California Employment Labor Law Class Action Gets Nod for $1.35 Million Settlement

San Francisco, CAA California employee labor law class action is one step closer to resolution after a San Francisco judge signaled he would grant final approval of a settlement worth $1.35 million. The lawsuit, which has been ongoing for about 18 months, pits a beer distributor from the Bay Area against a class of hourly employees who claimed violations against state labor laws.

The defendant in the lawsuit is Matagrano Inc. Plaintiffs, according to court records, are delivery drivers, ballpark vendors and warehouse workers that are paid hourly. In February of last year they filed suit claiming they were stiffed on overtime and state-mandated breaks as guaranteed under California employee labor law. Allegations included a lack of meal and rest breaks, timely wage payments, improper recordkeeping and unfair competition.

Specifically, plaintiffs claimed that workers who toiled offsite were always on duty and were not in a position to take breaks, even though pay packets were reduced by 30 minutes each day for meal breaks the employees were in no position to actually take, or so it was alleged.

Other alleged violations included the lack of compensation for commuting time between job site(s) and their homes, in spite of driving company vehicles. Plaintiffs characterized the lack of pay for commuting time as off the clock work. The plaintiffs in the California employee labor law dispute cited damages for any class member employed as an hourly worker by Matagrano Inc. from February 2012 through April of this year.

All told, the plaintiffs alleged damages of about $7.4 million.

However, the settlement at $1.35 million does not approach that figure. The judge in the case, California Superior Court Judge Curtis Karnow, expressed some reservations about incentive awards for the two lead plaintiffs in the California lawsuit. Specifically, $12,000 was earmarked for plaintiff Martin Gonzalez with $5,000 worth of incentive money for Juan Perez. Judge Karnow noted that in his view the incentive awards were high when compared with the expected proceeds from the settlement for the remainder of the class.

“Incentive awards are a fairly recent invention in the law. People usually don't get involved in a class action because they're in it for the money,” the judge said. “I'm acutely aware of the fact that every cent that goes to class representatives is taken away from the class.”

While the settlement includes a payment of $56,250 to the California Labor and Workforce Development Agency, the judge had issues with the San Mateo Police Activities League (SMPAL) as the cy pres recipient, noting that the SMPAL had little to do with the employment issues in the case. The judge signaled that he would be looking for a brief from both parties suggesting alternate organizations for the cy pres funding.

In spite of the judge’s misgivings about cy pres, as well as legal fees the judge felt was a tad high, he nonetheless signaled he would approve the settlement at $1.35 million.

The California employee labor lawsuit is Martin Gonzalez v. Matagrano Inc. et al., Case No. CGC-16-550494, in the California Superior Court for the City and County of San Francisco.