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Former California CarMax Buyer Sues For Employee Misclassification, Overtime Violations

April 2, 2012

According to recent California employee misclassification news that our Riverside labor and employment attorneys have been following, CarMax, a nationwide used-car retailer has been sued in a class action lawsuit--alleging that the company failed to pay around 1,500 buyers overtime pay.

The lawsuit, filed by former car buyer Michael Luchini, claims that CarMax violated the federal Fair Labor Standards Act (FLSA) by engaging in employee misclassification by unlawfully classifying employees as exempt--failing to pay properly pay them for all overtime hours worked.

CarMax reportedly hires nationwide buyers to collect car information for the CarMax computer systems and calculate appraisal prices for used vehicles. The lawsuit claims that due to the heavy work schedule, the buyers frequently travel and attend auctions to bid on and inspect the vehicles that will be sold at CarMax's 103 used-car retail locations across the country--which adds a substantial amount of overtime hours per week.

According to the lawsuit, the employees should not be considered as exempt from overtime compensation and state and federal wage and hour laws, as the CarMax buyers must attend mandatory training sessions, and follow the company's strict procedures and detailed policies and practices in every step of performing their job duties as buyers.

Luchini, who was employed at the Fresno CarMax outlet, states in his employee misclassification lawsuit that the company has achieved great success in the used car sales market due to the fundamental hard work of the used-car buyers--who deserve to be compensated fairly for the long hours they work, according to state and federal wage and hour laws.

The proposed class action California overtime lawsuit includes former and current buyers, senior buyers, and buyers-in-training (BITs) who have worked for CarMax in the past few years around the country.

CarMax reportedly reclassified the company's BITs to nonexempt status after a similar wage and hour lawsuit was settled in 2009. But the company's California senior buyers, buyers and all non-California employees in covered job positions continued to be classified as exempt from the FLSA's overtime provisions.

As Vincent Howard reported in a previous Anaheim wage and hour lawyer blog, under California law and the FLSA, most non-exempt employees are entitled to receive overtime payment, which equals one and one-half the workers' regular payment rate for all hours worked beyond forty in a workweek. The FLSA also provides exemptions from both the overtime and minimum wage payment for administrative, professional, and executive employees, as well as outside sales and some computer employees.

For questions about your employee misclassification issue in the California workplace, contact Howard Law's labor and employment attorney Vincent Howard today, for a free consultation.

Class Action Lawsuit Charges That CarMax Failed To Pay Workers Overtime Pay In Violation of Federal And California Law, Business Wire, March 21, 2012

Former Fresno CarMax buyer sues for overtime pay, The Business Journal, March 22, 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)

Related Blog Posts:

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Mexican Restaurant Pays Over $74K in Back Wages for Employee Misclassification, California Employment Lawyers Blog, March 6, 2012

Novartis To Pay $99M in Employment Misclassification Lawsuit Settlement, California Employment Lawyers Blog, January 26, 2012

Audit Associates Gain Certification for Conditional Collective Action--in Employee Misclassification Lawsuit, California Employment Lawyers Blog, January 10, 2012

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DOL Continues Long Island Wage and Hour Enforcement Initiative to Stop FLSA Violations, California Employment Lawyers Blog, December 3, 2011

DOL Continues to Track Down Federal Wage and Hour Law Violations in the Workplace, California Employment Lawyers Blog, September 8, 2011

"White Collar" Exemptions under the FLSA , California Employment Lawyers Blog, November 12, 2010