California Injury Attorney Blog

In a recent wage and hour case, the California Court of Appeal, Fourth Appellate District, issued a decision in a matter involving whether certain employees should be exempt from overtime pay requirements because their income was argued to be derived from commissioned sales. In Muldrow v. Surrex Solutions Corporation, the court determined that a class of workers, known as senior consulting service managers, were commissioned sales and were not entitled to payment for overtime in this instance.

As we have shared in prior posts, the way an employer classifies a worker, does not determine whether that worker is entitled to overtime pay and other benefits of employment. Sometimes employers try to avoid compliance with California's labor laws by misclassifying them to avoid paying the wages workers should be paid. In this case, the question was whether the employees were commissioned sales people which would exempt them from the benefit of overtime pay.

The plaintiffs in this case worked to fit job candidates to jobs. Some of the matches were made using cold calling and some were made using Surrex's databases. The plaintiffs were only paid commissions if the match was made and stuck. In certain instances, the employment candidates were essentially kept by Surrex itself as consultants. They were effectively loaned to Surrex's clients and in these placements, the plaintiffs were paid from a formula that resulted in the "adjusted gross profit" that Surrex received for the work.

Plaintiffs contended in this case that they really did not "sell" a product or service and should not be categorized as sales people. They took the position that their pay should not be categorized as "commissions." The time they spent identifying and recruiting new candidates was not sales in their view.

Surrex categorized them as commissioned sales people exempt from overtime pay. If they were categorized as other than sales, the commissioned sales exemption that precluded them from receiving overtime pay, would not apply.

The court's view, like that of the trial court, was that the activities performed to make these matches was sales related. The managers were deemed to be performing essentially sales activities and were exempt for overtime pay requirements.

Arguing that the formula for their compensation was complex and did not relate to the services sold and could not be deemed commissions, the plaintiffs sought to secure the payments they believed to be warranted under the law. The court did not agree and found that the commissions were related to the price of services sold. This conclusion led to the court's view that these were "commissions for purposes of the commissioned employees exemption (Cal.Code. Regs., tit. 8, § 11070, subd. (3)(D))."

It is possible that the California Supreme Court will accept this case for review given the importance of the decision and implications for workers who could be deemed as performing sales functions. Requirements such as overtime pay, wage and hour issues, rest breaks and related claims provide important protection for workers.

Hersh & Hersh represents consumers, workers, patients and accident victims. If you have any questions about your employment situation or whether you are being paid properly by your employer, please contact our law firm to speak confidentially and for no fee at all, with one of our lawyers.

For many years, the health care workers that provide home care to the elderly and disabled have been unprotected under wage and hour laws. Yesterday, President Barack Obama announced that this situation is "inexcusable" and has called for a major change in the support provided to these caregivers.

Home health care workers that care for the elderly and disabled often receive less than the minimum wage. The law does not require otherwise which means there is nothing these workers can really do to receive fair pay for their hard and important work. A total of 29 states do not mandate the payment of minimum wage and overtime for home health care workers.

Many of us have elderly parents or disabled family members who need this type of in-home care. President Obama has endorsed a new Labor Department rule that would require home health care workers to receive minimum wages, plus overtime.

Since the labor force involved in this type of care is actually fairly large -- and a total of 2 million health care workers are being employed without the benefit of wage protections, the change is going to make a big difference for these workers. During the announcement, the President was flanked by the hard working men and women who take care of our family members in their homes. Describing them as working "their tails off" he noted that fair pay should be provided to them.

With an aging population, more and more Americans will need home health care. It is very important that all workers are paid fairly and are protected under the law. Hersh & Hersh applauds this effort on the part of the White House to ensure fair wages for American workers. In our experience as wage and hour lawyers, it is our honor to have helped many workers receive the pay they are entitled to under the law. If you have a concern that you might not be receiving appropriate pay, please contact our San Francisco wage and hour law firm for a free consultation with regard to your rights. We have helped many workers receive their proper wages and benefits.

This past June, the California Supreme Court ruled that Oracle employees who resided in Colorado and Arizona, were entitled to overtime pay under California's wage and hour laws. The plaintiffs, who travel the country training users of Oracle's software applications, had taken the position that they were not teachers as the company had said.

By classifying these workers as teachers, the company was not required to pay overtime to these workers. Under California law this put them in a classification of "exempt" workers. The plaintiffs sought overtime pay, claiming that they were in fact "non-exempt."

Oracle's position was that California law was not applicable to these employees. They said the home states of these employees should control their rights to overtime pay.

The software company also argued that if non-resident employees were to be classified as "non-exempt," employers would be unduly burdened by being required to apply California wage and hour laws in many employment situations. Finally, Oracle took the position that the laws of the state of residency should control and that in this case, the laws of Arizona and Colorado were in conflict with that of California's laws.

But, the California Supreme Court disagreed with Oracle and ruled against them. As a result, Oracle has now reached a settlement to pay $35 million to over 1,700 employees to resolve the class-action. This settlement has been preliminarily approved by the Alameda County Superior Court. The case has been winding its way through the courts for many years.

Employers who attempt to misclassify workers to avoid paying them proper wages eventually must pay for their failure to follow the laws of California. Often, these cases become class actions as they involve many plaintiffs. These cases involving wage and hour and related claims is an area of expertise for the lawyers of Hersh & Hersh. We have recently handled important matters involving many workers in cases involving Terminix and Marcus & Millichap. For more information about our law practice, please contact Hersh & Hersh for a free consultation with one of our litigators on your employment situation.

The lawyers of Hersh & Hersh who sponsor the California Injury Attorney Blog served as co-counsel in a landmark win in federal court this week involving wage and hour claims. A federal jury rendered a verdict that is a victory for workers' rights.

In this case, the termite inspectors employed by Terminix (which is part of Terminix International, Inc.) presented a case to the jury that involved the company's failure to provide rest breaks, required work for greater than the number of hours per day allowed by California law and resulted in wage and hour violations. The inspectors also worked nights and weekends without additional compensation, which amounted to a failure by the company to pay overtime wages. This is not permitted under California law.

In September, we posted on a related case in which a class action was settled for $1.5 million that involved 1200 termite inspector trainees who were working in California. A United States District Court Judge approved a $1.5 million settlement, but several of the employees must make their claims in arbitration.

Overtime pay claims involving wages and hours are generally settled by companies. But when profits are carried on the backs of workers, companies might be reluctant to settle out of court and take their chances litigating the matter in court.

These cases will help all workers who are not being paid according to the laws that protect them. Such requirements as overtime pay, wage and hour issues, rest breaks and related claims will perhaps be taken more seriously by other employers who are not following the laws and regulations that ensure the protection of workers in many cases.

Hersh & Hersh is proud to continue its longstanding history of groundbreaking litigation in all areas that protect consumers, workers, patients and accident victims. If you have any questions about your employment situation and whether you are being paid properly by your employer, please contact our law firm to speak confidentially and for no fee at all, with one of our lawyers.

A recent decision by the Ninth Circuit Court of Appeals is good news for victims of wage and hour violations. As California wage and hour lawyers, we want to keep our readers informed of the law in this area.

In a case involving a Nevada employee, the court answered the following question: when a class representative rejects an offer of judgment of the full amount of his or her claim, and that offer precedes the filing of a motion for class certification, is the class action complaint still viable? The court said that it is. The case was decided by the Ninth Circuit, which also includes California, so the law of this case would also apply to California employees.

In the Spring of 2009, the plaintiff filed a class action complaint in his state (Nevada) against his employer for failing to pay overtime and minimum wages to him and those similarly situated. Among the allegations in the complaint were violations of the Fair Labor Standards Act (FLSA), violations of Nevada's labor laws and breach of contract.

The defendant employer removed the case to federal court, which is how the Ninth Circuit ended up ruling on the case. The federal trial court began discovery, but the plaintiff had difficulty getting the information needed from the defendant to try to obtain class certification. A class action is a procedure that is applicable when many people have been injured in the same way. The injured parties can ask the court to allow "class certification" so that all plaintiffs who have been injured can proceed together.

In this case, the plaintiff tried to get information from the defendant to enable him to seek class certification to make it possible for the case to go forward with more injured victims. But the defendant stalled and would not provide the information requested. The plaintiff asked the court to make the defendant provide the information and the court said it would decide this later, but also extended what is called "discovery" so that the parties would have time to learn what they needed to learn from one another.

While all of this was happening, the defendant made an offer to resolve this case by offering judgment against it in favor of the plaintiff. But the plaintiff did not accept the offer, even though it would have compensated him fully for his monetary claim. The defendant employer than asked the court to dismiss the action, saying that the class action was no longer viable since it had made this offer, it was rejected and the plaintiff had not yet asked that the class be certified. The trial court said that the plaintiff did not timely file the request for class action certification and dismissed the case, saying it was "moot."

But the Ninth Circuit ultimately ruled that even though the plaintiff had rejected the offer of judgment and he had not yet moved for class certification, the case could proceed because the class certification motion was still timely. What this means is the plaintiff can still proceed to ask the court to certify the class action.

The lawyers of Hersh & Hersh dedicate their practice to protecting injured consumers and employees. If you have been injured by your employer and are not receiving proper wages, or if you are concerned that you are not receiving overtime pay, please contact our law firm. We provide free consultations to evaluate legal matters such as wage and hour violations.

In these tough economic times, families are working harder than ever to put food on the table and receive the pay they have rightfully earned. One of the ways you and your family can protect yourselves is to know your rights with regard to wage and hour laws and overtime pay provisions.

The California Injury Attorney Blog will be posting from time to time on workers' rights and wage and hour claims, so that readers begin to educate themselves on their rights.

There are many nuances to the laws that protect workers and it is important to consult with experts who can help you understand your rights.

California has many protections in place to make sure that workers receive their overtime pay. Employers are not allowed to classify employees as managing themselves or in a sales job, just to avoid paying overtime.

Many employers try to avoid paying overtime pay, giving meal and rest breaks by misclassifying employees. That is, they call them "management" or "sales," for example, when they are actually doing some form of labor or selling is only a small fraction of how they spend their time on the job. This is misclassification and it is illegal and you could be entitled to back pay of OT, penalties and other compensation.

Generally, overtime pay applies to a nonexempt employee who is 18 years old or older or a minor employee who is 16 or 17 years old and is legally allowed to work. Nonexempt employees may work eight hours per day or 40 hours per week. But once more hours are involved, the employer must pay additional wages such as overtime pay.

Although it is difficult to generalize, if you are a person employed in a job that is not a professional licensed job like a lawyer, a doctor or is not a technical job like a highly skilled computer programmer, you might well be a nonexempt employee.

Assuming you are a nonexempt employee, you are likely entitled to earn overtime pay from your employer. What this means is that once you have worked the permissible number of hours allowed by law in a day or in a week, your employer may be required to pay you as follows:

"One and one-half times the employee's regular rate of pay for all hours worked in excess of eight hours up to and including 12 hours in any workday, and for the first eight hours worked on the seventh consecutive day of work in a workweek; and

Double the employee's regular rate of pay for all hours worked in excess of 12 hours in any workday and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek."

Again, this applies if you are not exempt from overtime and are not in a classification of employee that is not entitled to earn overtime. There are also some exceptions to the general overtime pay rules and for certain classifications of employees overtime pay is calculated differently.

Related Web Resources

For more reading on overtime pay rights, please click here.

Continue reading "Know Your Overtime Pay Rights" »