Family Dollar Ordered to Pay $33M in Overtime

April 11, 2006 ( - Family Dollar Stores was found guilty of violating the Fair Labor Standards Act (FLSA) by misclassifying workers in order to avoid paying overtime.

A news release from the plaintiffs’ attorneys, Wiggins, Childs, Quinn & Pantazis LLC, said the jury initially awarded plaintiffs more than $19 million in back pay and owed overtime, which was later reduced to $16.6 million. However, US District Judge U.W. Clemon doubled the amount to $33.2 million after agreeing with the jury that the company purposefully violated the law.

The plaintiffs, 1,424 current and past employees, worked 60-80 hour work weeks without overtime compensation due to their classification as Store Managers, the release said. The FLSA’s requirements for overtime exemption state that a manager’s primary duty is management of a department or subdivision and at least two or more full-time employees, as well as the authority to hire and fire employees. Evidence in the case showed the plaintiffs actually spent only 10-20% of their time conducting such managerial duties, and the remaining time was spent doing manual labor such as unloading trucks, stocking shelves, mopping the floor, and running the cash register.

The attorneys’ office has been contacted by other current and former employees with the same claims and plans to file a new lawsuit on their behalf. Family Dollar has said it will appeal the case.