Homestead mailing list

[Tvoivozhd <tvoivozd AT infionline.net>]

Yeah, they were intended to allow employers a license to steal from 
wage-earners by labelling non-managerial work as managerial---real cute, 
but something we have come to expect from the Orwellian Doublespeak like 
"Clean Skies Initiative", and "Healthy Forests" aka "The Only Good Tree 
Is A Dead Tree".

latimes.com <http://www.latimes.com/>
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http://www.latimes.com/business/la-fi-savon27aug27,1,2228162.story?coll=la-home-business 



 Class-Action Lawsuits for Overtime Pay Allowed

By Maura Dolan and Lisa Girion
Times Staff Writers

August 27, 2004

SAN FRANCISCO — In a closely watched labor law case, the California 
Supreme Court cleared the way Thursday for a class-action lawsuit 
brought by Sav-on Drug Stores workers who say they were misclassified as 
managers and improperly denied overtime.

The unanimous ruling overturned a lower-court decision that would have 
discouraged such suits.

Plaintiffs' attorneys maintain that many workers — despite being given 
titles such as "store manager" or "team leader" — spend most of their 
day on non-managerial tasks such as stocking shelves or tending a cash 
register, rather than overseeing any aspect of the business.

Companies had hoped that the lower court's position would slow a wave of 
overtime litigation that has swept the state in recent years, costing 
firms hundreds of millions of dollars in judgments and settlements. A 
broad swath of corporate California has been hit, including Farmers 
Insurance Group, Bank of America Corp., RadioShack Corp., Rite Aid 
Corp., Starbucks Corp., Taco Bell Corp. and United Parcel Service Inc.

As a result of the high-court ruling, experts said, California 
businesses can expect a renewed surge of class-action litigation seeking 
overtime pay.

"There are probably a fair number of these lawsuits waiting in the wings 
for the court to clarify what the standards are," said Steven Katz, a 
Los Angeles lawyer who wrote a friend-of-the-court brief for other 
businesses in the Sav-on case. "Now that that has happened, I think 
we're going to see those suits being filed."

A spokeswoman for Sav-on, which has about 300 stores in California, 
declined to comment on the ruling. Rex S. Heinke, a Los Angeles attorney 
who represented the drugstore chain, said he couldn't comment because 
the litigation was ongoing.

The California Supreme Court ruling came the same week that new federal 
overtime regulations took effect. Those rules, which are expected to 
reduce the amount of overtime paid to workers and reduce litigation, 
were opposed by organized labor and embraced by the business community.

The federal regulations, however, are expected to have little effect in 
California, which has its own labor laws.

Under the state statutes, workers who spend more than 50% of their time 
performing the duties of hourly workers, even if they're called 
managers, are eligible for overtime pay. Eligible workers who put in 
more than eight hours a day on the job are supposed to be paid for the 
overtime at time-and-a-half — 1.5 times their usual hourly rate.

Under federal law followed in most other states, managers may be exempt 
from overtime pay if their primary duties are supervisory.

The state high court's decision stemmed from a lawsuit brought by two 
Sav-on managers who contended that the chain misclassified its assistant 
managers and operating managers as exempt from the state's overtime wage 
laws.

Lawyers in the case have estimated that 600 to 1,400 Sav-on workers may 
be entitled to back pay if the lawsuit succeeds.

A trial judge in Los Angeles agreed to certify the suit as a class 
action, a move that was appealed by Sav-on, a unit of Albertsons Inc., 
which is based in Boise, Idaho. The state Court of Appeal reversed the 
trial judge, finding that managers in different stores spent their time 
in such different ways that they were not similar enough to be treated 
the same in a mass trial or settlement.

In overturning the Court of Appeal's decision, the high court stressed 
that it was not ruling on the factual merits of the plaintiffs' case. 
The judges said the employees had presented enough evidence of common 
grievances to have their lawsuit certified as a class action.

"The record contains substantial, if disputed, evidence that deliberate 
misclassification was defendant's policy and practice," Justice Kathryn 
Mickle Werdegar wrote for the court.

Without class actions, she added, there would be a "multiplicity of 
trials conducted at enormous expense to both the judicial system and the 
litigants."

Brad Seligman, an Oakland lawyer who represented the Sav-on workers, 
said the ruling might prompt employers to be more careful about how they 
classify jobs. Others suggested that businesses might now turn to state 
lawmakers and the Schwarzenegger administration for relief from such 
lawsuits.

The Sav-on case, Seligman said, also is significant because the court 
emphasized that there was a strong public policy argument in favor of 
class actions generally.

"This will make it much harder for a defendant to argue in other cases 
that you can't have a class because you have to prove each individual's 
claims," said Seligman, who is also representing 1.6 million female 
Wal-Mart Stores Inc. employees in a federal discrimination case.



He said the Supreme Court indicated in its ruling that surveys, 
statistics and other kinds of evidence could be used to support class 
certification.

Dennis Riordan, another lawyer for the Sav-on employees, said the 
decision was "absolutely critical to working people, particularly those 
who really aren't managers."

"The decision makes it clear that the Court of Appeal not only was 
wrong," he said, "but egregiously wrong."


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Copyright 2004 Los Angeles Times