LOS ANGELES — After conducting a hearing, a California federal court approved a proposed settlement of a wage suit filed by a class of current and former pharmacists against their employer, Rite Aid, alleging violations of the California Labor Code. The settlement amounts to $9 million and settles the claims of a class consisting of 2,775 members. The class suit claims that Rite Aid failed to allow the class members rest and meal breaks and overtime pay, and is the latest in a string of wage suits filed against chain pharmacies across California.
Initial Disapproval of Proposed Settlement
The court rejected the first proposed settlement, stating that its opt-in claims process seemed to be counting on class members’ inattentiveness to lessen the settlement’s total value. The initial terms required class members to submit claims within a limited window of time or not be paid. The parties revised the agreement, which amounts to a payout of about $1,650 per class member, and also provides that class members be automatically paid their share without submitting a claim. All parties agreed to the proposed settlement, except for a request from the plaintiffs asking the court to reconsider capping incentive awards for the three named plaintiffs at $15,000 each. The court’s final order deducted $30,000 from the plaintiffs’ attorneys’ $3 million fee award and granted it to the named plaintiffs as an added incentive award.
Settlements of Class Wage Suits
In California, when parties to a wage and hour class action suit reach a settlement agreement, it must be approved by a state court to ensure it is fair and reasonable. Once one of the parties submits a proposed settlement to a court, the court may grant preliminary approval and provide notice to the class. Members will likely have a choice to opt in or opt out, which would exclude a member from the settlement and preserve his or her individual right to sue the employer.
Courts will scrutinize a proposed settlement amount for its adequacy to ensure that it was the product of an arm’s-length negotiation between the parties. It will also analyze the how much participation the class members had in arriving at the settlement, rule on objections to the settlement, and determine the appropriate amount for attorneys’ fees and incentive awards for class representatives, who receive additional money for taking the risk of filing the class action.
You should seek the counsel of an experienced employment attorney if you are seeking to file a wage suit against your employer. They can assist you, not only with litigating your case, but also in negotiating any potential settlements of your claims. Even the settlement process consists of extensive procedures that would not be advisable for you to undertake without an effective attorney by your side. You should call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page. Our wage lawyers will conduct a free consultation and help you pursue the best strategy for obtaining compensation. Call our seasoned attorneys today.