Overtime Wage Payment Violations are an Epidemic in California

April 9, 2007, 9:45AM. By Richard G. Nadler, Attorney at Law

Los Angeles, CAThere is a flood of court cases filed in California claiming employers violated overtime wage statutes. Many of these violations may be traced to a business attitude which teaches it is worth the risk if the financial gain received is greater than the penalty imposed.

A Fair Days Pay for a Fair Days Work
The 40 hour work week and overtime wages are part of the Fair Labor Standards Act of 1938 (FLSA). This was a time when tens of millions of Americans families, in the midst of a great depression were trying to live on income so meager that family disaster hung over them every day. In a message to the Congress in support of the Act, President Franklin D. Roosevelt, said:

Our Nation so richly endowed with natural resources and with a capable and industrious population should be able to devise ways and means of insuring to all our able-bodied working men and women a fair day's pay for a fair day's work. A self-supporting and self-respecting democracy can plead no justification for the existence of child labor, no economic reason for chiseling workers' wages or stretching workers' hours.

... And so to protect the fundamental interests of free labor and a free people we propose that only goods which have been produced under conditions which meet the minimum standards of free labor shall be admitted to interstate commerce. Goods produced under conditions which do not meet rudimentary standards of decency should be regarded as contraband and ought not to be allowed to pollute the channels of interstate trade.

Minimum Wage and Overtime Pay
The original FLSA provided a minimum hourly wage of 30¢. In California, the minimum hourly wage today is $7.50. As of January 1, 2008 the California minimum wage increases to $8.00. (The FLSA provides whichever state of federal minimum wage law has a higher rate shall prevail.) The FLSA also provides an overtime rate of 1½ times the employee's regular hourly rate for work in excess of maximum hours in a workweek. Originally, overtime pay was required after 44 hours. Today, overtime pay is required after 40 hours. The 1½ rate has never been altered.

Mandatory meal and rest Breaks
California has taken an even larger step in protecting workers by enacting mandatory lunch and rest break laws. If an employer fails to provide an employee with these mandatory breaks, or requires the employee to stay on the premise during a meal break, the employer is liable to the employee for an extra 1 hour of pay, for each day the meal or rest period is missed.

Recent cases filed in State and Federal. Courts in California reveal a flood of overtime, rest and meal break violations. The chart below is a sample.

Court & Year	Description of Claim & Employer's Violations	Recovery
Federal 2007	500 Mortgage Loan Consultants who worked on-line - misclassified as exempt employees - overtime wages	$13.6 Million
Orange County 2006	1200 Salaried automobile insurance sales agents (with commission opportunity) telemarketing policies - unpaid overtime wages- meal and rest break violations	$1.3 Million
Orange County 2006	800 Software engineers - misclassified as managers - to avoid overtime wages	$27.5Million
Federal 2006	6,380 Food workers - fast food chain - often worked thru meal and rest periods and misclassified as exempt to avoid overtime wages	$3.75 Million

Federal 2006	4500 employees -banking and investment services - intentionally misclassified to avoid overtime wages	$12.8 Million
Los Angeles County 2006	250 Retail clothing store managers - classified as exempt to avoid - overtime compensation	$2 Million
Stanislaus County, 2005	40 Dairy workers employer deprived them of minimum wages, overtime wages, meal and rest breaks by failing to provide pay stubs.	$100,000
Los Angeles County 2005	2000 Insurance adjusters - overtime wages for time adjusters spent at home on their laptops	$120 Million
San Mateo County, 2005	600 Computer programmers -overtime were told they were exempt from state laws	$15.6 Million

Fresno County 2005

550 Customer Service representatives and drivers for uniform cleaning company - meal breaks & misclassified to avoid overtime wages

$6.6 Million

Hopefully, in the not too distant future, American businesses will get the message and stop overtime wage lawsuits because workers will see overtime wage compensation automatically in their paycheck.

Richard G. Nadler is an accomplished attorney with over 30 years of trial and appellate experience. He has represented over 250,000 individuals in civil, criminal, and class action cases.