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Overtime Collective Action Dismissed Despite Court Believing Workers Claims May be Valid

 

The ability to file a lawsuit as a class action is a key tool in many areas of the law, particularly employment law. It benefits plaintiffs because a plaintiff with a small claim for unpaid wages would not be able to afford the costs of filing a lawsuit. When taken together, groups of employees can sometimes claim tens of thousands of dollars (if not more) in a lawsuit against their employer. The opportunity to file a class action also provides employees with leverage against their employer, an important consideration, especially if the employer is a large company with a team of lawyers at its disposal.

Class action lawsuits also benefit the courts. They prevent the courts from getting flooded with lawsuits filing the same claims against the same defendant. The ability to handle multiple claims in one lawsuit makes the process faster and more efficient.

In recent years, plaintiffs have been fighting to keep the right to file class actions. Companies all over have been requiring everyone from their employees to their customers to sign contracts which include arbitration agreements. These agreements state that any dispute between the parties is to be settled in arbitration only without recourse to class action. These agreements tend to heavily favor the company and courts will usually rule that the contract is unenforceable and allow the plaintiffs to proceed as a class.

Recently, the U.S. District Court for the District of Northern Georgia failed to side with the plaintiffs in a class action wage and hour lawsuit. The case concerns employees who worked for Chipio Windshield Repair LLC, Kingco Promotions Inc., and Levaughn Hall. The employees worked as window repairers in 2011 and allegedly worked 50-80 hours per week, without the proper overtime compensation. Under the federal Fair Labor Standards Act (FLSA), employers are required to provide all of their hourly employees with one and one-half times the employees’ normal hourly rates for all time spent working in excess of eight hours a day or forty hours a week.

The lead plaintiffs, Ashley Walthour and Kevin Chappell, signed an arbitration agreement with their employer. When they filed the lawsuit, the companies responded with a Joint Motion to Compel Arbitration and to Dismiss Plaintiffs’ Complaint. The plaintiffs do not deny that they signed the arbitration agreement, but they argue that the right to file a class action is protected under the FLSA, and as such, cannot be legally waived.

Although the court agreed that the plaintiffs had a strong case, it still ruled in favor of the defendants, noting that “until either the Supreme Court or the Eleventh Circuit put to rest the question of whether a collective action is a substantive right under the FLSA which cannot be contractually waived by an employer, this court must order such claims to mandatory arbitration.”

The plaintiffs appealed the court’s decision and have asked the Eleventh Circuit Court of Appeals to reevaluate their case. If the district court’s ruling is upheld, it could negatively affect all wage and hour class actions throughout the country. Stephen Michael Katz, the attorney representing the plaintiffs in the case, said, “If we’ve learned anything from the [FLSA] in [the] last 70 years, it’s that you won’t be able to bring any overtime claims unless you have the threat of collective action.”

The Chicago class action and employment law lawyers at the Chicago Overtime Law Center are investigating unpaid overtime claims by large corporations such as Wal-Mart and Schneider Logistics for misclassifying employees as managers or assistant managers, failing to pay for meal breaks, forcing employees to work off the clock at business, failing to share all tips, erasing or altering time sheets or time records, pressuring workers not to report or record overtime, and otherwise failing to pay workers for overtime and other wages. If you are the victim these wage theft practices call us at (312) 869-4095 or contact us online.

The Chicago class action attorneys at the Chicago Overtime Law Center have three decades of experience fighting to help employees who are victims of wage, overtime and tip theft by their employers. We have a team of Chicago unpaid overtime lawyers who concentrate on prosecuting state and nationwide class action lawsuits. Our attorneys work out of Chicago and Oak Brook offices and pursue claims for workers all over the Chicago area including Elgin and Evanston. We protect unpaid workers who haven’t received overtime throughout the Chicago area including in DuPage, Lake, McHenry, Kane and Cook Counties.

Our Cicero and Berwyn overtime lawyers are intimately familiar with the issues that arise during wage claim litigation, and we know the laws that govern overtime cases well. Many employers misclassify employees as being exempt from overtime laws and pay workers salaries instead of hourly wages in order to avoid paying them overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and a lawsuit may be the only way to recover their earned wages.

The Chicago Overtime Law Center is based in Chicago, and represents clients throughout the country who have not been paid for the overtime hours that they worked. If you believe that you are owed overtime wages, contact one of our Chicago class action attorneys by phone at (312) 869-4095 or through our online form.