Unpaid Overtime: Wet Seal hits rewind & plays it again?

August 31st, 2009. By AbiK

Overtime pay lawsuits are a big topic at LawyersAndSettlements.com—we report a lot on unpaid overtime settlements. So much, in fact, that it can take some effort to keep track of it all. Case in point, our recent post on 61 companies that have had overtime lawsuits; the post was only about overtime pay and it only listed a handful of ’em. 

That’s when the recent developments at Wet Seal caught my eye. You’ve probably passed a Wet Seal in the shopping mall—or perhaps you even shop there. You can even get the t-shirt shown here at Wet Seal, and you’ve got to appreciate the irony on that one (btw, for those who care, it’s currently $9.90, BOGO 50% off). They’re all about the teen and twenty-something set, which is basically what their on-the-floor labor force is about as well. 

Young though they may be, they’re apparently no fools, and some have gone after Wet Seal for miscalculated overtime pay. LawyersAndSettlements.com had reported on a settlement back in 2004 in which Wet Seal store managers claimed they had been wrongly denied overtime pay. Of note, the then CEO of Wet Seal, Peter D. Whitford, was quoted in the LA Times (latimes.com, 1/23/04) as saying, “clearing up lingering legal battles would help the company move forward.” 

What’s interesting here is not what the lawsuit was about—or that it was Wet Seal—there are countless companies that find themselves involved in an overtime pay class action. No, what’s interesting is that Wet Seal was brought to task again in 2006 for basically the same issue—miscalculation of overtime pay for non-exempt managers. 

It’s deterrence and recidivism 101. I can remember blowing countless hours in undergrad debating such in relation to hard-core criminals. But why limit the discussion to murder? Granted, a little “whoops!” on a paystub may not spark the same level of passion and heated debate, but when companies are reprimanded and fined substantial amounts for not paying appropriate overtime, you’d think they might have a little pow-wow at corporate HR and figure out a few things. 

But repeatedly, logic defies practice. And, bigger picture, it begs the question of what justice is really being done when a company can easily attain “repeat offender” status? Of course, there’s the argument that without prosecution, wage and overtime abuse would be running rampant… 

For Wet Seal, even the 2006 overtime pay lawsuit they settled continues to live on. Another employee—Sally Chaaban—along with three others, filed a second class action in objection to the 2006 settlement. While the trial court overruled the objection, Chaaban filed an appeal; on appeal, the judgment was reversed and remanded to the trial court for a new hearing…stay tuned…

Tags: Overtime, wet seal

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