Santa Clara, CA: Payless Shoesource Inc, is facing a potential unpaid overtime class action lawsuit filed by store managers in Florida who allege they were denied overtime wages due to a fluctuation in their exempt status and that off-the-clock work is a "de facto"common practice throughout the company.
The lawsuit, filed by lead plaintiff Marley Vargas, claims that Vargas worked as a Payless store manager from 1985 until September of 2015, when she was fired after taking a leave protected under the Family and Medical Leave Act.
According to the lawsuit, Payless would conduct regular audits on the hours of store managers worked to see if they met the threshold to be treated as an exempt employee. During these "look back"periods, Payless would determine whether a manager had worked enough hours as a supervisor to not receive overtime, and if they had not, they would switch their employment status to non-exempt and begin paying overtime, according to the complaint.
Vargas claims that this overtime pay failed to account for weekly hours worked in excess of 45 during the look-back period.
"By beginning their overtime after the audit, it is already too late,"the complaint states. "[Managers] are entitled to their overtime pay, and Payless has violated and then continued to willfully violate the [Fair Labor Standards Act] by not paying the employees for the overtime wages earned in the prior periods of time they failed to meet the 80 hours of labor standard."
Further, Vargas contends in the suit that Payless had a uniform policy of not allowing managers to record their overtime hours and said any overtime hours that were recorded would negatively affect budgets and a manager's overall performance evaluation because "they were not performing their job fast enough."
"Defendants were absolutely aware that plaintiff and the putative class members were working off the clock,"the complaint states. "The policy of encouraging off-the-clock work starts from purposeful insufficient staffing levels and unrealistic budgets that the company sets, [and] each store has a labor budget which includes the manager's hours regardless of exempt status."
Payless began paying overtime at the proper rate at the end of 2012. Vargas is attempting to collect for the unpaid wages of approximately 3,000 managers prior to the change.
Class members excluded from this complaint are those that took part in a Connecticut suit against Payless, also for unpaid overtime wages to managers, which involved some2,197 plaintiffs and was settled for $2.9 million.
Plaintiffs are represented by Mitchell L. Feldman of Feldman Law Group PA. The case is Vargas v. Payless Shoesource Inc. et al., case number 8:15-cv-02627, in the U.S. District Court for the Middle District of Florida.
