A judge in a Tennessee federal District Court has approved a $30 million settlement between Publix Super Markets Inc. and more than 1,500 collective-action plaintiffs who alleged improper overtime compensation.
Publix paid certain nonexempt managers salaries on a “fluctuating workweek” basis, in which managers received a weekly salary for all hours worked, but only half time for hours over 40 per week. While the Fair Labor Standards Act (FLSA) permits such an arrangement pursuant to an agreement between the employer and employee, Publix failed to take all necessary steps for legal compliance and also failed to factor bonuses and holiday pay into employees’ compensation to calculate correctly each employee’s regular rate of pay for each workweek.
Publix, which operates 1,000 grocery stores in six states, denies all liability.
MSEC frequently encounters employers who would like to compensate employees using a fluctuating workweek. Be aware that in this age of increasing enforcement activity, employers must be able to demonstrate adherence to the FLSA’s requirements in order to withstand agency scrutiny. MSEC attorneys are always available to assist with your compliance efforts.