California worker misclassification case focuses on overtime pay

On Behalf of | Mar 10, 2016 | Employment Litigation |

Some workers in California and elsewhere across the country are legally entitled to receive overtime pay and related benefits when they cross an hours-worked threshold relevant to a particular pay period.

They don’t always receive it. And when they don’t, their complaints concerning the alleged bad-faith behavior of employers t often lead to wage-and-hour-based lawsuits regarding misclassification. That was the case in a recent lawsuit against a company that owns IHOP and Applebee’s restaurants. 

That misclassification component is often important — indeed, the key consideration — in an employment lawsuit focused upon an overtime dispute.  (Another very common form of misclassification lawsuit, important to our transportation clients, is when an independent contractor claims to have been an employee.)

The federal Fair Labor Standards Act mandates that workers deemed nonexempt from its provisions are lawfully entitled to overtime pay. The FLSA is supplemented in California by additional worker-protective state law that addresses the same subject.

The question of exempt versus nonexempt is often marked by murky parameters and conflicting versions of reality that are presented by the worker and his or her employer, respectively.

A IHOP/Applbee’s case involving a claim filed in state court by a long-term worker who claims she was unlawfully denied overtime pay and wrongfully terminate from her job centrally spotlights the concept of misclassification and the exempt/nonexempt distinction.

The employer treated her as an exempt employee, which is often the case for workers who are logically seen as managers and command workplace powers typically associated with managerial employees.

The plaintiff has argued otherwise, saying that she was a manager in name only, and that her employer designated her as such to deprive her of earned wages.

The court will have to look at that and make an assessment whether the tag placed on the worker by her employer was correct or, rather, was motivated by an unlawful intent to violate relevant labor laws and skirt payment responsibilities.

Section 1 of the California Wage Orders provide the standards in California for distinguishing between exempt and non-exempt employees. Unfortunately, these standards often require the objective assessment of an experienced attorney to guide employers in the proper classification of their employees.

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