Texas car delivery company sued over worker misclassification
A lawsuit was recently filed against Texas-based M.S.J.E. Enterprises alleging that the car delivery company misclassified its workers as independent contractors, wrongly exempting them from minimum wage and overtime requirements dictated by the Fair Labor Standards Act.
"In many cases, employees worked up to six days a week and far in excess of 40 hours per week," said Allen Vaught, head of the FLSA litigation section at Baron & Budd, the firm that filed the suit. "They were paid by the car instead of by the hour, and … the wages these employees typically earned was below minimum wage."
Companies often deliberately classify workers incorrectly in order to avoid paying overtime, payroll taxes, minimum wage, social security contributions and other expenses, which short-changes the government as well as employees.
In California, mortgage lender Guaranteed Rate is facing similar litigation after being accused of failing to comply with time and attendance regulations set by the California Labor Code. The class action complaint alleges that the company incorrectly classified its loan officers as outside salespeople, thereby exempting them from some state laws regarding overtime and minimum wage.
"In many cases, employees worked up to six days a week and far in excess of 40 hours per week," said Allen Vaught, head of the FLSA litigation section at Baron & Budd, the firm that filed the suit. "They were paid by the car instead of by the hour, and … the wages these employees typically earned was below minimum wage."
Companies often deliberately classify workers incorrectly in order to avoid paying overtime, payroll taxes, minimum wage, social security contributions and other expenses, which short-changes the government as well as employees.
In California, mortgage lender Guaranteed Rate is facing similar litigation after being accused of failing to comply with time and attendance regulations set by the California Labor Code. The class action complaint alleges that the company incorrectly classified its loan officers as outside salespeople, thereby exempting them from some state laws regarding overtime and minimum wage.
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