The class action lawsuit is an effective way for employees with small individual wage claims to band together and recover unpaid wages from large, powerful employers. Class action lawsuits provide a cost-effective way for employees to share the costs and fees incurred in the effort to collect relatively small amounts of wages owed to them individually and to hold employers legally accountable when they circumvent federal and state laws designed to ensure employees receive a fair wage. A class action “is a procedural device that was adopted with the goals of economies of time, effort and expense, uniformity of decisions, the promotion of efficiency and fairness in handling large numbers of similar claims.” In re West Virginia Rezulin Litigation, 585 S.E. 2d. 52, 62 (5th Cir. 2004).
For a class action to be approved or “certified,” the named plaintiff(s) bringing the lawsuit must demonstrate that they are “similarly situated” with others of the same class, meaning the class members must have been subjected to the same state-wide or nation-wide policy or scheme that resulted in the unpaid wages. Class members who are similarly situated are generally employed by the same employer and often have the same job title. Class actions arising out of the employment context typically allege violations of wage and hour laws, including but not limited to, violations of the New Jersey Wage and Hour Law (“NJWHL”) and its federal counterpart the Fair Labor Standards Act (“FLSA”).
A common claim under the FLSA and NJWHL for unpaid overtime wages is where an employer misclassified an employee as exempt from receiving overtime wages. Generally, employees are entitled to overtime wages at a rate of 1 ½ times their regular rate of pay for all hours worked over 40 in a workweek. N.J.S.A. 34:11-56a4. However, employees are exempt if the work they perform is primarily executive, administrative or professional in nature. Id.; N.J.A.C. 12:56-7.1. The definition of these exempt categories is defined by the provisions of 29 CFR § 541.0, et. al. An employee may have a misclassification class claim if an employer has a common policy to not pay the employee and others similarly situated overtime wages because the employer misclassified the employees as exempt from receiving overtime. For example, a manager who has little to no independent discretion as to their job duties, who cannot independently make managerial decisions and primarily performs the same customer service duties and manual labor as non-exempt employees could have a potential legal claim for being misclassified as exempt from receiving overtime pay. 29 C.F.R. § 541.700.