A nearly decade-long court battle ends as national department store chain Burlington Stores Inc. has agreed to pay almost $20 million for misclassifying workers to avoid paying them overtime.
According to court records, roughly 1,630 employees will receive an average payment of $12,000 as part of the settlement. California workers are included under a second class-action suit filed against the company.
A nine-year court battle erupted over worker classifications
Hundreds of workers classified as assistant managers (ASM) say the company directed them to do non-managerial tasks identical to those performed by non-exempt employees, forcing them to work extra hours for no pay. These duties included:
- Loading and unloading trucks
- Stocking store shelves
- Assisting customers
- Janitorial work
The first lawsuit was filed in June 2011, charging Burlington with wrongly classifying these workers as ASMs to exempt them from overtime requirements.
Financial stress likely led to settlement
Like many other retailers, 2020 was a rough year for Burlington, which reported a loss of $333 million during the first nine months of the year. During the same period in 2019, the chain reported nearly $280 million in earnings.
The company has 730 stores across the country and reported total sales during that same nine-month period dropped by more than $1.5 billion during 2020. Despite the economic turmoil, the U.S. magistrate overseeing the settlement says the deal was hard-fought during mediation.
Worker misclassification is a common issue in California
Employers routinely misclassify their workers, whether they are full-time employees or independent contractors, to avoid paying overtime and offering other benefits, such as health care, sick leave, unemployment insurance and meal breaks.
California has some of the most stringent worker protections in the country. Employees are presumed to be non-exempt workers unless an employer can prove they are exempt or independent contractors. If you believe you have been misclassified, working with an aggressive wage law attorney can help you receive the pay and benefits you are entitled to receive.