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Amazon Faces Steep Potential Damages in Overtime Suit

The federal Fair Labor Standards Act (FLSA) regulates things like minimum wage and overtime for all employees working within the United States. Despite some of the very specific requirements laid out by the Act, some issues remain in somewhat of a gray area and require further clarification. One example is the matter of whether employees should be paid for the time they spend waiting in line to have their bags checked.

According to a study conducted by the Security Research Project at the University of Florida, employee theft cost retailers an estimated $18 billion in losses in 2012 alone. From that standpoint, it makes sense that retailers would want to check their employees’ bags and pockets before allowing them to leave for the day. Since the employees are not actively working, retailers claim that the time employees spend waiting in line to get their bags checked is not time for which they can be paid.

Employees disagree, insisting that, as long as the retailer is requiring employees to remain on the premises, the retailer should pay its workers for that time. Jesse Busk of Henderson, Nevada is a plaintiff in a recent wage and hour lawsuit against Amazon. Busk understands Amazon’s need to conduct bag checks, but he points out that Amazon is allegedly conducting these checks on his personal time. “If people are stuck in your building and they’re not allowed to leave, why don’t you go ahead and pay them?”

The FLSA does not specify whether employers need to pay their workers for the time spent conducting bag checks, but in 1947, an amendment was added to the FLSA, called the “Portal-to-Portal” Act. This Act states that employers do not have to pay workers for the time it takes them to travel to and from their work site. However, in 1956, the Supreme Court ruled in favor of workers at a car-battery plant who claimed they should be paid for the time they spent changing into and out of their protective gear, which they were required to wear in order to perform their jobs.

Now the Supreme Court will weigh in on the latest wage and hour lawsuit against Amazon. The retail giant has already faced one unpaid overtime lawsuit filed by a former employee in one of Amazon’s Tennessee warehouses. That case also involved employee bag checks and alleged that the wait time to get through the line could take as long as 15 minutes. Because employees were subject to these checks every time they left the warehouse, the lawsuit alleged that many employees simply did not take their breaks (which are granted by law) because it was not worthwhile to wait in the long line. By allowing employees to work through their breaks, Amazon was allegedly in violation of state labor laws.

Amazon settled that lawsuit by paying between $252 and $5,808 in compensation and back wages to about 15 employees, but the current class action lawsuit filed by Busk is much larger. If the Supreme Court decides that the case can go to trial in the federal court system, Amazon could end up paying $100 million to resolve compensation claims from about 400,000 employees.The attorneys at Chicago Overtime Law Center have decades of experience litigating wage and hour cases, including overtime, vacation pay, meal breaks, and tips. We have offices conveniently located in Oak Brook and Chicago, Illinois. Contact the Schaumburg, Aurora, Kankakee and Rockford overtime and class action lawyers and attorneys at the Chicago Overtime Law Center today at 312-869-4095. We are looking to represent loan and mortgage brokers who have not been paid overtime and have been mis-classified as managers.