SAN JOSE, Calif. — A group of 1,375 current and former store managers and assistant store managers filed an overtime suit against Claire’s Boutiques Inc. alleging violations of California labor laws. The suit alleged that Claire’s Boutiques failed to properly account for the hours worked by the plaintiffs and did not provide them with sufficient break times. Additionally, the suit alleged that Claire’s calculated overtime wages based only on each proposed class member’s base hourly rate, instead of their regular rate of pay as required by California labor law. Calculation for the regular rate of pay for overtime purposes must also reflect bonuses and incentive awards earned during the same period because Claire’s store managers and assistant managers are paid both hourly wages and bonuses.
Depending on the number of class members who file claims, the average payout would be $490 if all 1,375 members of the class filed claims. The two named plaintiffs would each get $10,000. The attorneys seek $383,333 in fees plus $25,000 in costs, and the claims administrator would get $40,000.
Inclusion of Bonuses in Overtime Calculations in California
Employee overtime in California is calculated based on a regular rate of pay. This includes an employee’s base pay (such as hourly rate), plus commissions and most bonuses. Inclusion of commissions and most bonuses in calculating overtime is meant to prevent employers from paying a lower hourly rate and offering higher bonuses.
California’s labor department calculates the overtime rate of bonus pay by dividing the amount of the bonus by the number of hours worked (including the overtime hours), to determine the regular hourly rate of bonus pay times the number of overtime hours worked. This amount will be the overtime amount due on the bonus portion of the earned wages and should be paid in addition to any hourly overtime. When paying a bonus, employers must determine how bonuses might impact overtime calculations.
California Meal and Rest Break Requirements
The California Labor Code requires employers to provide employees with at least a thirty-minute meal break if they work more than five hours per day. If the employee works more than ten hours per day, then employers are generally required to provide a second thirty-minute meal period. During this meal period, the employer must relieve employees of all duties, relinquish control over their activities, and allow them a reasonable opportunity to take an uninterrupted 30-minute break in which they are free to come and go as they please. If the employer fails to relinquish control and, for example, requires employees to remain on the premises during the meal period, they are entitled to compensation for your meal period.
Additionally, employers in California are required to provide certain covered employees with a net 10-minute rest period for every four hours worked. As much as practicable, this rest period must be in the middle of the four-hour work period. If the employer fails to provide this rest period, then he or she must pay employees one additional hour of pay for each workday that the rest period is not provided.
If you or someone you know is not being paid minimum wage or overtime under federal or state law, or you should call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page. Our top rated team of wage lawyers will evaluate your situation to determine your best course of action. We will also determine if it is in your best interest to file a lawsuit against your employer. There are strict time limitations for filing, so it is important that you call our experienced attorneys today.