There are a couple of different types of common employee misclassifications. Far too often employers will misclassify workers as independent contractors rather than employees. In that way, employers try to dodge paying California unemployment taxes and covering them for workers’ compensation and unemployment insurance.
Another type of misclassification occurs when employers try to lump some hourly workers in with salaried employees. This tactic is often used by employers eager to avoid paying time and a half for overtime.
A recent case involving Safeway grocery stores and store managers involved allegations that the company misclassified as exempt employees – that is, employees exempt from overtime wages.
Former store managers sought unpaid wages on the basis of misclassification, arguing that they spent most of their time doing non-exempt tasks: checking out customers, stocking shelves, etc.
At trial, the jury found in Safeway’s favor, ruling that the company had proven that the plaintiff was not entitled to overtime.
The plaintiff appealed, however, arguing that the trial court that when a manager performs tasks typically done by hourly employees, that is important in determining whether that task is exempt from overtime pay or not. In other words, the trial court told the jury that hourly employee tasks are exempt if performed by a manager as part of supervising employees because that helps keep the store operating smoothly.
The California Court of Appeals clarified that tasks don’t become exempt just because a manager performs the tasks to ensure smooth store operations.
It makes sense then that employers take a cautious approach to having exempt employees perform work typically performed by hourly employees. If the work isn’t related to supervision, the managers’ exempt status could be unjustified – and overtime will need to be paid.
These matters can be very complex. That is why if you believe you and co-workers have been misclassified by an El Segundo employer, you should contact an employment law attorney experienced in wage and hour claims involving unpaid wages, unpaid overtime, off-the-clock work and much more.