Category: Unpaid Overtime

Breaking Down New FLSA Regulations—What Does it Mean?

Every employee should know what their rights are, especially when it comes to their wages and salary. The federal government just released new proposed regulations that will make more than 5 million employees eligible for overtime pay. So, starting from the beginning, who creates these regulations? Why is overtime a good thing? How will this affect my pay?

The country’s labor and employment laws are governed by the United States Department of Labor, a part of the federal government. Within the US Department of Labor, there are various divisions that focus on particular parts of labor laws. For today’s discussion, we’ll use the WHD as an example. The WHD stands for the Wage and Hour Division, and their governing doctrine or act is the FLSA (Fair Labor and Standards Act).

The WHD and FLSA establishes national minimum wage rates, overtime regulations, etc. States must first abide by the FLSA and then can implement any other state wide regulations on top of the national law. (i.e. state minimum wages can be higher than the national minimum wage).

In California, we have our own state department of labor, aptly named the California Department of Industrial Relations. Within the CA DIR, wage and hour regulations are enforced by the Division of Labor Standards Enforcement (known commonly as the Labor Commissioner). Their governing doctrine or act is the Industrial Welfare Commission Wage Orders. The Wage Orders outline similar regulations as the FLSA but with California labor law.

Now that the background is out of the way, let’s discuss the regulation changes that the FLSA will enact which that will lead to changes on the state level as well. In the workforce, there are two main classifications for wage earners: hourly, non-exempt or salary, exempt. The former is paid on an hourly basis and is eligible to get paid overtime for any hours worked over eight in a day and/or forty in a week.

An employee’s job description has to meet a duties test, among other things, to determine whether or not they are exempt from overtime (and therefore on a salary). If the employee meets that exemption, then the employee must also be paid a minimum threshold for salaried employees; in California, it’s approximately $37,000 per year and nationally, it was $23,660. Last week, this all changed.

On Monday, June 29, 2015, the WHD released a new proposal to amend the FLSA and increase the base salary requirement for exempt employees. The requirement could jump from $23,660 to as much as $50,440. So what does this mean?

If you a salaried, exempt worker, it could mean a couple of outcomes. First, you might be reclassified into being a non-exempt worker, which means you are eligible for overtime. So for all of you salaried workers out there that were working more than 40 hours a week or 8 hours in a day and not receiving overtime because you were exempt, you may be getting paid your extra hours worked. The other scenario is that you stay exempt, but are given a raise to meet the threshold—in California, that maybe close to a $13,000 raise! Almost five million workers can be affected as a result of this proposal.

Uber Drivers: Employees or Not?

It has been a long war between drivers and the app based company Uber. Here and there, one side or the other gets a victory but more and more battling continues to make the fight confusing and convoluted. Turns out, in a very quiet judgement, the drivers may have had a victory. Like always, however, Uber isn’t going down without a fight.

Barbara Berwick, a former driver for Uber, filed a complaint with the California Labor Commission for unreimbursed business expenses, among other allegations. On June 3rd, the Labor Commission officer surmised that Berwick was treated like an employee as per California law, and she had been misclassified as an independent contractor, therefore was entitled to the $4,152.20 reimbursement.

In the Labor Commission case, the officer pointed out various points to assert drivers are employees. Upon applying for the company, drivers are subject to background checks and must register their cars. Cars cannot be over 10 years old, and if a driver’s client rating falls below 4.6 stars, they can be terminated from the company. Drivers cannot accept tips because it interferes with Uber’s marketing strategy (easy, streamlined, transportation). The Commissioner further qualified that the plaintiff did not exercise any managerial skills that “could affect a profit or loss” (i.e. they could not negotiate cancellation fees, only Uber could do that). Other than her vehicle and her time, Berwick had no other investment into the company.

Uber responded that it was a “neutral technological platform” that connected drivers with riders. The drivers chose their own hours and relative locations to work. However, their arguments fell flat with the Labor Commissioner. The company filed a notice of appeal, which turned the quiet judgement into another war cry.

This administrative judgement comes on the heels of a federal court decision (‘O Conner v. Uber Techs Inc.) that denied Uber’s motion for summary judgement, an attempt to claim that all issues were resolved or were unresolvable because they are so one sided. This case is also deciding whether an Uber driver is an employee or independent contractor.

Source: NY Times

When Your Employer is Watching Your Every Move – Literally

Myrna Arias was a sales executive in Bakersfield for a money transfer service called Intermex. Upon working for the company Arias was issued a company iPhone. The company required employees to download a particular clock in/clock out application loaded on the phone that became the center of Arias’ issues with the company.

When Arias inquired about the app, her boss admitted that the application still tracked the employees’ whereabouts through GPS tracking even after the employees “clocked out.” The boss, John Stubits, bragged that he knew other details about Arias’ whereabouts and habits when she was not working (i.e. he “knew how fast she was driving specific moments”). Arias and other co-workers expressed their discomfort at being tracked 24 hours a day, especially when she was not working.

Arias uninstalled the app after she told Stubits she believed it to be illegal. Stubits’ reply to his employee’s concern was that she “should tolerate the illegal intrusion…” After she uninstalled the app, she was terminated. She met all quotas and had no performance issues, so the application issue was on the forefront of her termination.

After the termination, Arias filed a lawsuit for invasion of privacy, retaliation, and unfair business practices. She is seeking in excess of $500,000 for damages and back pay for being monitored on her days off. According to the suit, “her manager made it clear that he was using the program to continuously monitor her, during company as well as personal time.”

Source: arstechnica.com

Image Source: Apple

REI Goes Into the Woods

Recreational Equipment Inc. (more commonly known by its woodsy acronym REI), is being sued by two former employees on behalf of a class of similarly situated past and present employees. “Alison M.” and “Justin Q.” filed the class suit, alleging violations of overtime laws in the state of California.

Employees who worked from November 21, 2009 to October 31, 2014 in the state of California were eligible to join the suit. It alleges employees were not paid for work they did off the clock though the work was mandatory. The suit further alleges that employees were not reimbursed for business expenses or paid for any or all overtime hours worked.

A preliminary motion for a settlement has already been approved by a Magistrate judge. According to the settlement provisions, REI would be required to pay out $2.5 million for any wage and hour violations with another $1.73 to be paid out to those who were a part of the overtime lawsuit. Alison M. and Justin Q.

Source: Topclassactions.com

BMW’s DriveNow Service Hit with ‘PAGA’ Penalties

The California Private Attorneys General Act (aka “PAGA) allows for current and former employees to act on behalf of the state in action against companies for violating California labor and employment law. PAGA was enacted in 2004 to help the Labor and Workforce Development Agency patrol employer compliance with labor law.

DriveNow, a subsidiary of BMW, is the latest company to see PAGA penalties served their way. In this class action, plaintiffs allege that DriveNow misclassified the workers as independent contractors when the company treated them as if they were employees. DriveNow controlled the workers’ schedules and workdays, much like an employer would to an employee.

In treating as such, the lead plaintiff in the action is alleging that the company failed to pay minimum wage, pay overtime wages, and provide meal and rest periods. The plaintiff further alleges that DriveNow misclassified the independent contractors in a blatant attempt to circumvent necessary California labor laws.

The case has been filed in the San Francisco.

Source: Topclassactions.com