Employee classification has far-reaching implications for employers and not only affects the individual’s wages, hours and benefits but also determines an employer’s obligations under the law, including its tax obligations. Employee classification is based on a complex intersection of federal, state, and local laws, which can create confusion and misconceptions as to proper employee classification. Employers face harsh consequences for misclassifying workers, including potential class action suits and investigations by state or federal agencies that could result in expensive verdicts, settlements, or fines.
Our attorneys guide employers through the nuances and details of employee classification. Our experience with clients in a wide-range of industries allows us to understand and anticipate the unique challenges that can arise in employee classification. We advise clients on the proper standards for evaluating a position and determining its eligibility to be exempt or non-exempt. The firm has experience conducting misclassification audits for local, regional, and national clients and providing strategizes for correcting misclassification where necessary. These audits can identify possible weaknesses in current classification programs and exposure to government investigation or litigation.
The firm represented a retail client in a lawsuit removed to the U.S. District Court for the Central District of California that alleged a putative class of over 200 individuals had been misclassified as exempt employees during the prior four years in violation of the California Labor Code. The firm aggressively litigated the matter for over a year, resulting in the named plaintiffs abandoning their class claims and settling the matter on an individual basis.
The firm represented a retail client in a lawsuit brought in the U.S. District for the District of New Jersey that alleged employees were misclassified as administratively exempt under the Fair Labor Standards Act and New Jersey wage and hour law. After over one year of litigation, the firm reached a favorable settlement with the named plaintiffs, in which they agreed to abandon their class allegations and settle their FLSA claims for $2,500.
The firm obtained a favorable settlement for a client in a lawsuit filed by a former long‑term employee in Fresno, California. The employee alleged, among other claims, that he was misclassified as an exempt employee and worked approximately 20 hours of overtime per week for the four years prior to the filing of the lawsuit.
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