CarMax facing class action lawsuit for FLSA violations
An employee of CarMax in Fresno, California, recently filed a lawsuit against the used car company for misclassifying workers as exempt employees so they wouldn't earn extra pay for overtime employee attendance. According to the claim, CarMax failed to pay approximately 1,500 workers overtime.
By federal law, employers are required to pay employees a premium pay rate for any hours worked in excess of the regular 40-hour workweek - one-and-a-half times the regular pay rate, according to the Fair Labor Standards Act (FLSA). However, some positions are considered exempt by the FLSA and are not eligible for basic employee benefits.
"CarMax's great success in the used vehicle sales market rests in part on the hard work and long hours of its dedicated buyers," stated plaintiff Mike Luchini. "We work through early mornings, meal times, and late evenings for the company. We just ask to be paid for the hours we have worked, according to what the law requires."
Employers can avoid costly claims by re-visiting FLSA and state labor laws to ensure their practices are in compliance. Companies should keep accurate records of all of their payroll procedures and policies, so they can prove they are properly compensating employees if investigated by the Department of Labor's wage and hour division.
By federal law, employers are required to pay employees a premium pay rate for any hours worked in excess of the regular 40-hour workweek - one-and-a-half times the regular pay rate, according to the Fair Labor Standards Act (FLSA). However, some positions are considered exempt by the FLSA and are not eligible for basic employee benefits.
"CarMax's great success in the used vehicle sales market rests in part on the hard work and long hours of its dedicated buyers," stated plaintiff Mike Luchini. "We work through early mornings, meal times, and late evenings for the company. We just ask to be paid for the hours we have worked, according to what the law requires."
Employers can avoid costly claims by re-visiting FLSA and state labor laws to ensure their practices are in compliance. Companies should keep accurate records of all of their payroll procedures and policies, so they can prove they are properly compensating employees if investigated by the Department of Labor's wage and hour division.
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