$1.5 Million Class Action Wage & Hour Settlement

Last week, a United States District Court judge approved a major wage and hour settlement in a case involving more than 1,200 trainee inspectors with the Terminix Company in California. The lawyers of the California Injury Attorneys Blog worked as co-counsel to secure the $1.5 million settlement and continue to represent other Terminix employees who were not included in the class. Those workers will be seeking recovery against the company through arbitration proceedings. This case is another example of the importance to workers in pursuing their right to proper wages.

Terminix argued before the court that termite inspections are part of the sales process and therefore should not be subject to overtime pay for workers. The pest control company had sought to characterize their free inspections as a sales pitch or giveaway in an attempt to exempt the extra hours worked by inspectors that were in excess of the 40-hour work-week provided for by California law. But the court rejected this argument and said that their services were not in fact sales activity.

Inspector trainees of the Terminix company sometimes work long hours – even longer than what are normally long hours. Prior to the class action, when the trainees worked longer hours, they did not receive rest or meal breaks or overtime pay. The settlement will result in the class member trainees receiving about $800 each in gross pay. Terminix will pay their share of employment taxes as well. The settlement covers trainee employees who worked as inspectors.

All those who worked as inspectors for Terminix have a claim for being misclassified as exempt from overtime and for failing to reimburse expenses, such as vehicle mileage. Due to a recent United States Supreme Court ruling, which upheld a company’s right to impose arbitration on employees, most of the employees must arbitrate their claims. Those inspectors who were not trainees, will now pursue their claims in arbitration. Unlike the trainees, the inspectors signed arbitration agreements. A few will be trying their cases before the court.

Arbitrations are likely to take some time, as there are 1,800 who were employed during the period of time when the company did not classify them properly. The inspectors were classified as performing a sales function when they were performing certain services and the company did not pay them overtime because of that classification. But the court ruled that those services were not part of the sales process, as claimed by the company. Those inspectors will now have the opportunity to show the amount of time they were inspecting and doing other services for customers (other than sales) for which they should be paid overtime when they worked longer hours than the law allows without extra pay.

Hersh & Hersh represents many inspectors that are already making claims in arbitration and expects many more will file arbitration claims. As wage and hour attorneys, we fight for workers’ rights to receive the pay and benefits to which they are entitled under the law. Please contact our law firm for a free consultation with one of our expert lawyers to review your employment and pay situation.