CA High Court Approves OT Suit Class Certification

August 27, 2004 ( - The Golden State's highest court has approved a move by a Los Angeles judge to certify as a class action overtime lawsuits for hundreds of drugstore company workers claiming they were improperly labeled overtime exempt.

The California Supreme Court ruled unanimously that Los Angeles County Superior Court Judge Irving Feffer didn’t abuse his discretion by certifying a class action for 600 to 1,400 employees of Sav-on Drug Stores, The Recorder reported. The workers charged they were deliberately mislabeled as salaried managers to exempt them from overtime pay.

Plaintiffs Robert Rocher and Connie Dahlin filed the suit on behalf of themselves and others who had been designated as operating managers or assistant managers – classifications that would exempt them from state laws requiring overtime pay for working more than eight hours a day or 40 hours a week. In the suit, Rocher and Dahlin argued that they actually had been “uniformly misclassified” because their jobs required them to perform non-managerial tasks – helping customers at checkouts, stocking shelves and cleaning the stores – for more than 50% of their work hours.

The company countered by arguing that managerial duties varied significantly from person to person and store to store and that no meaningful generalizations could be made about the individual employment circumstances. However Feffer disagreed, finding that the plaintiffs had shown there were enough common issues among the hundreds of Sav-on workers and certified the suit as a class action for the period April 3, 1996 to June 22, 2001.

Justices agreed with Feffer’s finding. “The record contains substantial, if disputed, evidence that deliberate misclassification was defendant’s policy and practice,” Justice Kathryn Mickle Werdegar wrote. “The record also contains substantial evidence that, owing in part to operational standardization and perhaps contrary to what defendant expected, classification based on job descriptions alone resulted in widespread de facto misclassification.”

The fact that there may be differences from employee to employee shouldn’t preclude a trial judge from deciding to hear plaintiffs’ claims as a group, the high court said.

“Individual issues do not render class certification inappropriate so long as such issues may effectively be managed,” Werdegar wrote. “Nor is it a bar to certification that individual class members may ultimately need to itemize their damages. We have recognized that the need for individualized proof of damages is not per se an obstacle to class treatment and ‘that each member of the class must prove his separate claim to a portion of any recovery by the class is only one factor to be considered in determining whether a class action is proper.'”

Attorney Brad Seligman, who represented the employees called the ruling “critically important.” “The employers’ argument was that overtime cases could only be proven on a person-by-person basis,” Seligman, executive director of The Impact Fund in Berkeley, California, told the Recorder.     “And if that had been accepted, you’d never be able to do an overtime case.”

The Supreme Court’s ruling reversed a 2002 decision by the Los Angeles’ 2nd District Court of Appeal that the employees’ job descriptions were so different, regardless of their titles, that there could be no class.

The case is Sav-on Drug Stores Inc. v. Superior Court (Rocher), 04 C.D.O.S. 7902.