San Francisco Business Times, Aug 27, 2015
An Oakland lawyer who just won a $36 million settlement from Bank of America for failing to pay overtime to 365 employees said he expects to see an uptick in overtime-related lawsuits in the Bay Area—particularly for companies in the sharing economy, such as Uber or Lyft.
“There has been an increase in cases around certain industries. For example, independent contractor misclassification cases, especially cases involving drivers,” said Bryan Schwartz, founder of Oakland-based Bryan Schwartz Law, P.C., and co-lead counsel on the case. “And cases involving the sharing economy, of course.”
The Bank of America (NYSE: BAC) lawsuit filed in April 2013 in federal court alleged that the company erroneously applied the “administrative” and “professional” exemptions to residential staff appraisers.
It also charged that workers regularly worked from 6 a.m. to 10 p.m. without any overtime compensation from either the subsidiary, Landsafe Appraisal Services, Inc., or Bank of America.
A federal court’s May 6 decision in that case meant that mortgage appraisal management companies should have their staff appraisers classified as non-exempt, and be paying them overtime, and in California, providing them with meal periods and making rest periods available.
“The settlement should be a warning to any company that does not comply — it could cost you,” he said.
Schwartz cautioned that even small business owners must be vigilant about enforcing overtime pay standards.
“Small businesses should take a very conservative approach and ensure that anyone who is not a management employee, a company policymaker, or a professional within certain very limited fields, is getting paid overtime,” he said. “It is not worth the risk to cut corners.”
In particular, California real estate appraisal businesses will be under much more scrutiny, but also any business claiming the “administrative” or “professional” exemptions with respect to certain job classifications should take note.
Schwartz said these exemptions will be narrowly construed, and generally shouldn’t be used with non-management employees engaged principally in helping to produce the company’s product, or who don’t require an extended, specialized, academic background (as opposed to several weeks of job training) to do their jobs.
He said the next big minefield for overtime lawsuits? California’s burgeoning tech sector.
“There have been some interesting recent cases around independent contractor misclassification in the tech industry,” said Schwartz. “Also, ordinary coders, phone workers — there are many groups who are frequently victims of wage theft in tech.”
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