Former Employees Sue for Unpaid California Overtime from Defunct Market

Santa Clara, CAA collection of grocery workers who allegedly were stiffed out of California overtime suffered the ultimate indignation when the company they worked for closed its doors. Now the former employees are suing Kimomex Markets Inc. for lost wages pursuant to overtime pay laws in the Golden State. Plaintiffs allege that their former employer denied mandated rest periods, meal breaks and overtime pay.

The lawsuit, filed in Santa Clara County Superior Court, also alleges that Kimomex Markets Inc. deducted wages for medical insurance coverage for the employees, but the coverage is alleged to have never been provided.

The San Jose Business Journal on February 22 reported that Albert Lujan, the former CEO of the defunct company, former members of the Kimomex board of directors, together with the affiliates of major shareholder Pacific Community Ventures, were also named in the suit.

The overtime laws complaint alleges fraud, breach of contract and business code violations.

According to the lawsuit, the two Kimomex stores located in Mercados Su Vianda were quietly and abruptly closed in June of last year, with the corporation filing for Chapter 7 bankruptcy in August. At the time of the filing, Kimomex reported $630,000 worth of assets and $12 million worth of liabilities owed to roughly 275 vendors, former employees and others within the Silicon Valley and beyond.

Former employees are said to be owed $225,000 in unpaid overtime and other wages and benefits. Their legal representatives accuse Kimomex of being a shell corporation, having thrown any records it might have kept in a dumpster.

Plaintiffs are asking, in the unpaid overtime lawsuit, where the money might have gone?

Former Kimomex CEO Lujan is reported to be living in El Dorado Hills, an upscale suburb near Sacramento. Lujan removed himself from Kimomex in May 2010, a month before the stores closed their doors.

The bankruptcy case was dismissed in November. The judge in the bankruptcy proceedings noted that Kimomex had failed to comply with a previous order to provide required tax returns.

California overtime law requires that employers duly pay their employees extra pay for hours worked over and above a standard workday or workweek.