Costco Appeal of Overtime Award Rejected

Costco Appeal of Overtime Award Rejected

SAN FRANCISCO — After losing a wage and overtime lawsuit in California federal court Costco Wholesale Corp. appealed the judgement in the Ninth Circuit Court of Appeals. Recently, the Ninth Circuit Court of Appeal rejected Costco’s appeal to throw out the damages awarded to the managers in the lawsuit. In the initial lawsuit, the managers alleged the wholesale giant misclassified their positions as exempt from overtime, which wrongfully denied them the overtime wages to which they were entitled.

The Original Overtime Claim

Two receiving managers filed their lawsuit in April 2011 in California federal court. The managers initially sought class action status and claimed that while they had a job title of manager and were classified as exempt from overtime, the majority of their work time was spent on nonexempt work. The receiving managers claimed they regularly worked more than 50 hours each workweek, usually performing receiving, inventory, and stocking tasks, yet never received overtime wages for their additional time. They alleged the company intentionally classified them as exempt to avoid paying overtime and without evaluating what the receiving managers actually did during their workday. Costco claimed that regardless of the actual duties the managers performed, Costco expected the managers to spend the majority of their time performing exempt, managerial duties. The court, however, ignored Costco’s expectations of what the receiving managers would do and looked instead at the managers’ actual duties.

The managers’ request for class action status was denied in October 2011. As a result, only two managers’ claims actually went to trial. At trial, Steven Berry and Virginia Velazquez were collectively awarded more than $400,000 in damages and attorneys’ fees and costs, which Costco appealed.

The Appeal

Either party may appeal a court’s decision and award. In this case, Costco appealed the lower court’s decision claiming the court erred in its decision to ignore the company’s expectations. The three-judge panel reviewing the case on appeal determined the lower court did not err in its judgement that the managers spent more than half of their time performing non-exempt non-managerial tasks. The appeals court did, however, reverse part of the lower court’s award relating to the amount of unpaid wages owed after Berry was terminated.

Simply because you have a supervisory or managerial title does not automatically mean you are exempt from overtime pay. If you believe your employer has misclassified your position and is not paying you one and a half times your regular rate when you work overtime, you may have a wage or overtime pay claim. Time is limited for filing wage and overtime complaints so it is important to call today! Our top-rated team of overtime pay lawyers can be reached at (855) 754-2795. Or complete our Free Unpaid Overtime Case Review form and our experienced legal team will evaluate your claim. If we accept your case, we will represent you under our No Fee Promise. This means there are no legal fees or costs unless you receive a settlement.

Text Now For Free Case Review