Coach Inc. Settles Overtime Lawsuit, Agrees to Pay $1.75 Million

Coach Inc. Settles Overtime Lawsuit, Agrees to Pay $1.75 Million

LOS ANGELES — A group of sales associates for Coach, Inc. has reportedly agreed to settle a wage suit against the company alleging violations of the California labor code.

The company, based in California, has agreed to settle the putative class action suit in exchange for paying $1.75 million. The settlement would resolve the claims of more than 4,000 sales associates who were affected by the alleged violations, and Coach agreed to settle to avoid the cost of further litigation.

The settlement is to be fully paid in cash, and $437,500 will go to paying attorneys’ fees.

Security Checks as Compensable Time

The representative plaintiffs who worked at Coach stores in California brought separate wage lawsuits against the company.

In their suits, they argued that Coach violated California labor laws by forcing employees to spend up to thirty unpaid minutes waiting for a manager to complete a security check of their bags prior to leaving the store for a break or at the end of a shift.

According to the lawsuits, the company’s security check polity had been in place for at least four years before it was challenged.

A federal court consolidated the lawsuits into a putative class action suit, and now covers all full or part-time sales associates employed by Coach in California from March 20, 2010 to May 3, 2016.

Integrity Staffing Decides Federal Wage Issue, but Not State Labor Law

Last year, in Integrity Staffing Solutions Inc. v. Busk, the U.S. Supreme Court ruled that workers filling orders did not need to be paid for time they spent going through security checks.

According to the Supreme Court in its opinion, an activity is integral and indispensable to the principal activities that an employee is meant to perform if it is an intrinsic element of those activities and one which the employee cannot avoid if he or she will perform the principal activities of the job. In this case, Coach attempted to get the federal court to dismiss the suit citing the Integrity Staffing decision.

However, the federal court found that the ruling only applied to federal wage laws under the Fair Labor Standards Act (FLSA), and not California labor law.

Under FLSA, the workweek ordinarily includes all time during which an employee is required to be at the workplace or on duty.

The workday means the period between the time on any particular day when an employee starts his or her principal activity and the time that that activity ends. The workday may be longer that the employee’s scheduled shift, hours, tour of duty, or production line time.

The issue of what constitutes “hours worked” under FLSA or California labor law is a complex one and requires analysis.

You should call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page if you believe that you have not been compensated for time you spent performing tasks that are part of your principal work activities.

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.


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