AT&T May Roll Dice on Overtime Pay Claim by Managers
Low Level “Managers” Claim They Are Owed Unpaid Overtime Wages
Hundreds of Level One Managers for the Southern New England Telephone Co. are challenging their exempt classification under the FLSA and Connecticut state labor law. Being classified as “exempt” results in them not being paid overtime when they work over 40 hours per week. The case is scheduled to go to trial in the next week and it appears that AT&T may take its chances this time instead of paying out tens of millions of dollars, as it has to resolve numerous prior unpaid overtime claims. This case is noteworthy because it could be one of the very few wage and hour cases that are not settled out of court. In many overtime pay claims, the employer’s mistake in classification is fairly clear, leaving the two sides to figure out and negotiate the amount of unpaid back overtime pay the employees are owed.
In short, the low level managers claim that they should not be exempt from overtime under the federal labor laws because they don’t have the power to hire and fire the employees they supervise and that their primary duty is not “managing a subdivision of the company”. The lawsuit alleges that these “managers” worked 50 to 70 hours per week and that back in the 70s these types of employees actually did receive overtime pay. If AT&T is wrong and has misclassified its employees, it could be looking at paying the class millions of dollars – potentially owing an amount equal to double the total of 3 years of back overtime wages plus attorneys’ fees and cost.
ATT is not alone when it comes to claims that employees are being misclassified as exempt instead of non-exempt. Similar overtime wage claims have been successfully brought and settled by a wide variety of workers including: oil spill and disaster clean-up workers, oil and gas field workers, maritime and barge workers, cable and telecom workers, IT tech support employees, pharmaceutical reps, loan officers, health care workers, independent contractors and the list goes on. Due to its more favorable state overtime pay laws, a significant numbers of these types of claims are brought in California. The U.S. Department of Labor as well as the California and other individual state regulators have become increasingly aggressive in cracking down on companies that misclassify employees as exempt and/or independent contractors.
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