BJ, DoL Reach FLSA Settlement

July 15, 2004 ( - BJ's Wholesale Club Inc. has reached a settlement with the Department of Labor (DoL) over allegations the Natick, Massachusetts-based retailers improperly classified workers to skim on overtime pay.

Per terms of the settlement, BJ’s paid $320,000 in overtime wages to 233 workers in its chain of warehouse stores. The settlement follows a 2003 investigation by the DoL, according to a Boston Globe report.

The DoL alleged BJ’s improperly classified a position known as “club personnel manager” as exempt from federal overtime-pay requirements. The club personnel manager typically performed tasks such as entering employee work schedules into the computer, answering employees’ questions about benefits, and making sure job applications are properly filled out.

However, following the job audit, the DoL said this position fails to meet the level of administrative exempt status that would exempt it from the overtime provisions of the Fair Labor Standards Act (FLSA). Club personnel managers at BJ’s earn $14.93 per hour, on average, thus the settlement amounts to $1,373 in back wages, on average, for each worker and covers the pay period from October 6, 2001, through October 4, 2003.

BJ’sdirector of human resources, Thomas Davis, said in a statement that company executives ”disagree with the Do L’s findings” but agreed to the voluntary settlement ”to avoid the expense of litigation.” The company’s settlement ”makes no admission of liability for any violations,” he said.