California Bank Pays Over $1M in Overtime Back Wages to Misclassified Employees

November 30, 2012

A recent U.S. Department of Labor (DOL) investigation recently uncovered that the San Francisco-based bank First Republic Bank engaged in employee misclassification--by wrongly classifying bank employees as exempt from the overtime provisions of the Fair Labor Standards Act (FLSA)--a violation of federal law.

According to the DOL press release, that Costa Mesa-based labor and employment attorney Vincent Howard has been following, the investigators discovered that First Republic Bank failed to follow the FLSA's criteria, allowing certain professional and administrative employees to be exempt from the FLSA's overtime provisions. As a result, the DOL reportedly recovered $1,009,643 million in overtime back wages for 392 employees of First Republic Bank, working in California, New York, Oregon, Connecticut and Massachusetts.

As Vincent Howard has discussed in a related Anaheim employment lawyers blog, under the FLSA, individuals are provided with an exemption from both the minimum wage and overtime payment requirements if they are employed in bona fide administrative, professional, outside sales and executive positions, as well as certain computer workers. In order for an individual to qualify for an exemption, employees must meet a certain test regarding their employment duties and must be compensated with a salary of at least $455 per week. Job titles never decide exempt status, rather it is necessary for the employee's specific job duties and salary to meet the FLSA requirements.

The DOL investigation reportedly found that the misclassified employees were actually entitled to overtime compensation of one and one-half their normal payment rates for any hours worked beyond forty in a week. The bank also reportedly violated the FLSA by failing to include bonus payments in the nonexempt employees' normal payment rates when calculating overtime compensation. The bank was also found to have violated the record-keeping provisions of the FLSA by failing to properly record the actual work hours performed by the misclassified employees.

In Cypress, Costa Mesa and Dana Point, California, contact Howard Law's labor and employment attorney Vincent Howard, for a free consultation about your wage and hour rights in the California workplace.

San Francisco-based bank pays more than $1 million in overtime back wages to employees in 5 states following US Labor Department investigation, U.S. Department of Labor Press Release, November 27, 2012

Related Web Resources:

U.S. Department of Labor: Wage and Hour Division (WHD), Fair Labor Standards Act (FLSA)

Department of Labor (DOL): Wage and Hour Division (WHD)

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