Retail chains all over the country have been hit with wage and hour class action lawsuits from employees alleging they should be paid for the time they’re made to spend waiting in line to have a manager check their bags for stolen merchandise before they can leave. Different courts have provided different rulings on this issue, making it difficult for the parties to predict which side the court will favor.
In 2014, two Coach employees, Eve M. and Lou A., filed separate wage and hour lawsuits against the luxury retailer for allegedly refusing to pay them for the time they spent waiting for a manager to complete the security check. The lawsuit alleges employees sometimes had to wait as long as half an hour before the check was completed and they were allowed to leave.
The lawsuits were filed in California and the courts combined the two complaints into one class action. The plaintiffs claim the class could include as many as 4,000 full-time and part-time sales associates who worked in Coach stores all over California any time between March 20, 2010 and May 3, 2016 and were affected by the alleged security checks. Based on these numbers, the plaintiffs filed for claims of $7.25 million.
Coach filed a motion to have the case dismissed based on the case of Integrity Staffing Solutions Inc. v. Busk, in which the Supreme Court ruled that time spent waiting for bag checks is not compensable under the federal Fair Labor Standards Act (FLSA). A California federal judge denied Coach’s motion to dismiss, saying the Supreme Court’s ruling does not apply to state law.
The two parties have agreed to settle their dispute for $1.75 million, which is much less than what the plaintiffs originally requested. Nevertheless, both sides say the settlement agreement is fair and reasonable to everyone involved. $437,500 of that money will go to pay attorneys’ fees and legal costs and the settlement states that all payment will be made in cash, rather than coupons, gift certificates, or vouchers, which are methods some companies have been known to use in order to settle their legal disputes, knowing many of them go unused.
Another term of the settlement is that Coach gets to put the matter behind them while continuing to deny having done anything illegal. Many defendants involved in class action lawsuits opt to settle outside of court, even if they’re adamant they did nothing wrong, because it’s more cost effective than pursuing an expensive legal battle. You can never be 100% sure which way a jury is going to rule, so Coach gets to save itself a considerable amount of time and money by putting an end to the dispute early on.
The plaintiffs likewise have a lot to lose by pursuing a lengthy legal battle that may or may not end in their favor. That’s why, despite the fact the settlement amount is so much lower than they were initially asking for, they may still be better off with the money they know they can get rather than with the larger amount they may never see.The Chicago overtime lawyers at the Chicago Overtime Law Center are investigating unpaid overtime claims against large retail chains such as Petsmart, Officemax, Staples, Smart & Final, Apple, Walgreen’s, CVS, Urban Outfitters, GAP, Abercrombie & Fitch, Limited, Forever 21, Macy’s, Hollister, Gilly Hicks, Target, JC Penney’s, Lowes, Burlington Coat Factory, Marshalls, TJ Max, Victoria’s Secret, Nieman Marcus, Saks Fifth Avenue, Best Buy, Home Depot, Apple, Best Buy, Sears, K Mart, J.C Penney, Walmart, Costco, PetSmart, REI and other retail chains for misclassifying employees as managers, erasing or altering time sheets or time records, pressuring workers not to report or record overtime, failing to pay for time spent on security checks, and otherwise failing to pay workers for overtime and other wages. If you are the victim this practice call us at one of our offices near Bollingbrook and Bartlett at (312) 869-4095 or contact us online.