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Negotiating an OT back wage settlement

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windingmeup1

Junior Member
What is the name of your state (only U.S. law)? California

I'm seeking suggestions/advice for settling a back overtime directly with my employer that is owed to me due to exempt misclassification. I have actually been involved in the past with lengthy lawsuits involving similar situations and I am very knowledgeable in this area of what type of work cannot be classified as exempt. One of the lawsuits settled for 61 million and was one of the largest OT settlements in the nation.

I am a computer professional providing maintenance and support for IT equipment/software/PDA's etc. It's desktop support work. I was actually paid overtime for 8 years but a year an a half ago I was "promoted" to exempt with no salary increase. In the process I lost significant OT pay because my job requires about 8 OT hours a week. My job did duties did not change at all.

In my research I have discovered that this company routinely misclassifies most it's computer professionals. After speaking to a lawyer, I was told the reason this is so common is because the worst thing that happens to the company abusing the labor law is they just pay the OT owed. They are worse off financially to follow the law and pay OT when labor law requires it because they can just pay it later if someone discovers.

Well the last time I went through a law suit I did not get all the OT owed because the settlement granted some compensation to the lawyers and of course this is fair because of the hard work they put into the case.

However, this time around I want to approach the company (after I reach 2 years or I am laid off/fired) and let them know that I plan to sue them for my back owed overtime plus start a class action lawsuit for the hundreds of other computer professionals who are misclassified. I want to see if I can get them to negotiate a direct settlement with me at that point rather than risk me starting a class action.

I would ask them to pay me the OT owed for two years at 1.5 my computed hourly rate. I would also ask for two weeks severance for each year I was employed with the company (approaching 11).

Can I legally ask for a negotiated settlement like this under the "threat" of filing a class action lawsuit? Or can that be considered a form of bribery? If I put myself in their shoes, they risk having to pay hundreds of individuals back OT and deal with a lengthy legal process or they can just settle with me and be done with it.

Could something like this work or am I better off just dealing with this through the legal system and waiting 3-5 years for payment at most likely less than I would be actually owed.

thanks in advance for responses.
 


eerelations

Senior Member
You can ask for anything you want but they have no obligation to give any of it to you. Try filing a wage claim with the federal DOL.
 

cbg

I'm a Northern Girl
Given that's it's California, he'd be better off filing with the state DOL.
 

windingmeup1

Junior Member
Given that's it's California, he'd be better off filing with the state DOL.

Thanks for the quick response. Knowing how lengthy the legal process can be I was hoping to have a quick direct settlement with the company. The only leverage I have is my knowledge of their violation of labor laws for most likely well over a hundred IT employees. It may be as many as five hundred. This is a very large company (in the fortune 20). I would threaten to come forward to DOL with the knowledge and documents I have collected if they did not settle on my terms which would be back OT owed and some severance.

I just wanted to make sure I wasn't doing anything illegal by demanding they pay me or I sue. Any suggestions on direct negotiations with the company on this? Does this approach have flaws?
 

Zigner

Senior Member, Non-Attorney
The biggest flaw is that your understanding of how exemptions to the OT laws apply is probably less complete than theirs. Your next big flaw is that your legal team is much smaller than theirs.
 

cbg

I'm a Northern Girl
"Pay me what you owe me or I'll sue for it" is fine.

"Pay me or I'll go public with accusations of illegal actions" is not.

You may or may not be right that you are owed back overtime. As far as the law is concerned, you are not owed a single penny of severance. Ever. No matter what the circumstances. The SOLE exception to that would be if a legally binding and enforceable contract says you are.

Keep that in mind.
 
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windingmeup1

Junior Member
"Pay me what you own me or I'll sue for it" is fine.

"Pay me or I'll go public with accusations of illegal actions" is not.

You may or may not be right that you are owed back overtime. As far as the law is concerned, you are not owed a single penny of severance. Ever. No matter what the circumstances. The SOLE exception to that would be if a legally binding and enforceable contract says you are.

Keep that in mind.

Thanks CBG for the clarification.

I could go into details but I can assure 100% I am classified incorrectly as are many others. I have spoken to lawyers and they agree that I am classified incorrectly but they suggest I do not file a lawsuit while I am still employed and I agree. I have already been closely involved with a 65 million dollar OT settlement (2006) against IBM for the exact same thing. That lawsuit stemmed from a single person whom I put in touch with a lawyer. IBM refused to pay this person back OT after he left the company and that guy filed a class action on behalf of 32,000 of us. I think the company should have settled with him for the $8000 they owed him in back OT and had him sign a non disclosure.

I will most likely end up going with a lawyer but I would think the company would be interested in settling if I can present them with the info I know. One piece of evidence I have which is damming is that they recently had many of us document our day to day, hour by hour duties for 2 months. I have copies of those documents which is proof of incorrect classification. I don't think they realized what they did. This happened as a result of a new VP that was hired and he wanted to get a better feel for what everyone's day to day work life is like. Is was done in the context of being able to justify hiring additional personal but it inadvertently documented our incorrect classification.
 

windingmeup1

Junior Member
The biggest flaw is that your understanding of how exemptions to the OT laws apply is probably less complete than theirs. Your next big flaw is that your legal team is much smaller than theirs.



Thanks Zigner. I agree. I am a legal team of one and they would run circles around me or possibly even trick me into signing something I would regret. I would probably hire and pay an overtime attorney to go over any final agreement.

Don't underestimate the power of a small legal team though when a company is clearly in the wrong. In 2006 I helped start one of the largest OT lawsuits (65 million) in the nation against IBM. In 2000-2001, I spent many hours discussing this case with my lawyer who was running a very small firm. This small firm slowly build this class action using other law firms across the country and in the end it was a powerful team that could oppose IBM's world class legal team.

https://redmondmag.com/articles/2006/11/26/ibm-pays-tech-workers-65-million-to-settle-overtime-lawsuit.aspx

That IBM lawsuit was the result of a single individual who was refused back OT pay when he left the company. This lawsuit may have never happened if IBM had agreed to pay this individual $8,000 owed in back OT when he left the company. I put him in touch with my lawyer to file a class action on behalf of all of us.
 

windingmeup1

Junior Member
Whether they owe you or not, waiting 6 more months to hit that 2 year milestone is bad form. Fish or cut bait.
Sorry, I disagree with that. From experience and from advice from my lawyer, if I report this now they will most likely agree, reclassify me, then cut my pay significantly to account for the OT, then refuse to pay OT without approval. This is exactly what IBM did in 2006 after settling the OT lawsuit.

I would also be under a microscope and subject to dismissal if I made any screw up.
 
Sorry, I disagree with that. From experience and from advice from my lawyer, if I report this now they will most likely agree, reclassify me, then cut my pay significantly to account for the OT, then refuse to pay OT without approval. This is exactly what IBM did in 2006 after settling the OT lawsuit.

I would also be under a microscope and subject to dismissal if I made any screw up.

So you think you're entitled to EXTRA for their bad deed. My opinion is the same. Bad form. Good luck to you.
 

Zigner

Senior Member, Non-Attorney
He's waiting to pull a GOTCHA!

Again, I suspect that the OP might not be up to snuff on overtime law exemptions in 2017.
 

windingmeup1

Junior Member
You've got all the answers AND spoken to attorneys...why are you here again? :confused:

FreeAdvice. I was looking for suggestions comments on direct negotiations after I leave the company. There many great legal minds here and I am interested in the pros cons of direct negotiation versus a lawsuit.

Thank you and everyone for their comments. I already have my answer and that is I should file a lawsuit (possibly class action) versus direct negotiations. I also wanted to make sure I wasn't doing anything illegal by asking them to pay or I sue. CBG answered that very clearly.

By the way CBG thank you. You were very instrumental back in the early 2000's when I was posting early info on the lawsuit against IBM. It may be somewhere in these archives.
 

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