The Second Circuit Court of Appeals in Glatt et al. v. Fox Searchlight Pictures, Inc. recently rejected the Department of Labor (“DOL”) six factor test for determining whether an individual has been properly classified as an unpaid intern in favor of another test that looks at whether the intern or the employer is the primary beneficiary of the relationship.

The DOL’s six factors are:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  4. The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
  5. The intern is not necessarily entitled to a job at the end conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship. Rejecting the DOL test, the court (as discussed below) elected to adopt a test that it believed aligned more closely with common law and the underlying purpose of an unpaid internship.

In Glatt, the Second Circuit reversed a district court decision that held, in part, that three individuals working for either Fox Searchlight or Fox Entertainment Group were improperly classified as “unpaid interns” in accordance with the FLSA and the New York Labor Law (“NYLL”). In doing so, the Second Circuit rejected the district court’s analysis that relied on the DOL test. The six factors came directly from a 1947 Supreme Court decision in which the Supreme Court refused to recognize unpaid railroad brake trainees as employees under FLSA. The Glatt court rejected the DOL test because it relied on what it considered to be an outdated Supreme Court decision that failed to reflect the purpose of the modern internship.
Continue Reading Second Circuit rejects DOL test for unpaid internships

Following on the heels of its proposed rule expanding the number of employees entitled to overtime under the FLSA, the Department of Labor’s Wage & Hour Division has issued an Interpretation Letter that addresses independent contractor misclassification. Though the Letter, issued by WHD Administrator David Weil, contains no earthshaking new compliance obligations for employers, it

Today, the Department of Labor announced a proposed rule that would extend overtime pay to an additional 5 million Americans.  Currently, those executive, administrative, professional, outsides sales, and computer employees who make above $23,660 annually are exempt from the minimum wage and overtime requirements under the Fair Labor Standards Act (FLSA). Under the proposed regulation,

It is summer, and you know what that means: teenagers, everywhere. And they are not just hanging out at the mall, they are working at the mall, at the local pool, and in other entry-level positions. Unlike other workers, however, teenagers come with their own special set of complications. Generational issues aside, the real concern for employers with employment of minors is complying with federal and state laws specific to employment of minors.

Hiring

Before hiring minors, each employer should verify whether it can hire minor employees in the industry in which the employer operates and the state in which the business is located. Many states, including Ohio, require that an employer first obtain some type of work permit before hiring minors. Under Ohio law, every minor 14 through 17 years of age must have a working permit unless otherwise exempted, e.g., 16 and 17 year olds who only work during the summer in nonagricultural and nonhazardous employment. R.C. § 4109.02.

There are, however, some occupations deemed too hazardous for minors. In Ohio, they include the following:
Continue Reading Hiring minors: Not my teenage dream