A California office space company, Regus, faces unpaid overtime allegations in a recent lawsuit and has now been told they must revise their $5.3 million settlement because not enough was going to Class Members.
Los Angeles Superior Court Judge Elihu M. Berle told Regus that it needed to revise a proposed $5.3 million settlement and that he would not approve it unless it was revised.
He said that too much of the large settlement for unpaid overtime allegations was going to be paid to taxes and attorneys’ fees and that not enough of it was going to be going to Class Members. Judge Berle noted that while there are legitimate expenses that will be incurred when Regus sets up the settlement fund account, there needs to be a cap on expenditures and Regus should be specific about what will be spent.
As it has been proposed, the $5.3 million will first cover federal insurance taxes, taxes incurred by the settlement fund, and attorneys’ fees and costs. The Class Members will be paid from what is left over.
Regus has been sued in an overtime allegations class action lawsuit by seven named plaintiffs who represent a Class of workers claiming they were misclassified as managers so that Regus could avoid paying them overtime. Each plaintiff represents a separate overtime allegations lawsuit against Regus, which operates over 3000 business centers around the world.
These overtime allegation lawsuits claim that Regus did not pay workers for missed meal and rest breaks and intentionally misclassified non-managerial workers as managers so that they would not have to pay them overtime.
Nearly 1,000 current and former workers stand to be paid a portion of the $5.3 million deal.
Judge Berle expressed concern that the settlement fund account could be used to pay various other expenses such as fees for accountants and tax attorneys. Such expenses could make the settlement fund significantly smaller than the $5.3 million reported to Class Members in the settlement notice, he said.
The judge notified the plaintiffs’ attorneys that they would be called to justify asking for such a large percentage, 35%, of the $5.3 million.
Additionally, the judge told both parties in the overtime allegations lawsuits that they needed to remove the language from the settlement that class members needed to file advance notice if they wanted to speak at the final approval hearing. He said that it could scare away class members from making a claim.
If you believe you have an overtime allegations claim against an employer in the state of California, you may be entitled to legal compensation. A California labor law attorney can answer questions and help decide if a lawsuit is right for you.
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If you were forced to work off the clock or without overtime pay within the past 3 years in California, you have rights – and you don’t have to take on the company alone.