Wednesday, March 28, 2012

Northern District Certifies Overtime Class Based on Failure to Incorporate Bonus Pay Into Hourly Overtime Rate: Chavez v. Lumber Liquidators

On March 26, 2012, United States District Court Judge, Samuel Conti, granted class certification against Lumber Liquidators, in part, on the theory that the defendant had failed to take bonus pay into account in calculating the overtime rate for California non-exempt employees.  See Chavez v. Lumber Liquidators, 2012 U.S. Dist. LEXIS 40984 (N.D. Cal. Mar. 26, 2012).  As reasoned by the Court, class-wide adjudication of the plaintiff's overtime claim was appropriate based solely on evidence that the defendant utilized a standardized calculation methodology that did not consider sales related bonus pay:
Zaldivar's claims are typical of the 130 non-exempt employees' claims because all were subject to the common pay practices of LLI. Zaldivar has stated that he regularly worked more than forty hours per week and that he received $12,282.87 in sales bonuses that were not incorporated in his regular rate of pay for the purposes of calculating his overtime rate. Zaldivar Decl. ¶¶ 4-5. LLI objects that Zaldivar has failed to prove that his overtime was ever calculated incorrectly. Opp'n at 25. Plaintiffs respond that LLI has failed to produce adequately detailed records and LLI's argument is not relevant to whether class certification is appropriate. Reply at 10. The Court concludes that the evidence presented by Plaintiffs is sufficient for the purposes of class certification. At this stage, it is enough that Plaintiffs have shown that LLI had a uniform practice for calculating overtime pay, that LLI's uniform practice did not account for bonuses and other non-discretionary pay, and that Zaldivar received $12,282.87 in bonuses and claims to have worked more than forty hours per week on several occasions. "In determining the propriety of a class action, the question is not whether the plaintiff[s] . . . have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met[.]" United Steel, Paper & Forestry, Rubber, Mfg. Energy, Allied Indus. & Serv. Workers Int'l Union v. ConocoPhillips Co., 593 F.3d 802, 808 (9th Cir. 2010) (quoting Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177-78 (1974)).
See Chavez, 2012 U.S. Dist. LEXIS 40984, at 18-19.

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