PHILADELPHIA (Legal Newsline) - A provider of online company credit reports agreed Monday to pay more than $92,000 to settle a Fair Labor Standards Act class action lawsuit over lack of compensation for overtime hours that was filed in Philadelphia federal court.
The agreement between lead plaintiff Nicholas DeJesus, of Bethlehem, and his former employer, CreditSafe USA, Inc., is pending approval by federal Judge Jeffrey Schmehl.
According to the consent motion, CreditSafe admits no liability for the accusations, in return for a global settlement amount of $92,500.
Eligible members of the class, described as current and former employees who worked in the telesales department for CreditSafe between Jan. 1, 2012 and Aug. 13, 2014, will receive a share of $59,167. Attorney fees and costs will be covered by the remaining $33,333.
DeJesus originally filed the class action July 14, 2014, claiming that managers at the CreditSafe offices in Allentown underpaid the more than 100 workers in the telesales department. He has requested a $3,500 service award for bringing the matter to the court.
According to the complaint, Creditsafe required these employees to arrive to work early, prior to their scheduled shift start time, and log into various computer applications to be ready to begin placing calls at the beginning of their paid shift.
Creditsafe also allegedly ordered these employees to stay late, beyond their paid, scheduled shift, in order to reach production quotas established by the company.
The claim says that telesales executives were paid an annual salary based on 40 hour work weeks, with each shift scheduled to start at 8:30 a.m. and end at 5 p.m., with an unpaid half-hour for lunch.
The plaintiff claimed that he and his co-workers were expected to arrive to the office at least 10 to 15 minutes early, start up their computers and access the applications necessary to perform their duties.
Following a daily 8:30 a.m. meeting, the telesales staff would be ready to immediately start making service calls. Failure to arrive early and have the computer ready was considered being late for work, the complaint said.
The claim also alleged that it was common for the telesales executives to stay at the office until at least 7 p.m. in order to complete their production quotas.
The complaint says that previous U.S. Supreme Court rulings, namely IBP, Inc. v. Alvarez, have upheld that preparatory work duties that are integral and indispensable to the principal work activity are compensable under the FLSA.
The FLSA also requires the payment of at least one and-a-half times the normal rate of pay for any work performed beyond 40 hours in a week.
According to the consent motion, both parties exchanged information prior to a Jan. 8 settlement meeting and came to the conclusion that the case would produce a lengthy and complicated trial. The court documents say the bona fide negotiations resulted in a fair and reasonable agreement.
The plaintiffs are represented by Larry Weisberg of McCarthy Weisberg Cummings, PC, in Harrisburg. CreditSafe is represented by attorneys from Wilson, Elser, Moskowitz, Edelman & Dicker, LLP.