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May 10, 2010
Overtime Litigation Outnumbers Employment Discrimination Class Actions

Some alarming statistics about overtime litigation should be a wake-up call to HR professionals.

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In a BLR webinar titled "Reducing Overtime Costs: What You Legally Can—and Can't—Do to Keep Workers at Their Straight-Time Rates," Laura P. Worsinger, Esq., explained that the number of individual and class action wage and hour lawsuits continues to grow, and that these cases now outnumber employment discrimination class actions.

Citing a recently released workplace litigation report, she said that the top 10 wage-and-hour lawsuits against private employers were settled for a staggering $363 million in 2009. Couple that with the fact that the Department of Labor is hot on the heels of employers who owe for unpaid overtime, and it's clear that overtime compensation-related enforcement and litigation is becoming a major headache for employers across the country.

Recent Awards and Settlements
  • Federal Express was ordered to pay California drivers $14.4 million in October 2008 after misclassifying them as independent contractors.
  • Farmers Insurance was hit with a $90 million jury verdict when its home-based adjusters took the company to court over overtime issues, arguing that they were not exempt employees.
  • IBM settled a similar case for $65 million.
  • RadioShack agreed to pay up to $30 million to settle a class action lawsuit in California filed on behalf of 1,300 store managers who said they were improperly denied overtime.

In addition, Wal-Mart, Starbucks, IBM, Wells Fargo, and Merrill Lynch have all been sued repeatedly by employees, claiming they were forced to work well beyond 40-hours-per-week without appropriate compensation.

Laura P. Worsinger, Esq. is Of Counsel with the Los Angeles office of Dykema Gossett PLLC. She has broad counseling and litigation experience and specializes in the defense of employers in individual and class actions involving wage and hour violations, misclassification, discrimination, wrongful termination, and other employment-related proceedings. She can be contacted at lworsinger@dykema.com.

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