Calif. Wage and Hour Lawsuit Settled for $2.25 Million

By Joanne Deschenaux Jan 25, 2016
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A federal judge in California granted final approval of a $2.25 million settlement in a class-action lawsuit alleging that Bank of America misclassified some employees as exempt from California’s wage and hour laws (Brawner v. Bank of Am. Nat'l Assoc., N.D. Cal., No. 3:14-cv-02702, order granting final approval Jan. 14, 2016).

Zelma Brawner filed the wage and hour class-action lawsuit against Bank of America in May 2014. She accused the bank of five violations of California labor law: 1) failure to pay overtime wages, 2) failure to provide accurate itemized wage statements, 3) willful failure to pay all wages due within 72 hours after separation from employment, 4) violation of California’s unfair labor law, and 5) violation of the Labor Code Private Attorneys General Act.

Bank of America denied the allegations, but it agreed to settle the wage and hour class-action lawsuit to avoid the risk and expense of continued litigation.

The deal included $562,500 for attorney fees and a $15,000 payment to named plaintiff Brawner.

Misclassification Alleged

Brawner, who was employed by Bank of America for almost 28 years, alleged that the employer misclassified as administrative employees all dedicated service directors (DSDs) at its back-office facility in Concord, Calif, and sued on behalf of a potential class of similarly situated workers.

In an August 2015 motion for preliminary relief, the workers said that DSDs serve as personal representatives to the bank's “major corporate customers.”

“If the customer wishes to open a new account, close out an old account or inquire about the status of a transaction in an existing account, the customer can contact the DSD and expect a personalized and prompt response,” the employees said in the motion. “The Bank did not pay any overtime premium pay to the DSDs because it classified them as ‘administrative’ employees who are ‘exempt’ from the overtime protections set forth in Wage Order 4.”

Settlement Fair

The court found the settlement to be fair, adequate and reasonable.

“First, litigation poses risks and is expensive, and an evaluation of the strengths and weaknesses of the plaintiff's and the defendant's cases militates in favor of settlement,” the judge wrote in the order granting final approval. “Second, the settlement treats class members fairly, allocating the money to them based on a formula weighted by their annual salary, estimated overtime hours and eligible workweeks.”

The class covered 133 DSDs, treasury service consultants and senior treasury service consultants who worked in Concord from May 9, 2010, through Jan. 14, the date the settlement was approved.

The settlement included $1.6 million for class members, which will be distributed based on salary, estimated overtime hours and eligible workweeks. It also designated $22,500 for the California Labor and Workforce Development Agency and $9,000 to the third-party claims administrator, according to court records.

Joanne Deschenaux, J.D., is SHRM’s senior legal editor.

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