Assisted Living Operator to Settle Wage and Hour Lawsuit for $9.5 Million

Sacramento, CA Frontier Management LLC will pay $9.5 million to settle a California labor lawsuit brought by roughly 1,000 workers who were not paid for work required before they clocked in, after they clocked out and during meal breaks. Wright v. Frontier Management, as originally filed, alleged nine causes of action under the federal Fair Labor Standards Act (FLSA), the California Labor Code and the California Business and Professions Code. Claims under the California Private Attorneys General Act (PAGA) were added thereafter. The senior care industry is notorious  for wage and hour violations and has been the subject of federal and California investigations.

Unpaid Work

Joshua Wright worked as a medication technician at an assisted living facility in California from April 2018 until March 2019. In his 2019 lawsuit, he alleged that Frontier Management had a longstanding practice of failing to pay hourly employees for work performed while “off-the-clock,” and for missed or interrupted rest and meal periods. Frontier’s failure to pay for all hours worked and its resulting failure to pay overtime at legally required overtime rates violates federal and California labor law and constitutes an unfair business practice with respect to law-abiding employers. Wright further claimed that Frontier failed to provide accurate itemized wage statements, pay full wages owed in a timely manner on a workers’ termination or resignation, and failed to reimburse necessary business expenses.

Frontier Management operates a chain of retirement and assisted living communities at 130 locations across 19 states. The lawsuit ultimately included non-exempt employees who worked at Frontier facilities in California, Oregon, Washington and Illinois. The average award is expected to be $1,474 per California class member, $884 per Oregon and Washington class member, $589 per Illinois class member and $151 per FLSA collective class member. 

California labor law

As of January 1, 2022, the minimum wage in California is $15.00 per hour for employers with 26 or more employees and $14.00 per hour for employers with 25 or less employees. Some cities and counties have higher minimum wages than the state’s rate. California minimum wage laws require employers to pay non-exempt employees for all hours worked. “Hours worked” includes all time an employee is subject to the employer’s control and all time the employee is suffered or permitted to work, regardless of whether the employee is required to work or not. 

California wage and hour law requires employers to pay overtime when non-exempt employees (those who work on a non-salaried, hourly basis) work more than 8 hours per day or 40 hours in any workweek. The law also requires employers to provide a paid, uninterrupted 10-minute rest break for each 4 hours of hours of work and an uninterrupted, unpaid 30-minute meal break for each five hours of work.

California employers must provide accurate, itemized wage statements that detail total hours worked per pay period and the worker’s gross wages. Departing employees are entitled to receive their final paycheck almost immediately. Employees who quit must receive their final paycheck within 72 hours of giving notice that they're leaving. Employees who are fired must be paid on the same day as termination.

Chronic problem

In 2020, an aide to the House Education and Labor Committee reported an alarming rate of wage theft among senior residential care industry workers. Many care workers are poor immigrants and have been paid as little as $2.00 per hour for around-the-clock work. Some workers have been harassed or assaulted and may be fired if they complain.

Investigations have found that companies continue to operate despite having failed to pay wage theft judgments. Medicaid funds still continue to flow to operators convicted of fraud or previously cited for labor violations.    

In 2021 California workers reportedly filed nearly 19,000 claims totaling more than $338 million in stolen wages, according to a database provided by the California Labor Commissioner’s office. In 2020, the Legislative Analyst’s Office reported workers were filing 30,000 claims a year on average, totaling more than $320 million annually. Workers recovered about $40 million, or about one-eighth of those claims, the Legislative Analyst’s Office said.

The healthcare and social assistance industries in California accounted for roughly 12.9 percent of those claims, the largest share of all industries surveyed. In real terms, California workers who were victims of minimum wage theft lost out on $64 in pay a week, or about $3,400 a year in 2015, the most recent data available. For workers in low-wage industries, that means less food on the table, a harder time paying rent, or delayed trips to the doctor.