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May 2015

Gordon & Rees Employment Team Wins Misclassification Claim Before the California Labor Commissioner

Gordon & Rees’s San Francisco and Los Angeles partner Mollie Burks, assisted by associate Sara Moore, recently prevailed before the California Department of Labor Standards Enforcement (DLSE) on behalf of their client, a national provider of facility housekeeping services to healthcare entities.

Three individual claimants, who were employed by the company as environmental services professionals at various hospital sites, filed an administrative charge with the DLSE following their termination. Each claimant alleged that the company had misclassified him/her as an exempt employee for the majority of, if not the entire time, that they were employed. In total, claimants sought in excess of $195,000 in allegedly unpaid overtime, missed meal and rest break pay, plus liquidated damages for minimum wage violations and waiting time penalties.

During the course of the hearing before the Labor Commissioner, Gordon & Rees presented evidence that claimants were primarily engaged in exempt duties, including managing large groups of workers on the hospital sites, directing and apportioning their work on a daily basis, and conducting daily inspections to ensure the quality of the client’s work. Burks skillfully presented key documentary and testimonial evidence refuting each of the three claimants’ allegations during the hearing. In addition, Burks elicited key admissions during cross examination including one claimant’s admission that he spent the bulk of his work days performing critical quality assurance inspections and often managed as many as 50 employees. Another claimant testified to training and participating in the hiring/firing and evaluation of new employees, closely directing and monitoring their day-to-day work performance.

On May 7, 2015, the Labor Commissioner issued her decision, finding in favor of Gordon & Rees’s client across the board. The Labor Commissioner determined that all three claimants were properly classified as exempt and were not entitled to recover any unpaid overtime or damages. Further, the Labor Commissioner determined that claimants were not entitled to receive liquidated damages or waiting time penalties under the Labor Code.

Sara A. Moore