CBG or Beth3 - Is this legal?

[RunningOnEmpty]

What is the name of your state? CALIFORNIA

A class action lawsuit was filed against my employer on behalf of employees of my occupation. The issue was whether or not we are entitled to overtime pay for overtime worked. The company said we were "exempt" from overtime pay.

In 1999, the Superior Court ruled in our favor, stating we were entitled to overtime pay. The Court of Appeals upheld the decision and the California Supreme Court denied the petition to review.

In 2001, a verdict of $90,009,208.00 was awarded, plus pre-judgement interest for a total of $124,524.816.00. The court also ruled that the company would have to keep time records and pay overtime. The court denied a post-trial motion requesting a new trial or reduction of the jury verdict. My employer is now in the process of exausting appeals, motions, etc. concerning the amount of the jury award.

In the meantime, they are having us record any overtime they approve, however, they are still not paying us for it. They have stated they are keeping track of our overtime, but do not intend to pay us for it until the court proceedings are concluded. What are they up to and is this lawful?

 

[Beth3]

You need to put this question to one of the attornies involved. This situation is out of my league.

My guess however would be that the employer has been advised by their attornies that as long as they're appealing the verdict or judgement, they are not yet obligated to pay the OT and that doing so may demonstrate that they agree with the finding of non-exempt status, perhaps putting the basis for their appeal in jeopardy.

Juries can be absurdly generous when determining awards and damages ($124 MILLION???? are there thousands of employees due back OT pay???) so at a minimum, perhaps the employer is looking for a court to reduce that to what they consider to be a more reasonable figure.

 

[RunningOnEmpty]

Yes, there are probably a thousand or more employees involved. And back overtime for a period of several years. This is a very large national company.

The jury determined the award based on depositions of a sampling of about 300 employees.

I think you are right about them wanting to make it clear they do not agree with the court's decision. But since they exhausted all appeals on whether or not we are exempt, went to the penalty phase and now are appealing the amount of the verdict, it seems like they are in violation of the court's previous ruling, that we are not exempt. Apparently this is still an issue in the penalty phase?

I have accumulated several thousand dollars in approved overtime since the company began keeping track. My best guess is that the company probably owes every penny of that jury award. (seriously). And I like my company and I like my job. I think most of us would rather have more manageable workloads than paid overtime, but unfortunately, it came to a lawsuit.

 

[JETX]

I agree with Beth. It is very common, and expected, for the employer to withhold paymetn of the overtime until the final legal issues are resolved. Anything otherwise could weaken their claim.

However, I add another possible reason for this action.... that is to wait until all the issues are finalized, then to file for bankruptcy protection to get out of the huge judgment. I have no idea whether this is even practical for your employer (and in fact $124MM may be small potatoes to the company). But this is a possibilty that should be considered.

 

[Beth3]

I'll be damned. I guessed right.

Harvard Law School, here I come...