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OT Lawsuit Follow-up/Update

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windingmeup

Junior Member
What is the name of your state? California

I originally posted a question here on this site (about two years back) about being improperly classified as an exempt employee. Over the last few years I have posted many questions and have given many updates.

I don't have any questions this time but I am posting an update for anyone who wants to know how an overtime lawsuit progresses.

What was originally my misclassification has turned into a major class action against my employer involving hundreds and possibly thousands of employees. I was originally only interested in collecting back pay for myself but it turns out there was a good case to make this into a class action suit and thus we started it (I am the class rep).

It turns out my employer approached my lawyers early and wanted to settle quickly for a small group of 50 or so people (about 1 million dollars in back pay). My lawyer said this was because they knew they had no case. My company had already admitted improper classification but did not pay us out correctly (They gave us 33 cents on the dollar of what they should have paid).

However, we have since been able to expand the suit to include more people and a greater time period and thus put more pressure on. The suit was originally for California but new class actions may be launched in several other states. This is progressing into a major suit that could rival the Farmers lawsuit several years back.

I have not been noticeably harassed by my company to date but have been preparing ever since the class action was filed. So far so good. I am told they are watching me carefully though for any little screw-up.

When everything is settled I can post some or all details.

Would any of the senior members want to know the end results and what happened during the negotiation and settlement process? I don't think this will go to trial but unless a miracle happens it should go on for another couple years. We have another meeting in early Dec to discuss settlement but this is probably the 4th meeting of that sort.

Thanks....
 


windingmeup

Junior Member
Final update

Just a follow-up as this lawsuit is all done. This turned out to be one of the largest OT settlements in United States history. All told the two separate lawsuits settled for a combined $100 million dollars. The interesting twist on this is that the company continues to this day to improperly classify their employees. In a candid conversation between their lawyers and ours they said it was cost effective to settle lawsuits. In other words the productivity gains by not having to pay overtime (and settling lawsuits) outweighed the costs of paying everyone OT up front.

I think this is a good lesson for employees of large corporations. Cooperation's have no problem breaking the law as long as the financial consequences are not as severe as adhering the law.
 

windingmeup

Junior Member
Just a follow-up as this lawsuit is all done. This turned out to be one of the largest OT settlements in United States history. All told the two separate lawsuits settled for a combined $100 million dollars. The interesting twist on this is that the company continues to this day to improperly classify their employees. In a candid conversation between their lawyers and ours they said it was cost effective to settle lawsuits. In other words the productivity gains by not having to pay overtime (and settling lawsuits) outweighed the costs of paying everyone OT up front.

I think this is a good lesson for employees of large corporations. Cooperation's have no problem breaking the law as long as the financial consequences are not as severe as adhering the law.

I know it's been about 8 years since this last post but now that I no longer work for IBM I feel I can publish more details. Here is one of the two lawsuits I was involved in. http://www.lieffcabraser.com/Case-Center/IBM-Overtime-Pay-Class-Action-Lawsuit.shtml

It's interesting because the company I work for now understands the labor laws very well in California. I work on a team that has member across the country and we all basically do the same thing. Those who work in California are non-exempt and receive overtime while those in other states are Exempt and no not receive OT.

This company does not know that I was part of any previous lawsuit so that is not the reason they are classifying us this way. They simply understand the labor laws and choose to follow them.
 

Zigner

Senior Member, Non-Attorney
I know it's been about 8 years since this last post but now that I no longer work for IBM I feel I can publish more details. Here is one of the two lawsuits I was involved in. http://www.lieffcabraser.com/Case-Center/IBM-Overtime-Pay-Class-Action-Lawsuit.shtml

It's interesting because the company I work for now understands the labor laws very well in California. I work on a team that has member across the country and we all basically do the same thing. Those who work in California are non-exempt and receive overtime while those in other states are Exempt and no not receive OT.

This company does not know that I was part of any previous lawsuit so that is not the reason they are classifying us this way. They simply understand the labor laws and choose to follow them.

I'm glad things worked out well for you, but I believe you are giving your current employer too much credit. The rules regarding exempt/non-exempt are FEDERAL, so if they are only properly classifying employees in California and not in other states, then they either really don't understand or really don't care.
 

windingmeup1

Junior Member
I'm glad things worked out well for you, but I believe you are giving your current employer too much credit. The rules regarding exempt/non-exempt are FEDERAL, so if they are only properly classifying employees in California and not in other states, then they either really don't understand or really don't care.


Sorry to unearth this ancient post but since it's related to my current post on this potential overtime Negotiation I will reference. Zigner you commented about giving my current employer too much credit. You were 100% right. They had me classified correctly as exempt for 7.5 years until changing me to exempt in 2015 to "align" me with the rest of the team.
 

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